Hertz 2007 Annual Report Download - page 155

HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Pension Benefits Postretirement
U.S. Non-U.S. Benefits (U.S.)
2007 2006 2007 2006 2007 2006
Amounts recognized in balance sheet:
Liabilities .............................. $(121.5) $ (98.8) $ (37.1) $ (64.4) $(13.2) $(16.6)
Net obligation recognized in the balance sheet . . . $(121.5) $ (98.8) $ (37.1) $ (64.4) $(13.2) $(16.6)
Initial net asset (obligation) .................. $ — $ — $ — $ — $ — $ —
Prior service cost ........................ (0.1) (0.2) — — — —
Net gain (loss) .......................... (1.3) 13.1 29.5 (5.2) 7.2 3.6
Accumulated other comprehensive income (loss) . . (1.4) 12.9 29.5 (5.2) 7.2 3.6
Unfunded accrued pension or postretirement
benefit .............................. (120.1) (111.7) (66.6) (59.2) (20.4) (20.2)
Net obligation recognized in the balance sheet . . . $(121.5) $ (98.8) $ (37.1) $ (64.4) $(13.2) $(16.6)
Total recognized in other comprehensive income
(loss) ............................... $ (14.3) $ — $ 34.7 $ — $ 3.6 $ —
Total recognized in net periodic benefit cost and
other comprehensive loss (income) ........ $ 46.5 $ 26.2 $ (24.8) $ 9.4 $ (2.9) $ 1.1
Estimated amounts that will be amortized from
accumulated other comprehensive (income) loss
over the next fiscal year:
Net gain (loss) .......................... $ (0.6) $ — $ 0.7 $ — $ 0.6 $ 0.2
Balance sheet adjustment: Increase in accumulated
other comprehensive (income) loss (before tax)
to reflect the adoption of SFAS 158 .......... $ (12.9) $ 5.2 $ (3.6)
Accumulated Benefit Obligation at December 31 . . $ 377.2 $ 365.4 $168.1 $164.0 N/A N/A
Weighted-average assumptions as of December 31
Discount rate ........................... 6.30% 5.70% 5.51% 4.81% 6.30% 5.70%
Expected return on assets .................. 8.50% 8.75% 7.22% 7.22% N/A N/A
Average rate of increase in compensation ....... 4.3% 4.3% 4.0% 3.8% N/A N/A
Initial health care cost trend rate .............. — — — — 9.5% 9.5%
Ultimate health care cost trend rate ............ — — — — 5.0% 5.0%
Number of years to ultimate trend rate ......... — — — — 8 8
The discount rate used to determine the December 31, 2007 benefit obligations for U.S. pension plans is
based on an average of three indices of high quality corporate bonds whose duration closely matches
that of our plans. The rates on these bond indices are adjusted to reflect callable issues. For our plans
outside the U.S., the discount rate reflects the market rates for high-quality corporate bonds currently
available. The discount rate in a country was determined based on a yield curve constructed from high
quality corporate bonds in that country. The rate selected from the yield curve has a duration that
matches our plan.
135