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Net defined benefit assets (liability)
 12 Months Ended
Dec. 31, 2023
Disclosure of net defined benefit liability (asset) [abstract]  
Net defined benefit assets (liability)
15. Net defined benefit assets (liability)
20232022
Fair value of plan assets$37,159 $31,197 
Defined benefit obligation(31,440)(30,332)
Other employee benefits(373)(361)
$(31,813)$(30,693)
Net defined benefit asset$5,346 $504 
In accordance with Panamanian law, the Company contributes to the following defined benefit plans:
Seniority premium plan: is a contingent liability that companies must pay to their employees according to article 224 of Panama’s Labor Code according to the following:
Eligibility:All employees
Benefit:
One week of salary per years of service
Salary:
Average of the 5 prior years of the monthly base salary
Payment:Lump sum
The actuarial liability is recognized for the legal obligation under the formal terms of the plan, and for the implied projections as required under IAS 19R. These actuarial projections do not constitute a legal obligation for the Company.
Indemnity plan: According to paragraph 225 of Panama’s Labor Code, in the case of unjustified dismissal the employee is entitled to an Indemnity Plan depending on their weekly salary and seniority. However, this benefit does not constitute a constructive obligation for the Company as described in paragraphs 61 and 62 of IAS19, therefore there is no obligation calculated for this benefit.
The following table summarizes the components of net benefit expense included under “Wages, salaries, benefits and other employees’ expenses” in the accompanying consolidated statement of profit or loss:
Year ended December 31,2023Defined benefit
obligation		Fair value of
assets 		Defined benefit
assets (liability)
Current service cost$2,725 $— $2,725 
Interest cost on net benefit obligation1,715 (1,641)74 
Past service cost13 — 13 
Net periodic benefit cost (income)$4,453 $(1,641)$2,812 
Year ended December 31,2022
Defined benefit
obligation
Fair value of
assets
Defined benefit
assets (liability)
Current service cost2,860 $— $2,860 
Interest cost on net benefit obligation972 (722)250 
Past service cost16 — 16 
Net periodic benefit cost (income)$3,848 $(722)$3,126 
Year ended December 31,2021
Defined benefit
obligation
Fair value of
assets
Defined benefit
assets (liability)
Current service cost3,272 — 3,272 
Interest cost on net benefit obligation721 (472)249 
Past service cost191 — 191 
Net periodic benefit cost (income)$4,184 $(472)$3,712 
The following table shows reconciliation from the opening balance to the closing balances for net employee defined benefit liabilities and its components:
Defined benefit
obligation
Fair value of
assets
Other employee
benefits liability
Net defined
benefit
assets
(liability)
At January 1, 2021$(39,466)$25,783 $(649)$(14,332)
Current service cost(3,272)— — (3,272)
Interest (cost) income(721)472 — (249)
Past service cost(191)— — (191)
Curtailment / Settlement— — — — 
Return on plan assets— 416 — 416 
Experience gain (loss)602 — — 602 
Actuarial changes arising from changes in financial assumptions4,411 — — 4,411 
Employer contributions— 2,565 — 2,565 
Benefits paid1,622 (1,102)— 520 
Adjustments
2,422 — — 2,422 
Others— (721)159 (562)
As of December 31, 2021$(34,593)$27,413 $(490)$(7,670)
Current service cost(2,860)— — (2,860)
Interest (cost) income(972)722 — (250)
Past service cost(16)— — (16)
Return on plan assets— 172 172 
Experience gain (loss)(3,959)— — (3,959)
Actuarial changes arising from changes in financial assumptions10,874 — — 10,874 
Employer contributions— 3,911 — 3,911 
Benefits paid1,194 (869)— 325 
Others— (152)129 (23)
As of December 31, 2022$(30,332)$31,197 $(361)$504 
Current service cost(2,725)— — (2,725)
Interest (cost) income(1,715)1,641 — (74)
Past service cost(13)— — (13)
Return on plan assets— (251) (251)
Experience gain (loss)80 — — 80 
Actuarial changes arising from changes in financial assumptions2,295 — — 2,295 
Employer contributions— 4,572 — 4,572 
Benefits paid970 — — 970 
Others— — (12)(12)
As of December 31, 2023$(31,440)$37,159 $(373)$5,346 
As of December 31, 2023, and 2022, plan assets are comprised totally by fixed term deposits.
For the year ended December 31, 2023, actuarial gain of $2.1 million, (2022: actuarial gain of $7.2 million and 2021: actuarial loss of $5.4 million) were recognized in other comprehensive income.
During 2023 and 2022, the Company did not retire interest earned of the fund.
The following were the principal actuarial assumptions at the reporting date:
202320222021
Economic assumptions -
Discount rate6.7%5.9%2.9%
Compensation - salary increase4.0%4.0%4.0%
Demographic assumptions -
MortalityPanama expirence
Termination2003 SoA pension plan
Retirement
Males62 years
Females57 years
Reasonably possible changes at the reporting date to one of the relevant actuarial assumptions, holding other assumptions constant, would have affected the defined benefit obligation by the amount shown below:
December, 31 2023December, 31 2022December, 31 2021
Increase
Decrease
Increase
Decrease
Increase
Decrease
Discount rate (0.5% movement)
$1,296 $(1,400)$1,338 $(1,451)$1,876 $(2,056)
The sensitivity analyses above have been determined based on a method that extrapolates the impact on the defined benefit obligation as a result of reasonable changes in key assumptions occurring at the end of the reporting period. The sensitivity analyses are based on a change in a significant assumption, keeping all other assumptions constant. The sensitivity analyses may not be representative of an actual change in the defined benefit obligation as it is unlikely that changes in assumptions would occur in isolation from one another.
The following payments are expected contributions to the defined benefit plan in future years:
20232022
Up to one year$3,313 $2,532 
One to five years11,873 10,989 
Over five years18,878 16,847 
Total expected payments$34,064 $30,368 
The average duration of the defined benefit plan obligation at the end of the reporting period is 8.3 years.