Hasbro 2010 Annual Report Download - page 83

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For 2010, 2009 and 2008, the Company measured the assets and obligations of the Plans as of the fiscal
year-end. The following is a detail of the components of the net periodic benefit cost (benefit) for the three
years ended December 26, 2010.
2010 2009 2008
Components of Net Periodic Cost
Pension
Service cost ......................................... $ 2,018 1,642 1,597
Interest cost ......................................... 17,014 17,358 17,714
Expected return on assets ............................... (19,503) (18,982) (23,961)
Amortization of prior service cost ........................ 198 266 282
Amortization of actuarial loss............................ 4,026 4,495 993
Curtailment/settlement losses ............................ — 3,957 1,213
Net periodic benefit cost (benefit) ........................ $ 3,753 $ 8,736 (2,162)
Postretirement
Service cost ......................................... $ 609 627 570
Interest cost ......................................... 1,795 1,903 2,065
Amortization of actuarial loss............................ — 12 115
Net periodic benefit cost ............................... $ 2,404 2,542 2,750
Assumptions used to determine net periodic benefit cost of the pension plan and postretirement plan for
each fiscal year follow:
2010 2009 2008
Pension
Weighted average discount rate .................................. 5.73% 6.20% 6.34%
Long-term rate of return on plan assets ............................ 8.00% 8.50% 8.75%
Postretirement
Discount rate................................................ 5.75% 6.02% 6.32%
Health care cost trend rate assumed for next year ..................... 8.00% 8.50% 9.00%
Rate to which the cost trend rate is assumed to
decline (ultimate trend rate) ................................... 5.00% 5.00% 5.00%
Year that the rate reaches the ultimate trend rate ..................... 2016 2016 2016
If the health care cost trend rate were increased one percentage point in each year, the accumulated
postretirement benefit obligation at December 26, 2010 and the aggregate of the benefits earned during the
period and the interest cost would have both increased by approximately 4%.
Hasbro works with external benefit investment specialists to assist in the development of the long-term
rate of return assumptions used to model and determine the overall asset allocation. Forecast returns are based
on the combination of historical returns, current market conditions and a forecast for the capital markets for
the next 5-7 years. All asset class assumptions are within certain bands around the long-term historical
averages. Correlations are based primarily on historical return patterns.
73
HASBRO, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements — (Continued)
(Thousands of Dollars and Shares Except Per Share Data)