A business manages a defined benefit pension scheme under IAS 19. The opening balances on the pension scheme assets are 800m and the opening present value of the pension scheme's liabilities are 1,000m. The actuaries have estimated a return on plan assets of 3% and recommended a discount rate of 4% to account for the interest cost associated with the pension liability. During the year, the contributions paid were 20m, the current service costs for existing employees were estimated by the actuary to be 30m, and the benefits paid to retired employees from the fund were 50m. Q1 Assuming there were no required revisions to the estimates that the actuary provided, what would the closing net pension deficit be at the end of the year? Q2 Using the same scenario as outlined above, by the end of the year, the actuary reassesses the pension plan assets and liabilities and discovers that adjustments are required for the following items: 1. The market value of the plan assets at the end of the year is higher than first estimated by the actuary. 2. The return received from the plan assets as income in the year (e.g., dividends) are lower than first estimated by the actuary. 3. New information is available that suggests that the life expectancy of current and retired employees is now higher than estimated by the actuary at the start of the year. 4. The expected final salary of existing employees is expected to be lower than first estimated by the actuary. Which of the above would cause an INCREASE in the pension deficit? A. 1 and 3 B. 2 and 3 C. 2, 3 and 4 D. 1 and 4