Snapple 2011 Annual Report Download - page 107

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DR PEPPER SNAPPLE GROUP, INC.
NOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS - (Continued)
87
The following table summarizes the expected future benefit payments cash activity for the Company's pension and
postretirement medical plans in the future (in millions):
Pension plans
Postretirement medical plans
2012
$ 16
1
2013
$ 18
1
2014
$ 18
1
2015
$ 19
1
2016
$ 17
1
2017-2021
$ 104
3
Actuarial Assumptions
The Company's pension expense 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.
The discount rate utilized to determine the Company's projected benefit obligations as of December 31, 2011 and 2010, as
well as projected 2012 net periodic benefit cost for U.S. plans, reflects the current rate at which the associated liabilities could be
effectively settled as of the end of the year. The Company set its rate to reflect the yield of a portfolio of high quality, fixed-income
debt instruments that would produce cash flows sufficient in timing and amount to settle projected future benefits.
For the year ended December 31, 2011 and 2010, 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 25% with equity
managers, with expected long-term rates of return of approximately 8.90%, and approximately 75% with fixed income managers,
with an expected long-term rate of return of approximately 5.90% for the year ended December 31, 2011. The expected long-
term rate of return on the assets in the plans was based on an asset allocation assumptions of approximately 25% with equity
managers, with expected long-term rates of return of approximately 9.40%, and approximately 75% with fixed income managers,
with an expected rate of return of approximately 5.50% for the year ended December 31, 2010.
The following table summarizes the weighted-average assumptions used to determine benefit obligations at the plan
measurement dates for U.S. plans:
Weighted-average discount rate
Rate of increase in compensation levels
Pension Plans
2011
5.00%
3.00%
2010
5.60%
3.50%
Postretirement
Medical Plans
2011
5.00%
N/A
2010
5.60%
N/A
The following table summarizes the weighted average actuarial assumptions used to determine the net periodic benefit costs
for U.S. plans for the years ended December 31, 2011, 2010 and 2009:
Weighted-average discount rate
Expected long-term rate of return on assets
Rate of increase in compensation levels
Pension Plans
2011
5.57%
6.50%
3.50%
2010
5.52%
7.00%
3.50%
2009
6.50%
7.30%
3.50%
Postretirement
Medical Plans
2011
5.60%
6.50%
N/A
2010
5.57%
7.00%
N/A
2009
6.50%
7.30%
N/A