Hasbro 2011 Annual Report Download - page 85

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HASBRO, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements — (Continued)
(Thousands of Dollars and Shares Except Per Share Data)
For 2011, 2010 and 2009, 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 for the three years ended
December 25, 2011.
2011 2010 2009
Components of Net Periodic Cost
Pension
Service cost ............................................ $ 1,729 2,018 1,642
Interest cost ............................................ 16,852 17,014 17,358
Expected return on assets .................................. (19,012) (19,503) (18,982)
Amortization of prior service cost ........................... 198 198 266
Amortization of actuarial loss .............................. 4,624 4,026 4,495
Curtailment/settlement losses ............................... — — 3,957
Net periodic benefit cost .................................. $ 4,391 3,753 8,736
Postretirement
Service cost ............................................ $ 685 609 627
Interest cost ............................................ 1,764 1,795 1,903
Amortization of actuarial loss .............................. 67 — 12
Net periodic benefit cost .................................. $ 2,516 2,404 2,542
Assumptions used to determine net periodic benefit cost of the pension plan and postretirement plan for
each fiscal year follow:
2011 2010 2009
Pension
Weighted average discount rate ..................................... 5.20% 5.73% 6.20%
Long-term rate of return on plan assets ................................ 7.25% 8.00% 8.50%
Postretirement
Discount rate .................................................... 5.27% 5.75% 6.02%
Health care cost trend rate assumed for next year ........................ 7.50% 8.00% 8.50%
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 ........................ 2020 2016 2016
If the health care cost trend rate were increased one percentage point in each year, the accumulated
postretirement benefit obligation at December 25, 2011 and the aggregate of the benefits earned during the
period and the interest cost would have both increased by approximately 3%.
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.
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