Amal Ltd 2020-21

Amal Ltd | Annual Report 2020-21 ii) Salary risk The present value of the defined benefit plan liability is calculated by reference to the future salaries of members. As such, an increase in the salary of the Members more than assumed level will increase the plan liability. iii) Investment risk The present value of the defined benefit plan liability is calculated using a discount rate, which is determined with reference to market yields at the end of the reporting period on government bonds. If the return on plan asset is below this rate, it will create a plan deficit. Currently, for the plan in India, it has a relatively balanced mix of investments in government securities and other debt instruments. iv) Concentration risk Plan is having a concentration risk as all the assets are invested with the insurance company and a default will wipe out all the assets. Although probability of this is very less as insurance companies have to follow regulatory guidelines. The weighted average duration of the defined benefit obligation is nine years (2019-20: four years). The expected maturity analysis of gratuity is as follows: ( ` lakhs) Particulars Less than a year Between 1 - 2 years Between 2 - 5 years Over 5 years Total Defined benefit obligation (gratuity) As at March 31, 2021 0.51 0.51 1.96 13.78 16.77 As at March 31, 2020 4.77 0.26 0.98 3.94 9.95 b) Other long-term benefits Leave encashment is payable to eligible employees who have earned leaves, during the employment and | or on separation as per the policy of the Company. Valuation in respect of leave encashment has been carried out by an independent actuary, as at the Standalone Balance Sheet date, based on the following assumptions: ( ` lakhs) Expenses recognised for the year ended on March 31, 2021 (included in Note 22) 2020-21 2019-20 Present value of unfunded obligations 6.26 3.91 - Current 0.75 1.01 - Non-current 5.51 2.90 Expense recognised in the Standalone Statement of Profit and Loss 0.66 0.40 Discount rate 6.44% 6.43% Salary escalation rate 7.62% 8.40% Note 25.5 Employee benefit obligations (continued)