Macy's 2009 Annual Report Download - page 87

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
The Company develops its rate of compensation increase assumption on an age-graded basis based on recent
experience and reflects an estimate of future compensation levels taking into account general increase levels,
seniority, promotions and other factors. The salary increase assumption is used to project employees’ pay in
future years and its impact on the projected benefit obligation for the supplementary retirement plan. This
assumption was revised during 2009 based on the completion of a third-party assumption study reflecting more
recent experience.
The following benefit payments are estimated to be funded by the Company and paid from the
supplementary retirement plan:
(millions)
Fiscal year:
2010 ......................................................... $ 54
2011 ......................................................... 50
2012 ......................................................... 48
2013 ......................................................... 48
2014 ......................................................... 52
2015-2019 ..................................................... 258
Savings Plan
The Savings Plan includes a voluntary savings feature for eligible employees. The Company’s contribution
was historically based on the Company’s annual earnings and more recently based on a discretionary matching
contribution with a minimum contribution based on an employee’s eligible savings of 10% for 2009 and 33
1
⁄
3
%
for 2008 and 2007. Expense for the Savings Plan amounted to $9 million for 2009, $37 million for 2008 and $38
million for 2007.
Deferred Compensation Plan
The Company has a deferred compensation plan wherein eligible executives may elect to defer a portion of
their compensation each year as either stock credits or cash credits. The Company transfers shares to a trust to
cover the number management estimates will be needed for distribution on account of stock credits currently
outstanding. At January 30, 2010 and January 31, 2009, the liability under the plan, which is reflected in other
liabilities on the Consolidated Balance Sheets, was $51 million and $52 million, respectively. Expense for 2009,
2008 and 2007 was immaterial.
15. Postretirement Health Care and Life Insurance Benefits
In addition to pension and other supplemental benefits, certain retired employees currently are provided
with specified health care and life insurance benefits. Eligibility requirements for such benefits vary by division
and subsidiary, but generally state that benefits are available to eligible employees who were hired prior to a
certain date and retire after a certain age with specified years of service. Certain employees are subject to having
such benefits modified or terminated.
Effective February 4, 2007, the Company adopted the measurement date provision of Statement of Financial
Accounting Standards No. 158, “Employers’ Accounting for Defined Benefit and Other Postretirement Plans –
an amendment of FASB Statements No. 87, 88, 106 and 132(R) (subsequently included in ASC Subtopic 715-60,
“Defined Benefit Plans – Other Postretirement”). This required a change in the Company’s measurement date,
which was previously December 31, to be the date of the Company’s fiscal year-end. As a result, the Company
recorded a $1 million decrease to accumulated equity and a $1 million increase to other liabilities.
F-39