Berkshire Hathaway 2010 Annual Report Download - page 61

Notes to Consolidated Financial Statements (Continued)
(19) Pension plans (Continued)
Fair value measurements for pension assets as of December 31, 2010 and 2009 follow (in millions).
Total
Fair Value
Quoted Prices
(Level 1)
Significant
Other
Observable
Inputs
(Level 2)
Significant
Unobservable
Inputs
(Level 3)
December 31, 2010
Cash and equivalents ........................................... $ 474 $ 423 $ 51 $—
Government obligations ......................................... 895 609 285 1
Investment funds ............................................... 2,020 597 1,423 —
Corporate debt obligations ....................................... 1,015 147 868 —
Equity securities ............................................... 3,069 3,069 — —
Other ........................................................ 773 54 349 370
$8,246 $4,899 $2,976 $371
December 31, 2009
Cash and equivalents ........................................... $ 408 $ 401 $ 7 $—
Government obligations ......................................... 674 554 120 —
Investment funds ............................................... 1,470 174 1,296 —
Corporate debt obligations ....................................... 744 157 587 —
Equity securities ............................................... 2,152 2,131 21 —
Other ........................................................ 478 27 223 228
$5,926 $3,444 $2,254 $228
Refer to Note 17 for a discussion of the three levels in the hierarchy of fair values. Pension assets measured at fair value
with significant unobservable inputs (Level 3) for the year ended December 31, 2010 and 2009 consisted primarily of real estate
and limited partnership interests.
Pension plan assets are generally invested with the long-term objective of earning sufficient amounts to cover expected
benefit obligations, while assuming a prudent level of risk. Allocations may change as a result of changing market conditions
and investment opportunities. The expected rates of return on plan assets reflect subjective assessments of expected invested
asset returns over a period of several years. Generally, past investment returns are not given significant consideration when
establishing assumptions for expected long-term rates of returns on plan assets. Actual experience will differ from the assumed
rates.
The defined benefit plans expect to pay benefits to participants over the next ten years, reflecting expected future service as
appropriate, as follows (in millions): 2011 – $588; 2012 – $606; 2013 – $625; 2014 – $645; 2015 – $650; and 2016 to 2020 –
$3,431. Sponsoring subsidiaries expect to contribute $340 million to defined benefit pension plans in 2011.
As of December 31, 2010 and 2009, the net funded status of the plans is summarized in the table that follows (in millions).
2010 2009
Amounts recognized in the Consolidated Balance Sheets:
Other liabilities ....................................................................... $2,425 $2,288
Other assets .......................................................................... (73) (78)
$2,352 $2,210
A reconciliation of amounts included in accumulated other comprehensive income related to defined benefit plans for the
years ending December 31, 2010 and 2009 follows (in millions).
2010 2009
Accumulated other comprehensive income (loss), beginning of year ............................... $(1,368) $(1,320)
Amount included in net periodic pension expense .......................................... 53 39
Gains (losses) current period and other ................................................... (80) (87)
Accumulated other comprehensive income (loss), end of year .................................... $(1,395)* $(1,368)
*Includes $96 million that is expected to be included in net periodic pension expense in 2011.
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