Tyson Foods 2006 Annual Report Download - page 49

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The Company uses a September 30 measurement date for its defined
benefit plans and one postretirement medical plan and a July 31
measurement date for its remaining postretirement medical plans.
The Company generally recognizes the effect of actuarial gains and
losses into earnings immediately rather than amortizing the effect
over future periods.
Other postretirement benefits include postretirement medical costs
and life insurance.
BENEFIT OBLIGATIONS AND FUNDED STATUS
The following table provides a reconciliation of the changes in the
plans’ benefit obligations, assets and funded status as of fiscal year
ends September 30, 2006, and October 1, 2005:
Other Postretirement
Pension Benefits Benefits
in millions 2006 2005 2006 2005
Change in benefit obligation
Benefit obligation at
beginning of year $107 $ 77 $60 $ 66
Service cost 661–
Interest cost 6644
Plan participants’
contributions ––54
Addition of subsidiary plan 118 ––
Amendments ––(3) (9)
Actuarial loss 11 614 9
Benefits paid (7) (6) (18) (14)
Curtailment ––(2) –
Benefit obligation at end of year 124 107 61 60
Change in plan assets
Fair value of plan assets at
beginning of year 82 59 ––
Actual return on plan assets 78––
Employer contributions 210 13 10
Plan participants’
contributions ––54
Addition of subsidiary plan 111 ––
Benefits paid (7) (6) (18) (14)
Fair value of plan assets at
end of year 85 82 ––
Funded status (39) (25) (61) (60)
Amounts not yet recognized:
Unrecognized prior
service cost 67(17) (16)
Unrecognized actuarial loss 25 15 ––
Net amount recognized $(8) $ (3) $(78) $(76)
Amounts recognized in the Consolidated Balance Sheets consist of:
Other Postretirement
Pension Benefits Benefits
in millions 2006 2005 2006 2005
Prepaid benefit cost $ – $ 7 $ – $ –
Accrued benefit liability (31) (17) (78) (76)
Accumulated other
comprehensive loss 23 7––
Net amount recognized $(8) $ (3) $(78) $(76)
The increase (decrease) in the pretax minimum liability related to
the Company’s pension plans included in other comprehensive
income (loss) was $16 million, $2 million and $(2) million in fiscal
2006, 2005 and 2004, respectively.
At September 30, 2006, all pension plans had an accumulated
benefit obligation in excess of plan assets. At October 1, 2005, two
pension plans had an accumulated benefit obligation in excess of
plan assets, and two pension plans had assets in excess of the accu-
mulated benefit obligation. The accumulated benefit obligation for
all pension plans was $122 million and $98 million at September 30,
2006, and October 1, 2005, respectively. Plans with accumulated
benefit obligations in excess of plan assets are as follows:
Pension Benefits
in millions 2006 2005
Projected benefit obligation $124 $37
Accumulated benefit obligation 122 36
Fair value of plan assets 85 12
Ty s on Foods, Inc. 2006 Annual Report47
Notes to Consolidated Financial Statements continued