| (c) |
Plan assets |
The major categories of plan assets as a percentage of the fair value of total plan assets are as follows:
| December 31, | ||||||||||||
| 2017 | 2016 | 2015 | ||||||||||
|
Equity securities |
51 | % | 49 | % | 51 | % | ||||||
|
Debt securities |
18 | % | 18 | % | 19 | % | ||||||
|
Real estate |
7 | % | 7 | % | 7 | % | ||||||
|
Other |
24 | % | 26 | % | 23 | % | ||||||
|
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|
|
|
|
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| (d) |
Discount rate |
The discount rate for entities belonging to the “euro zone” is 1.50%. The discount rate is determined by reference to the yield on private investment grade bonds (AA), using the Iboxx index.
The discount rate used for the United Kingdom is 2.70%.
An increase of 0.25bps of the discount rate would decrease the defined benefit plan (“DBO”) by US$6.4 million, and a decrease of the discount rate of 0.25bps would increase the DBO by US$6.8 million.
A variation of 0.25bps of the discount rate would have no significant impacts on Service Cost and on Interest Cost (calculated impact is within US$0.1 million).
| (e) |
Increase in future compensation |
An increase of 0.25bps of the average rate would increase the future compensation by US$1.3 million, and a decrease of the average rate of 0.25bps would decrease the future compensation by US$1.3 million.
A variation of 0.25bps of the average rate would have no significant impacts on Service Cost and on Interest Cost (calculated impact is within US$0.1 million).