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Notes to the Consolidated Financial Statements
(Thousands of US dollars)
76
Dar Al-Maal Al-Islami Trust
Annual Report 2014
35. Retirement benefit plans
(continued)
36. Related party
transactions and
balances
The plan invested in offices partially occupied by the Group. This is the plan’s
primary investment risk and requires it to be set up as a semi-autonomous
foundation with trustees. There are three trustees representing the companies
and three trustees representing the employees as per the regulations of the
Pension Foundation. Collectively they are responsible for ensuring compliance
with Swiss occupational pension legislation and the rules of the plan. This
includes the administration, arranging for the drafting of accounts and their
audit, setting the investment strategy and communicating with members.
The Group has not changed the processes used to manage its risks from
previous periods. The Group does not use derivatives to manage its risk.
Investments are well diversified, such that the failure of any single investment
would not have a material impact on the overall level of assets. A large portion
of assets in 2014 are managed by an insurance company, although the Group
also invests in property and cash.
Expected contributions to post-employment benefit plans for the year ending 31
December 2015 are $1.1 million (2014: $1.2 million).
The weighted average duration of the defined benefit obligation is 9.8 years
(2013: 8.5 years).
The expected maturity analysis of undiscounted pension benefits at 31
December 2014 was:
Less than Between one Between three
Over five
a year
to two years to five years
years Total
Undiscounted
pension benefits
1,040 4,391 6,424 14,546 26,401
Related parties include equity participation holders, directors, associated
companies and other companies, whose ownership and management is
common with DMI or its subsidiaries and associates. A number of transactions
are entered into with related parties in the normal course of business. These
include loans, current and investment accounts. Transactions and balances
disclosed as with associated companies are those with companies in which
DMI owns 20% to 50% of the voting rights and over which it exerts significant
influence, but does not have control. The volumes of related party transactions,
outstanding balances at the year end, and relating income and expense for the
year are as follows.
a) Loans to key management personnel
2014
2013
Loans
Loans outstanding at 1 January
404
1,549
Loans issued during the year
508
103
Loan repayments during the year
(341)
(1,234)
Foreign exchange
(15)
(14)
Loans outstanding at 31 December
556
404
No provisions were recognised in respect of loans given to related parties
(2013: $Nil).
Loans advanced to key management personnel bear no return and are
unsecured.