Macy's 2010 Annual Report Download - page 78

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
Net pension costs and other amounts recognized in other comprehensive income for the Pension Plan
included the following actuarially determined components:
2010 2009 2008
(millions)
Net Periodic Pension Cost
Service cost ......................................................... $ 99 $ 81 $ 97
Interest cost ......................................................... 158 173 159
Expected return on assets .............................................. (218) (187) (192)
Amortization of net actuarial loss ........................................ 61 – 5
Amortization of prior service credit ...................................... (1) (1) –
99 66 69
Other Changes in Plan Assets and Projected Benefit Obligation
Recognized in Other Comprehensive Income
Net actuarial (gain) loss ............................................... (9) 311 604
Amortization of net actuarial loss ........................................ (61) – (5)
Amortization of prior service credit ......................................11–
(69) 312 599
Total recognized in net periodic pension cost and other comprehensive income ........ $ 30 $378 $668
The estimated net actuarial loss and prior service credit for the Pension Plan that will be amortized from
accumulated other comprehensive (income) loss into net periodic benefit cost during 2011 are $84 million and
$(1) million, respectively.
As permitted under ASC Subtopic 715-30, “Defined Benefit Plans – Pension,” the amortization of any prior
service cost is determined using a straight-line amortization of the cost over the average remaining service period
of employees expected to receive the benefits under the Pension Plan.
The following weighted average assumptions were used to determine the projected benefit obligations for
the Pension Plan at January 29, 2011 and January 30, 2010:
2010 2009
Discount rate ........................................................... 5.40% 5.65%
Rate of compensation increases ............................................ 4.50% 4.50%
The following weighted average assumptions were used to determine the net periodic pension cost for the
Pension Plan:
2010 2009 2008
Discount rate ............................................................. 5.65% 7.45% 6.25%
Expected long-term return on plan assets ....................................... 8.75% 8.75% 8.75%
Rate of compensation increases ............................................... 4.50% 5.40% 5.40%
The Pension Plan’s assumptions are evaluated annually and updated as necessary.
The discount rate used to determine the present value of the projected benefit obligation for the Pension
Plan is based on a yield curve constructed from a portfolio of high quality corporate debt securities with various
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