Employee benefits, restructuring and post-retirement employee benefits provisions
 12 Months Ended
Jun. 30, 2021
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Employee benefits, restructuring and post-retirement employee benefits provisions
26    Employee benefits, restructuring and post-retirement employee benefits provisions
 
    
2021
      2020  
    
US$M
      US$M  
Employee benefits
(1)
   
 
1,624
 
      1,313  
Restructuring
(2)
   
 
54
 
      34  
Post-retirement employee benefits
(3)
   
 
534
 
      547  
    
 
 
     
 
 
  
Total provisions
   
 
2,212
 
      1,894  
    
 
 
     
 
 
  
Comprising:
                  
Current
   
 
1,606
 
      1,283  
Non-current
   
 
606
 
      611  
 
2021
US$M
   
Employee
benefits
    
Restructuring
    
Post-
retirement
employee
benefits
(3)
    
Total
  
At the beginning of the financial year
   
 
1,313
 
  
 
34
 
  
 
547
 
  
 
1,894
 
Charge/(credit) for the year:
                                 
Underlying
   
 
1,402
 
  
 
45
 
  
 
62
 
  
 
1,509
 
Discounting
   
 
–
 
  
 
–
 
  
 
31
 
  
 
31
 
Net interest expense
   
 
–
 
  
 
–
 
  
 
(10
) 
  
 
(10
) 
Exchange variations
   
 
104
 
  
 
1
 
  
 
30
 
  
 
135
 
Released during the year
   
 
(82
) 
  
 
–
 
  
 
(46
) 
  
 
(128
) 
Remeasurement gains taken to retained earning
s
   
 
–
 
  
 
–
 
  
 
(58
) 
  
 
(58
) 
Utilisation
   
 
(1,119
) 
  
 
(26
) 
  
 
(59
) 
  
 
(1,204
) 
Transfers and other movements
   
 
6
 
  
 
–
 
  
 
37
 
  
 
43
 
    
 
 
    
 
 
    
 
 
    
 
 
  
At the end of the financial year
   
 
1,624
 
  
 
54
 
  
 
534
 
  
 
2,212
 
    
 
 
    
 
 
    
 
 
    
 
 
  
 
(1)
 
The expenditure associated with total employee benefits will occur in a pattern consistent with when employees choose to exercise their entitlement to benefits.
 
(2)
 
Total restructuring provisions include provisions for terminations and office closures.
 
(3)
 
Refer to note 27 ‘Pension and other post-retirement obligations’.
Recognition and measurement
Provisions are recognised by the Group when:
 
•  
there is a present legal or constructive obligation as a result of past events
 
•  
it is more likely than not that a permanent outflow of resources will be required to settle the obligation
 
•  
the amount can be reliably estimated and measured at the present value of management’s best estimate of the cash outflow required to settle the obligation at reporting date
 
Provision
   
Description
Employee benefits
   
Liabilities for annual leave and any accumulating sick leave accrued up until the reporting date that are expected to be settled within 12 months are measured at the amounts expected to be paid when the liabilities are settled.
 
Liabilities for long service leave are measured as the present value of estimated future payments for the services provided by employees up to the reporting date and disclosed within employee benefits.
 
Liabilities that are not expected to be settled within 12 months are discounted at the reporting date using market yields of high-quality corporate bonds or government bonds for countries where there is no deep market for corporate bonds. The rates used reflect the terms to maturity and currency that match, as closely as possible, the estimated future cash outflows.
 
In relation to industry-based long service leave funds, the Group’s liability, including obligations for funding shortfalls, is determined after deducting the fair value of dedicated assets of such funds.
 
Liabilities for unpaid wages and salaries are recognised in other creditors.
   
Restructuring
   
Restructuring provisions are recognised when:
 
•   the Group has a detailed formal plan identifying the business or part of the business concerned, the location and approximate number of employees affected, a detailed estimate of the associated costs, and an appropriate timeline
 
•   the restructuring has either commenced or been publicly announced and can no longer be withdrawn
 
Payments falling due greater than 12 months after the reporting date are discounted to present value.