Macy's 2010 Annual Report Download - page 85

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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:
2011 ......................................................... $ 52
2012 ......................................................... 50
2013 ......................................................... 50
2014 ......................................................... 54
2015 ......................................................... 54
2016-2020 ..................................................... 264
Retirement Plan
The Retirement Plan includes a voluntary savings feature for eligible employees. The Company’s
contribution was historically based on the Company’s annual earnings including a minimum contribution rate
based on an employee’s eligible savings and more recently based on a stated matching contribution rate based on
an employee’s eligible savings. Expense for the Retirement Plan amounted to $9 million for 2010, $9 million for
2009 and $37 million for 2008.
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 29, 2011 and January 30, 2010, the liability under the plan, which is reflected in other
liabilities on the Consolidated Balance Sheets, was $46 million and $51 million, respectively. Expense for 2010,
2009 and 2008 was immaterial.
F-37