Vectren 2008 Annual Report Download - page 86

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84
The asset allocation for the Company's pension and postretirement plans at the measurement date for 2008 and
2007 by asset category follows:
Pension Benefits Other Benefits
2008 2007 2008 2007
Equity securities 58% 64% 72% 74%
Debt securities 37% 31% 25% 26%
Real estate and other 5% 5% 3% -
Total 100% 100% 100% 100%
The Company invests in trusts that benefit its qualified defined benefit plans. The general investment objectives
are to invest in a diversified portfolio, comprised of both equity and fixed income investments, which are further
diversified among various asset classes. The diversification is designed to minimize the risk of large losses while
maximizing total return within reasonable and prudent levels of risk. The investment objectives specify a targeted
investment allocation for the pension plans of 60 percent equities, 35 percent debt, and 5 percent for other asset
classes, including real estate, for 2009, and for postretirement plans of 75 percent equities and 25 percent debt for
2009. Objectives do not target a specific return by asset class. The portfolio’s return is monitored in total and
investment objectives are long-term in nature.
Funded Status
The funded status of the plans as of December 31, 2008 and 2007 follows:
(In millions)
2008 2007 2008 2007
Benefit obligation, end of period 260.6$ 249.6$ 72.3$ 70.2$
Fair value of plan assets, end of period (150.9) (211.8) (4.3) (6.8)
Post measurement date adjustments - (2.4) - (1.1)
Funded status, end of period: 109.7$ 35.4$ 68.0$ 62.3$
Accrued liabilities
0.7$ 0.7$ 4.3$ 3.9$
Other liabilities
109.0$ 34.7$ 63.7$ 58.4$
Pension Benefits Other Benefits
As of December 31, 2008 and 2007, the funded status of the SERP, which is included in Pension Benefits in the
chart above, was an unfunded amount of $14.6 million and $13.1 million, respectively.
Prior Service Cost, Actuarial Gains and Losses, and Transition Obligation Effects
A roll forward of these amounts identifying those components reclassified to periodic cost and those components
arising during the year since adoption of SFAS 158 follows:
(In millions) Pensions Other Benefits
Prior
Service Cost
Net Gain or
Loss
Prior
Service Cost
Net Gain or
Loss
Transition
Obligation
Balance at adoption of SFAS 158 12.9$ 35.3$ (5.5)$ (2.2)$ 8.7$
Amounts arising during the period - (21.9) - 1.2 -
Reclassification to benefit costs (1.7) (1.5) 0.8 (0.1) (1.1)
Balance December 31, 2007 11.2 11.9 (4.7) (1.1) 7.6
Amounts arising during the period 0.4 79.1 - 4.6 -
Reclassification to benefit costs (2.1) (0.1) 1.0 - (1.4)
Balance December 31, 2008 9.5$ 90.9$ (3.7)$ 3.5$ 6.2$