Raytheon 2004 Annual Report Download - page 107

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89
Notes to Consolidated Financial Statements (Continued)
Net periodic benefit cost includes income from discontinued operations, including curtailments, of $47 million
in 2002.
Weighted-Average Net Periodic Benefit Cost Assumptions Pension Benefits
2004 2003 2002
Discount rate 6.22% 6.95% 7.21%
Expected return on plan assets 8.67% 8.67% 9.43%
Rate of compensation increase 4.49% 4.46% 4.47%
Weighted-Average Net Periodic Benefit Cost Assumptions Other Benefits
2004 2003 2002
Discount rate 6.25% 7.00% 7.25%
Expected return on plan assets 7.75% 7.75% 8.50%
Rate of compensation increase 4.50% 4.50% 4.50%
Health care trend rate in the next year 13.50% 13.50% 11.00%
Gradually declining to an ultimate trend rate of 5.75% 5.75% 5.00%
Year that the rate reaches ultimate trend rate 2014 2013 2010
The effect of a one percent increase or (decrease) in the assumed health care trend rate for each future year for
the aggregate of service cost and interest cost is $8 million or $(7) million, respectively, and for the accumulated
postretirement benefit obligation is $55 million or $(48) million, respectively.
The projected benefit obligation and fair value of plan assets for Pension Benefits plans with projected benefit
obligations in excess of plan assets were $13,763 million and $9,900 million, respectively, at December 31, 2004,
and $12,409 million and $8,749 million, respectively, at December 31, 2003.
The accumulated benefit obligation and fair value of plan assets for Pension Benefits plans with accumulated
benefit obligations in excess of plan assets were $12,198 million and $9,878 million, respectively, at December 31,
2004 and $11,118 million and $8,731 million, respectively, at December 31, 2003. The accumulated benefit
obligation for all Pension Benefits plans was $13,314 million and $12,184 million at December 31, 2004 and 2003,
respectively.
The Company expects total contributions (required and discretionary) to the Pension Benefits and Other
Benefits plans to be approximately $515 million and $105 million, respectively, in 2005.
The table below reflects the total Pension Benefits expected to be paid from the plans or from the Company’s
assets, including both the Company’s share of the benefit cost and the participants’ share of the cost, which is
funded by participant contributions. Other Benefits payments reflect the Company’s portion only.
Pension
Benefits
Other
Benefits
2005 $ 863 $111
2006 850 97
2007 861 98
2008 876 98
2009 876 100
2010-2014 4,512 514