Mitsubishi 2009 Annual Report Download - page 56

16. Retirement Benefits
MMC and its consolidated subsidiaries have defined benefit pension plans for their employees. The plans include contributory plans in
accordance with the Welfare Pension Institute Law of Japan, tax-qualified plans, and non-contributory severance plans. Additional
retirement benefits are paid in certain cases upon an employee’s retirement. Certain foreign consolidated subsidiaries have defined
contribution pension plans. At March 31, 2009, MMC and its consolidated subsidiaries have 1 fund for contributory plans in accordance
with the Welfare Pension Insurance Law, and 13 funds for tax-qualified plans. MMC and its consolidated subsidiaries have 16 non-
contributory severance plans.
The funded status of multi-employer pension plans included in the above plans which are accounted for as defined contribution
schemes as of March 31, 2009 was as follows:
, In millions of yen
In thousands of
U.S. dollars
Pension Plan assets ¥28,068 $285,737
Benefit obligations under pension plan rules 25,791 262,557
Difference 2,277 23,180
The ratio of MMC and its consolidated subsidiaries’ payments to total contributions of the multi-employer plans as of March 31,
2009 was 57.4%. This ratio is not equal to the ratio of the amount actually contributed by the MMC group.
Defined Benefit Plans
The discount rates used to determine the retirement benefit obligation were 1.5% – 2.5% for MMC and its domestic consolidated
subsidiaries, 3.7% – 11.7% for its foreign consolidated subsidiaries, and 1.5% – 2.5% for MMC and its domestic consolidated subsidiar-
ies, 5.1% – 7.8% for its foreign consolidated subsidiaries at March 31, 2009 and 2008, respectively. The rates of return on plan assets
assumed were 0.8% – 4.0% for MMC and its domestic consolidated subsidiaries, 4.9% – 8.0% for its foreign consolidated subsidiaries
for the year ended March 31, 2009 and 2008.
Prior service cost is amortized using the straight line method over periods of 1 to 21 years for the years ended March 31, 2009 and
2008. These periods are within the estimated average remaining service years of the employees.
The amortization period for actuarial gains and losses starts from the subsequent fiscal year and actuarial gains and losses are
amortized by the straight line method over the periods of 5 to 21 years for the years ended March 31, 2009 and 2008. These periods
are within the estimated average remaining service years of the employees.
Unrecognized net obligations and assets at the date of initial application are amortized within one year.
The retirement benefit obligation for MMC and its consolidated subsidiaries’ employees’ defined benefit plans at March 31, 2009
and 2008 are summarized as follows:
In millions of yen
In thousands of
U.S. dollars
2009 2008 2009
Retirement benefits obligation ¥(178,133) ¥(184,183) $(1,813,431)
Pension plan assets at fair value 47,566 67,122 484,235
Unfunded status (130,566) (117,060) (1,329,196)
Unrecognized actuarial losses 27,057 17,327 275,452
Unrecognized prior service costs 3,190 3,304 32,478
Net recognized retirement benefits obligation (100,318) (96,428) (1,021,264)
Prepaid pension premiums 5,993 6,866 61,011
Provision for retirement benefits ¥(106,311) ¥(103,295) $(1,082,275)
Some of the consolidated subsidiaries adopt the simplified method for the calculation of retirement benefits obligation.
54 MITSUBISHI MOTORS CORPORATION Annual Report 2009