Eversource 2004 Annual Report Download - page 70

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68
The following table represents information on the plans’ benefit obligation, fair value of plan assets, and the respective plans’ funded status:
At December 31,
Pension Benefits Postretirement Benefits
(Millions of Dollars) 2004 2003 2004 2003
Change in benefit obligation
Benefit obligation at beginning of year $(1,941.3) $(1,789.8) $(405.0) $(397.8)
Service cost (40.7) (35.1) (6.0) (5.3)
Interest cost (118.9) (117.0) (25.3) (26.8)
Medicare prescription drug benefit impact N/A N/A — 19.5
Actuarial loss (136.7) (102.9) (68.7) (34.8)
Benefits paid — excluding lump sum payments 105.0 99.6 36.7 40.2
Benefits paid — lump sum payments 1.5 3.9 ——
Special termination benefits (2.1) — ——
Benefit obligation at end of year $(2,133.2) $(1,941.3) $(468.3) $(405.0)
Change in plan assets
Fair value of plan assets at beginning of year $ 1,945.1 $ 1,632.3 $ 178.0 $ 147.7
Actual return on plan assets 236.9 416.3 16.8 35.4
Employer contribution —— 41.7 35.1
Benefits paid — excluding lump sum payments (105.0) (99.6) (36.7) (40.2)
Benefits paid — lump sum payments (1.5) (3.9) ——
Fair value of plan assets at end of year $ 2,075.5 $ 1,945.1 $ 199.8 $ 178.0
Funded status at December 31 $ (57.7) $ 3.8 $(268.5) $(227.0)
Unrecognized transition obligation/(asset) 0.4 (1.1) 94.8 106.6
Unrecognized prior service cost 56.3 63.5 (5.2) (5.5)
Unrecognized net loss 353.7 294.5 166.5 113.6
Prepaid/(accrued) benefit cost $ 352.7 $ 360.7 $ (12.4) $ (12.3)
The accumulated benefit obligation for the Plan was $1.9 billion and $1.7 billion at December 31, 2004 and 2003, respectively.
The following actuarial assumptions were used in calculating the plans’ year end funded status:
At December 31,
Pension Benefits Postretirement Benefits
Balance Sheets 2004 2003 2004 2003
Discount rate 6.00% 6.25% 5.50% 6.25%
Compensation/progression rate 4.00% 3.75% N/A N/A
Health care cost trend rate N/A N/A 8.00% 9.00%
The components of net periodic (income)/expense are as follows:
For the Years Ended December 31,
Pension Benefits Postretirement Benefits
(Millions of Dollars) 2004 2003 2002 2004 2003 2002
Service cost $ 40.7 $ 35.1 $ 37.2 $ 6.0 $ 5.3 $ 6.2
Interest cost 118.9 117.0 119.8 25.3 26.8 29.2
Expected return on plan assets (175.1) (182.5) (204.9) (12.5) (14.9) (16.6)
Amortization of unrecognized net transition (asset)/obligation (1.5) (1.5) (1.4) 11.9 11.9 13.6
Amortization of prior service cost 7.2 7.2 7.7 (0.4) (0.4) (0.1)
Amortization of actuarial loss/(gain) 15.7 (7.1) (31.8) —— —
Other amortization, net —— — 11.4 6.4 2.2
Net periodic expense/(income) — before curtailments
and special termination benefits 5.9 (31.8) (73.4) 41.7 35.1 34.5
Curtailment income —— (30.3) —— —
Special termination benefits expense/(income) 2.1 — 8.1 —— (1.2)
Total curtailments and special termination benefits 2.1 — (22.2) —— (1.2)
Total — net periodic expense/(income) $ 8.0 $(31.8) $(95.6) $41.7 $35.1 $33.3