Motorola 2011 Annual Report Download - page 93

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87
the benefit obligation when due. The long-term rates of return on plan assets represents an estimate of long-term
returns on an investment portfolio consisting of a mixture of equities, fixed income, cash and other investments
similar to the actual investment mix. In determining the long-term return on plan assets, the Company considers
long-term rates of return on the asset classes (both historical and forecasted) in which the Company expects the plan
funds to be invested.
Weighted average actuarial assumptions used to determine costs for the plans were as follows:
2011 2010
December 31 U.S. Non U.S. U.S. Non U.S.
Discount rate 5.75% 5.01% 6.00% 5.39%
Investment return assumption (Regular Plan) 8.25% 6.50% 8.25% 6.86%
Investment return assumption (Officers’ Plan) 6.00% N/A 6.00% N/A
Weighted average actuarial assumptions used to determine benefit obligations for the plans were as follows:
2011 2010
December 31 U.S. Non U.S. U.S. Non U.S.
Discount rate 5.10% 4.58% 5.75% 5.07%
Future compensation increase rate (Regular Plan) 0.00% 2.56% 0.00% 2.61%
Future compensation increase rate (Officers’ Plan) 0.00% N/A 0.00% N/A
The accumulated benefit obligations for the plans were as follows:
2011 2010
December 31 Regular
Officers’
and
MSPP Non
U.S. Regular
Officers’
and
MSPP
Non
U.S.
Accumulated benefit obligation $6,948 $ 38 $1,588 $6,129 $ 44 $1,423
The Company has adopted a pension investment policy designed to meet or exceed the expected rate of return
on plan assets assumption. To achieve this, the pension plans retain professional investment managers that invest
plan assets in equity and fixed income securities and cash. In addition, some plans invest in insurance contracts. The
Company’s measurement date of its plan assets and obligations is December 31. The Company has the following
target mixes for these asset classes, which are readjusted periodically, when an asset class weighting deviates from
the target mix, with the goal of achieving the required return at a reasonable risk level:
Target Mix
Asset Category 2011 2010
Equity securities 63% 63%
Fixed income securities 35% 35%
Cash and other investments 2% 2%
The weighted-average pension plan asset allocation by asset categories:
Actual Mix
December 31 2011 2010
Equity securities 60% 66%
Fixed income securities 35% 32%
Cash and other investments 5% 2%
Within the equity securities asset class, the investment policy provides for investments in a broad range of
publicly-traded securities including both domestic and international stocks. Within the fixed income securities asset
class, the investment policy provides for investments in a broad range of publicly-traded debt securities ranging from
U.S. Treasury issues, corporate debt securities, mortgage and asset-backed securities, as well as international debt
securities. In the cash and other investments asset class, investments may be in cash, cash equivalents or insurance
contracts.