Employee Benefit Obligations

12 Months Ended

Dec. 31, 2019

Employee benefit obligations

The Company's liability in respect of the Swiss Plan (see Note 2(t)) is the projected benefit obligation calculated using the projected unit credit method. The projected benefit obligation as of December 31, 2019 represents the actuarial present value of the estimated future payments required to settle the obligation that is attributable to employee service rendered before that date. Swiss Plan assets are recorded at fair value. Pension expense is presented in the payroll expenses in the various functions in which the employees are engaged. Actuarial gains and losses arising from differences between the actual and the expected return on the Swiss Plan assets are recognized in accumulated other comprehensive income (loss) and amortized over the requisite service period. The Swiss Plan is part of a collective pension foundation of pooled investments managed by a top tier insurance company. The Company and the employees pay retirement contributions, which are defined as a percentage of the employees’ covered salaries. Interest is credited to the employees’ account at the minimum rate provided in the Swiss Plan, which represents the Swiss Plan’s primary asset. The targeted allocation for these funds is as follows:


Asset Allocation by Category as of September 30, 2019:						Asset allocation (%)
Asset Category:
Debt Securities						36%
Real Estate						26%
Equity Securities						33%
Others						5%
Total						100%

The following table sets forth the Swiss Plan’s funded status and amounts recognized in the consolidated financial statements for the year ended December 31, 2019 and 2018:


	December 31,
	2019		2018
Change in Benefit Obligation
Projected benefit obligation at beginning of year	$	12,249	$	10,317
Interest cost	114		64
Company service cost	932		820
Employee contributions	599		486
Prior service cost	—		—
Benefits paid	(109)		475
Actuarial loss	1,900		87
Projected benefit obligation at end of year	$	15,685	$	12,249
Change in Plan Assets
Fair value of plan assets at beginning of year	$	9,936	$	8,243
Actual return on plan assets	1,031		3
Employer contributions	899		729
Employee contributions	599		486
Benefits paid	(109)		475
Fair value of plan assets at end of year	$	12,356	$	9,936
Funded Status at End of year
Excess of obligation over assets	$	3,329	$	2,313
Change in Accrued Benefit Liability
Accrued benefit liability at beginning of year	$	(2,313)	$	(2,074)
Company contributions made during year	899		729
Net periodic benefit cost for year	(1,024)		(874)
Net decrease (increase) in accumulated other comprehensive loss	(891)		(94)
Accrued benefit liability at end of year	$	(3,329)	$	(2,313)


	December 31,
	2019		2018
Non-current plan assets	$	12,357	$	9,936
Non-current liability	15,686		12,249
Accrued benefit liability at end of year	$	(3,329)	$	(2,313)
Projected Benefit Payments
Projected year 1	$	270	$	206
Projected year 2	1,434		205
Projected year 3	255		1,158
Projected year 4	260		195
Projected year 5	571		200
Projected years 6-10	2,109		2,859

The fair value of the plan assets is the estimated cash surrender value of the insurance contract at December 31, 2019. The level of inputs used to measure fair value was Level 2.


	Year ended December 31,
	2019		2018
Net Periodic Benefit Cost
Service cost	$	932	$	820
Interest cost (income)	114		69
Expected return on plan assets	(97)		(54)
Amortization of transition obligation	54		65
Amortization of prior service costs	(19)		(18)
Total net periodic benefit cost	$	984	$	882

Weighted average assumptions:
Discount rate as of December 31	0.20 %		0.90%
Expected long-term rate of return on assets	0.20 %		0.90%
Rate of compensation increase	1.00%		1.00%
Mortality and disability assumptions (*)	BVG 2015 GT		BVG 2015 GT

(*) Mortality data used for actuarial calculation.