EMC 2008 Annual Report Download - page 90
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Table of Contents
EMC CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)
The components of the change in benefit obligation of the Pension Plans are as follows (table in thousands):
December 31,
2008 December 31,
2007
Benefit obligation, at beginning of year $ 339,835 $ 359,038
Interest cost 21,876 20,857
Foreign exchange gain — 271
Benefits paid (12,481) (11,545)
Settlement payments (7) (2)
Actuarial loss (gain) 1,851 (28,784)
Benefit obligation, at end of year $ 351,074 $ 339,835
The reconciliation of the beginning and ending balances of the fair value of the assets of the Pension Plans is as follows (table in thousands):
December 31,
2008 December 31,
2007
Fair value of plan assets, at beginning of year $ 421,361 $ 405,690
Actual return on plan assets (112,175) 27,074
Foreign exchange gain — 144
Benefits paid (12,481) (11,545)
Settlement payments (7) (2)
Fair value of plan assets, at end of year $ 296,698 $ 421,361
We did not make any contributions to the Pension Plans in 2008 or 2007 and we do not expect to make a contribution to the Pension Plans in 2009. The
net (under funded) funded status of the Pension Plans at December 31, 2008 and 2007 was $(54.4) million and $81.5 million, respectively.
Amounts recognized in the balance sheet as assets and liabilities consist of the following (table in thousands):
December 31,
2008 December 31,
2007
Prepaid benefit cost $ — $ 82,453
Accrued benefit liability (54,376) (927)
Net amount recognized at year end $ (54,376) $ 81,526
Upon adoption of FAS No. 158 in 2006, we reclassified the accumulated actuarial loss and prior service credit associated with the Pension Plans to
accumulated other comprehensive loss. The reclassification consisted of the following items (table in thousands):
December 31,
2006
Accumulated actuarial loss $ 100,535
Taxes (37,701)
Net amount reclassified $ 62,834
There was no other activity within accumulated other comprehensive loss during 2006 associated with the Pension Plans. In 2008, $2.7 million of the
accumulated actuarial loss and prior services cost associated with the Pension Plans were reclassified from accumulated comprehensive loss to a component
of net pension benefit cost. Additionally, the Pension Plans had net losses that arose during 2008 of $148.2 million primarily as a result of decreases in the fair
value of the plan assets and the defined benefit plans of foreign subsidiaries had net losses of $3.7 million that further increased the
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