Snapple 2009 Annual Report Download - page 119

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The following table summarizes amounts included in AOCL for the plans as of December 31, 2009 and 2008
(in millions):
2009 2008 2009 2008
Pension Plans
Postretirement
Benefit Plans
Prior service cost (gains) ..................................... $ 1$1$(1)$(1)
Net losses ................................................ 64 71 5 8
Amounts in AOCL ....................................... $ 65 $ 72 $ 4 $ 7
The following table summarizes the contributions made to the Company’s pension and other postretirement
benefit plans for the years ended December 31, 2009 and 2008, as well as the projected contributions for the year
ending December 31, 2010 (in millions):
2010 2009 2008
Projected Actual
Pension plans .................................................... $ 12 $ 43 $ 26
Postretirement benefit plans ......................................... 2 2 2
Total ........................................................ $ 14 $ 45 $ 28
The following table summarizes the expected future benefit payments cash activity for the Company’s pension
and postretirement benefit plans in the future (in millions):
2010 2011 2012 2013 2014 2015-2019
Pension plans ............................ $ 14 $ 15 $ 16 $ 18 $ 18 $ 102
Postretirement benefit plans .................. 2 2 2 2 2 8
Actuarial Assumptions
The Company’s 2009 pension expense for U.S. plans was calculated based upon a number of actuarial
assumptions including discount rate, retirement age, compensation rate increases, expected long-term rate of return
on plan assets for pension benefits and the healthcare cost trend rate related to its postretirement medical plans.
These assumptions are determined by management.
The discount rate that was utilized for determining the Company’s 2009 projected benefit obligations and
projected 2010 net periodic benefit cost for U.S. plans was selected based upon an interest rate yield curve. The
yield curve is constructed based on the yields of over 400 high-quality, non-callable corporate bonds with maturities
between zero and 30 years as of December 31, 2009. The population of bonds utilized to calculate the discount rate
includes those having an average yield between the 40th and 90th percentiles. Projected cash flows from the
U.S. plans are then matched to spot rates along that yield curve in order to determine their present value and a single
equivalent discount rate is calculated that produces the same present value as the spot rates.
For the year ended December 31, 2009, the expected long-term rate of return on U.S. pension fund assets held
by the Company’s pension trusts was determined based on several factors, including the impact of active portfolio
management and projected long-term returns of broad equity and bond indices. The plans’ historical returns were
also considered. The expected long-term rate of return on the assets in the plans was based on an asset allocation
assumption of approximately 35% with equity managers, with expected long-term rates of return of approximately
8.5%, and approximately 65% with fixed income managers, with an expected long-term rate of return of
approximately 5.50%.
99
DR PEPPER SNAPPLE GROUP, INC.
NOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)