Delta Airlines 2002 Annual Report Download - page 160
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The following table shows the change in our accumulated postretirement benefit
obligation (APBO) for the years ended December 31, 2002 and 2001 (as measured at
September 30, 2002 and 2001):
(in millions) 2002 2001
------ ------
APBO at beginning of period $2,100 $1,780
Service cost 30 37
Interest cost 160 146
Benefits paid (154) (102)
Actuarial loss 234 163
Plan amendments -- (176)
Curtailment loss -- 49
Special termination benefits -- 203
------ ------
APBO at end of period $2,370 $2,100
====== ======
The special termination benefits and curtailment loss reflected in the table
above relate to the workforce reduction programs offered to certain of our
employees during 2001. In December 2002, we recorded a $44 million pretax charge
for special termination benefits related to the 2002 workforce reduction
programs. During the March 2003 quarter, we will recorded a $4 million pretax
gain for the associated cost of curtailing the future obligations for the
participants in these programs. See Note 16 for additional information about
our 2002 and 2001 workforce reduction program.
A 1% change in the healthcare cost trend rate used in measuring the APBO at
September 30, 2002, would have the following effects:
(in millions) 1% Increase 1% Decrease
----------- -----------
Increase (decrease) in total service and interest cost $ 12 $ (11)
Increase (decrease) in the APBO $108 $(106)
---- -----
The following table shows the calculation of the accrued postretirement benefit
cost recognized on our Consolidated Balance Sheets at December 31, 2002 and 2001
(as measured at September 30, 2002 and 2001):
(in millions) 2002 2001
------- -------
Funded status $(2,370) $(2,100)
Unrecognized net actuarial loss 299 100
Unrecognized prior service cost (353) (421)
Special termination benefits recognized between the measurement date and year end (44) --
Contributions made between the measurement date and year end 45 29
------- -------
Accrued postretirement benefit cost recognized on the Consolidated Balance Sheets $(2,423) $(2,392)
======= =======
Our net periodic postretirement benefit cost for the years ended December 31,
2002, 2001 and 2000, included the following components:
(in millions) 2002 2001 2000
---- ---- ----
Service cost $ 30 $ 37 $ 37
Interest cost 160 146 129
Amortization of prior service cost (50) (39) (40)
Recognized actuarial loss 2 -- --
Special termination benefits 44 -- --
---- ---- ----
Net periodic postretirement benefit cost $186 $144 $126
==== ==== ====
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