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Table of Contents
EMC CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)
net losses of $16.5 million that arose during 2010 primarily as a result of increases in the fair value of the plan assets. We expect that $12.5 million of the total
balance included in accumulated other comprehensive loss at December 31, 2010 will be recognized as a component of net periodic benefit costs in 2011. We
do not expect to receive any refunds from the Pension Plan in 2011.
The components of net periodic expense (benefit) of the Pension Plan are as follows (table in thousands):
2010 2009 2008
Interest cost $ 22,685 $ 22,027 $ 21,876
Expected return on plan assets (23,304) (23,832) (34,142)
Recognized actuarial loss 12,616 14,584 2,683
Net periodic expense (benefit) $ 11,997 $ 12,779 $ (9,583)
The weighted-average assumptions used in the Pension Plan to determine benefit obligations at December 31 are as follows:
December 31,
2010
December 31,
2009
December 31,
2008
Discount rate 5.4% 6.0% 6.6%
Rate of compensation increase N/A N/A N/A
The weighted-average assumptions used in the Pension Plan to determine periodic benefit cost for the years ended December 31 are as follows:
December 31,
2010
December 31,
2009
December 31,
2008
Discount rate 6.0% 6.6% 6.6%
Expected long-term rate of return on plan assets 6.75% 8.25% 8.25%
Rate of compensation increase N/A N/A N/A
The benefit payments are expected to be paid in the following years (table in thousands):
2011 $ 18,264
2012 19,427
2013 20,443
2014 21,510
2015 22,811
2016 – 2020 138,031
Fair Value of Plan Assets
Following is a description of the valuation methodologies used for assets measured at fair value at December 31, 2010:
Common Collective Trusts – valued at the net asset value calculated by the fund manager based on the underlying investments. These are all classified
within Level 2 of the valuation hierarchy. These include: Collective Trust High Yield Fund, EB Daily Valued Large Cap Growth Stock Index Fund, EB Daily
Valued Large Cap Value Stock Index Fund, EB Daily Valued Small Cap Stock Index Fund, EB Daily Valued Stock Index Fund, EB Daily Valued
International Stock Index Fund, EB Daily Valued Emerging Markets Index Fund, EB Long Term Credit Bond Index and EB Long Term Government Bond
Index Fund.
U.S. Agency Securities – valued daily at the closing price reported in active U.S. financial markets and are classified within Level 2 of the valuation
hierarchy.
U.S. Treasury Securities – valued daily at the closing price reported in active U.S. financial markets and are classified within Level 1 of the valuation
hierarchy.
Corporate Debt Securities – valued daily at the closing price reported in active U.S. financial markets and are classified within Level 2 of the valuation
hierarchy.
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