Pizza Hut 2010 Annual Report Download - page 195

98
Plan Assets
The fair values of our pension plan assets at December 25, 2010 by asset category and level within the fair value hierarchy
are as follows:
U.S. Pension
Plans
International
Pension Plans
Level 1:
Cash(a) $ 1 $
—
Level 2:
Cash Equivalents(a) 5 3
Equity Securities – U.S. Large cap(b) 308
—
Equity Securities – U.S. Mid cap(
b
) 50
—
Equity Securities – U.S. Small cap(
b
) 51
—
Equity Securities – Non-U.S.(
b
) 97 99
Fixed Income Securities – U.S. Corporate(
b
) 238 16
Fixed Income Securities – U.S. Government and Government Agencies(c) 150
—
Fixed Income Securities – Non-U.S. Government(
b
)(c) 20 36
Other Investments(b)
—
10
Total fair value of plan assets(d) $ 920 $ 164
(a) Shor
t
-term investments in money market funds
(b) Securities held in common trusts
(c)
I
nvestments held by the Plan are directly held
(d)
E
xcludes net payable of $13 million in the U.S. for purchases of assets included in the above that were settled
a
fter year end
Our primary objectives regarding the investment strategy for the Plan’s assets, which make up 85% of total pension plan
assets at the 2010 measurement date, are to reduce interest rate and market risk and to provide adequate liquidity to meet
immediate and future payment requirements. To achieve these objectives, we are using a combination of active and
passive investment strategies. Our equity securities, currently targeted at 55% of our investment mix, consist primarily of
low cost index funds focused on achieving long-term capital appreciation. We diversify our equity risk by investing in
several different U.S. and foreign market index funds. Investing in these index funds provides us with the adequate
liquidity required to fund benefit payments and plan expenses. The fixed income asset allocation, currently targeted at
45% of our mix, is actively managed and consists of long duration fixed income securities that help to reduce exposure to
interest rate variation and to better correlate asset maturities with obligations.
A mutual fund held as an investment by the Plan includes YUM stock valued at less than $0.6 million at December 25,
2010 and less than $0.5 million at December 26, 2009 (less than 1% of total plan assets in each instance).
Form 10-K