US Airways 2011 Annual Report Download - page 101

Table of Contents
The Company's overall investment strategy is to achieve long-term investment growth. The Company's targeted asset allocation as of December 31,
2011 is approximately 65% equity securities and 35% fixed-income securities. Equity securities primarily include mutual funds invested in large-cap, mid-cap
and small-cap U.S. and international companies. Fixed-income securities primarily include mutual funds invested in U.S. treasuries and corporate bonds. The
Company believes that its long-term asset allocation on average will approximate the targeted allocation. The Company regularly reviews its actual asset
allocation and periodically rebalances its investments to its targeted allocation when considered appropriate.
The fair value of pension plan assets by asset category is as follows (in millions):
Quoted Prices in Significant Other Significant
Active Markets for Observable Unobservable
Identical Assets Inputs Inputs
Fair Value (Level 1) (Level 2) (Level 3)
At December 31, 2011
Mutual funds $ 39 $ 39 $ — $ —
At December 31, 2010
Mutual funds $ 40 $ 40 $ — $ —
As of December 31, 2011, the plan's mutual funds were invested 53% in equity securities of large-cap, mid-cap and small-cap U.S. companies, 35% in
U.S. treasuries and corporate bonds and 12% in equity securities of international companies.
As of December 31, 2010, the plan's mutual funds were invested 54% in equity securities of large-cap, mid-cap and small cap U.S. companies, 33% in
U.S. treasuries and corporate bonds and 13% in equity securities of international companies.
The mutual fund shares are classified as Level 1 instruments and valued at quoted prices in an active market exchange, which represents the net asset
value of shares held by the pension plan.
(b) Defined Contribution and Multiemployer Plans
The Company sponsors several defined contribution plans which cover a majority of its employee groups. The Company makes contributions to these
plans based on the individual plan provisions, including an employer non-discretionary contribution and an employer match. These contributions are generally
made based upon eligibility, eligible earnings and employee group. Expenses related to these plans were $79 million, $81 million and $76 million for the
years ended December 31, 2011, 2010 and 2009, respectively.
Pursuant to the Company's collective bargaining agreements with the International Association of Machinists & Aerospace Workers ("IAM"), the
Company makes contributions for eligible employees to the IAM National Pension Fund, Employer Identification No. 51-6031295 and Plan No. 002 (the
"IAM Pension Fund"). The IAM Pension Fund reported that its Pension Protection Act of 2006 certification filed in March 2011 with the IRS shows that it
qualified for Green Zone Status, as it was at least 80% funded. Expenses related to contributions to this plan were $24 million, $21 million and $22 million for
the years ended December 31, 2011, 2010 and 2009, respectively. The Company's contributions for the year ended December 31, 2010, the most recent period
for which annual IAM Pension Fund information was available, represented approximately 6% of total employer plan contributions. The Company's
collective bargaining agreements with the IAM became amendable on December 31, 2011.
(c) Postemployment Benefits
The Company provides certain postemployment benefits to its employees. These benefits include disability-related and workers' compensation benefits
for certain employees. The Company accrues for the cost of such benefit expenses once an appropriate triggering event has occurred.
(d) Profit Sharing Plans
Most non-executive employees of US Airways are eligible to participate in a profit sharing plan. Awards are paid as a lump sum after the end of each
fiscal year. The Company recorded $12 million and $47 million for profit sharing in 2011 and 2010, respectively, which is recorded in salaries and related
costs on the consolidated statement of operations and included in accrued compensation and vacation on the consolidated balance sheet. In 2009, no amounts
were recorded for profit sharing.
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