SOBI expects to win Akzo pension case
NETHERLANDS – Dutch shareholder activist group SOBI says it expects to win its court case against Akzo Nobel over pensions accounting.
“I expect to win the case against Akzo Nobel,” said SOBI chairman Pieter Lakeman. But he said there would be no sanction against Akzo if it loses. “The severest punishment can be that the court decides that Akzo Nobel has to make up a new annual report.”
This week SOBI, the Stichting Onderzoek Bedrijfs Informatie, summoned Akzo Nobel before the Business Chamber of the Amsterdam High Court over the accounts.
It claims the firm did not make a profit of 818 million euros but a loss of 260 million euros. It says Akzo Nobel “masked this by not booking personnel costs (pension costs) in the profit and loss account but writing this amount directly from the reserves”.
Arnhem-based Akzo has rejected the charge, saying its financial statements are prepared in accordance with Dutch accounting standards and are accompanied by an unqualified auditors’ report.
Akzo says it follows SFAS 87 for the recognition of pension liabilities. “Application of this standard resulted in a charge against shareholders’ equity of 1.1 billion euros for the minimum pension liability in the 2002 financial statements.”
Last month Akzo said it would restructure its pension fund in a move that was seen as a benchmark case for Dutch corporate pension funds. It would continue to pay pension premiums to its pension fund, but staff would bear the risks of the fund's investments by making up the shortage if the fund's coverage ratio drops below 100%.
Nieuwersluis-based corporate information research foundation SOBI was set up in 1976 with the aim of improving the financial disclosure of Dutch businesses, in the interest of creditors, shareholders and staff.