ComEd 2006 Annual Report Download - page 273

Exelon Corporation and Subsidiary Companies
Exelon Generation Company, LLC and Subsidiary Companies
Commonwealth Edison Company and Subsidiary Companies
PECO Energy Company and Subsidiary Companies
Combined Notes to Consolidated Financial Statements—(Continued)
(Dollars in millions, except per share data unless otherwise noted)
The following table provides the PBO, ABO and fair value of all pension plans with a PBO in
excess of plan assets.
December 31,
2006 2005
Projected benefit obligation .............................................. $10,396 $9,457
Accumulated benefit obligation ............................................ 9,502 8,463
Fair value of plan assets ................................................. 9,645 8,196
The following table provides the components of the net periodic benefit costs for the years ended
December 31, 2006, 2005 and 2004 for all plans combined. The table reflects an annualized reduction
in 2006, 2005 and 2004 net periodic postretirement benefit cost of approximately $40 million, $40
million and $33 million, respectively, related to a Federal subsidy provided under the Prescription Drug
Act. This subsidy has been accounted for under FSP FAS 106-2, as described in Note 1—Significant
Accounting Policies. A portion of the net periodic benefit cost is capitalized within Exelon’s
Consolidated Balance Sheets.
Pension Benefits
Other Postretirement
Benefits
2006 2005 2004 2006 2005 2004
Service cost ................................... $ 157 $144 $128 $ 99 $ 89 $ 78
Interest cost ................................... 562 546 545 183 175 163
Expected return on assets (a) ...................... (817) (767) (611) (105) (98) (90)
Amortization of:
Transition obligation (asset) ................... — (4) (4) 9 9 10
Prior service cost (credit) ..................... 16 16 15 (91) (91) (81)
Actuarial loss ............................... 149 121 73 87 81 44
Curtailment/settlement charges .................... 6 — 22 — — 2
Special accounting costs ......................... 3 — — — — 16
(b)
Net periodic benefit cost ......................... $ 76 $ 56 $168 $182 $165 $142
Other additional information:
Increase (decrease) in other comprehensive loss
(net of tax) ............................... $1,138 $ 10 $(392) $ — $ — $ —
(a) The increase in expected return on pension assets during 2006 and 2005 compared to 2004 was primarily attributable to
discretionary pension contributions of $2 billion made during the first quarter of 2005.
(b) Represents special health and welfare severance benefits offered to terminated employees. These costs were recorded
pursuant to SFAS No. 112. Prior service cost is amortized on a straight-line basis over the average remaining service period
of employees expected to receive benefits under the plans.
In 2004, the additional minimum pension liability was increased by $606 million and Exelon’s
shareholders’ equity decreased by $392 million (net of income taxes) as a result of an annual actuarial
valuation associated with Exelon’s and AmerGen’s pension plans. In 2005, the additional minimum
pension liability was reduced by $150 million and shareholders’ equity increased by $10 million (net of
income taxes) primarily as a result of an annual actuarial valuation associated with Exelon’s and
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