Ford 2006 Annual Report Download - page 96
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Please find page 96 of the 2006 Ford annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.94
Notes to the Financial Statements
94
NOTE 23. RETIREMENT BENEFITS (Continued)
The following table summarizes the benefit obligation included in our financial statements and the assets held by the
UAW Benefit Trust and not included in our 2006 financial statements (in millions):
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In 2005, an agreement was reached with Visteon which included forgiving a receivable related to Visteon's remaining
UAW OPEB obligation and a portion of Visteon's salary obligation for former Ford employees and retirees. The total
receivable forgiven was about $800 million, of which $600 million was recorded in 2004 as an allowance for doubtful
receivables. At December 31, 2006 and 2005, we had a long-term receivable of $127 million and $140 million,
respectively, representing Visteon's remaining responsibility for the benefits of the Visteon salaried employees.
The Medicare Prescription Drug Improvement and Modernization Act of 2003 provides for a federal subsidy to
sponsors of retiree health care benefit plans that provide a benefit at least actuarially equivalent to the benefit established
by the law. We provide retiree drug benefits that exceed the value of the benefits that will be provided by Medicare
Part D, and our retirees' out-of-pocket costs are less than they would be under Medicare Part D. Therefore, we have
concluded that our plan is at least "actuarially equivalent" to the Medicare Part D plan and that we will be eligible for the
subsidy. We have reflected the impact of the subsidy by reducing our 2006, 2005, and 2004 expense by $270 million,
$290 million, and $250 million, respectively. Beginning in 2008, the U.S. salary health care plan will no longer be eligible
for the subsidy receipt under Medicare Part D.
The measurement date for substantially all of our worldwide postretirement benefit plans is December 31. Our
expense for defined benefit pension and OPEB benefits was as follows (in millions):
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