Mattel 2010 Annual Report Download - page 79

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Net periodic benefit cost for Mattel’s domestic defined benefit pension and postretirement benefit plans was
calculated on January 1 of each year using the following assumptions:
For the Year
2010 2009 2008
Defined benefit pension plans:
Discount rate ............................................................ 5.6% 5.4% 6.2%
Weighted average rate of future compensation increases .......................... 3.8% 3.8% 3.8%
Long-term rate of return on plan assets ........................................ 8.0% 8.0% 8.0%
Postretirement benefit plans:
Discount rate ............................................................ 5.6% 5.4% 6.2%
Annual increase in Medicare Part B premium ................................... 6.0% 6.0% 6.0%
Health care cost trend rate:
Pre-65 .............................................................. 6.0% 7.0% 8.0%
Post-65 ............................................................. 8.0% 9.0% 10.0%
Ultimate cost trend rate (pre- and post-65) ..................................... 5.0% 5.0% 5.0%
Year that the rate reaches the ultimate cost trend rate:
Pre-65 .............................................................. 2011 2011 2011
Post-65 ............................................................. 2013 2013 2013
Discount rates, weighted average rates of future compensation increases, and long-term rates of return on
plan assets for Mattel’s foreign defined benefit pension plans differ from the assumptions used for Mattel’s
domestic defined benefit pension plans due to differences in local economic conditions in which the non-US
plans are based. The rates shown in the preceding table are indicative of the weighted average rates of all
Mattel’s defined benefit pension plans given the relative insignificance of the foreign plans to the consolidated
total.
The estimated net actuarial loss and prior service cost for the domestic defined benefit pension plans that
will be amortized from accumulated other comprehensive loss into net periodic benefit cost over the next fiscal
year is $14.9 million. The estimated net actuarial loss for the domestic postretirement benefit plans that will be
amortized from accumulated other comprehensive loss into net period benefit cost over the next fiscal year is
$0.3 million.
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