Xerox 2006 Annual Report Download - page 87

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in millions, except per-share data and unless otherwise indicated)
Note 14 – Employee Benefit Plans
We sponsor numerous pension and other post-retirement benefit plans, primarily retiree health, in our U.S. and
international operations. September 30 is the measurement date for most of our European plans and December 31 is the
measurement date for all of our other post-retirement benefit plans, including all of our domestic plans. Refer to
Note 1 – “New Accounting Standards and Accounting Changes” for further information regarding adoption of SFAS
No. 158, “Employers’ Accounting for Defined Benefit Pension and Other Postretirement Plans, an amendment of
FASB Statements No. 87, 88, 106 and 132(R).” Information regarding our benefit plans is presented below (in
millions):
Pension Benefits Retiree Health
2006 2005 2006 2005
Change in Benefit Obligation
Benefit obligation, January 1 ....................................... $10,302 $10,028 $ 1,653 $ 1,662
Service cost .................................................... 244 234 19 19
Interest cost .................................................... 732 581 92 90
Plan participants’ contributions ..................................... 13 11 19 15
Plan amendments ................................................ (234) 30 31 44
Actuarial (gain) loss .............................................. (85) 527 (105) (54)
Currency exchange rate changes .................................... 564 (486) — 4
Curtailments .................................................... (2) (5) — —
Benefits paid/settlements .......................................... (1,067) (618) (117) (127)
Benefit obligation, December 31 ................................... $10,467 $10,302 $ 1,592 $ 1,653
Change in Plan Assets
Fair value of plan assets, January 1 .................................. $ 8,444 $ 8,110 $ — $ —
Actual return on plan assets ........................................ 959 933 — —
Employer contribution ............................................ 355 388 98 112
Plan participants’ contributions ..................................... 13 11 19 15
Currency exchange rate changes .................................... 513 (418) — —
Transfers/divestitures ............................................. — 38 — —
Benefits paid/settlements .......................................... (1,067) (618) (117) (127)
Fair value of plan assets, December 31 ............................. $ 9,217 $ 8,444 $ — $ —
Funded status (including under-funded and non-funded plans) at the end
of year ...................................................... $ (1,250) $ (1,858) $(1,592) $(1,653)
Unamortized transition obligations .................................. 3 —
Unrecognized prior service credit ................................... (28) (45)
Unrecognized net actuarial loss ..................................... 1,918 410
Net amounts recognized .......................................... $ 35 $(1,288)
Amounts recognized in the Consolidated Balance Sheets:
Other long-term assets ............................................ $ 19 $ 833 $ — $ —
Intangible asset .................................................. — 9 — —
Accrued compensation and benefit costs .............................. (79) — (102) (100)
Pension and other benefit liabilities .................................. (1,190) (1,081) — —
Post-retirement medical benefits .................................... — — (1,490) (1,188)
Minimum pension liability included in AOCL ......................... — 274 — —
Net amounts recognized .......................................... $ (1,250) $ 35 $(1,592) $(1,288)
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