Mattel 2013 Annual Report Download - page 83

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(b) Amounts exclude related tax benefits of $70.2 million and $102.7 million for December 31, 2013 and 2012,
respectively, which are also included in accumulated other comprehensive loss.
The accumulated benefit obligation differs from the projected benefit obligation in that it assumes future
compensation levels will remain unchanged. Mattel’s accumulated benefit obligation for its defined benefit
pension plans as of December 31, 2013 and 2012 totaled $579.0 million and $597.6 million, respectively.
The assumptions used in determining the projected and accumulated benefit obligations of Mattel’s
domestic defined benefit pension and postretirement benefit plans are as follows:
December 31,
2013 2012
Defined benefit pension plans:
Discount rate .................................................................... 4.7% 4.0%
Weighted average rate of future compensation increases ................................. 3.8% 3.8%
Postretirement benefit plans:
Discount rate .................................................................... 4.7% 4.0%
Annual increase in Medicare Part B premium .......................................... 6.0% 6.0%
Health care cost trend rate:
Pre-65 ..................................................................... 8.5% 8.5%
Post-65 .................................................................... 7.5% 7.5%
Ultimate cost trend rate:
Pre-65 ..................................................................... 6.1% 6.1%
Post-65 .................................................................... 5.4% 5.4%
Year that the rate reaches the ultimate cost trend rate:
Pre-65 ..................................................................... 2030 2030
Post-65 .................................................................... 2030 2030
A one percentage point increase/(decrease) in the assumed health care cost trend rate for each future year
would impact the postretirement benefit obligation as of December 31, 2013 by $3.0 million and $(2.5) million,
respectively, while a one percentage point increase/(decrease) would impact the service and interest cost
recognized for 2013 by $0.1 million and $(0.1) million, respectively.
The estimated future benefit payments for Mattel’s defined benefit pension and postretirement benefit plans
are as follows:
Defined Benefit
Pension Plans
Postretirement
Benefit Plans
(In thousands)
2014 .............................................................. $ 32,289 $ 2,700
2015 .............................................................. 36,071 2,600
2016 .............................................................. 42,815 2,500
2017 .............................................................. 34,583 2,500
2018 .............................................................. 35,934 2,500
2019 – 2023 ........................................................ 203,523 11,100
Mattel expects to make cash contributions totaling approximately $29 million to its defined benefit pension
and postretirement benefit plans in 2014, which includes approximately $8 million for benefit payments for its
unfunded plans.
Mattel periodically commissions a study of the plans’ assets and liabilities to determine an asset allocation
that would best match expected cash flows from the plans’ assets to expected benefit payments. Mattel monitors
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