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Notes to the Consolidated Financial Statements

31st March 2017

8 EMPLOYEE BENEFIT EXPENSES (INCLUDING DIRECTORS’ EMOLUMENTS)

2017 2016
HK$’000 HK$’000

Wages and salaries 214,240 213,248
Pension costs – defined contribution retirement schemes
(Note (a)) 2,864 2,639
Other staff benefits 16,249 16,171

233,353 232,058
Severance pay 6,550 13,279

Notes:

(a) Defined contribution retirement schemes

Before 1st December 2000, the Group operated a defined contribution retirement scheme (the “ORSO Scheme”) in Hong Kong for all
qualified employees. The rate of contribution payable by the Group was 5% of the individual employee’s basic salaries.

With effect from 1st December 2000, the Mandatory Provident Fund Scheme (the “MPF Scheme”) was set up under the MPF Scheme
Ordinance for existing staff who opted for this scheme and eligible staff recruited on or after that date. The ORSO Scheme has
remained in place with the introduction of the MPF Scheme. Under the MPF Scheme, eligible employees and the Group are each
required to contribute 5% on the employees’ monthly net salaries with a maximum monthly contribution of HK$1,500 for employees’
monthly contribution.

Contributions to the ORSO Scheme and MPF Scheme charged to the consolidated income statement for the year amounted to
approximately HK$2,864,000 (2016: HK$2,639,000). No forfeited contribution in respect of the defined contribution retirement
scheme was utilised during the year (2016: same). No forfeiture contribution was available as at 31st March 2017 and 2016 to reduce
future contributions.

Contributions totaling approximately HK$625,000 (2016: HK$418,000) were payable to the ORSO Scheme and MPF Scheme at the
year end and were included in other payables and accruals.

ALCO HOLDINGS LIMITED ANNUAL REPORT 2017 79