Net pension cost and benefit obligation are determined using assumptions as of the beginning of each fiscal year. Weighted average assumptions for the fiscal years are as follows:
| |
|
2009 |
|
|
2008 |
|
Discount rate |
|
|
5.75 |
% |
|
|
8.00 |
% |
Rate of increase in salary levels |
|
|
N/A |
|
|
|
N/A |
|
Expected return on plan assets |
|
|
8.00 |
% |
|
|
8.00 |
% |
The benefit obligation, plan assets, and funded status of these plans as of the fiscal years ended are as follows:
| |
|
2009 |
|
|
2008 |
|
Change in benefit obligations: |
|
|
|
|
|
|
Benefit obligations - beginning of year |
|
$ |
25,819 |
|
|
$ |
31,371 |
|
Service cost |
|
|
102 |
|
|
|
148 |
|
Interest cost |
|
|
2,023 |
|
|
|
1,948 |
|
Actuarial (gain) loss |
|
|
8,062 |
|
|
|
(6,807 |
) |
Benefits paid |
|
|
(964 |
) |
|
|
(841 |
) |
Benefit obligations - end of year |
|
|
35,042 |
|
|
|
25,819 |
|
Change in plan assets: |
|
|
|
|
|
|
|
|
Fair value of plan assets - beginning of year |
|
|
21,548 |
|
|
|
27,806 |
|
Employer contributions |
|
|
989 |
|
|
|
2,467 |
|
Actual return on plan assets |
|
|
3,428 |
|
|
|
(7,884 |
) |
Benefits paid |
|
|
(964 |
) |
|
|
(841 |
) |
Fair value of plan assets - end of year |
|
|
25,001 |
|
|
|
21,548 |
|
Funded status of the plans |
|
|
(10,041 |
) |
|
|
(4,271 |
) |
Unrecognized prior service costs |
|
|
7 |
|
|
|
8 |
|
Unrecognized net actuarial loss |
|
|
10,202 |
|
|
|
3,954 |
|
Accrued pension cost |
|
$ |
168 |
|
|
$ |
(309 |
) |
Current accounting principles require that an internal rate of return analysis be included in the discount rate selection process. The discount rates were based on Citigroup Pension Liability Index as of October 30, 2009 and October 31, 2008.
Plan assets are primarily invested in marketable equity securities, corporate and government debt securities and are administered by an investment management company. The plans’ long-term return on assets is based on the weighted-average of the plans’ investment allocation as of the measurement date and the published historical returns for those types of asset categories, taking into consideration inflation rate forecasts. Our expected employer contribution to the plan in fiscal year 2010 is $2,394.
The actual allocations as of the fiscal years ended and target allocation for plan assets are as follows:
Asset Class |
|
2009 |
|
Target
Asset
Allocation |
|
2008 |
|
Target
Asset
Allocation |
|
Large Cap Equities |
|
32.7 |
% |
40.0 |
% |
34.7 |
% |
40.0 |
% |
Mid Cap Equities |
|
6.7 |
% |
10.0 |
% |
6.5 |
% |
10.0 |
% |
Small Cap Equities |
|
4.2 |
% |
5.0 |
% |
3.8 |
% |
5.0 |
% |
International (including Non-U.S. Fixed Income) |
|
18.3 |
% |
20.0 |
% |
10.8 |
% |
20.0 |
% |
Fixed Income |
|
30.0 |
% |
0.0 |
% |
6.2 |
% |
0.0 |
% |
Other (Government/Corporate, Bonds) |
|
0.0 |
% |
25.0 |
% |
29.0 |
% |
25.0 |
% |
Cash |
|
8.1 |
% |
0.0 |
% |
9.0 |
% |
0.0 |
% |
Total |
|
100.0 |
% |
100.0 |
% |
100.0 |
% |
100.0 |
% |
|
