Mercedes 2009 Annual Report Download - page 225

Consolidated Financial Statements |Notes to Consolidated Financial Statements |221
The Group used the following weighted average assumptions to
determine pension benefit obligations:
The Group used the following weighted average assumptions to
determine net periodic pension cost:
Discount rates. The discount rates for German and non-German
pension plans are determined annually as of December 31 on
the basis of high-quality corporate bonds with maturities and values
matching those of the pension payments.
Expected return on plan assets. The expected long-term rates
of return for German and non-German plan assets are primarily
derived from the asset allocations of plan assets and expected
future returns for the various asset classes in the portfolios.
Temporary variability in the asset allocations of plan assets does
not result in adjustments of the expected long-term rates of
return. Our investment committees survey banks and large asset
portfolio managers about their expectations for future returns
for the relevant market indices. The allocation-weighted average
return expectations serve as an initial indicator for the expected
rate of return on plan assets for each pension fund.
In addition, Daimler considers long-term actual plan assets’ results
and historical market returns in its evaluation in order to reflect
the long-term character of the plan assets.
Multi-employer plans. Daimler participates in some collectively
bargained defined benefit pension plans maintained by more
than one employer. The Group accounts for these plans as defined
contribution plans because the information required to use
defined benefit accounting is not available in a timely manner and
in sufficient detail. The Group can not exercise direct control
over such plans and the plan-trustees have no legal obligation to
share information directly with participating employers. Based
on available information, Daimler’s share in the underfunded status
of the plans (difference between liabilities and assets), as of the
beginning of 2009 amounted to €0.1 billion. Higher contributions
by the Group to such a pension plan could result in particular
when the underfunded status exceeds a specific level.
Non-German plans
At December 31,
2008
2009
German plans
At December 31,
20082009
5.9
–
1.8
5.3
–
1.8
5.0
3.7
–
5.1
3.9
–
in %
Discount rates
Expected long-term remuneration increases1
Expected increase in cost of living2
1 For most German plans, expected increases in long-term remuneration are not a part of the benefit formula.
2 For most non-German plans, expected increases in cost of living are not a part of the benefit formula.
Non-German Plans
2007
20082009
German Plans
200720082009
4.5
7.5
2.5
1.9
5.4
6.5
3.1
1.9
5.9
6.5
–
1.8
5.7
8.5
4.1
–
5.3
7.3
4.6
–
5.0
7. 2
3.7
–
in %
Discount rates
Expected long-term returns on plan assets
Expected long-term remuneration increases1
Expected increase in cost of living2
1 For most German plans, expected increases in long-term remuneration are not a part of the benefit formula.
2 For most non-German plans, expected increases in cost of living are not a part of the benefit formula.