BB&T 2008 Annual Report Download - page 118

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BB&T CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
The IRS has completed its federal income tax examinations of BB&T through 2006. BB&T has received
notification of proposed IRS adjustments related to foreign tax credits claimed by a deconsolidated subsidiary for
tax years 2002-2007. Management has consulted with outside counsel and continues to believe that BB&T’s
treatment of these issues was appropriate and in compliance with the tax laws and regulations applicable to the
years examined and intends to pursue available regulatory and legal remedies to defend BB&T’s position.
Management believes the company’s current reserves for this matter are adequate, although the final outcome is
uncertain. In addition, BB&T may make payments or deposits to the IRS in connection with this matter to stop
the accrual of additional interest and penalties, while it pursues resolution. Resolution of this matter is not
expected to occur within the next 12 months. BB&T has agreed to settle its dispute with the IRS regarding its
leveraged lease transactions. Various years remain subject to examination by state taxing authorities.
NOTE 14. Benefit Plans
BB&T provides various benefit plans to substantially all employees, including employees of acquired entities.
Employees of acquired entities generally participate in existing BB&T plans after consummation of the business
combinations. The plans of acquired institutions are typically merged into the BB&T plans after consummation of
the mergers, and, under these circumstances, credit is usually given to these employees for years of service at the
acquired institution for vesting and eligibility purposes.
The following table summarizes expenses (income) relating to employee retirement plans:
For the Years Ended
December 31,
2008 2007 2006
(Dollars in millions)
Defined benefit plans $ 9 $ 32 $ 50
Defined contribution and ESOP plans 76 72 67
Other (38) 12 19
Total expense related to retirement benefit plans $ 47 $116 $136
Defined Benefit Retirement Plans
BB&T provides a defined benefit retirement plan qualified under the Internal Revenue Code that covers
substantially all employees. Benefits are based on years of service, age at retirement and the employee’s
compensation during the five highest consecutive years of earnings within the last ten years of employment.
In addition, supplemental retirement benefits are provided to certain key officers under supplemental
defined benefit executive retirement plans, which are not qualified under the Internal Revenue Code. Although
technically unfunded plans, a Rabbi Trust and insurance policies on the lives of the certain covered employees are
available to finance future benefits.
The following are the significant actuarial assumptions that were used to determine net periodic pension
costs:
December 31,
2008 2007
Actuarial Assumptions
Weighted average assumed discount rate 6.60% 6.00%
Weighted average expected long-term rate of return on plan assets 8.00 8.00
Assumed rate of annual compensation increases 2009 - 2011 2.50 NA
Assumed rate of annual compensation increases thereafter 4.50 4.50
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