Omron 2005 Annual Report Download - page 63

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61
Discount rate .....................................................................................................................................
Compensation increase rate .............................................................................................................
2.0%
2.0
2.0%
2.0
2005 2004
Discount rate...........................................................................................................
Compensation increase rate...................................................................................
Expected long-term rate of return on plan assets..................................................
2.0%
2.0
3.0
2.5%
3.0
4.0
2004
2.0%
2.0
3.0
2005 2003
Weighted-average assumptions used to determine net periodic benefit cost for the years ended March 31,2005, 2004 and 2003 are as
follows:
The expected return on plan assets is determined by estimating the future rate of return on each category of plan assets considering
actual historical returns and current economic trends and conditions.
Cash...................................................................................................................................................
Equity Securities................................................................................................................................
Debt Securities ..................................................................................................................................
Life insurance company general accounts .......................................................................................
Other..................................................................................................................................................
Total ...................................................................................................................................................
20.0%
15.9
42.4
10.3
11.4
100.0%
14.4%
25.0
43.5
10.8
6.3
100.0%
2005 2004
Asset Category
Plan assets
The Company’s pension plan weighted-average asset allocation by asset category is as follows:
Measurement Date
The Company and certain of its domestic subsidiaries use a December 31 measurement date for the majority of their plans.
Assumptions
Weighted-average assumptions used to determine benefit obligations at March 31, 2005 and 2004 are as follows:
The Company investment policies are designed to ensure ade-
quate plan assets are available to provide future payments of
pension benefits to eligible participants. Taking into account the
expected long-term rate of return on plan assets, the Company
formulates a model portfolio comprised of the optimal combina-
tion of equity and debt securities in order to produce a total
return that will match the expected return on a mid-term to long-
term basis.
The Company evaluates the gap between expected return
and actual return of invested plan assets on an annual basis to
determine if such differences necessitate a revision in the model
portfolio. The Company revises the model portfolio when and to
the extent considered necessary to achieve the expected long-
term rate of return on plan assets.
Equity securities include common stock of the Company in
the amounts of ¥10 million ($93 thousand) (0.01% of total domes-
tic plan assets) and ¥53 million (0.04% of total domestic plan
assets) at December 31, 2004 and 2003, respectively.