Danaher 2009 Annual Report Download - page 61

Table of Contents
of the plan and the expected long-term returns on equity and debt investments included in plan assets. The U.S. plan targets to invest between 60% and 70% of
its assets in equity portfolios which are invested in funds that are expected to mirror broad market returns for equity securities or in assets with characteristics
similar to equity investments. The balance of the asset portfolio is generally invested in corporate bonds and bond index funds. Pension expense for the U.S.
plan for the year ended December 31, 2009 was $3 million (or $2 million on an after-tax basis), compared with pension benefit of $5 million (or $3 million on
an after-tax basis) for this plan in 2008. If the expected long-term rate of return on plan assets was reduced by 0.5%, pension expense for 2009 would have
increased $5 million (or $3 million on an after-tax basis). The Company made a voluntary contribution of $60 million to the U.S. plan in 2009. The
Company’s non-U.S. plan assets are comprised of various insurance contracts, equity and debt securities as determined by the administrator of each
plan. The estimated long-term rate of return for the non-U.S. plans was determined on a plan by plan basis based on the nature of the plan assets and ranged
from 0.75% to 8.0% for 2009 and ranged from 1.5% to 8.25% for 2008.
For a discussion of the Company’s 2009 and anticipated 2010 defined benefit pension plan contributions, please see “Liquidity and Capital Resources
—Cash and Cash Requirements”.
New Accounting Standards
In December 2009, the FASB issued Accounting Standards Update (ASU) No. 2010-02, “Accounting and Reporting for Decreases in Ownership of a
Subsidiary – a Scope Clarification.” The update revises the accounting requirements for decreases in ownership of a subsidiary that were originally contained
in FASB Statement No. 160 on non-controlling interests (currently codified in Accounting Standards Codification (ASC) Topic 810, Consolidation). The
revised decrease in ownership provisions require an entity that ceases to have a controlling interest in a subsidiary or group of assets that is a business to
recognize a gain or loss on the transaction and include an amount for the remeasurement of any retained investment to fair value. A decrease in ownership that
does not result in a loss of control is accounted for as an equity transaction with no gain or loss recognized for the difference between the carrying amount of
the portion of the subsidiary or group of assets that is sold and consideration received from the buyer. The update is effective from the effective date of FASB
Statement No. 160, which was January 1, 2009 for the Company. The adoption of the ASU did not have a material impact to the Company, however, the
requirements of this update will be required to be applied to any future transactions that results in a decreases in ownership of businesses owned by the
Company.
In October 2009, the FASB issued ASU No. 2009-13, “Multiple-Deliverable Revenue Arrangements.” This ASU establishes the accounting and reporting
guidance for arrangements including multiple revenue-generating activities and provides amendments to the criteria for separating deliverables and measuring
and allocating arrangement consideration to one or more units of accounting. The amendments also establish a selling price hierarchy for determining the
selling price of a deliverable. Significantly enhanced disclosures are also required to provide information about a vendor’s multiple-deliverable revenue
arrangements, including information about the nature and terms, significant deliverables, and its performance within arrangements. The amendments also
require providing information about the significant judgments made and changes to those judgments and about how the application of the relative selling-price
method affects the timing or amount of revenue recognition. The new ASU requirements are effective for fiscal years beginning after June 15, 2010, which is
the Company’s 2011 fiscal year. Early adoption of the standard is permitted and various options for prospective or retroactive adoption are available. The
Company is currently in the process of reviewing and evaluating the impact of these new requirements.
Concurrent with the issuance of ASU No. 2009-13, the FASB issued ASU No. 2009-14, “Certain Revenue Arrangements That Include Software Elements.”
This ASU changes the accounting model for revenue arrangements that include both tangible products and software elements that are “essential to the
functionality,” and scopes these products out of current software revenue guidance. The new guidance includes factors to help companies determine what
software elements are considered “essential to the functionality.” The amendments will now subject software-enabled products to other revenue guidance and
disclosure requirements, such as guidance surrounding revenue arrangements with multiple deliverables. The amendments in this ASU are effective
prospectively for revenue arrangements entered into or materially modified in the fiscal years beginning on or after June 15, 2010, which is the Company’s
2011 fiscal year. Early adoption of the standard is permitted and various options for prospective or retroactive adoption are available. The Company is in the
process of reviewing and evaluating the impact of these new requirements.
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Source: DANAHER CORP /DE/, 10-K, February 24, 2010 Powered by Morningstar® Document Research℠
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