Washington Post 2007 Annual Report Download - page 87

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The following table sets forth obligation, asset and funding
information for the Company’s defined benefit pension plans at
December 30, 2007 and December 31, 2006 (in thousands):
2007 2006 2007 2006
Pension Plans SERP
Change in Benefit
Obligation
Benefit obligation
at beginning of
year ........ $802,791 $ 748,873 $54,382 $ 51,625
Service cost .... 28,115 27,298 1,542 1,728
Interest cost ..... 47,201 43,707 3,213 2,936
Amendments .... (179) 60,695 —1,349
Actuarial loss
(gain) ....... 2,310 (21,499) 53 (2,123)
Benefits paid .... (40,068) (56,283) (1,728) (1,133)
Benefit obligation
at end of
year ........ $840,170 $ 802,791 $57,462 $ 54,382
Change in Plan
Assets
Fair value of assets
at beginning of
year ........ $1,778,083 $1,683,265 $—$—
Actual return on
plan assets.... 136,944 151,101 ——
Employer
contributions . . . ——1,728 1,133
Benefits paid .... (40,068) (56,283) (1,728) (1,133)
Fair value of
assets at end of
year ........ $1,874,959 $1,778,083 $—$—
Funded status ... $1,034,789 $ 975,292 $(57,462) $(54,382)
The accumulated benefit obligation for the Company’s pension
plans at December 30, 2007 and December 31, 2006,
was $756.7 million and $714.9 million, respectively. The
accumulated benefit obligation for the Company’s SERP at
December 30, 2007 and December 31, 2006 was
$44.6 million and $42.2 million, respectively. The amounts
recognized in the consolidated balance sheets for the
Company’s defined benefit pension plans at December 30,
2007 and December 31, 2006 (in thousands):
2007 2006 2007 2006
Pension Plans SERP
Non-current asset . . $1,034,789 $975,292 $—$—
Current liability . . . . ——(1,738) (1,627)
Non-current liability. . ——(55,724) (52,755)
Recognized asset
(liability) ...... $1,034,789 $975,292 $(57,462) $(54,382)
Key assumptions utilized for determining the benefit obligation
at December 30, 2007 and December 31, 2006 are as
follows:
2007 2006 2007 2006
Pension Plans SERP
Discount rate............. 6.0% 6.0% 6.0% 6.0%
Rate of compensation
increase .............. 4.0% 4.0% 4.0% 4.0%
The Company made no contributions to its pension plans in
2007, 2006 and 2005, and the Company does not expect to
make any contributions in 2008 or in the foreseeable future.
The Company made contributions to its SERP of $1.7 million
and $1.1 million for the years ended December 30, 2007 and
December 31, 2006, respectively, as the plan is unfunded
and the Company covers benefit payments. The Company
makes contributions to the SERP based on actual benefit
payments.
At December 30, 2007, future estimated benefit payments,
excluding charges for early retirement programs, are as
follows (in millions):
Pension Plans SERP
2008 . . ..................... $ 38.5 $ 1.8
2009 . . ..................... $ 39.2 $ 2.3
2010 . . ..................... $ 40.4 $ 2.6
2011 . . ..................... $ 41.9 $ 2.9
2012 . . ..................... $ 43.8 $ 3.2
2013–2017 . . ................ $247.9 $20.6
The Company’s defined benefit pension obligations are funded
by a portfolio made up of a relatively small number of stocks and
high-quality fixed-income securities that are held in trust. As of
December 30, 2007 and December 31, 2006, the assets of
theCompany’spensionplanswereallocatedasfollows(in
percentages):
December 30,
2007 December 31,
2006
Pension Plan Asset Allocations
Equities . . ............... 88% 89%
Fixed income . . ........... 12% 11%
Total ................... 100% 100%
Essentially all of the assets are actively managed by two
investment companies. Included in the assets they manage are
$459.1 million and $445.9 million of Berkshire Hathaway
Class A and Class B common stock at December 30, 2007
and December 31, 2006, respectively. None of the assets is
managed internally by the Company.
The goal of the investment managers is to try to produce moderate
long-term growth in the value of those assets, while protecting
them against large decreases in value. The managers are not
permitted to invest in securities of the Company or in alternative
investments. In addition, they cannot invest more than 20% of the
assetsatthetimeofpurchaseinthestockofBerkshireHathaway
or more than 10% of the assets in the securities of any other single
2007 FORM 10-K 71