PENSION LIABILITIES, NET

12 Months Ended

Dec. 31, 2018

Liability, Defined Benefit Plan [Abstract]

NOTE 10:-

PENSION LIABILITIES, NET

The Norwegian subsidiary Ceragon Networks AS (formerly "Nera Networks AS") has defined contribution schemes and four unfunded pension plans.

Under the defined contributions scheme Ceragon Networks AS makes a payment to the insurance company who administer the fund on behalf of the employee. Ceragon Networks AS has no liabilities relating to such schemes after the payment to the insurance company. As of December 31, 2018 almost all active employees are in this scheme. The contribution and the corresponding social security taxes are recognized as payroll expenses in the period to which the employee's services are rendered. The defined pension contribution schemes meet the requirements of the law on compulsory occupational pension.

Defined benefit scheme was stopped for admission from December 1, 2007, and persons that were employed after that date were automatically entered into the defined contribution scheme. The schemes give right to defined future benefits. These are mainly dependent on the number of qualifying employment years, salary level at pension age, and the amount of benefits from the national insurance scheme. The commitment related to the pension scheme is covered through an insurance company. As of December 31, 2018, the pension scheme has 0 members.

AFP-scheme - in force from 1 January 2011, the AFP-scheme is a defined benefit multi-enterprise scheme, but is recognized in the accounts as a defined contribution scheme until reliable and sufficient information is available for the group to recognize its proportional share of pension cost, pension liability and pension funds in the scheme. Ceragon Networks AS's liabilities are therefore not recognized as liability in the balance sheet.

The liabilities in respect of Ceragon Networks AS's pension plans have been recalculated based on updated employee numbers as at December 31, 2018. These plans together represent 100% of the PBO of the entire group.

The following tables provide a reconciliation of the changes in the plans' benefits obligation for the year ended December 31, 2017, and the statement of funds status as of December 31, 2018:

	December 31,
	2017			2018

Change in projected benefit obligation
Projected benefit obligation at beginning of year	$	2,373		$	2,123
Liability assumed at the acquisition date of Nera
Service cost		18			16
Interest cost		47			47
Expenses paid		(143	)		(227	)
Exchange rates differences		(124	)		121
Actuarial loss (gain)		(48	)		97

Projected benefit obligation at end of year	$	2,123		$	2,177

The assumptions used in the measurement of the Company' benefits obligations as of December 31, 2017 and 2018 are as follows:

	December 31,
	2017			2018
Weighted-average assumptions
Discount rate		2.30	%		2.60	%
Rate of compensation increase		2.50	%		2.75	%

The amounts reported for net periodic pension costs and the respective benefit obligation amounts are dependent upon the actuarial assumptions used. The Company reviews historical trends, future expectations, current market conditions and external data to determine the assumptions. The discount rate is the covered bond. For purposes of calculating the 2018 net periodic benefit cost and the 2018 benefit obligation, the Company has used a discount rate of 2.60%. The rate of compensation increase is determined by the Company, based upon its long-term plans for such increases.

The following table provides the components of net periodic benefits cost for the years ended December 31, 2017 and 2018:

	December 31,
	2017		2018
Components of net periodic benefit cost
Service cost	$	18	$	16
Interest cost		47	$	47

Net periodic benefit cost	$	65	$	63

Benefit payments are expected to be paid as follows:

	December 31,
	2017		2018


2018	$	227	$	-
2019		260		180
2020		360		180
2021		189		189
2022 and thereafter		1,087		1,628

	$	2,123	$	2,177

Regarding the policy for amortizing actuarial gains or losses for pension and post-employment plans, the Company has chosen to charge the actuarial gains or losses to statement of operations.

For the years ended December 31, 2016, 2017 and 2018, an actuarial gain (loss) of $ (204), $ 48 and $ (97) respectively, was recognized in statements of income (loss).