Pension Plans

12 Months Ended

Mar. 31, 2021

Defined Benefit Plan Net Periodic Benefit Cost [Abstract]

Pension Plans

Note 11. Pension Plans

The Company operates a defined contribution pension scheme. The assets of the scheme are held separately from those of the Company in an independently administered fund. The pension cost charge represents the contribution payable by the Company to the fund during the year. Defined contribution pension costs during the years ended March 31, 2021, 2020 and 2019 amounted to $756, $788 and $750, respectively.

In addition, the Company’s Swiss subsidiary is affiliated to the collective foundation of AXA LPP Foundation Suisse Romande. Funding is granted by means of defined saving contributions on individual retirement assets implementing a guaranteed interest and a fixed conversion rate for old age pensions of the retirement asset. In Switzerland, pension plans are financed by contributions of both, employees and employer. Contributions are defined by the plan regulations and cannot be decreased without amending the plan regulations. The risks of disability and death before retirement are covered by AXA insurance. The assets are pooled for all affiliated companies; the investment of assets is done by the governing bodies of the collective foundation or by mandated parties. The pension arrangements are based on a contract of affiliation between the Company’s Swiss subsidiary and the AXA pension foundation, which can be terminated by either party. In the event of a termination, the Company’s Swiss subsidiary would have an obligation to find alternative pension arrangements for its employees. Because there is no guarantee that the Swiss employee pension arrangements would be continued under the same conditions, there is a risk, albeit remote, that a pension obligation may fall on the Company’s Swiss subsidiary.  

These circumstances require that the Swiss employee pension arrangements be treated as a defined benefit plan under ASC 715 Compensation – Retirement Benefits. Accordingly, an actuarial valuation of the pension obligation has been performed. At March 31, 2021 and 2020, the accumulated pension obligation amounted to $22,648 and $18,789, respectively, as compared with plan assets of $15,751 and $12,436, respectively. Therefore, the net funded status was an obligation of $6,897 and $6,353, as of March 31, 2021 and March 31, 2020 respectively, which were recorded as liabilities on the consolidated balance sheets.

The following provides a reconciliation of the benefit obligations, the plan assets and the funded status.

	Year ended
	March 31, 2021			March 31, 2020
Pension benefit obligation, beginning of year	$	18,789		$	17,784
Service cost		2,447			1,828
Contributions paid by plan participants		2,704			2,180
Interest cost		126			131
Benefits paid		(2,207	)		(2,841	)
Prior service cost		—			836
Actuarial loss / (gain)		473			(1,740	)
Foreign currency translation		316			611
Pension benefit obligation, end of year	$	22,648		$	18,789

The actuarial losses on the projected benefit obligation as at March 31, 2021 result in part from changes in the assumptions compared to those adopted at March 31, 2020. There was a loss due to decrease in the discount rate assumption, which was offset by a gain due to changing the base mortality tables from BVG2015 to BVG2020 tables. A further loss due to experience resulted in an overall net actuarial loss to March 31, 2021. The experience loss can be attributed to the membership movements during the financial year.

	Year ended
	March 31, 2021			March 31, 2020
Fair value of plan assets, beginning of year	$	12,436		$	10,416
Actual return on plan assets		1,293			1,008
Contributions paid by employer		1,333			1,280
Contributions paid by plan participants		2,704			2,180
Benefits paid		(2,207	)		(2,841	)
Foreign currency translation		192			393
Fair value of plan assets, end of year	$	15,751		$	12,436

Contributions paid by plan participants include $1,768 and $1,375 of payments into the scheme on new employees joining in the years ended March 31, 2021 and March 31, 2020, respectively.

	Year ended
	March 31, 2021		March 31, 2020
Pension benefit obligation, end of year	$	22,648	$	18,789
Fair value of plan assets, end of year		15,751		12,436
Net funding obligation, end of year	$	6,897	$	6,353

The assumptions used to determine the pension benefit obligation at the end of each financial year are:

	Year ended
	March 31, 2021			March 31, 2020			March 31, 2019
Price inflation		1.00	%		1.00	%		1.00	%
Discount rate		0.35	%		0.60	%		0.70	%
Interest rate on retirement savings capital		0.60	%		0.60	%		1.20	%
Expected return on plan assets		1.75	%		1.75	%		1.20	%
Average rate of salary increase		1.00	%		1.00	%		1.00	%

Each employee participating in the plan has an individual portfolio that is managed by AXA under a collective arrangement.  Plan assets comprise the surrender value of the portfolio of active insured scheme participants. The expected return on plan assets was determined after consideration of current and historical levels of return and discussions with AXA. The discount rate is based on bond yields at March 31, 2021 and March 31, 2020 of high quality corporate bonds taking into account the duration of the liabilities.

The net pension costs for the year are based on the assumptions adopted at the start of each financial year and comprise:

	Year ended
	March 31, 2021			March 31, 2020			March 31, 2019
Employer service cost	$	2,447		$	1,828		$	1,574
Interest cost		126			131			153
Expected return on plan assets		(243	)		(130	)		(131	)
Amortization of prior service credit		58			(23	)		(14	)
Amortization of net loss		—			216			154
Net pension cost	$	2,388		$	2,022		$	1,736

The provision for pension benefit obligation recognized in other comprehensive income comprises:

	Year ended
	March 31, 2021			March 31, 2020			March 31, 2019
Net actuarial (gain) / loss	$	(564	)	$	(1,841	)	$	1,027
Amortization of prior service credit		(58	)		23			14
Amortization of net loss		—			(216	)		(154	)
	$	(622	)	$	(2,034	)	$	887

The cumulative amounts recognized in other comprehensive income were $3,035 and $3,658 at March 31, 2021 and March 31, 2020 respectively. This represented a net loss of $2,431 and $2,995 at March 31, 2021 and March 31, 2020 respectively and a prior service cost of $605 at March 31, 2021 and $663 at March 31, 2020.

The following benefit payments are expected to be paid in the following periods:

2022	$	1,122
2023	$	1,161
2024	$	1,178
2025	$	1,199
2026	$	1,215
2027 to 2030	$	6,397

Expected annual employer contributions to the plan in the year ending March 31, 2022 amount to $1,436.