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FINANCIALS
49
resolution has been prepaid or tax carryovers will be utilized, which will result in no additional cash payments.
We recognize both accrued interest and penalties related to unrecognized tax benefi ts in income tax expense.
During the years ended December 31, 2007, 2006, and 2005, we recognized $66.6 million, $51.2 million, and
$44.2 million in interest and penalties, respectively. At December 31, 2007 and 2006, our accruals for the payment
of interest and penalties totaled $238.4 million and $171.8 million, respectively. Substantially all of the expense
and accruals relate to interest.
Note 12: Retirement Benefi ts
In September 2006, the FASB issued SFAS No. 158, Employers’ Accounting for Defi ned Benefi t Pension and Other
Postretirement Plans—an amendment of FASB Statements No. 87, 88, 106, and 132(R). SFAS 158 required the recog-
nition of the overfunded or underfunded status of a defi ned benefi t postretirement plan as an asset or liability in its
statement of fi nancial position, the measurement of a plan’s assets and its obligations that determine its funded sta-
tus as of the end of the employer’s fi scal year, and the recognition of changes in that funded status through compre-
hensive income in the year in which the changes occur. We adopted the provisions of SFAS 158 on December 31, 2006.
We use a measurement date of December 31 to develop the change in benefi t obligation, change in plan assets,
funded status, and amounts recognized in the consolidated balance sheets at December 31 for our defi ned benefi t
pension and retiree health benefi t plans, which were as follows:
Defi ned Benefi t Pension Plans Retiree Health Benefi t Plans
2007 2006 2007 2006
Change in benefi t obligation
Benefi t obligation at beginning of year . . . . . . . . . . . . . . . . $6,480.3 $5,628.4 $1,740.7 $1,673.6
Service cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 287.1 280.0 70.4 72.2
Interest cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 362.4 343.5 101.4 97.9
Actuarial (gain) loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (373.1) 64.9 16.4 (25.0)
Benefi ts paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (311.0) (291.2) (81.6) (82.5)
Plan amendments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32.7 — (227.7) —
Foreign currency exchange rate changes and other
adjustments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82.6 454.7 3.2 4.5
Benefi t obligation at end of year . . . . . . . . . . . . . . . . . . . . . 6,561.0 6,480.3 1,622.8 1,740.7
Change in plan assets
Fair value of plan assets at beginning of year . . . . . . . . . . 6,519.0 5,482.4 1,157.3 965.7
Actual return on plan assets . . . . . . . . . . . . . . . . . . . . . . . 833.8 913.1 147.4 103.0
Employer contribution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 202.9 221.3 125.4 171.1
Benefi ts paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (301.4) (287.9) (81.6) (82.5)
Foreign currency exchange rate changes and other
adjustments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49.9 190.1 — —
Fair value of plan assets at end of year . . . . . . . . . . . . . . . 7,304.2 6,519.0 1,348.5 1,157.3
Funded status . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 743.2 38.7 (274.3) (583.4)
Unrecognized net actuarial loss . . . . . . . . . . . . . . . . . . . . . 1,143.3 1,788.6 820.3 931.8
Unrecognized prior service cost (benefi t) . . . . . . . . . . . . . 88.4 63.4 (297.7) (85.7)
Net amount recognized . . . . . . . . . . . . . . . . . . . . . . . . . . . . $1,974.9 $1,890.7 $ 248.3 $ 262.7
Amounts recognized in the consolidated balance sheet
consisted of
Prepaid pension . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $1,670.5 $1,091.5 $ — $ —
Other current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . (47.9) (43.4) (8.6) (5.9)
Accrued retirement benefi t . . . . . . . . . . . . . . . . . . . . . . . . . (879.4) (1,009.4) (265.7) (577.5)
Accumulated other comprehensive loss before
income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,231.7 1,852.0 522.6 846.1
Net amount recognized . . . . . . . . . . . . . . . . . . . . . . . . . . . . $1,974.9 $1,890.7 $ 248.3 $ 262.7