Barnes and Noble 2003 Annual Report Download - page 36

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The Company’s Retirement Plan allocation at January 31, 2004 and February 1, 2003, target allocation for fiscal 2004
and expected long-term rate of return by asset category are as follows:
Weighted- Average
Target Percentage of Plan Expected Long-Term
Allocation Assets Rate of Return
Fiscal Year 2003 2003 2002 2004
Asset Category
Large Capitalization Equities 25.0 % 25.1% 22.7 % 2.9 %
Mid Capitalization Equities 15.0 15.0 14.0 1.7
Small Capitalization 15.0 15.3 14.8 1.7
International Equities 5.0 5.2 4.9 0.6
Fixed Income Core Bonds 35.0 34.4 37.5 1.9
Global Bonds 5.0 4.9 5.9 0.3
Cash -- 0.1 0.2 --
100.0 % 100.0 % 100.0 % 9.1 %
The Company’s investment strategy is to obtain the highest possible return commensurate with the level of assumed
risk. Investments are well diversified within each of the major asset categories.
The expected long-term rate of return is figured by using the target allocation and expected returns for each asset class
as in the table above. The actual historical returns are also relevant. Annualized returns for periods ending December
31, 2003 have been as follows: 23.7% for one year and 6.7% for five years.
The Company expects that there will be no minimum regulatory funding requirements that will need to be made during
the fiscal year ending January 29, 2005 but that voluntary tax deductible contributions of up to about $3,000 will be
allowed under Internal Revenue Service (IRS) rules. No decision has been made at this time on Company contributions.
Expected benefit payments are as follows over future years:
[NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS continued ]
35
2003 Annual Report Barnes & Noble, Inc.
Fiscal Pension Postretirement
Year Plan Plan
2004 $ 705 $ 356
2005 805 378
2006 927 395
2007 1,022 412
2008 1,161 420
2009-2013 7,460 2,029
On December 8, 2003, the Medicare Prescription Drug Improvement and Modernization Act of 2003 (the Act) was signed
into law. Following the guidance of the FASB, the Company has elected to defer recognition of this Act at this time. The
accumulated postretirement benefit obligation and net periodic postretirement benefit cost do not reflect the effect of the
Act on the Postretirement Plan. Specific authoritative guidance on the accounting for the federal subsidy is pending and
guidance, when issued, could require a change to previously reported information.