Macy's 2014 Annual Report Download - page 74
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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
F-27
Net pension costs and other amounts recognized in other comprehensive loss for the Pension Plan included the
following actuarially determined components:
2014 2013 2012
(millions)
Net Periodic Pension Cost
Service cost ....................................................................................... $ 6 $ 112 $ 117
Interest cost ....................................................................................... 151 143 157
Expected return on assets.................................................................. (246)(242)(253)
Amortization of net actuarial loss..................................................... 25 141 141
Amortization of prior service credit.................................................. — — (1)
(64) 154 161
Other Changes in Plan Assets and Projected Benefit Obligation
Recognized in Other Comprehensive Loss
Net actuarial (gain) loss .................................................................... 491 (254)(91)
Amortization of net actuarial loss..................................................... (25)(141)(141)
Amortization of prior service credit.................................................. — — 1
466 (395)(231)
Total recognized in net periodic pension cost and
other comprehensive loss...................................................................... $ 402 $ (241) $ (70)
The estimated net actuarial loss for the Pension Plan that will be amortized from accumulated other comprehensive
loss into net periodic benefit cost during 2015 is $39 million.
The following weighted average assumptions were used to determine the projected benefit obligations for the
Pension Plan at January 31, 2015 and February 1, 2014:
2014 2013
Discount rate........................................................................................................................ 3.55% 4.50%
Rate of compensation increases........................................................................................... 4.10% 4.10%
The following weighted average assumptions were used to determine the net periodic pension cost for the Pension
Plan:
2014 2013 2012
Discount rate ............................................................................................ 4.50% 4.15% 4.65%
Expected long-term return on plan assets ................................................ 7.50% 7.50% 8.00%
Rate of compensation increases ............................................................... 4.10% 4.50% 4.50%
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 maturities. Each year’s
expected future benefit payments are discounted to their present value at the appropriate yield curve rate, thereby
generating the overall discount rate for the projected benefit obligation.