TJ Maxx 2014 Annual Report Download - page 85

TJX made aggregate cash contributions of $151.3 million in fiscal 2015, $32.7 million in fiscal 2014 and $77.8
million in fiscal 2013 to the funded plan and to fund current benefit and expense payments under the unfunded plan.
TJX’s policy with respect to the funded plan is to fund, at a minimum, the amount required to maintain a funded
status of 80% of the applicable pension liability (the Funding Target pursuant to the Internal Revenue Code section
430) or such other amount as is sufficient to avoid restrictions with respect to the funding of nonqualified plans under
the Internal Revenue Code. We do not anticipate any required funding in fiscal 2016 for the funded plan. We
anticipate making contributions of $3.3 million to provide current benefits coming due under the unfunded plan in
fiscal 2016.
The following are the components of net periodic benefit cost and other amounts recognized in other
comprehensive income related to our pension plans:
Funded Plan
Fiscal Year Ended
Unfunded Plan
Fiscal Year Ended
Dollars in thousands
January 31,
2015
February 1,
2014
February 2,
2013
January 31,
2015
February 1,
2014
February 2,
2013
(53 weeks) (53 weeks)
Net periodic pension cost:
Service cost $ 40,481 $ 44,623 $ 41,813 $ 1,398 $ 1,716 $ 1,448
Interest cost 49,522 44,654 42,029 3,001 2,447 2,321
Expected return on plan assets (65,187) (60,474) (54,759) ———
Amortization of prior service cost ——— 233
Amortization of net actuarial loss 13,848 28,070 25,373 2,146 2,884 1,465
Expense related to current period 38,664 56,873 54,456 6,547 7,050 5,237
Correction of prior years pension accruals —— 26,964 ———
Total expense $ 38,664 $ 56,873 $ 81,420 $ 6,547 $ 7,050 $ 5,237
Other changes in plan assets and benefit
obligations recognized in other
comprehensive income:
Net (gain) loss $209,091 $ (89,265) $ 61,692 $19,552 $ (2,925) $ 6,666
Amortization of net (loss) (13,848) (28,070) (25,373) (2,146) (2,884) (1,465)
Plan amendment 3,067 —— (2) (3) (3)
Total recognized in other comprehensive
income $198,310 $(117,335) $ 36,319 $17,404 $ (5,812) $ 5,198
Total recognized in net periodic benefit
cost and other comprehensive income $236,974 $ (60,462) $117,739 $23,951 $ 1,238 $10,435
Weighted average assumptions for
expense purposes:
Discount rate 5.00% 4.40% 4.80% 4.80% 4.00% 4.40%
Expected rate of return on plan assets 7.00% 7.00% 7.40% N/A N/A N/A
Rate of compensation increase 4.00% 4.00% 4.00% 6.00% 6.00% 6.00%
The rate of compensation increase presented for the unfunded plan (for measurement purposes and expense
purposes) is the rate assumed for participants eligible for the primary benefit. The assumed rate of compensation
increase for participants eligible for the alternative benefit under the unfunded plan is the same rate as assumed for
the funded plan.
During fiscal 2013, TJX recorded an adjustment to its pension accrual to correct an understatement related to a
computational error that commenced in fiscal 2008. The cumulative impact through fiscal 2012 of correcting for the
error resulted in incremental pension expense of $27.0 million and an increase in the projected benefit obligation of
$33.8 million. Management evaluated the impact of correcting the error in fiscal 2013 and determined that there was
no material impact on that year, or the prior year financial statements as reported.
TJX develops its long-term rate of return assumption by evaluating input from professional advisors taking into
account the asset allocation of the portfolio and long-term asset class return expectations, as well as long-term
inflation assumptions.
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