PG&E 2013 Annual Report Download - page 93

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
NOTE 11: EMPLOYEE BENEFIT PLANS (Continued)
Other Benefits
2013 2012 2011
(in millions)
Service cost for benefits earned ................ $ 53 $ 49 $ 42
Interest cost .............................. 74 83 91
Expected return on plan assets ................ (79) (77) (82)
Amortization of transition obligation ............ — 24 26
Amortization of prior service cost .............. 23 25 27
Amortization of net actuarial loss ..............664
Net periodic benefit cost ..................... $ 77 $ 110 $ 108
There was no material difference between PG&E Corporation and the Utility for the information disclosed
above.
Components of Accumulated Other Comprehensive Income
PG&E Corporation and the Utility record the net periodic benefit cost for pension benefits and other benefits
as a component of accumulated other comprehensive income, net of tax. Net periodic benefit cost is composed of
unrecognized prior service costs, unrecognized gains and losses, and unrecognized net transition obligations as
components of accumulated other comprehensive income, net of tax.
Regulatory adjustments are recorded in the Consolidated Statements of Income and Consolidated Balance
Sheets to reflect the difference between pension expense or income calculated in accordance with GAAP for
accounting purposes and pension expense or income for ratemaking, which is based on a funding approach. A
regulatory adjustment is also recorded for the amounts that would otherwise be charged to accumulated other
comprehensive income for the pension benefits related to the Utility’s defined benefit pension plan. To the extent the
other benefits are in an overfunded position, the Utility records a regulatory liability related to its other benefits and
long term disability costs, for the excess of cumulative income for ratemaking over cumulative other benefits expense
calculated in accordance with GAAP, and a portion of the credit balance in accumulated other comprehensive
income. However, this recovery mechanism does not allow the Utility to record a regulatory asset for an
underfunded position related to other benefits. Therefore, the charge remains in accumulated other comprehensive
income (loss) for other benefits.
The estimated amounts that will be amortized into net periodic benefit costs for PG&E Corporation in 2014 are
as follows:
Pension Benefit
(in millions)
Unrecognized prior service cost ...................................... $ 20
Unrecognized net loss ............................................. 2
Total ........................................................ $22
Other Benefits
(in millions)
Unrecognized prior service cost ...................................... $ 23
Unrecognized net loss ............................................. 2
Total ........................................................ $25
There were no material differences between the estimated amounts that will be amortized into net periodic
benefit costs for PG&E Corporation and the Utility.
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