Washington Post 2004 Annual Report Download - page 67

plans at January 2, 2005 and December 28, 2003 (in At January 2, 2005, future estimated benefit payments are as
thousands): follows (in millions): Postretirement
Pension Plans Postretirement Plans Pension Plans Plans
2004 2003 2004 2003 2005 ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $ 26.2 $ 6.6
2006 ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $ 27.2 $ 6.9
Change in BeneÑt Obligation
2007 ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $ 28.5 $ 7.4
BeneÑt obligation at beginning of year ÏÏÏ $ 625,774 $ 498,952 $ 120,444 $ 112,174
2008 ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $ 30.0 $ 8.0
Service cost ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 22,896 19,965 5,285 5,164
Interest cost ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 37,153 33,696 7,355 7,395
2009 ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $ 31.8 $ 8.6
AmendmentsÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 218 60,697 Ì(5,479)
2010-2014 ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $196.9 $52.7
Actuarial loss ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 46,655 37,339 5,764 6,733
BeneÑts paid ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ (43,555) (24,875) (6,308) (5,543)
The Company's defined benefit pension obligations are funded by
BeneÑt obligation at end of yearÏÏÏÏÏÏÏÏ $ 689,141 $ 625,774 $ 132,540 $ 120,444
a relatively small but diversified mix of stocks and high-quality fixed-
Change in Plan Assets
income securities that are held in trust. Essentially all of the assets
Fair value of assets at beginning of year ÏÏ $1,564,966 $1,362,084 $Ì$Ì
are managed by two investment companies. None of the assets are
Actual return on plan assets ÏÏÏÏÏÏÏÏÏÏÏ 66,802 227,757 ÌÌ
Employer contributions ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ ÌÌ6,308 5,543
managed internally by the Company or are invested in securities of
BeneÑts paid ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ (43,555) (24,875) (6,308) (5,543)
the Company. The goal of the investment managers is to produce
Fair value of assets at end of year ÏÏÏÏÏÏ $1,588,213 $1,564,966 $Ì$Ì
moderate long-term growth in the value of those assets while
Funded status ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $ 899,072 $ 939,192 $(132,540) $(120,444)
protecting them against decreases in value. The investment manag-
Unrecognized transition asset ÏÏÏÏÏÏÏÏÏÏ (355) (1,442) ÌÌ
Unrecognized prior service cost ÏÏÏÏÏÏÏÏ 38,389 46,941 (8,001) (8,589)
ers cannot invest more than 20% of the assets at the time of
Unrecognized actuarial gain ÏÏÏÏÏÏÏÏÏÏÏ (380,359) (469,890) (4,949) (11,707)
purchase in the stock of Berkshire Hathaway or more than 10% of
Net prepaid (accrued) cost ÏÏÏÏÏÏÏÏÏÏ $ 556,747 $ 514,801 $(145,490) $(140,740)
the assets in the securities of any other single issuer, except for
The accumulated benefit obligation for the Company's defined obligations of the U.S. Government, without receiving prior approv-
benefit pension plans at January 2, 2005 and December 28, 2003 al by the Plan administrator. Over the past five years, the managers
was $599.2 million and $548.4 million, respectively. together have invested between 60% and 90% of the assets in
equities. At the end of 2004, 86% of the assets were invested in
Key assumptions utilized for determining the benefit obligation at
equities; 26% of the assets were invested in Berkshire Hathaway
January 2, 2005 and December 28, 2003 are as follows:
common stock. The Company's retirement plan trust held shares of
Postretirement Berkshire Class A and Class B common stock with a total market
Pension Plans Plans
2004 2003 2004 2003 value of $415.4 million and $398.2 million at January 2, 2005
and December 28, 2003, respectively.
Discount rate ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 5.75% 6.25% 5.75% 6.25% The total (income) cost arising from the Company's defined benefit
Rate of compensation increaseÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 4.0% 4.0% ÌÌ
pension and postretirement plans for the years ended January 2,
The assumed health care cost trend rate used in measuring the 2005, December 28, 2003, and December 29, 2002, consists of
postretirement benefit obligation at January 2, 2005 was 9.5% for the following components (in thousands):
both pre-age 65 and post-age 65 benefits, decreasing to 5% in
Pension Plans Postretirement Plans
the year 2015 and thereafter.
2004 2003 2002 2004 2003 2002
Assumed health care cost trend rates have a significant effect on the
amounts reported for the health care plans. A change of 1 percent-
Serv ice cost ÏÏÏÏÏÏÏ $ 22,896 $ 19,965 $ 17,489 $ 5,285 $ 5,164 $ 5,418
Inte rest cos t ÏÏÏÏÏÏÏ 37,153 33,696 30,820 7,355 7,395 7,997
age point in the assumed health care cost trend rates would have
Expected return on
the following effects (in thousands):
asse ts ÏÏÏÏÏÏÏÏÏÏÏ (97,702) (96,116) (92,192) ÌÌÌ
Amortization of
1% 1%
transition assetÏÏÏ (1,086) (2,189) (5,221) ÌÌÌ
Increase Decrease
Amortization of
prior service cost 4,530 4,172 2,185 (588) (360) (421)
Recognized
BeneÑt obligation at end of year ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $20,106 $(18,798)
actuarial gainÏÏÏÏ (7,745) (14,665) (17,528) (995) (1,675) (2,435)
Service cost plus interest costÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $ 2,018 $ (1,957)
Net periodic
(benefit) cost
The Company made no contributions to its defined benefit pension
for the yearÏÏÏÏÏÏ (41,954) (55,137) (64,447) 11,057 10,524 10,559
plans in 2004 and 2003, and the Company does not expect to
Early retirement
programs
make any contributions in 2005 or in the foreseeable future. The
expense ÏÏÏÏÏÏÏÏÏ 132 34,135 19,001 ÌÌÌ
Company made contributions to its postretirement benefit plans of
Curtailment gainÏÏÏÏ ÌÌÌÌ(634) Ì
Total (benefit)
$6.3 million and $5.5 million for the years ended January 2, 2005
cost for the year $(41,822) $(21,002) $(45,446) $11,057 $ 9,890 $10,559
and December 28, 2003, respectively, as the plans are unfunded
and the Company covers benefit payments. The Company expects The costs for the Company's defined benefit pension and postretire-
to make contributions for its postretirement plans by funding benefit ment plans are actuarially determined. Below are the key assump-
payments consistent with the assumed heath care cost trend rates
discussed above.
2004 FORM 10-K 51