American Express 1998 Annual Report Download - page 51

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Net pension cost consisted of the following
components:
49
under these local plans are generally expensed and are
not funded.
Plan assets consist principally of equities and fixed
income securities.
(millions) 1998 1997 1996
Service cost $88 $76 $77
Interest cost 90 82 77
Expected return on plan assets (91) (86) (78)
Amortization of:
Prior service cost (9) (9) (9)
Transition obligation 112
Reversion gain (4) (4) (4)
Recognized net actuarial loss 3—4
Settlement/Curtailment gain (15) (11) (12)
Net periodic pension benefit cost $63 $49 $57
The funded status of the Company’s pension plans is
based on valuations as of September 30. The following
tables provide a reconciliation of the changes in the
plans’ benefit obligation and fair value of assets:
Reconciliation of change in benefit obligation
(millions) 1998 1997
Benefit obligation at October 1, $ 1,199 $ 1,040
Service cost 88 76
Interest cost 90 82
Benefits paid (43) (39)
Actuarial loss 156 103
Settlements/Curtailments (81) (40)
Foreign currency exchange rate changes 4(23)
Benefit obligation at September 30, $ 1,413 $ 1,199
Reconciliation of change in fair value of plan assets
(millions) 1998 1997
Fair value of plan assets at October 1, $ 1,279 $ 1,103
Actual return on plan assets 2228
Employer contributions 47 39
Benefits paid (43) (39)
Settlements/Curtailments (71) (41)
Foreign currency exchange rate changes 2(11)
Fair value of plan assets at September 30, $ 1,216 $ 1,279