Cablevision 2014 Annual Report Download - page 141

COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
(Dollars in thousands, except share and per share amounts)
F-52
2014 2013
Defined Benefit Plans......................................................................................................................... $ (127,170) $ (165,306)
Less: Current portion......................................................................................................................... 6,526 2,494
Long-term defined benefit plan obligations ....................................................................................... $ (120,644) $ (162,812)
Components of the net periodic benefit cost, recorded primarily in selling, general and administrative expenses, for the Defined
Benefit Plans for the years ended December 31, 2014, 2013 and 2012, are as follows:
Years Ended December 31,
2014 2013 2012
Service cost................................................................................................................. $ 774 $ 45,346 $ 39,789
Interest cost................................................................................................................. 18,040 14,128 14,570
Expected return on plan assets, net............................................................................. (9,548)(7,866)(9,127)
Recognized actuarial loss (reclassified from accumulated other comprehensive
loss)......................................................................................................................... 2,364 1,645 752
Settlement loss (reclassified from accumulated other comprehensive loss) (a)......... 5,348 — 315
Net periodic benefit cost............................................................................................. $ 16,978 $ 53,253 $ 46,299
(a) As a result of benefit payments to terminated or retired individuals exceeding the service and interest costs for the Pension
Plan and the Excess Cash Balance Pension Plan during 2014, the Company recognized a non-cash settlement loss that
represented the acceleration of the recognition of a portion of the previously unrecognized actuarial losses recorded in
accumulated other comprehensive loss on the Company’s consolidated balance sheets relating to these plans.
Plan Assumptions for Defined Benefit Plans
Weighted-average assumptions used to determine net periodic cost (made at the beginning of the year) and benefit obligations
(made at the end of the year) for the Defined Benefit Plans are as follows:
Weighted-Average Assumptions
Net Periodic Benefit Cost for the
Years Ended December 31, Benefit Obligations at December 31,
2014 2013 2012 2014 2013
Discount rate (a) ......................................................... 4.24% 3.67% 4.32% 3.70% 4.56%
Rate of increase in future compensation levels .......... 3.50% 3.50% 3.50% 3.50% 3.50%
Expected rate of return on plan assets (Pension Plan
only) ........................................................................ 4.53% 3.60% 3.76% N/A N/A
(a) The discount rate of 4.24% in 2014 represents the average of the quarterly discount rates used to remeasure the Company's
projected benefit obligation and net periodic benefit cost in connection with the recognition of settlement losses discussed
above.
The discount rate used by the Company in calculating the net periodic benefit cost for the Cash Balance Plan and the Excess Cash
Balance Plan was determined based on the expected future benefit payments for the plans and from the Towers Watson U.S. Rate
Link: 40-90 Discount Rate Model. The model was developed by examining the yields on selected highly rated corporate bonds.
The Company's expected long-term return on Pension Plan assets is based on a periodic review and modeling of the plan's asset
allocation structure over a long-term horizon. Expectations of returns for each asset class are the most important of the assumptions
used in the review and modeling and are based on comprehensive reviews of historical data, forward looking economic outlook,
and economic/financial market theory. The expected long-term rate of returns were selected from within the reasonable range of
rates determined by (a) historical real returns, net of inflation, for the asset classes covered by the investment policy, and (b)
projections of inflation over the long-term period during which benefits are payable to plan participants.