Frontier Communications 2009 Annual Report Download - page 96

Download and view the complete annual report

Please find page 96 of the 2009 Frontier Communications annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 107

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107

Postretirement Benefits Other Than Pensions—“OPEB”
The following tables set forth the OPEB plan’s benefit obligations, fair values of plan assets and the
postretirement benefit liability recognized on our consolidated balance sheets at December 31, 2009 and 2008
and the components of net periodic postretirement benefit costs for the years ended December 31, 2009, 2008
and 2007.
($ in thousands) 2009 2008
Change in benefit obligation
Benefit obligation at beginning of year.................................. $ 178,615 $ 174,602
Service cost ........................................................... 361 444
Interest cost ........................................................... 11,017 11,255
Plan participants’ contributions ......................................... 4,086 3,753
Actuarial loss. . . ....................................................... 11,378 3,917
Benefits paid . . . ....................................................... (16,167) (15,261)
Plan change ........................................................... — (95)
Benefit obligation at end of year . . . .................................... $ 189,290 $ 178,615
Change in plan assets
Fair value of plan assets at beginning of year ........................... $ 8,137 $ 9,369
Actual return on plan assets ............................................ 1,018 388
Plan participants’ contributions ......................................... 4,086 3,753
Employer contribution.................................................. 10,954 9,888
Benefits paid . . . ....................................................... (16,167) (15,261)
Fair value of plan assets at end of year ................................. $ 8,028 $ 8,137
Funded status. . . ....................................................... $(181,262) $(170,478)
Amounts recognized in the consolidated balance sheet
Current liabilities ...................................................... $ (9,052) $ (8,916)
Other long-term liabilities . ............................................. $(172,210) $(161,562)
Accumulated other comprehensive income............................... $ 21,554 $ 8,045
($ in thousands)
Expected
2010 2009 2008 2007
Components of net periodic postretirement benefit cost
Service cost . . . ................................................. $ 361 $ 444 $ 533
Interest cost on projected benefit obligation ...................... 11,017 11,255 10,241
Expected return on plan assets . . . ............................... (439) (514) (578)
Amortization of prior service cost/(credit) . . ...................... (7,716) (7,751) (7,751) (7,735)
Amortization of unrecognized loss ............................... 6,324 5,041 5,946 6,099
Net periodic postretirement benefit cost .......................... $ 8,229 $ 9,380 $ 8,560
Assumptions used in the computation of annual OPEB costs and valuation of the year-end OPEB
obligations were as follows:
2009 2008 2007
Discount rate—used at year end to value obligation . ........................ 5.75% 6.50% 6.50%
Discount rate—used to compute annual cost................................. 6.50% 6.50% 6.00%
Expected long-term rate of return on plan assets ............................ 6.00% 6.00% 6.00%
F-34
FRONTIER COMMUNICATIONS CORPORATION AND SUBSIDIARIES
Notes to Consolidated Financial Statements