Frontier Communications 2006 Annual Report Download - page 90

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CITIZENS COMMUNICATIONS COMPANY AND SUBSIDIARIES
Notes to Consolidated Financial Statements
Assumptions used in the computation of annual OPEB costs and valuation of the year-end OPEB
obligations were as follows:
2006 2005
Discount rate—used at year end to value obligation .......... 6.00% 5.625%
Discount rate—used to compute annual cost ................ 5.625% 6.00%
Expected long-term rate of return on plan assets ............. 8.25% 8.25%
($ in thousands) 2006 2005
Change in benefit obligation
Benefit obligation at beginning of year ............. $ 160,922 $ 217,380
Service cost .................................. 664 1,046
Interest cost .................................. 8,974 12,055
Plan participants’ contributions ................... 1,558 3,461
Actuarial loss ................................. 1,778 3,770
Amendments ................................. — (59,798)
Benefits paid ................................. (13,965) (16,992)
Benefit obligation at end of year .................. $ 159,931 $ 160,922
Change in plan assets
Fair value of plan assets at beginning of year ........ $ 11,424 $ 15,126
Actual return on plan assets ..................... 445 397
Benefits paid ................................. (12,407) (13,530)
Employer contribution .......................... 12,407 9,431
Fair value of plan assets at end of year ............. $ 11,869 $ 11,424
Accrued benefit cost
Funded status ................................. $(148,062) $ (149,498)
Unrecognized prior service cost .................. (61,161)
Unrecognized loss ............................. 42,325
Accrued benefit cost ........................... $(168,334)
Amounts recognized in the consolidated balance sheet
Current liabilities .............................. $ (7,238) $ —
Other long-term liabilities ....................... $(140,824) $ (168,334)
Accumulated other comprehensive income ......... $ (13,703) $ —
($ in thousands)
Expected
2007 2006 2005 2004
Components of net periodic postretirement benefit cost
Service cost ................................... $ 664 $ 1,046 $ 1,128
Interest cost on projected benefit obligation .......... 8,974 12,055 12,698
Return on plan assets ........................... (889) (1,248) (2,268)
Amortization of prior service cost and transition
obligation .................................. $ (7,586) (7,589) (1,255) (204)
Amortization of unrecognized loss ................. 4,064 4,678 6,615 5,238
Net periodic postretirement benefit cost ............. $ 5,838 $ 17,213 $ 16,592
F-42