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Pension benefits
 12 Months Ended
Dec. 31, 2012
Compensation and Retirement Disclosure [Abstract]  
Pension and Other Postretirement Benefits Disclosure [Text Block]
6. Pension benefits

 

U.S. Defined Contribution Pension Plan-The Company has a defined contribution plan qualified under Section 401(k) of the Internal Revenue Code, pursuant to which substantially all of its U.S. employees are eligible to participate after completing six months of service. Participants may elect to contribute a portion of their compensation to the plan. Under the plan, the Company has the discretion to match a portion of participants’ contributions. The Company intends to match approximately $0.1 million to the plan for the year ended December 31, 2012.  For the year ended December 31, 2011 the Company did not make any matching contributions. For the year ended December 31 2010 the Company’s matching contributions were approximately $0.1 million.

 

Non-U.S. Pension benefits-The accounting standard for pensions requires an employer to recognize a net liability or asset and an offsetting adjustment to accumulated other comprehensive income (loss) to report the funded status of defined benefit pension and other post-retirement benefit plans.

 

Most of the non-U.S. subsidiaries provide for government-mandated defined pension benefits. For certain of these subsidiaries, vested eligible employees are provided a lump sum payment upon retiring from the Company at a defined age. The lump sum amount is based on the salary and tenure as of retirement date. Other non-U.S subsidiaries provide for a lump sum payment to vested employees on retirement, death, incapacitation or termination of employment, based upon the salary and tenure as of the date employment ceases. The liability for such defined benefit obligations is determined and provided on the basis of actuarial valuations. As of December 31, 2012, these plans are unfunded. Pension expense for foreign subsidiaries totaled approximately $0.7 million, $0.5 million and $0.4 million for each of the three years in the period ended December 31, 2012.

 

The following table summarizes the amounts recognized in accumulated other comprehensive income (loss), net of taxes (in thousands):

 

    Years Ended December 31,  
    2012     2011     2010  
                   
Amortization of transition obligation   $ 90     $ 89     $ 91  
Actuarial loss     (228 )     (373 )     (379 )
Total   $ (138 )   $ (284 )   $ (288 )
                         
Amounts in accumulated other comprehensive income (loss) not yet reflected in net periodic pension cost, net of taxes:                        
                         
Actuarial gain   $ 173     $ 401          
Transition obligation     (216 )     (306 )        
Total   $ (43 )   $ 95          
                         
Amounts in accumulated other comprehensive income (loss) expected to be amortized in 2013 net periodic pension cost, net of taxes:                        
                         
Actuarial loss   $ 329                  
Transition obligation     84                  
Total   $ 413                  

 

The following table sets out the status of the non-U.S pension benefits and the amounts (in thousands) recognized in the Company’s consolidated financial statements for each of the three years ended December 31, 2012:

 

Benefit Obligations:

 

Change in the Benefit Obligation:   2012     2011     2010  
                   
Projected benefit obligation at beginning of the year   $ 2,695     $ 2,074     $ 1,392  
Service cost     420       332       244  
Interest cost     218       186       142  
Actuarial loss     186       299       271  
Foreign currency exchange rate changes     101       (100 )     86  
Benefits paid     (68 )     (96 )     (61 )
Projected benefit obligation at end of year   $ 3,552     $ 2,695     $ 2,074  

 

Components of Net Periodic Pension Cost:
    2012     2011     2010  
                   
Service cost   $ 420     $ 332     $ 244  
Interest cost     218       186       142  
Actuarial (gain) loss recognized     30       (17 )     (4 )
Net periodic pension cost   $ 668     $ 501     $ 382  

 

The accumulated benefit obligation, which represents benefits earned to date, was approximately $1.8 million and $1.1 million at December 31, 2012 and 2011, respectively.

 

Actuarial assumptions for all non-U.S. plans are described below. The discount rates are used to measure the year end benefit obligations and the earnings effects for the subsequent year. The assumptions for each of the three years ended December 31, 2012 are as follows:

 

      2012       2011       2010  
Discount rate     5.8%-14%       7.2%-9.5%       8.5%-9.9%  
Rate of increase in compensation levels     7%-9%       7%-9%       7%-9%  

 

Estimated Future Benefit Payments:

 

The following benefit payments, which reflect expected future service, as appropriate, are expected to be paid (in thousands):

 

Years Ending December 31,      
       
2013   $ 173  
2014     66  
2015     171  
2016     281  
2017     95  
2018 to 2022     1,026  
    $ 1,812