Raytheon 2010 Annual Report Download - page 110

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
The PBO for our domestic and foreign Pension Benefits plans was $18,407 million and $731 million, respectively at
December 31, 2010 and $16,748 million and $693 million, respectively, at December 31, 2009.
Change in Plan Assets Pension Benefits Other Benefits
(In millions) December 31: 2010 2009 2010 2009
Fair value of plan assets at beginning of year $12,839 $10,907 $407 $ 365
Actual return (loss) on plan assets 1,508 1,885 45 55
Company contributions 1,902 1,115 32 45
Plan participants’ contributions 21 21 45 46
Foreign exchange gain (loss) (19) 49 ——
Benefits paid (1,152) (1,142) (96) (104)
Net transfer in —4——
Fair value of plan assets at end of year $15,099 $12,839 $433 $ 407
Retirement Plan Assumptions
Weighted-Average Net Periodic Benefit Cost Assumptions Pension Benefits
2010 2009 2008
Discount rate 6.23% 6.50% 6.46%
Expected return on plan assets 8.68% 8.62% 8.64%
Rate of compensation increase
Range 2.00% -7.00% 2.00% -7.00% 2.00% -7.00%
Average 4.51% 4.48% 4.50%
Weighted-Average Net Periodic Benefit Cost Assumptions Other Benefits
2010 2009 2008
Discount rate 6.00% 6.75% 6.50%
Expected Long-term rate of return on plan assets 8.25% 8.75% 8.75%
Rate of compensation increase
Range 2.00% -7.00% 2.00% -7.00% 2.00% -7.00%
Average 4.50% 4.50% 4.50%
Health care trend rate in the next year 7.00% 7.40% 8.50%
Gradually declining to an ultimate trend rate 4.00% 4.00% 5.00%
Year that the rate reaches ultimate trend rate 2027 2029 2015
Weighted-Average Year-End Benefit Obligation
Assumptions Pension Benefits Other Benefits
December 31: 2010 2009 2010 2009
Discount rate 5.73% 6.23% 5.50% 6.00%
Rate of compensation increase
Range 2.00% -7.00% 2.00% -7.00% 2.00% - 7.00% 2.00% - 7.00%
Average 4.50% 4.51% 4.50% 4.50%
Health care trend rate in the next year 4.00% 7.00%
Gradually declining to an ultimate trend rate of 4.00% 4.00%
Year that the rate reaches the ultimate trend rate 2010 2027
The discount rate for our domestic Pension Benefits plans was 5.75% and 6.25% at December 31, 2010 and December 31,
2009, respectively. Our foreign Pension Benefits plan assumptions have been included in the Pension Benefits
assumptions in the table above.
102