Jack In The Box 2006 Annual Report Download - page 70

JACK IN THE BOX INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in thousands, except per share data)
F-20
8. RETIREMENT AND SAVINGS PLANS (continued)
The assumed discount rate for our pension plans reflects the market rates for high-quality bonds currently
available. The Company’ s discount rate was determined by considering the average of pension yield curves
constructed of a population of high-quality bonds. The resulting discount rate reflects the matching of plan
liability cash flows to the yield curves. The long-term rate of return on assets was determined taking into
consideration our projected asset allocation and economic forecasts prepared with the assistance of our actuarial
consultants.
Plan assets — As of October 1, 2006, our target asset allocation was 41% U.S. equities, 38% debt securities,
15% international equities and 6% balanced fund. We regularly monitor our asset allocation and senior financial
management and the Finance Committee of the Board of Directors review performance results at least quarterly.
We believe our long-term asset allocation will continue to approximate our target allocation. The qualified plans
had the following asset allocations at June 30, 2006 and June 30, 2005:
2006 2005
U.S. equities ..................................................................................................................................... 41% 41%
International equities ........................................................................................................................ 15 15
Debt securities.................................................................................................................................. 38 38
Balanced fund................................................................................................................................... 6 6
100% 100%
Future cash flows — During fiscal year 2007, we expect to contribute approximately $12,000 to our qualified
plans and $2,100 to our non-qualified plan. Total qualified and non-qualified plan pension benefits expected to
be paid in each fiscal year from 2007 through 2011 are $5,437, $6,145, $6,821, $7,396 and $8,095, respectively.
The aggregate expected benefits to be paid in the five fiscal years from 2012 through 2016 are $57,072.
Expected benefits to be paid are based on the same assumptions used to measure our benefit obligation at
October 1, 2006 and include estimated future employee service.
Defined contribution plans — We maintain savings plans pursuant to Section 401(k) of the Internal Revenue
Code which allow administrative and clerical employees who have satisfied the service requirements and
reached age 21, to defer a percentage of their pay on a pre-tax basis. We match 50% of the first 4% of
compensation deferred by the participant. Our contributions under these plans were $1,931, $1,815 and $1,940 in
2006, 2005 and 2004, respectively. We also maintain an unfunded, non-qualified deferred compensation plan for
key executives and other members of management who are excluded from participation in the qualified savings
plan. This plan allows participants to defer up to 50% of their salary and 100% of their bonus, on a pre-tax basis.
We match 100% of the first 3% contributed by the participant. Our contributions under the non-qualified
deferred compensation plan were $1,244, $1,091 and $645 in 2006, 2005 and 2004, respectively. In each plan, a
participant’ s right to Company contributions vests at a rate of 25% per year of service.