Nokia 2003 Annual Report Download - page 170
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Notes to the Consolidated Financial Statements (Continued)
36. Differences between International Accounting Standards and U.S. Generally Accepted
Accounting Principles (Continued)
At December 31, approximately 3% (20% in 2002) or EUR 19 million (EUR 125 million in 2002) of
domestic plan assets consist of Nokia equity securities. The foreign pension plan assets include a
self investment through a loan provided to Nokia by the plan of EUR 64 million (EUR 66 million in
2002).
The following additional information as required in accordance with SFAS 132R, Employers
Disclosure about Pensions and Other Postretirement Benefits Revised, which was issued in
December 2003, relates to domestic plans only. The additional information disclosed regarding the
assets, obligations, cash flows and net periodic benefit costs of the Group’s domestic pension plans
will be disclosed for the Group’s foreign plans in 2004 in accordance with the provisions of
SFAS 132R.
The accumulated benefit obligation for the domestic plans at December 31, 2003 was
EUR 554 million (2002 EUR 479 million).
The Group expects to make contributions of EUR 27 million to its domestic pension plans in 2004.
Domestic Plan Assets
The Groups’s pension plan weighted average asset allocation at December 31, 2002, and 2003, by
asset category are as follows:
Percentage of
Plan Assets
at December 31,
2003 2002
Asset Category:
Equity securities ................................................... 39% 53%
Debt securities .................................................... 33% 38%
Real estate ....................................................... 2% 4%
Short-term investments ............................................. 26% 5%
Total ............................................................ 100% 100%
The objective of the investment activities is to maximize investment return within an accepted
risk level. The relatively high average benefit liability duration is taken into consideration when
assessing investment strategies. As of December 31, 2003 the target asset allocation was: 40%
equity securities, 55% debt securities and 5% real estate. The Pension Foundation board of trustees
approves the target asset allocation as well as deviation limits. Derivative instruments can be used
to change the portfolio asset allocation and risk characteristics.
F-61