This information noted below summarises all key assumptions, valuation inputs and key disclosures relating to Tiger Brands

The company and its subsidiaries operate post-employment medical benefit schemes that cover certain of their employees and retirees. This practice has since been stopped for new employees. The liabilities are valued annually using the projected unit credit method. The latest actuarial valuation was performed on 30 September 2020.

(%) 2020 2019
The principal actuarial assumptions used for accounting purposes were:    
Discount rate 10,70 9,80
Medical inflation 7,20 7,10
Future salary increases 7,20 7,10
Post-retirement mortality tables PA(90) PA(90)
  ultimate rated down 2 years ultimate rated down 2 years
  plus 1% improvement pa from 2006 plus 1% improvement pa from 2006

The risks faced by the group as a result of the post-retirement medical aid obligation can be summarised as follows:

  2020 2019
Sensitivity analysis* Base case                Medical inflation Base case                Medical inflation
Key assumption (%) 7,20 (1,0) 1,0 7,10 (1,0) 1,0
Accrued liability 30 September (R’million) 525,7 487,3 569,8 582,8 532,0 641,9
% change   (7,3) 8,4   (8,7) 10,2
Current service cost plus interest cost (R’million) 55,2 50,8 60,2 56,3 51,1 62,5
% change   (8,0) 9,1   (9,3) 10,9
  Base case                         Discount rate Base case                         Discount rate
Key assumption (%) 10,70 (1,0) 1,0 9,80 (1,0) 1,0
Present value of obligations 30 September (R’million) 525,7 572,4 485,8 582,8 639,2 535,0
% change   8,9 (7,6)   9,7 (8,2)
  Base case           Expected
          retirement age
Base case           Expected
          retirement age
Key assumption (%) 60/63/65
years
1 year
younger
1 year
older
60/63/65
years
1 year
younger
1 year
older
Present value of obligations 30 September (R’million) 525,7 528,0 522,9 582,8 586,1 579,8
% change   0,4 (0,5)   0,6 (0,5)

* The sensitivity analysis relates to the total liability for the year, including those related to VAMP which has been reclassified as held for sale.

The duration of the liability at 30 September 2020 is 9,4 years (2019: 11 years).