Morgan Stanley 2010 Annual Report Download - page 240

MORGAN STANLEY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Expected benefit payments associated with the Company’s pension and postretirement benefit plans for the next
five years and in aggregate for the five years thereafter as of December 31, 2010 are as follows:
Pension Postretirement
(dollars in millions)
2011 ......................................................... $114 $ 9
2012 ......................................................... 116 9
2013 ......................................................... 118 9
2014 ......................................................... 122 9
2015 ......................................................... 123 9
2016—2020 ................................................... 672 49
Morgan Stanley 401(k) Plan, Morgan Stanley 401(k) Savings Plan and Profit Sharing Awards. Eligible U.S.
employees receive 401(k) matching contributions that are invested in the Company’s common stock. Effective
July 1, 2009, the Company introduced the Morgan Stanley 401(k) Savings Plan for legacy Smith Barney U.S.
employees who were contributed to MSSB. Legacy Smith Barney U.S. employees with eligible pay less than or
equal to $100,000 will receive a fixed contribution under the 401(k) Savings Plan. The amount of fixed
contribution is included in the Company’s 401(k) expense and equals between 1% and 2% of eligible pay based
on years of service as of December 31. Additionally, certain eligible Smith Barney employees were granted a
transition contribution and, for 2009, a one-time make-up Company match based on certain transition
percentages of eligible pay and a comparison of the Company match under the Citi 401(k) Plan and Morgan
Stanley 401(k) Savings Plan. The retirement contribution granted in lieu of a defined benefit pension plan and the
fixed contribution, transition contribution and make-up Company match granted to legacy Smith Barney
employees are included in the Company’s 401(k) expense. The Company entered into an agreement with the
investment manager for the SVP, a fund within the Company’s 401(k) plan, and certain other third parties on
September 30, 2009 (see Note 13 for further information). Under the agreement, the Company contributed $20
million to the SVP on October 15, 2009 and recorded the contribution in the Company’s 401(k) expense. The
Company also provides discretionary profit sharing to certain non-U.S. employees. The pre-tax expense
associated with the 401(k) plans and profit sharing for 2010, 2009, fiscal 2008 and the one month ended
December 31, 2008 was $196 million, $181 million, $106 million and $8 million, respectively.
Defined Contribution Pension Plans. The Company maintains separate defined contribution pension plans that
cover substantially all employees of certain non-U.S. subsidiaries. Under such plans, benefits are determined
based on a fixed rate of base salary with certain vesting requirements. In 2010, 2009, fiscal 2008 and the one
month ended December 31, 2008, the Company’s expense related to these plans was $117 million, $99 million,
$128 million and $9 million, respectively.
Other Postemployment Benefits. Postemployment benefits include, but are not limited to, salary continuation,
severance benefits, disability-related benefits, and continuation of health care and life insurance coverage
provided to former employees or inactive employees after employment but before retirement. The
postemployment benefit obligations were not material at December 31, 2010 and December 31, 2009.
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