FFIINANNANCCIALIAL S STTAATTEEMMEENNTTSS NOTES TO THE FINANCIAL STATEMENTS CONTINUED S 25 PROVISIONS TR 2023 2022 A £m £m TE Warranty Total Restructuring Warranty Total G I C At the beginning of the year 41.1 41.1 0.4 38.5 38.9 R Charge for the year 29.7 29.7 – 30.9 30.9 E P O Utilisation (27.4) (27.4) (0.4) (26.5) (26.9) R Effect of movements in exchange rates 0.7 0.7 – (1.5) (1.5) T Release to the Income Statement (0.2) (0.2) – (0.3) (0.3) At the end of the year 43.9 43.9 – 41.1 41.1 G O VE R NAN Analysed as: Current 20.2 20.2 – 18.6 18.6 C Non-current 23.7 23.7 – 22.5 22.5 E 43.9 43.9 – 41.1 41.1 F I In the year ended 31 December 2020, the Group launched a consultation process to reduce employee numbers reflecting lower than originally planned NAN production volumes resulting in an exceptional charge to the Consolidated Income Statement in 2020. The restructuring was substantially completed C during 2021, with the final amounts being utilised during the year ended 31 December 2022. IAL The warranty provision is calculated based on the level of historical claims and is expected to be substantially utilised within the next three years. S T A 26 PENSION OBLIGATIONS T E Defined contribution scheme M E The Group opened a Defined Contribution scheme in June 2011. The total expense relating to this scheme in the year ended 31 December 2023 was N T £20.9m (2022: £17.6m). Outstanding contributions at the 31 December 2023 were £1.9m (2022: £1.5m). Contributions are made by the Group to other S pension arrangements for certain employees of the Group. F Defined Benefit scheme U R The Group operates a Defined Benefit Pension Scheme. During 2017, it was agreed and communicated to its members that the scheme’s benefits would be T H amended from a final pensionable salary basis to a career average revalued earnings (CARE) basis with effect from 1 January 2018. The scheme was closed E R to new entrants on 31 May 2011. The benefits of the existing members were not affected by the closure of the scheme. The assets of the scheme are held INF separately from those of the Group. On 31 January 2022, the scheme was closed to future accrual resulting in a curtailment loss of £2.8m (note 5). OR In constructing the investment strategy for the scheme, the Trustees take due account of the liability profile of the scheme along with the level of disclosed M surplus or deficit. The investment strategy is reviewed on a regular basis and, at a minimum, on a triennial basis to coincide with actuarial valuations. The A T I primary objectives are to provide security for all beneficiaries and to achieve long-term growth sufficient to finance any pension increases and ensure the ON residual cost is held at a reasonable level. The pension scheme operates under the regulatory framework of the Pensions Act 2004. The Trustee has the primary responsibility for governance of the scheme. Benefit payments are from Trustee-administered funds and scheme assets are held in a Trust which is governed by UK regulation. The Trustee comprises representatives of the Group and members of the scheme and an independent, professional Trustee was appointed during 2019. The pension scheme exposes the Group to the following risks: – Asset volatility – the scheme’s Statement of Investment Principles targets around 22% return-enhancing assets and 78% risk-reducing assets. The Trustee monitors the appropriateness of the scheme’s investment strategy, in consultation with the Group, on an ongoing basis. – Inflation risk – the majority of benefits are linked to inflation and so increases in inflation will lead to higher liabilities (although in most cases there are caps in place which protect against extreme inflation). – Longevity – increases in life expectancy will increase the period over which benefits are expected to be payable, which increases the value placed on the scheme’s liabilities. – Changes in bond yields – A decrease in corporate bond yields will increase the value placed on the Scheme liabilities, although this will be partially offset by an increase in the value of the Scheme’s bond holdings. The projected unit method has been used to determine the liabilities. The pension cost is assessed in accordance with the advice of an independent qualified actuary. The latest completed actuarial valuation of the scheme had an effective date of 6 April 2020. The assumptions that make the most significant effect on the valuation are those relating to the rate of return on investments, the rate of increase in salaries and pensions and expected longevity. It was assumed that the investment return would be based on the Bank of England gilt curve plus 0.5% per annum and that salary increases would be equivalent to CPI inflation plus 1.0% per annum. At the 6 April 2020 actuarial valuation, the actuarial value of the scheme assets was £314.6m, sufficient to cover 76% of the benefits which had accrued to members. ASTON MARTIN LAGONDA ANNUAL REPORT AND ACCOUNTS 2023 186