Dominion Power 2006 Annual Report Download - page 91

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED
The following table summarizesthechanges in our pensionand other postretirement benefit plan obligationsand plan assetsand
includes a statement of the plans’ funded status:
Pension Benefits Other Postretirement Benefits
Year Ended December 31, 2006 2005 2006 2005
(millions)
Change in benefit obligation:
Benefit obligation at beginning of year $3,834 $3,410 $1,622 $1,381
Acquisitions —15 —44
Service cost 124 110 72 64
Interest cost 210 201 81 83
Benefits paid (175) (142) (72) (67)
Actuarial (gain) loss during the year(1) (329) 231 (395) 143
Plan amendments 29(11) (26)
Benefit obligation at endof year $3,666 $3,834 $1,297 $1,622
Change in plan assets:
Fair value of plan assets at beginning of year $4,360 $4,049 $794 $697
Acquisitions —15 —10
Actual return on plan assets 589 433 85 51
Contributions 19 568 72
Benefits paid from plan assets (175) (142) (38) (36)
Fair value of plan assets at endof year $4,793 $4,360 $909 $794
Funded status $1,127 $526 $(388) $(828)
Unrecognized net actuarial loss —1,288 —491
Unrecognized prior service cost (credit) —34 —(32)
Unrecognized net transition obligation ———23
Net asset (liability) recognized $1,127 $1,848 $(388) $(346)
Amounts recognized in the Consolidated Balance Sheets at December 31:
Noncurrent pension andother postretirement benefit assets$1,240 $1,915 $6 $—
Other current liabilities (2) ———
Noncurrent pension andother postretirement benefit liabilities (111) (115) (394) (346)
Intangible asset—31 ——
Accumulated other comprehensive loss to offset additional minimum liability —17 ——
Net amountrecognized $1,127 $1,848 $(388) $(346)
(1) The 2006 actuarial gain for pension benefits primarily resulted from increases in the discount rateandtheexpected retirement age. The 2006 actuarial gain for other
postretirement benefits primarily resulted from an increase in the discount rateandadecrease in expected future benefit claims.
The following table summarizestheoverfunded and under-
funded status of our benefit plans recognized in our Consolidated
Balance Sheet at December 31, 2006:
Pension
Benefits
Other
Postretirement
Benefits
Funded status of overfunded plans $1,240 $ 6
Funded status of underfunded plans (113) (394)
Funded status $1,127 $(388)
The accumulatedbenefit obligation for all of our defined
benefit pensionplans was $3.2 billion and $3.3 billion at
December 31, 2006 and 2005, respectively. Under our funding
policies,we evaluate plan fundingrequirements annually, usually
in the fourth quarter after receiving updated plan information
from our actuary. Based on the funded status of each plan and
other factors, we determine the amount of contributions forthe
current year, if any, at that time.
Included above are nonqualified and supplemental pension
plans that do nothave “plan assets” as defined by generally
accepted accounting principles.The total projected benefit
obligation for these plans was $110 million and $134 million at
December 31, 2006 and 2005, respectively. The total accumu-
lated benefit obligation for these plans was $65 million and $118
million at December 31, 2006 and 2005, respectively. Because
the accumulatedbenefit obligation relatingto these plans is in
excess of the fair value of plan assets, we recognized an additional
minimum liability of $48 million at December 31, 2005. SFAS
No. 158 eliminates the requirement torecognize an additional
minimum liability; however, had we not been required to adopt
SFAS No. 158, we would not have recognized an additional
minimum liability at December 31, 2006.
We do not expect any pensionor postretirement benefit plan
assetsto be returned to the Company during2007.
90 DOMINION2006 Annual Report