Cablevision 2014 Annual Report Download - page 142

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COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
(Dollars in thousands, except share and per share amounts)
F-53
Pension Plan Assets and Investment Policy
The weighted average asset allocations of the Pension Plan at December 31, 2014 and 2013 were as follows:
Plan Assets at
December 31,
2014 2013
Asset Class:
Mutual funds....................................................................................................................................... 39% —%
Fixed income securities ...................................................................................................................... 58 88
Cash equivalents and other................................................................................................................. 3 12
100% 100%
The Pension Plan's investment objectives reflect an overall low risk tolerance to stock market volatility. This strategy allows for
the Pension Plan to invest in portfolios that would obtain a rate of return throughout economic cycles, commensurate with the
investment risk and cash flow needs of the Pension Plan. The investments held in the Pension Plan are readily marketable and
can be sold to fund benefit payment obligations of the plan as they become payable.
Investment allocation decisions are formally made by the Company's Investment and Benefit Committee, which takes into account
investment advice provided by its external investment consultant. The investment consultant takes into account expected long-
term risk, return, correlation, and other prudent investment assumptions when recommending asset classes and investment managers
to the Company's Investment and Benefit Committee. The Committee considers recommendations based on asset/liability studies
conducted by the external investment consultant who combines actuarial considerations, Pension Plan liabilities and strategic
investment advice. The major categories of the Pension Plan assets are cash equivalents and bonds which are marked-to-market
on a daily basis. Due to the Pension Plan's significant holdings in long-term government and non-government fixed income
securities, the Pension Plan's assets are subjected to interest rate risk; specifically, a rising interest rate environment. However,
these assets are structured in an asset/liability framework. Consequently, an increase in interest rates causes a corresponding
decrease to the overall liability of the Pension Plan thus creating a hedge against rising interest rates. Additional risks involving
the asset/liability framework include earning insufficient returns to cover future liabilities and imperfect hedging of the liability.
In addition, a portion of the Pension Plan's bond portfolio is invested in foreign debt securities where there could be foreign currency
risks associated with them, as well as in non-government securities which are subject to credit risk of the bond issuer defaulting
on interest and/or principal payments.
Investments at Estimated Fair Value
The fair values of the assets of the Pension Plan at December 31, 2014 by asset class are as follows:
Asset Class Level I Level II Level III Total
Mutual funds....................................................................................... $ 119,543 $ — $ — $ 119,543
Fixed income securities held in a portfolio:
Foreign issued corporate debt .......................................................... — 17,778 — 17,778
U.S. corporate debt........................................................................... — 50,155 — 50,155
Government debt.............................................................................. — 10,239 — 10,239
U.S. Treasury securities.................................................................... — 81,552 — 81,552
Asset-backed securities .................................................................... — 17,610 — 17,610
Cash equivalents (a)............................................................................ 3,580 — — 3,580
Total (b)............................................................................................ $ 123,123 $ 177,334 $ — $ 300,457
(a) Represents an investment in a money market fund.
(b) Excludes cash and net receivables relating to the sale of securities that were not settled as of December 31, 2014.