Xerox 2009 Annual Report Download - page 76

74 Xerox 2009 Annual Report
Notes to the Consolidated
Financial Statements
Dollars in millions, except per-share data and unless otherwise indicated.
Plan Assets
Current Allocation
As of the 2009 and 2008 measurement dates, the global pension plan
assets were $7.6 billion and $6.9 billion, respectively. These assets were
invested among several asset classes. None of the investments includes
debt or equity securities of Xerox Corporation.
The following table presents the defined benefit plans’ assets measured
at fair value at December 31, 2009 and the basis for that measurement:
In October 2008, we amended our domestic retiree health benefit plan
to eliminate the subsidy currently paid to current and future Medicare-
eligible retirees effective January 1, 2010. The amendment resulted in
a net decrease of approximately $225 in the benefit obligation and a
corresponding after-tax increase to equity. The amendment decreased
pre-tax net retiree health benefit expense by approximately $50 in 2009
and $15 in 2008.
Valuation Based on:
Quoted Prices in Significant Other Significant Total
Active Markets for Observable Unobservable Fair Value
Identical Asset Inputs Inputs December 31,
Asset Class (Level 1) (Level 2) (Level 3) 2009 % of Total
Cash and Cash Equivalents $ 748 $ — $ — $ 748 10%
Equity Securities:
U.S. Large Cap 768 46 — 814 11%
U.S. Mid Cap 31 — — 31 —%
U.S. Small Cap 90 70 — 160 2%
International Developed 1,292 493 — 1,785 24%
Emerging Markets 299 — — 299 4%
Global Equity 12 — — 12 —%
Total Equity Securities $ 2,492 $ 609 $ — $ 3,101 41%
Debt Securities:
U.S. Treasury Securities 4 185 — 189 3%
Debt Security Issued by Government Agency 114 798 — 912 12%
Corporate Bonds 145 1,570 — 1,715 23%
Asset Backed Securities 3 23 — 26 —%
Total Debt Securities $ 266 $ 2,576 $ — $ 2,842 38%
Common/Collective Trust $ 2 $ 26 $ — $ 28 —%
Derivatives:
Interest Rate Contracts — 52 — 52 —%
Foreign Exchange Contracts 15 (77) — (62) (1)%
Equity Contracts — (24) — (24) —%
Credit Contracts — (2) — (2) —%
Other Contracts — (6) — (6) —%
Total Derivatives $ 15 $ (57) $ — $ (42) (1)%
Hedge Funds — — 4 4 —%
Real Estate 62 119 237 418 6%
Private Equity/Venture Capital — — 286 286 4%
Guaranteed Insurance Contracts — — 130 130 2%
Other 8 9 — 17 —%
Total Defined Benefit Plan’s Assets(1) $ 3,593 $ 3,282 $ 657 $ 7,532 100%
(1) Total fair value assets exclude $29 of other net non-financial assets (liabilities) such as due to/from broker, interest receivables and accrued expenses.