ManpowerGroup 2012 Annual Report Download - page 74

The components of the net periodic benefit cost and other amounts recognized in other comprehensive loss for all plans
were as follows:
Year Ended December 31 2012 2011 2010
Service cost $ 10.4 $ 9.9 $ 8.6
Interest cost 15.1 15.5 14.5
Expected return on assets (14.7) (15.2) (13.4)
Curtailment and settlement —(1.0) —
Net loss (gain) 1.1 (0.2) (1.2)
Prior service cost 0.7 0.7 0.7
Net periodic benefit cost 12.6 9.7 9.2
Other Changes in Plan Assets and Benefit Obligations
Recognized in Other Comprehensive Loss
Net loss 15.4 11.6 8.5
Amortization of net (loss) gain (1.1) 0.2 1.2
Amortization of prior service cost (0.7) (0.7) (0.7)
Total recognized in other comprehensive loss 13.6 11.1 9.0
Total recognized in net periodic benefit cost and other comprehensive loss $ 26.2 $ 20.8 $ 18.2
Effective January 1, 2013, we amended a defined benefit plan in the Netherlands. The defined benefit plan was frozen, and
the participants were transitioned to a defined contribution plan. The curtailment gain arising from this plan amendment is
expected to be $2.3 and will be recorded in 2013.
Effective July 1, 2011, we completed a voluntary transition of our Norwegian employees from defined pension plans to
defined contribution plans, resulting in a curtailment and settlement gain of $1.0.
The estimated net loss and prior service cost for the defined benefit pension plans that will be amortized from accumulated
other comprehensive loss into net periodic benefit cost during 2013 are $3.4 and $0.5, respectively.
The weighted-average assumptions used in the measurement of the benefit obligation were as follows:
United States Plans Non-United States Plans
Year Ended December 31 2012 2011 2012 2011
Discount rate 3.7% 4.6% 4.2% 4.7%
Rate of compensation increase 3.0% 3.0% 3.6% 4.0%
The weighted-average assumptions used in the measurement of the net periodic benefit cost were as follows:
United States Plans Non-United States Plans
Year Ended December 31 2012 2011 2010 2012 2011 2010
Discount rate 4.6% 5.1% 5.7% 4.7% 5.1% 5.5%
Expected long-term return on plan assets 6.3% 7.0% 7.3% 4.7% 5.3% 5.5%
Rate of compensation increase 3.0% 4.0% 4.0% 4.0% 4.3% 4.5%
We determine our assumption for the discount rate to be used for purposes of computing annual service and interest costs
based on an index of high-quality corporate bond yields and matched-funding yield curve analysis as of the end of each
fiscal year.
Our overall expected long-term rate of return on United States plan assets is 6.3%, while our overall expected long-term
rate of return on our non-United States plans varies by country and ranges from 3.5% to 5.0%. For a majority of our plans,
a building block approach has been employed to establish this return. Historical markets are studied and long-term
historical relationships between equity securities and fixed income instruments are preserved consistent with the widely
accepted capital market principle that assets with higher volatility generate a greater return over time. Current market
factors such as inflation and interest rates are evaluated before long-term capital market assumptions are determined. The
long-term portfolio return is established with proper consideration of diversification and rebalancing. We also use guaranteed
insurance contracts for five of our foreign plans. Peer data and historical returns are reviewed to check for reasonableness
and appropriateness of our expected rate of return.
Projected salary levels utilized in the determination of the projected benefit obligation for the pension plans are based upon
historical experience and the future expectations for each respective country.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
in millions, except share and per share data
72 ManpowerGroup 2012 Annual Report Notes to Consolidated Financial Statements