Eversource 2007 Annual Report Download - page 33
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Actuarial Determination of Expense:LZWVhZi]ZVXijVg^VaYZiZgb^"
cVi^dcd[EZch^dcEaVcVcYE7DEEaVcZmeZchZdcVbVg`Zi"gZaViZY
kVajZd[VhhZihBGK6!l]^X]gZYjXZhnZVg"id"nZVgkdaVi^a^in#I]^h
BGK6XVaXjaVi^dcgZXd\c^oZh^ckZhibZci\V^chdgadhhZhdkZgV[djg"
nZVgeZg^dY[gdbi]ZnZVg^cl]^X]i]ZndXXjg#>ckZhibZci\V^chdg
adhhZh[dgi]^hejgedhZVgZi]ZY^[[ZgZcXZWZilZZci]ZZmeZXiZYgZijgc
XVaXjaViZYjh^c\i]ZBGK6VcYi]ZVXijVagZijgcWVhZYdci]Z[V^g
kVajZd[VhhZih#6i9ZXZbWZg(&!'%%,!idiVa^ckZhibZci\V^chidWZ
gZXd\c^oZY^ci]ZBGK6dkZgi]ZcZmi[djgnZVghVgZ&%+#,b^aa^dcVcY
&#*b^aa^dc![dgi]ZEZch^dcEaVcVcYi]ZE7DEEaVc!gZheZXi^kZan#6h
i]ZhZVhhZi\V^chVgZgZ[aZXiZY^cBGK6dkZgi]ZcZmi[djgnZVgh!i]Zn
l^aaWZhjW_ZXiidVbdgi^oVi^dcl^i]di]ZgjcgZXd\c^oZY\V^ch$adhhZh#
I]ZEaVchXjggZcianVbdgi^oZjcgZXd\c^oZY\V^ch$adhhZhVhVXdbedcZci
d[eZch^dcVcYE7DEZmeZchZdkZg&'nZVgh!l]^X]^hi]ZVkZgV\Z
[jijgZhZgk^XZa^kZhd[i]ZZbeadnZZhVi9ZXZbWZg(&!'%%,#6i
9ZXZbWZg(&!'%%,!i]ZcZiVXijVg^VaadhhhjW_ZXiidVbdgi^oVi^dcdkZg
i]ZcZmi&'nZVghlVh+*#'b^aa^dcVcY&%.#+b^aa^dc!gZheZXi^kZan!
l]^X]ZmXajYZh&%+#,b^aa^dcVcY&#*b^aa^dcd[egZk^djh^ckZhibZci
\V^chcdiXjggZciangZ[aZXiZY^ci]ZBGK6[dgi]ZEZch^dcEaVcVcY
E7DEEaVc!gZheZXi^kZan#
Discount Rate:I]ZY^hXdjcigViZi]Vi^hji^a^oZY^cYZiZgb^c^c\[jijgZ
eZch^dcVcYE7DEdWa^\Vi^dch^hWVhZYdcVn^ZaY"XjgkZVeegdVX]
l]ZgZZVX]XVh][adlgZaViZYidi]ZEZch^dcEaVcdgE7DEEaVca^VW^a^in
higZVb^hY^hXdjciZYViVc^ciZgZhigViZheZX^[^XVaanVeea^XVWaZidi]Z
i^b^c\d[i]ZXVh][adl#I]Zn^ZaYXjgkZ^hYZkZadeZY[gdbi]ZidefjVgi^aZ
d[66gViZYBddYnÉhVcYHEÉhWdcYhl^i]djiXVaaVWaZ[ZVijgZhdji"
hiVcY^c\Vi9ZXZbWZg(&!'%%,#I]^hegdXZhhXVaXjaViZhi]ZegZhZci
kVajZhd[i]ZhZXVh][adlhVcYXVaXjaViZhi]ZZfj^kVaZcih^c\aZY^hXdjci
gViZi]ViegdYjXZhi]ZhVbZegZhZcikVajZ[dg[jijgZXVh][adlh#I]Z
Y^hXdjcigViZhYZiZgb^cZYdci]^hWVh^hVgZ+#+eZgXZci[dgi]ZEZch^dc
EaVcVcY+#(*eZgXZci[dgi]ZE7DEEaVcVi9ZXZbWZg(&!'%%,#
9^hXdjcigViZhjhZYVi9ZXZbWZg(&!'%%+lZgZ*#.eZgXZci[dgi]Z
EZch^dcEaVcVcY*#-eZgXZci[dgi]ZE7DEEaVc#
Expected Contributions and Forecasted Expense: 9jZidi]ZZ[[ZXid[
i]ZjcgZXd\c^oZYVXijVg^Va\V^ch$adhhZhVcYWVhZYdci]Zadc\"iZgb
gViZd[gZijgcVhhjbei^dchVcYY^hXdjcigViZhVhcdiZYVWdkZVhlZaa
VhkVg^djhdi]ZgVhhjbei^dch!lZZhi^bViZi]ViZmeZXiZYXdcig^Wji^dch
idVcY[dgZXVhiZY^cXdbZ$ZmeZchZ[dgi]ZEZch^dcEaVcVcYE7DE
EaVcl^aaWZVh[daadlh^cb^aa^dch/
EZch^dcEaVc EdhigZi^gZbZciEaVc
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:meZXiZY :meZchZ$ :meZXiZY ;dgZXVhiZY
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di]Zg[VXidghgZaViZYidi]ZedejaVi^dcheVgi^X^eVi^c\^ci]ZeaVchVcY
VbdjcihXVe^iVa^oZY#7Z\^cc^c\^c'%%,!lZbVYZVcVYY^i^dcVa
Xdcig^Wji^dcidi]ZE7DEEaVc[dgi]ZVbdjcihgZXZ^kZY[gdbi]Z
[ZYZgVaBZY^XVgZhjWh^Yn#I]^hVbdjcilVh(b^aa^dc^c'%%,VcY
^hZhi^bViZYidWZ)b^aa^dc^c'%%-#
Sensitivity Analysis: I]Z[daadl^c\gZegZhZcihi]Z^cXgZVhZ$YZXgZVhZ
idi]ZEZch^dcEaVcÉhVcYE7DEEaVcÉhgZedgiZYXdhiVhVgZhjaid[V
X]Vc\Z^ci]Z[daadl^c\Vhhjbei^dchWn*%WVh^hed^cih^cb^aa^dch/
6i9ZXZbWZg(&!
EZch^dcEaVc8dhi EdhigZi^gZbZciEaVc8dhi
6hhjbei^dc8]Vc\Z '%%, '%%+ '%%, '%%+
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Plan Assets:I]ZbVg`Zi"gZaViZYkVajZd[i]ZEZch^dcEaVcVhhZih]Vh
^cXgZVhZYWn&%(#'b^aa^dcid'#*W^aa^dcVi9ZXZbWZg(&!'%%,#I]Z
Egd_ZXiZY7ZcZ[^iDWa^\Vi^dcE7D[dgi]ZEZch^dcEaVcYZXgZVhZYWn
,,#,b^aa^dcid'#(W^aa^dcVi9ZXZbWZg(&!'%%,#I]ZhZX]Vc\Zh]VkZ
X]Vc\ZYi]Z[jcYZYhiVijhd[i]ZEZch^dcEaVcdcVE7DWVh^h[gdbVc
dkZg[jcYZYedh^i^dcd['&#+b^aa^dcVi9ZXZbWZg(&!'%%+idVcdkZg"
[jcYZYedh^i^dcd['%'#*b^aa^dcVi9ZXZbWZg(&!'%%,#I]ZE7D^cXajYZh
ZmeZXiVi^dchd[[jijgZZbeadnZZXdbeZchVi^dc^cXgZVhZh#LZ]VkZcdi
bVYZVcnZbeadnZgXdcig^Wji^dchidi]ZEZch^dcEaVch^cXZ&..&#
I]ZVXXjbjaViZYWZcZ[^idWa^\Vi^dc67Dd[i]ZEZch^dcEaVclVh
Veegdm^bViZan)*)b^aa^dcaZhhi]VcEZch^dcEaVcVhhZihVi9ZXZbWZg(&!
'%%,VcYVeegdm^bViZan'+%b^aa^dcaZhhi]VcEZch^dcEaVcVhhZih
Vi9ZXZbWZg(&!'%%+#I]Z67D^hi]ZdWa^\Vi^dc[dgZbeadnZZhZgk^XZ
VcYXdbeZchVi^dcegdk^YZYi]gdj\]9ZXZbWZg(&!'%%,#
I]ZkVajZd[E7DEEaVcVhhZih]Vh^cXgZVhZYWn&&#*b^aa^dcid',-#&
b^aa^dcVi9ZXZbWZg(&!'%%,#I]ZWZcZ[^idWa^\Vi^dc[dgi]ZE7DEEaVc
]VhYZXgZVhZYWn&%#(b^aa^dcid)*.#+b^aa^dcVi9ZXZbWZg(&!'%%,#
I]ZhZX]Vc\Zh]VkZYZXgZVhZYi]ZjcYZg[jcYZYhiVijhd[i]ZE7DE
EaVcdcVcVXXjbjaViZYegd_ZXiZYWZcZ[^idWa^\Vi^dcWVh^h[gdb'%(#(
b^aa^dcVi9ZXZbWZg(&!'%%+id&-&#*b^aa^dcVi9ZXZbWZg(&!'%%,#
LZ]VkZbVYZVXdcig^Wji^dcZVX]nZVgZfjVaidi]ZE7DEEaVcÉh
edhigZi^gZbZciWZcZ[^iXdhi!ZmXajY^c\XjgiV^abZciVcYiZgb^cVi^dc
WZcZ[^ih#
Health Care Cost:I]Z]ZVai]XVgZXdhiigZcYVhhjbei^dcjhZYid
egd_ZXi^cXgZVhZh^cbZY^XVaXdhihlVh-#*eZgXZci[dg'%%-!YZXgZVh^c\
dcZ]Va[eZgXZciV\Zed^cieZgnZVgidVcjai^bViZgViZd[*eZgXZci^c'%&*#
I]ZZ[[ZXid[^cXgZVh^c\i]Z]ZVai]XVgZXdhiigZcYWndcZeZgXZciV\Z
ed^cildjaY]VkZ^cXgZVhZYhZgk^XZVcY^ciZgZhiXdhiXdbedcZcihd[
i]ZE7DEEaVcXdhiWn&b^aa^dc^c'%%,VcY&#'b^aa^dc^c'%%+#
8]Vc\Zh^ci]Zadc\"iZgb]ZVai]XVgZXdhiigZcYVhhjbei^dcXdjaY
]VkZVbViZg^Va^beVXidcdjg[^cVcX^VahiViZbZcih#
EgZhZciVi^dc/>cVXXdgYVcXZl^i]<66E!djgXdchda^YViZY[^cVcX^Va
hiViZbZcih^cXajYZVaahjWh^Y^Vg^ZhdkZgl]^X]Xdcigda^hbV^ciV^cZY
VcYldjaY^cXajYZVcnkVg^VWaZ^ciZgZhiZci^i^ZhK>:[dgl]^X]lZVgZ
i]Zeg^bVgnWZcZ[^X^Vgn#9ZiZgb^c^c\l]Zi]ZglZVgZi]Zeg^bVgn
WZcZ[^X^Vgnd[VK>:^hXdbeaZm!hjW_ZXi^kZVcYgZfj^gZhdjg_jY\bZci#
I]ZgZVgZXZgiV^ckVg^VWaZhiV`Zc^cidXdch^YZgVi^dcidYZiZgb^cZ
l]Zi]ZglZVgZXdch^YZgZYi]Zeg^bVgnWZcZ[^X^Vgnd[VK>:#6X]Vc\Z
^cVcndcZd[i]ZhZkVg^VWaZhXdjaYgZfj^gZjhidgZXdch^YZgl]Zi]Zgdg
cdilZVgZi]Zeg^bVgnWZcZ[^X^Vgnd[i]ZK>:#
I]Z:cZg\n>cYZeZcYZcXZ6XigZfj^gZhi]Z9EJ8id^ckZhi^\ViZi]Z
[^cVcX^Va^beVXidcY^hig^Wji^dcXdbeVc^Zhd[ZciZg^c\^cidadc\"iZgb
XdcigVXih[dgXVeVX^indgXdcigVXihidejgX]VhZgZcZlVWaZZcZg\negdYjXih
[gdbcZl\ZcZgVi^c\eaVcih#LZgZk^ZlZYZVX]XdcigVXiidYZiZgb^cZ
i]ZVeegdeg^ViZVXXdjci^c\igZVibZciWVhZYdci]ZiZgbhd[i]Z
XdcigVXih#9ZiZgb^c^c\l]Zi]ZgdgcdiXdchda^YVi^dc^hgZfj^gZY
^ckdakZhdjg_jY\bZci#