Eversource 2006 Annual Report Download - page 77

NU 2006 ANNUAL REPORT 75
The following table represents information on the plans’ benefit obligations, fair values of plan assets, and funded status:
AtDecember 31,
Pension Benefits SERP Benefits Postretirement Benefits
(Millions of Dollars) 2006 2005 2006 2005 2006 2005
Change in benefit obligation
Benefit obligation at beginning of year $(2,286.2) $(2,133.2) $(35.1) $(32.1) $(493.8) $(468.3)
Service cost (49.4) (48.7) (1.1) (1.0) (8.3) (8.0)
Interest cost (129.7) (125.6) (1.9) (1.9) (27.3) (25.2)
Actuarial gain/(loss) 58.3 (148.7) 2.1 (2.0) 23.4 (32.7)
Federal subsidy on benefits paid ————(3.2) —
Benefits paid – excluding lump sum payments 116.1 109.1 2.0 1.9 39.9 38.9
Benefits paid – lump sum payments —0.1 ————
Curtailment/impact of plan changes (41.4) 63.6 ——(0.3) 2.0
Termination benefits (2.3) (2.8) ——(0.3) (0.5)
Benefit obligation at end of year $(2,334.6) $(2,286.2) $(34.0) $(35.1) $(469.9) $(493.8)
Change in plan assets
Fair value of plan assets at beginning of year $2,122.6 $2,075.5 N/A N/A $222.9 $199.8
Actual return on plan assets 349.7 156.3 N/A N/A 33.0 12.1
Employer contribution ——N/A N/A 50.6 49.9
Benefits paid – excluding lump sum payments (116.1) (109.1) N/A N/A (39.9) (38.9)
Benefits paid – lump sum payments —(0.1) N/A N/A ——
Fair value of plan assets at end of year $ 2,356.2 $ 2,122.6 N/A N/A $ 266.6 $ 222.9
Funded status at December 31st $ 21.6 $ (163.6) $(34.0) $(35.1) $(203.3) $(270.9)
Unrecognized transition obligation 0.5 — 78.6
Unrecognized prior service cost40.5 0.8 (4.1)
Unrecognized actuarial net loss421.1 8.3 179.9
Prepaid/(accrued) benefit cost $ 298.5 $(26.0) $ (16.5)
The $63.6 million reduction in 2005 in the Pension Plan’s obligation that is included in the curtailment/impact of plan changes related to the
reduction in the future years of service expected to be rendered by plan participants. This reduction was the result of the expected transition of
employees into the new 401(k) benefit and the company’s corporate reorganization. This overall reduction in plan obligation served to reduce the
previously unrecognized actuarial losses. In 2006, $41.4 million of this curtailment was reversed because actual levels of elections of the new
401(k) benefit weremuch lower than expected and is reflected above as an increase to the obligation.
For the Pension Plan, the company amortizes its transition obligation over the remaining service lives of its employees as calculated on an
individual operating company basis and amortizes the prior service cost and unrecognized net actuarial loss over the remaining service lives of its
employees as calculated on an NU consolidated basis. For the PBOP Plan, the company amortizes its transition obligation, prior service cost, and
unrecognized net actuarial loss over the remaining service lives of its employees as calculated on an individual operating company basis.
Although the SERP does not haveany plan assets, NU supports the SERP with earnings on marketable securities. See Note 10, “Marketable
Securities,” for further information regarding these investments.
The accumulated benefit obligation for the Pension Plan was $2.096 billion and $2.061 billion at December 31, 2006 and 2005, respectively,
and $31.4 million and $29.4 million for the SERP at December 31, 2006 and 2005, respectively.
Amounts recognized in the accompanying consolidated balance sheets at December 31, 2006 and 2005 are as follows:
At December 31,
Pension Benefits SERP Benefits Postretirement Benefits Total
(Millions of Dollars) 2006 2005 2006 2005 2006 2005 2006 2005
Receivables $ — $ — $— $— $ 3.2 $ — $ 3.2 $—
Regulatory assets 223.5 —5.6 —178.3 —407.4 —
Prepaid pension 21.6 298.5 ————21.6 298.5
Total assets 245.1 298.5 5.6 —181.5 —432.2 298.5
Other current liabilities (2) ——(2.0) ———(2.0) —
Deferred taxes, net (11.7) (108.7) 12.6 9.9 (37.1) 7.2 (36.2) (91.6)
Accrued postretirement benefits ————(203.3) (16.5) (203.3) (16.5)
Other deferred credits ——(32.0) (26.0) ——(32.0) (26.0)
Total liabilities (11.7) (108.7) (21.4) (16.1) (240.4) (9.3) (273.5) (134.1)
Accumulated other
comprehensive loss, net of tax $ (1.9) $ — $(0.2) $ (0.5) $ (2.3) $ — $(4.4) $ (0.5)