Mattel 2004 Annual Report Download - page 77

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Note 4—Employee Benefit Plans
Mattel and certain of its subsidiaries have qualified and nonqualified retirement plans covering substantially
all employees of these companies. These plans include defined benefit pension plans, defined contribution
retirement plans, postretirement benefit plans, and deferred compensation and excess benefit plans. In addition,
Mattel makes contributions to government-mandated retirement plans in countries outside the US where its
employees work.
A summary of retirement plan expense (income) is as follows (in millions):
For the Year
2004 2003 2002
Defined benefit pension plans ...................................... $ 15.2 $ 16.4 $ (6.3)
Defined contribution retirement plans ................................ 27.8 24.0 22.9
Postretirement benefit plans ........................................ 5.0 5.0 5.0
Deferred compensation and excess benefit plans ....................... 3.1 3.0 2.7
Government-mandated plans outside the US ........................... 0.9 1.2 1.0
$ 52.0 $ 49.6 $ 25.3
Defined Benefit Pension and Postretirement Benefit Plans
Mattel provides defined benefit pension plans for eligible domestic employees, which satisfy the
requirements of the Employee Retirement Income Security Act of 1974 (“ERISA”). Some of Mattel’s foreign
subsidiaries have defined benefit pension plans covering substantially all of their eligible employees. Mattel
funds these plans in accordance with the terms of the plans and local statutory requirements, which differ for
each of the countries in which the subsidiaries are located. Mattel also has unfunded postretirement health
insurance plans covering certain eligible domestic employees.
A summary of the components of Mattel’s net benefit cost (income) for the years ended December 31 is as
follows (in thousands):
Defined Benefit Pension Plans Postretirement Benefit Plans
2004 2003 2002 2004 2003 2002
Service cost ............................... $ 7,998 $ 7,162 $ 6,996 $ 121 $ 129 $ 189
Interest cost ............................... 21,584 21,019 20,120 3,404 3,570 3,588
Expected return on plan assets ................ (22,146) (21,383) (32,211) — — —
Amortization of:
Prior service cost ....................... (599) (492) (537) — — —
Net actuarial loss ....................... 7,877 2,479 599 1,498 1,345 1,189
Recognized net (asset) ................... — — (18) — — —
Plan amendment loss (gain) .................. — 7,594 (1,230) — — —
Net periodic benefit cost (income) ............. 14,714 16,379 (6,281) 5,023 5,044 4,966
Special termination benefits .................. 519 — ————
Net benefit cost (income) .................... $15,233 $ 16,379 $ (6,281) $5,023 $5,044 $4,966
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