AT&T Wireless 2011 Annual Report Download - page 80

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Notes to Consolidated Financial Statements (continued)
Dollars in millions except per share amounts
78 AT&T Inc.
The accumulated benefit obligation for our pension plans
represents the actuarial present value of benefits based on
employee service and compensation as of a certain date and
does not include an assumption about future compensation
levels. The accumulated benefit obligation for our pension
plans was $53,640 at December 31, 2011, and $51,915 at
December 31, 2010.
Net Periodic Benefit Cost and Other Amounts
Recognized in Other Comprehensive Income
Our combined net pension and postretirement cost recognized
in our consolidated statements of income was $7,288, $3,750
and $2,253 for the years ended December 31, 2011, 2010
and 2009. A portion of pension and postretirement benefit
costs is capitalized as part of the benefit load on internal
construction and capital expenditures, providing a small
reduction in the net expense recorded.
The following tables present the components of net periodic
benefit obligation cost and other changes in plan assets and
benefit obligations recognized in OCI:
Amounts recognized on our consolidated balance sheets at
December 31 are listed below:
Pension Benefits Postretirement Benefits
2011 2010 2011 2010
Current portion of
employee benefit
obligation1 $ — $ — $ (2,288) $ (2,394)
Employee benefit
obligation2 (10,203) (6,296) (22,775) (21,497)
Net amount
recognized $(10,203) $(6,296) $(25,063) $(23,891)
1 Included in “Accounts payable and accrued liabilities.”
2 Included in “Postemployment benefit obligation.”
Prior service credits included in our accumulated OCI that
have not yet been recognized in net periodic benefit cost
were $149 for pension and $5,896 for postretirement benefits
at December 31, 2011, and $164 for pension and $4,760 for
postretirement benefits at December 31, 2010.
Net Periodic Benefit Cost
Pension Benefits Postretirement Benefits
2011 2010 2009 2011 2010 2009
Service cost – benefits earned during the period $ 1,186 $ 1,075 $ 1,070 $ 362 $ 348 $ 334
Interest cost on projected benefit obligation 2,958 3,150 3,355 2,051 2,257 2,434
Expected return on assets (3,690) (3,775) (3,766) (1,040) (943) (784)
Amortization of prior service cost (credit) (15) (16) 58 (694) (624) (469)
Actuarial (gain) loss 4,498 1,768 (103) 1,672 510 124
Net pension and postretirement cost1 $ 4,937 $ 2,202 $ 614 $ 2,351 $1,548 $1,639
1 During 2011, 2010 and 2009, the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 reduced postretirement benefit cost by $280, $237 and $255.
This effect is included in several line items above.
Other Changes in Plan Assets and Benefit Obligations Recognized in Other Comprehensive Income
Pension Benefits Postretirement Benefits
2011 2010 2009 2011 2010 2009
Prior service (cost) credit $ — $ — $394 $1,134 $ 459 $1,863
Amortization of prior service cost (credit) (10) (10) 67 (430) (388) (223)
Total recognized in other comprehensive (income) loss (net of tax) $(10) $(10) $461 $ 704 $ 71 $1,640