Emerson 2009 Annual Report Download - page 40

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Emerson 200938
Approximately $138 of the $1,692 of losses deferred in accumulated other comprehensive income at September 30, 2009,
will be amortized into earnings in 2010. Retirement plans in total were underfunded by $610 as of September 30, 2009.
As of the plans’ September 30, 2009 and June 30, 2008 measurement dates, the total accumulated benet obliga-
tion was $3,811 and $3,308, respectively. Also, as of the plans’ respective measurement dates, the projected benet
obligation, accumulated benet obligation and fair value of plan assets for the retirement plans with accumulated
benet obligations in excess of plan assets were $3,575, $3,383 and $2,974, respectively, for September 30, 2009, and
$1,127, $1,025 and $796, respectively, for June 30, 2008.
The weighted-average assumptions used in the valuations of pension benets were as follows:
 u.s.p l A n s n o n -u.s.p l A n s
  2007 2008 2009 2007 2008 2009
Assumptions used to determine
net pension expense:
Discount rate 6.50% 6.25% 6.50% 4.9% 5.3% 5.9%
Expected return on plan assets 8.00% 8.00% 8.00% 7.2% 7.3% 6.0%
Rate of compensation increase 3.25% 3.25% 3.25% 3.1% 3.5% 3.5%
Assumptions used to determine
benefit obligations:
Discount rate 6.25% 6.50% 5.50% 5.3% 5.9% 5.3%
Rate of compensation increase 3.25% 3.25% 3.00% 3.5% 3.5% 3.9%
The discount rate for the U.S. retirement plans was 5.50 percent as of September 30, 2009. Dened benet pension
plan expense for scal 2010 is expected to be approximately $130, versus $94 in 2009.
The primary objective for the investment of plan assets is to secure participant retirement benets, while earning a
reasonable rate of return. Plan assets are invested consistent with the provisions of the prudence and diversication
rules of ERISA and with a long-term investment horizon. The expected return on plan assets assumption is determined
by reviewing the investment returns of the plans for the past 10 years and the historical return (since 1926) of an
asset mix approximating Emerson’s asset allocation targets and evaluating these returns in relation to expectations of
various investment organizations to determine whether long-term future returns are expected to differ signicantly
from the past. The Company’s asset allocations at September 30, 2009 and June 30, 2008, and weighted-average
target allocations are as follows:
 u.s.p l A n s n o n -u.s.p l A n s
  2008 2009t A R G e t  2008 2009t A R G e t
Asset category
Equity securities 65% 64% 60-70% 54% 53% 50-60%
Debt securities 29% 32% 25-35% 35% 31% 25-35%
Other 6% 4% 3-7% 11% 16% 15-20%
100% 100% 100% 100% 100% 100%
The Company estimates that future benet payments for the U.S. plans will be as follows: $147 in 2010, $155 in 2011,
$163 in 2012, $171 in 2013, $180 in 2014 and $1,041 in total over the ve years 2015 through 2019. Using foreign
currency exchange rates as of September 30, 2009, the Company estimates that future benet payments for the
non-U.S. plans will be as follows: $41 in 2010, $36 in 2011, $35 in 2012, $40 in 2013, $41 in 2014 and $246 in total
over the ve years 2015 through 2019. In 2010, the Company expects to contribute approximately $250 to its retire-
ment plans.