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Retirement Benefit Plans
 12 Months Ended
Dec. 31, 2020
Retirement Benefits, Description [Abstract]  
RETIREMENT BENEFIT PLANS RETIREMENT BENEFIT PLANS
Defined Contribution Plans

The company operates defined contribution retirement benefit plans for all qualifying employees. The assets of the plans are held separately from those of the company in funds under the control of trustees. When employees leave the plans prior to vesting fully in the contributions, the contributions payable by the company are reduced by the amount of forfeited contributions.

The total amounts charged to the Consolidated Statements of Income for the year ended December 31, 2020, of $86.4 million (December 31, 2019: $73.5 million, December 31, 2018: $69.3 million) represent contributions paid or payable to these plans by the company at rates specified in the rules of the plans. As of December 31, 2020, accrued contributions of $30.7 million (December 31, 2019: $31.3 million) for the current year will be paid to the plans.

Defined Benefit Plans

The company maintains legacy defined benefit pension plans for qualifying employees of its subsidiaries in the UK, Ireland, Germany and Taiwan. All defined benefit plans are closed to new participants.

The most recent actuarial valuations of plan assets and the present value of the defined benefit obligation were valued as of December 31, 2020. The benefit obligation, related current service cost and prior service cost were measured using the projected unit credit method.

Benefit Obligations and Funded Status

The amounts included in the Consolidated Balance Sheets arising from the company's obligations and plan assets in respect of its defined benefit retirement plans are as follows:
Retirement Plans
$ in millions20202019
Benefit obligation(587.1)(551.7)
Fair value of plan assets585.0 524.5 
Funded status(2.1)(27.2)
Amounts recognized in the Consolidated Balance Sheets:
Other assets30.4 2.5 
Accrued compensation and benefits(32.5)(29.7)
Funded status(2.1)(27.2)
Changes in the benefit obligations were as follows:
Retirement Plans
$ in millions20202019
January 1551.7 475.6 
Service cost2.4 1.1 
Interest cost9.2 13.4 
Actuarial (gains)/losses40.6 64.0 
Exchange difference21.4 16.4 
Benefits paid(11.5)(18.6)
Curtailment— 0.4 
Settlement(26.7)(0.6)
December 31587.1 551.7 

Key assumptions used in plan valuations are detailed below. Appropriate local mortality tables are also used. The weighted average assumptions used to determine defined benefit obligations at December 31, 2020, and 2019 are as follows:
Retirement Plans
20202019
Discount rate1.83 %1.93 %
Expected rate of salary increases2.85 %2.95 %
Future pension trend rate increases2.64 %2.74 %

Changes in the fair value of plan assets in the current period were as follows:
Retirement Plans
$ in millions20202019
January 1524.5 430.2 
Actual return on plan assets55.2 73.7 
Foreign currency changes20.1 16.0 
Contributions from the company25.5 24.0 
Benefits paid(11.5)(18.6)
Settlement and other(28.8)(0.8)
December 31585.0 524.5 

The components of the amount recognized in accumulated other comprehensive income at December 31, 2020, and 2019 are as follows:
Retirement Plans
$ in millions20202019
Prior service cost/(credit)7.4 6.1 
Net actuarial loss/(gain)144.4 145.4 
Total151.8 151.5 

The amounts in accumulated other comprehensive income expected to be amortized into the Consolidated Income Statement during the year ending December 31, 2021 are as follows:
$ in millionsRetirement Plans
Prior service cost/(credit)0.3 
Net actuarial loss/(gain)3.1 
Total3.4 
The total accumulated and projected benefit obligation and fair value of plan assets for plans with accumulated and projected benefit obligations in excess of plan assets are as follows:
Retirement Plans
$ in millions20202019
Plans with accumulated and projected benefit obligation in excess of plan assets:
Accumulated and projected benefit obligation574.2 540.1 
Fair value of plan assets572.3 512.8 

Net Periodic Benefit Cost

The components of net periodic benefit cost in respect of these defined benefit plans are as follows:
Retirement Plans
$ in millions202020192018
Service cost2.4 1.1 3.8 
Interest cost9.2 13.4 12.6 
Expected return on plan assets(23.7)(22.1)(22.0)
Amortization of prior service cost/(credit)0.2 0.3 0.2 
Amortization of net actuarial (gain)/loss3.6 2.9 2.1 
Settlement8.0 (0.2)3.1 
Curtailment (gain)/loss— 0.4 — 
Net periodic benefit cost/(credit)(0.3)(4.2)(0.2)

The weighted average assumptions used to determine net periodic benefit cost for the years ended December 31, 2020, 2019, and 2018 are:
Retirement Plans
202020192018
Discount rate1.93 %2.82 %2.47 %
Expected return on plan assets4.69 %5.00 %4.73 %
Expected rate of salary increases2.95 %3.24 %3.26 %
Future pension rate increases2.74 %3.04 %2.97 %

In developing the expected rate of return, the company considers long-term compound annualized returns based on historical and current market data. Using this reference information, the company develops forward-looking return expectations for each asset category and an expected long-term rate of return for a targeted portfolio. Discount rate assumptions were based upon AA-rated corporate bonds of suitable terms and currencies.

Plan Assets

The analysis of the plan assets as of December 31, 2020 was as follows:
$ in millionsRetirement Plans% of Plan Assets
Cash and cash equivalents22.4 3.8 %
Fund investments224.2 38.3 %
Equity securities193.6 33.1 %
Government debt securities15.0 2.6 %
Guaranteed investments contracts22.2 3.8 %
Other assets107.6 18.4 %
Total585.0 100.0 %
The analysis of the plan assets as of December 31, 2019 was as follows:
$ in millionsRetirement Plans% of Plan Assets
Cash and cash equivalents27.3 5.2 %
Fund investments207.3 39.5 %
Equity securities181.4 34.6 %
Government debt securities22.5 4.3 %
Guaranteed investments contracts13.2 2.5 %
Other assets72.8 13.9 %
Total524.5 100.0 %

Plan assets are not held in company stock. The investment policies and strategies for plan assets held by defined benefit plans include:

•Funding - to have sufficient assets available to pay members benefits;
•Security - to maintain the minimum Funding Requirement;
•Stability - to have due regard to the employer's ability in meeting contribution payments given their size and incidence.

The following is a description of the valuation methodologies used for each major category of plan assets measured at fair value. Information about the valuation hierarchy levels used to measure fair value is detailed in Note 3, “Fair Value of Assets and Liabilities.”

Cash and cash equivalents

Cash equivalents include cash in the bank and cash investments in money market funds. Cash investments in money market funds are valued under the market approach through the use of quoted market prices in an active market, which is the net asset value of the underlying funds, and are classified within level 1 of the valuation hierarchy.

Fund investments

These plan assets are primarily invested in affiliated funds and are classified within level 1 of the valuation hierarchy. They are valued at the net asset value of common shares held by the plan at year end.

Equity securities, corporate debt securities, government debt securities, and other investments

These plan assets are classified within level 1 of the valuation hierarchy and are valued at the closing price reported on the active market on which the individual securities are traded.

Guaranteed investment contracts

These plan assets are classified within level 3 of the valuation hierarchy and are valued through use of unobservable inputs by discounting the related cash flows based on current yields of similar instruments with comparable durations considering the credit-worthiness of the issuer. Guaranteed investment contracts balance at December 31, 2020 is $22.2 million (December 31, 2019: $13.2 million).

Cash Flows

The estimated amounts of contributions expected to be paid to the plans during 2021 are $15.2 million for retirement plans. There are no future annual benefits of plan participants covered by insurance contracts issued by the employer or related parties.
The benefits expected to be paid in each of the next five fiscal years and in the five fiscal years thereafter are as follows:
$ in millionsRetirement Plans
Expected benefit payments:
202112.1 
202212.4 
202312.8 
202413.2 
202513.6 
Thereafter in the succeeding five years74.8