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Asbestos (Tables)
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12 Months Ended |
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Mar. 31, 2014
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| Text Block [Abstract] |
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| Asbestos Adjustments |
The asbestos adjustments included in
the consolidated statements of operations and comprehensive income
comprise the following:
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Years Ended 31 March |
| (Millions of US dollars) |
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2014 |
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2013 |
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2012 |
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Change in estimates:
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Change in actuarial estimate –
asbestos liability
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$ |
(340.3) |
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$ |
(163.0) |
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$ |
(67.8) |
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Change in actuarial estimate –
insurance receivable
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31.2 |
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27.9 |
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49.8 |
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Change in estimate – AICF
claims-handling costs
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0.9 |
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5.9 |
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8.4 |
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Subtotal – Change in
estimates
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(308.2) |
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(129.2) |
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(9.6) |
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Recovery of Insurance
Receivables
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15.2 |
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11.9 |
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- |
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Gain (loss) on foreign currency
exchange
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97.2 |
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0.2 |
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(6.2) |
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Total Asbestos
Adjustments
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$ |
(195.8) |
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$ |
(117.1) |
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$ |
(15.8) |
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| Asbestos-Related Assets and Liabilities |
These amounts are
detailed in the table below, and the net total of these
asbestos-related assets and liabilities is referred to by the
Company as the “Net AFFA Liability.”
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31 March |
| (Millions of US dollars) |
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2014 |
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2013 |
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Asbestos liability –
current
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$ |
(134.5 |
) |
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$ |
(135.0 |
) |
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Asbestos liability –
non-current
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(1,571.7 |
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(1,558.7 |
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Asbestos liability –
Total
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(1,706.2 |
) |
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(1,693.7 |
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Insurance receivable –
current
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28.0 |
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22.2 |
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Insurance receivable –
non-current
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198.1 |
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209.4 |
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Insurance receivable –
Total
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226.1 |
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231.6 |
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Workers’ compensation asset
– current
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4.3 |
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0.9 |
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Workers’ compensation asset
– non-current
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47.6 |
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60.7 |
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Workers’ compensation liability
– current
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(4.3 |
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(0.9 |
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Workers’ compensation liability
– non-current
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(47.6 |
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(60.7 |
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Workers’ compensation –
Total
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- |
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- |
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Loan facility
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(47.0 |
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- |
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Other net liabilities
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(0.8 |
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(1.6 |
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Restricted cash and cash equivalents
and restrictedshort-term investment assets of the AICF
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60.3 |
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133.5 |
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Net AFFA liability
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$ |
(1,467.6 |
) |
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$ |
(1,330.2 |
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Deferred income taxes –
current
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16.5 |
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18.6 |
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Deferred income taxes –
non-current
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455.2 |
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434.1 |
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Deferred income taxes –
Total
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471.7 |
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452.7 |
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Income tax payable
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16.7 |
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25.9 |
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Net Unfunded AFFA liability, net
of tax
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$ |
(979.2 |
) |
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$ |
(851.6 |
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| Summary of Changes in Asbestos Liability |
The changes in the asbestos liability
for the year ended 31 March 2014 are detailed in the table
below:
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A$
Millions
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A$ to US$
rate |
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US$
Millions
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Asbestos liability –
31 March 2013
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A$(1,625.4) |
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0.9597 |
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$ |
(1,693.7) |
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Asbestos claims
paid1
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140.4 |
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1.0716 |
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131.0 |
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AICF claims - handling costs
incurred1
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2.7 |
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1.0716 |
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2.5 |
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Change in actuarial
estimate2
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(369.1) |
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1.0845 |
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(340.3) |
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Change in claims handling cost
estimate2
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1.0 |
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1.0845 |
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0.9 |
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Effect of foreign exchange
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$ |
193.4 |
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Asbestos liability –
31 March 2014
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A$(1,850.4) |
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1.0845 |
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$ |
(1,706.2) |
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| Summary of Changes in Insurance Receivable |
The changes in the
insurance receivable for the year ended 31 March 2014 are
detailed in the table below:
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A$
Millions
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A$ to US$
rate |
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US$
Millions |
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Insurance receivables –
31 March 2013
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A$222.3 |
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0.9597 |
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$ 231.6 |
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Insurance recoveries 1
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(27.5) |
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1.0716 |
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(25.7) |
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Recovery of Insurance
Receivables 2
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16.5 |
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1.0845 |
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15.2 |
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Change in actuarial
estimate2
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34.0 |
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1.0845 |
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31.2 |
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Effect of foreign exchange
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(26.2) |
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Insurance receivables –
31 March 2014
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A$245.3 |
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1.0845 |
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$ 226.1 |
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| Changes in Deferred Income Taxes |
The changes in the
deferred income taxes – asbestos for the year ended
31 March 2014 are detailed in the table below:
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A$
Millions
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A$ to US$
rate |
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US$
Millions
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Deferred Tax Assets –
31 March 2013
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A$ 434.4 |
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0.9597 |
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$ 452.7 |
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Offset to Income Tax
Payable1
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(18.0) |
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1.0716 |
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(16.8) |
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AICF Earnings1
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(0.3) |
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1.0716 |
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(0.3) |
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Impact of change in
estimates2
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95.3 |
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1.0845 |
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87.9 |
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Effect of foreign exchange
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(51.8) |
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Deferred tax asset –
31 March 2014
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A$ 511.4 |
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1.0845 |
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$ 471.7 |
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| 1 |
The
average exchange rate for the period is used to convert the
Australian dollar amount to US dollars based on the assumption that
these transactions occurred evenly throughout the
period.
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| 2 |
The spot
exchange rate at 31 March 2014 is used to convert the
Australian dollar amount to US dollars as the adjustment was made
on that date.
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| 3 |
The
weighted average spot exchange rates on the dates the transactions
occurred are used to convert the Australian dollar amounts to US
dollars as the adjustments were made on those dates.
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| Changes in Restricted Cash and Short-Term Investments |
The changes in restricted
cash and short-term investments of AICF for the year ended
31 March 2014 are set forth in the table below:
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A$
Millions
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A$ to US$
rate |
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US$
Millions |
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Restricted cash assets –
31 March 2013
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A$ 128.1 |
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0.9597 |
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$ 133.5 |
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Asbestos claims
paid1
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(140.4) |
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1.0716 |
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(131.0) |
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AICF operating costs paid –
claims -handling1
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(2.7) |
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1.0716 |
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(2.5) |
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AICF operating costs paid – non
claims -handling1
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(2.3) |
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1.0716 |
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(2.1) |
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Insurance
recoveries1
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27.5 |
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1.0716 |
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25.7 |
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Interest and investment
income1
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3.1 |
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1.0716 |
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2.9 |
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NSW loan –
drawdowns3
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25.3 |
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1.1186 |
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22.6 |
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NSW loan –
drawdowns3
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25.3 |
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1.0983 |
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23.0 |
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Interest Received3
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0.9 |
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1.0074 |
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0.9 |
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Other1
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0.7 |
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1.0716 |
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0.7 |
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Effect of foreign exchange
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(13.4) |
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Restricted cash &
investments – 31 March 2014
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A$ 65.5 |
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1.0845 |
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$ 60.3 |
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| 1 |
The
average exchange rate for the period is used to convert the
Australian dollar amount to US dollars based on the assumption that
these transactions occurred evenly throughout the
period.
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| 2 |
The spot
exchange rates on the date the transactions occurred are used to
convert the Australian dollar amounts to US dollars.
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| 3 |
The
weighted average spot exchange rates on the dates the transactions
occurred are used to convert the Australian dollar amounts to US
dollars as the adjustments were made on those dates.
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| Central Estimates, Net of Insurance Recoveries |
The following table sets
forth the Central Estimates, net of insurance recoveries,
calculated by KPMG Actuarial as of 31 March 2014:
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Year Ended 31 March 2014 |
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(Millions of US and
Australian dollars, respectively)
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US$ |
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A$ |
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Central Estimate –
Discounted & Inflated
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$ 1,724.5 |
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A$ 1,870.2 |
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Central Estimate – Undiscounted
but Inflated
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2,586.5 |
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2,805.1 |
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Central Estimate – Used by
the Company
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$ 1,426.1 |
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A$ 1,546.6 |
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| Numbers of Open Claims, New Claims and Closed Claims and Average Settlement Per Settled Claim and Case Closed |
The following table shows
the activity related to the numbers of open claims, new claims and
closed claims during each of the past five years and the average
settlement per settled claim and case closed:
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For the Years Ended
31 March |
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2014 |
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2013 |
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2012 |
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2011 |
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2010 |
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Number of open claims at beginning of
period
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462 |
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592 |
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564 |
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529 |
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534 |
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Number of new claims
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608 |
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542 |
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456 |
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494 |
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535 |
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Number of closed claims
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604 |
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672 |
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428 |
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459 |
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540 |
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Number of open claims at end of
period
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466 |
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462 |
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592 |
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|
564 |
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|
529 |
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Average settlement amount per settled
claim
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A$ |
253,185 |
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A$ |
231,313 |
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A$ |
218,610 |
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A$ |
204,366 |
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A$ |
190,627 |
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Average settlement amount per case
closed
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A$ |
212,944 |
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A$ |
200,561 |
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A$ |
198,179 |
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A$ |
173,199 |
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A$ |
171,917 |
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Average settlement amount per settled
claim
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US$ |
236,268 |
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US$ |
238,615 |
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US$ |
228,361 |
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US$ |
193,090 |
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US$ |
162,250 |
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Average settlement amount per case
closed
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US$ |
198,716 |
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US$ |
206,892 |
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US$ |
207,019 |
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US$ |
163,642 |
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US$ |
146,325 |
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