DTE Energy 2009 Annual Report Download - page 34

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commingled funds and institutional mutual funds which hold exchange-traded equity or debt securities are valued based on underlying
securities, using quoted prices in actively traded markets. Non-exchange traded fixed income securities are valued by the trustee based
upon quotations available from brokers or pricing services. A primary price source is identified by asset type, class or issue for each
security. The trustees monitor prices supplied by pricing services and may use a supplemental price source or change the primary price
source of a given security if the trustees challenge an assigned price and determine that another price source is considered to be
preferable. MichCon has obtained an understanding of how these prices are derived, including the nature and observability of the
inputs used in deriving such prices. Additionally, MichCon selectively corroborates the fair values of securities by comparison of
market-based price sources.
Fair Value Measurements Using Significant Unobservable Inputs (Level 3):
(in Millions)
Hedge Funds
and Similar
Investments
Private Equity
and Other
Total
Beginning Balance at January 1, 2009 .....................................................
$ 155
$ 52
$ 207
Total realized/unrealized gains (losses) ...................................................
10
(3)
7
Purchases, sales and settlements ..............................................................
(5)
4
(1)
Ending Balance at December 31, 2009 ....................................................
$ 160
$ 53
$ 213
The amount of total gains (losses) for the period attributable to
the change in unrealized gains or losses related to assets
still held at the end of the period ..............................................................
$ 11
$ (3)
$ 8
The Company also participates in defined contribution retirement savings plans for DTE Energy and its affiliates. Participation in one
of these plans is available to substantially all represented and non-represented employees. The Company matches employee
contributions up to certain predefined limits based upon eligible compensation, the employee’s contribution rate and, in some cases,
years of credited service. The cost of these plans was $4 million in each of the years 2009, 2008, and 2007.
Other Postretirement Benefits
The Company participates in plans sponsored by LLC that provide certain postretirement health care and life insurance benefits for
employees who are eligible for these benefits. The Company’ s policy is to fund certain trusts to meet our postretirement benefit
obligations. Separate qualified Voluntary Employees Beneficiary Association (VEBA) trusts exist for represented and non-represented
employees. In 2009, the Company made cash contributions of $115 million to the VEBA trusts. At the discretion of management,
subject to MPSC requirements, the Company may make up to a $40 million contribution to the VEBA trusts in 2010.
Net postretirement cost includes the following components:
(in Millions)
2009
2008
2007
Service cost
$ 13
$ 14
$ 14
Interest cost
30
27
28
Expected return on plan assets
(18)
(17)
(14)
Amortization of
Net loss
7
5
10
Prior service cost
1
1
2
Net transition obligation
3
3
5
Net postretirement cost
$ 36
$ 33
$ 45