EMC 2002 Annual Report Download - page 72

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Table of Contents
EMC CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
The weighted-average assumptions used in the Pension Plans are as follows:
December 31,
2002
December 31,
2001
December 31,
2000
Discount rate 6.4% 7.0% 7.3%
Expected long-term rate of return on plan assets 8.4% 8.6% 8.5%
Rate of compensation increase N/A 3.8% 4.0%
As of December 31, 2002, the Pension Plans were frozen.
The projected benefit obligation, accumulated benefit obligation and fair value of plan assets for the Pension Plans with accumulated benefit obligations
in excess of plan assets were $326.8 million, $326.8 million and $201.7 million, respectively, as of December 31, 2002, and $291.4 million, $288.0 million
and $228.6 million, respectively, as of December 31, 2001.
Post Retirement Medical and Life Insurance Plan
EMC's post-retirement benefit plan, which was assumed in connection with the acquisition of Data General, provides certain medical and life insurance
benefits for retired former Data General employees. With the exception of certain participants who retired prior to 1986, the medical benefit plan requires
monthly contributions by retired participants in an amount equal to insured equivalent costs less a fixed EMC contribution which is dependent on the
participant's length of service and Medicare eligibility. Benefits are continued to dependents of eligible retiree participants for 39 weeks after the death of the
retiree. The life insurance benefit plan is noncontributory. Funds contributed to the plan are invested primarily in common stocks, mutual funds and cash
equivalent securities.
The components of the change in benefit obligation are as follows (table in thousands):
December 31,
2002
December 31,
2001
Benefit obligation at beginning of year $ 5,521 $ 5,900
Interest cost 416 363
Benefits paid (556) (344)
Actuarial (gain) loss 721 (398)
Benefit obligation at end of year $ 6,102 $ 5,521
The reconciliation of the beginning and ending balances of the fair value of plan assets is as follows (table in thousands):
December 31,
2002
December 31,
2001
Fair value of plan assets at beginning of year $ 337 $ 347
Actual return on plan assets (38) (10)
Employer contributions 556 344
Benefits paid (556) (344)
Fair value of plan assets at end of year $ 299 $ 337
68