Avnet 2011 Annual Report Download - page 67

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Table of Contents
AVNET, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
Benefit payments are expected to be paid to participants as follows for the next five fiscal years and the aggregate for the five
years thereafter (in thousands):
The Plan’s assets are held in trust and were allocated as follows as of the June 30 measurement date for fiscal 2011 and 2010:
The general investment objectives of the Plan are to maximize returns through a diversified investment portfolio in order to earn
annualized returns that meet the long-term cost of funding the Plan’
s pension obligations while maintaining reasonable and prudent
levels of risk. The target rate of return on Plan assets is currently 8.5%, which represents the average rate of earnings expected on the
funds invested or to be invested to provide for the benefits included in the benefit obligation. This assumption has been determined by
combining expectations regarding future rates of return for the investment portfolio along with the historical and expected distribution
of investments by asset class and the historical rates of return for each of those asset classes. The mix of equity securities is typically
diversified to obtain a blend of domestic and international investments covering multiple industries. The Plan assets do not include any
material investments in Avnet common stock. The Plan’
s investments in debt securities are also diversified across both public and
private fixed income securities. The Company’
s current target allocation for the investment portfolio is for equity securities, both
domestic and international, to represent approximately 76% of the portfolio with a policy for minimum investment in equity securities
of 60% of the portfolio and a maximum of 92%. The majority of the remaining portfolio of investments is to be invested in fixed
income securities.
As of June 30, 2011, the market value of plan assets by investment category was: U.S. Equity ($194.3 million); U.S. Bonds
($76.5 million); International Equity ($51.9 million) and cash and receivables ($2.0 million). Asset values are Level 1 for all asset
categories as the fair values are based upon quoted market prices for identical assets. The pension assets were highly diversified to
reduce the potential risk of significant concentrations of credit risk.
11. Long-term leases
The Company leases many of its operating facilities and is also committed under lease agreements for transportation and
operating equipment. Rent expense charged to operations during the last three years is as follows:
61
2012
$
26,463
2013
20,405
2014
20,619
2015
19,258
2016
20,625
2016 through 2021
112,041
2011
2010
Equity securities
76
%
74
%
Debt securities
24
25
Cash and receivables
—
1
Years Ended
July 2,
July 3,
June 27,
2011
2010
2009
(Thousands)
Buildings
$
78,371
$
59,047
$
58,213
Equipment
8,332
5,440
6,169
$
86,703
$
64,487
$
64,382