Sunoco 2004 Annual Report Download - page 61

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The following tables set forth the components of the changes in benefit obligations and fair value of plan assets during
2004 and 2003 as well as the funded status and amounts both recognized and not recognized in the consolidated bal-
ance sheets at December 31, 2004 and 2003:
Defined Benefit Plans
Postretirement
Benefit Plans
2004 2003
(Millions of Dollars)
Funded
Plans
Unfunded
Plans
Funded
Plans
Unfunded
Plans 2004 2003
Benefit obligations at beginning of year* $1,313 $ 128 $1,235 $ 118 $ 409 $ 398
Service cost 43 3 36 2 86
Interest cost 78 8 81 8 24 25
Actuarial losses 60 10 120 11 4** 34
Plan amendments (14) — —416 (26)
Benefits paid (131) (12) (159) (15) (41) (36)
Premiums paid by participants —— ——98
Benefit obligations at end of year* $1,349 $ 137 $1,313 $ 128 $ 429 $ 409
Fair value of plan assets at beginning of year*** $1,071 $ 930
Actual return on plan assets 123 211
Employer contributions 95 89
Benefits paid from plan assets (131) (159)
Fair value of plan assets at end of year*** $1,158 $1,071
Unfunded accumulated obligation $ (40) $(122) $ (121) $(120)
Provision for future salary increases (151) (15) (121) (8)
Benefit obligations in excess of plan assets at end of year (191) (137) (242) (128) $(429) $(409)
Unrecognized prior service cost (benefit) 17 (1) 18 (1) (27) (34)
Unrecognized net loss 374 57 382 51 84** 83
Net amount recognized in balance sheet at end of year $ 200 $ (81) $ 158 $ (78) $(372) $(360)
* Represents the projected benefit obligations for defined benefit plans and the accumulated postretirement benefit obligations (“APBO”) for postretirement benefit plans. The
accumulated benefit obligations for funded and unfunded defined benefit plans amounted to $1,198 and $122 million, respectively, at December 31, 2004, and $1,192 and $120
million, respectively, at December 31, 2003.
** Includes a $10 million actuarial gain attributable to the prescription drug subsidy provided by the Medicare Prescription Drug Act of 2003.
*** There are no plan assets invested in Company stock.
The net amount recognized in the consolidated balance sheets at December 31, 2004 and 2003 is classified as follows:
Defined
Benefit Plans
Postretirement
Benefit Plans
(Millions of Dollars) 2004 2003 2004 2003
Prepaid retirement costs $11 $11 $— $—
Retirement benefit liabilities (167) (244) (372) (360)
Deferred charges and other assets* 19 21 ——
Accumulated other comprehensive loss (before related tax benefit)** 256 292 ——
$ 119 $80 $(372) $(360)
* Represents an intangible asset for which an equivalent additional minimum liability is included in retirement benefit liabilities.
** Represents a separate component of shareholders’ equity for which an equivalent additional minimum liability is included in retirement benefit liabilities.
The asset allocations attributable to the funded defined benefit plans at December 31, 2004 and 2003 and the target
allocation of plan assets for 2005, by asset category, are as follows:
December 31
(In Percentages) 2005 Target* 2004 2003
Asset category:
Equity securities 60% 64% 62%
Debt securities 35 32 33
Other 545
Total 100% 100% 100%
*The target allocation has been in effect since 1999.
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