Assets & GRAP
Employee Benefit Provisions GRAP 25
Actuarially valued long-service, leave and post-retirement medical obligations under GRAP 25.
Why employee benefit provisions need rigour
Long-service awards, accumulated leave and post-retirement medical obligations are long-term employee benefits that GRAP 25 requires to be measured on an actuarial basis, and these provisions are frequently material and judgemental in municipal financial statements. Auditors test the actuarial assumptions and the integrity of the underlying data because small changes drive large swings in the liability. AuditPro Core links the actuarial valuation to its source employee data so the GRAP 25 provisions are traceable and defensible.
The Numbers
AuditPro Core renders this view from your tenant's live, tamper-evident records. The figures below are illustrative sample data.
Total obligation
R486 m
▲ R31 m
Post-retirement medical
R298 m
Discount rate
10.8%
Unfunded portion
R412 m
Employee benefit obligation mix
Actuarial assumption sensitivity
| Assumption | Change | Impact (R m) |
|---|---|---|
| Discount rate | -1% | 38 |
| Medical inflation | +1% | 41 |
| Mortality | +1 year | 12 |
Figures shown are illustrative sample data for demonstration. AuditPro Core renders these views from your own tenant's live, tamper-evident records.
Scope of GRAP 25
GRAP 25 covers short-term and long-term employee benefits, including defined benefit obligations like post-retirement medical aid. The long-term obligations require actuarial measurement, not simple accrual.
Actuarial assumptions
The liability depends on assumptions about discount rates, salary inflation, medical inflation, mortality and withdrawal. These assumptions must be reasonable, consistent and disclosed.
Data integrity
An actuarial valuation is only as reliable as the membership and salary data fed into it. Errors in headcount, service or benefit entitlement flow straight into the provision.
Movement and remeasurement
The provision changes each year for service cost, interest cost and actuarial gains or losses. Understanding the movement is essential to assessing whether the closing balance is reasonable.
How AuditPro Core Bridges the Gap
- Data linkage: the actuarial valuation is tied to the source employee and benefit data so the provision traces to its inputs.
- Assumption visibility: the key actuarial assumptions are surfaced alongside the liability for reasonableness review.
- Exception flags: data inconsistencies feeding the valuation, such as service or entitlement errors, are highlighted for correction.
- Audit-ready disclosure: the GRAP 25 movement and assumption notes export ready for the financial statements and auditor scrutiny.
Key Takeaways
- GRAP 25 requires actuarial measurement of long-term employee benefits.
- Discount rate and inflation assumptions drive large swings in the liability.
- The valuation is only as reliable as the underlying employee data.
- Understand the service, interest and remeasurement movement to assess the balance.
See This on Your Own Data
AuditPro Core renders this dashboard from your tenant's live, tamper-evident records — every figure traceable to source.