Famous Footwear 2011 Annual Report Download - page 59
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• Investments in corporate stocks – common, U.S. government securities, mutual fund, money market funds, real estate
investment trusts and S&P 500 Index put and call options (traded on security exchanges) are classifi ed within Level 1
of the fair value hierarchy because the fair values are based on unadjusted quoted market prices in active markets with
su cient volume and frequency.
• Corporate debt instruments and interest rate swap agreements are valued at fair value based on vendor-quoted pricing
for which inputs are observable; therefore, these are classifi ed within Level 2 of the fair value hierarchy.
• The limited partnership investment represents the pension plan’s undivided interest in a limited partnership. Limited
partnership assets are allocated to the pension plan by assigning the pension plan transactions that can be specifi cally
identifi ed and allocating non-specifi c transactions in proportion to the pension plan’s benefi cial interest in the limited
partnership; therefore, this contract is classifi ed within Level 2 of the fair value hierarchy. There are currently no
redemption restrictions on the limited partnership investment.
• The group trust investment is a unitized fund classifi ed within Level 2 of the fair value hierarchy because the fair
value is estimated using the NAV per unit based on vendor-quoted pricing for which inputs are observable. There are
currently no redemption restrictions on the group trust investment.
• The unallocated insurance contract is valued at contract value, which approximates fair value; therefore, this contract is
classifi ed within Level 3 of the fair value hierarchy. The unallocated insurance contract fair value was $0.1 million as of
both January 28, 2012 and January 29, 2011.
The fair values of the Company’s pension plan assets at January 28, 2012 by asset category are as follows:
Fair Value Measurements at January 28, 2012
($ thousands) Total Level 1 Level 2 Level 3
Asset
Money market funds. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 4,723 $ 4,723 $ – $ –
U.S. government securities . . . . . . . . . . . . . . . . . . . . . . . . . . 68,667 68,667 – –
Mutual fund. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11,078 11,078 – –
Limited partnership . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31,461 – 31,461 –
Group trust . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,306 – 7,306 –
Real estate investment trusts. . . . . . . . . . . . . . . . . . . . . . . . . 2,047 2,047 – –
Corporate debt instruments . . . . . . . . . . . . . . . . . . . . . . . . . 68,240 – 68,240 –
Corporate stocks – common . . . . . . . . . . . . . . . . . . . . . . . . . 112,795 112,795 – –
S&P 500 Index options . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,472 1,472 – –
Interest rate swap agreements. . . . . . . . . . . . . . . . . . . . . . . . 13,406 – 13,406 –
Unallocated insurance contract . . . . . . . . . . . . . . . . . . . . . . . 104 – – 104
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 321,299 $ 200,782 $ 120,413 $ 104
The fair values of the Company’s pension plan assets at January 29, 2011 by asset category are as follows:
Fair Value Measurements at January 29, 2011
($ thousands) Total Level 1 Level 2 Level 3
Asset (liability)
Money market funds. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 6,991 $ 6,991 $ – $ –
U.S. government securities . . . . . . . . . . . . . . . . . . . . . . . . . . 40,965 40,965 – –
Mutual fund. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13,180 13,180 – –
Limited partnership . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39,459 – 39,459 –
Group trust . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,548 – 8,548 –
Real estate investment trusts . . . . . . . . . . . . . . . . . . . . . . . . . 1,970 1,970 – –
Corporate debt instruments . . . . . . . . . . . . . . . . . . . . . . . . . 51,263 – 51,263 –
Corporate stocks – common . . . . . . . . . . . . . . . . . . . . . . . . . 119,460 119,460 – –
S&P 500 Index options . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1,632) (1,632) – –
Interest rate swap agreements . . . . . . . . . . . . . . . . . . . . . . . . (14,462) – (14,462) –
Unallocated insurance contract. . . . . . . . . . . . . . . . . . . . . . . . 106 – – 106
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 265,848 $ 180,934 $ 84,808 $ 106
The following table sets forth changes in the fair value of plan assets, including all domestic and Canadian plans:
Pension Benefi ts Other Postretirement Benefi ts
($ thousands) 2011 2010 2011 2010
Fair value of plan assets at beginning of year . . . . . . . . . . . . . . . . $ 265,848 $ 239,427 $ – $ –
Actual return on plan assets. . . . . . . . . . . . . . . . . . . . . . . . . . 66,527 38,053 – –
Employer contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,523 3,657 236 204
Plan participants’ contributions . . . . . . . . . . . . . . . . . . . . . . . . 11 10 17 41
Benefi ts paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (18,590) (15,677) (253) (245)
Foreign exchange rate changes . . . . . . . . . . . . . . . . . . . . . . . . (20) 378 – –
Fair value of plan assets at end of year. . . . . . . . . . . . . . . . . . . . $ 321,299 $ 265,848 $ – $ –
The majority of employer contributions for 2011 related to payments due under our SERP. Employer contributions and
benefi ts paid in the above table include both those amounts contributed directly to and paid directly from plan assets and
those amounts paid directly to plan participants.