OG&E 2009 Annual Report Download - page 88

Plan Assets
The following table is a summary of OGE Energy’s Pension Plan’s assets that are measured at fair value on a recurring basis
at December 31, 2009, of which approximately $398.9 million is the Company’s portion. There were no Level 3 investments held by
the Pension Plan at December 31, 2009.
(In millions) Total Level 1 Level 2
Common stocks
U.S. common stocks $ 152.4 $ 152.4 $ ---
Foreign common stocks 57.2 57.2 ---
Bonds, debentures and notes (A)
Bonds, debentures and notes 119.1 --- 119.1
Mortgage-backed securities 8.6 --- 8.6
U.S. Government obligations
Mortgage-backed securities 72.3 --- 72.3
U.S. treasury notes and bonds (B) 22.2 22.2 ---
Other securities 4.5 --- 4.5
Commingled fund (C) 32.8 --- 32.8
Common collective trust (D) 15.9 --- 15.9
Foreign government bonds 5.1 --- 5.1
U.S. municipal bonds 2.5 --- 2.5
Foreign mutual funds 2.0 2.0 ---
Foreign preferred stock 0.9 0.9 ---
U.S. mutual funds 0.8 0.8 ---
Total $ 496.3 $ 235.5 $ 260.8
(A) This category primarily represents U.S. corporate bonds with an investment grade rating at or above Baa3 or BBB- by Moody’s,
Standard & Poor’s or Fitch.
(B) This category represents U.S. treasury notes and bonds with a Moody’s rating of Aaa and Government Agency Bonds with a
Moody’s rating of A1 or higher.
(C) This category represents units of participation in a commingled fund that primarily invest in stocks and bonds of U.S. companies.
(D) This category represents units of participation in an investment pool which primarily invests in commercial paper, repurchase
agreements and U.S. treasury notes and bonds and certificates of deposit.
The three levels defined in the fair value hierarchy and examples of each are as follows:
Level 1 inputs are quoted prices in active markets for identical assets or liabilities that the Pension Plan and postretirement
benefit plans have the ability to access at the measurement date. An active market for the asset or liability is a market in which
transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis.
Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either
directly or indirectly. If the asset or liability has a specified (contractual) term, a Level 2 input must be observable for substantially the
full term of the asset or liability. Level 2 inputs include the following: (i) quoted prices for similar assets or liabilities in active
markets, (ii) quoted prices for identical or similar assets or liabilities in markets that are not active, (iii) inputs other than quoted prices
that are observable for the asset or liability or (iv) inputs that are derived principally from or corroborated by observable market data
by correlation or other means.
Level 3 inputs are unobservable inputs for the asset or liability. Unobservable inputs shall be used to measure fair value to the
extent that observable inputs are not available. Unobservable inputs shall reflect the Pension Plan’s and postretirement benefit plans
own assumptions about the assumptions that market participants would use in pricing the asset or liability (including assumptions
about risk). Unobservable inputs shall be developed based on the best information available in the circumstances, which might include
the Pension Plan’s and postretirement benefit plans own data. The Pension Plan’s and postretirement benefit plans own data used to
develop unobservable inputs shall be adjusted if information is reasonably available that indicates that market participants would use
different assumptions.
82