GE 2005 Annual Report Download - page 96

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(96)
FAIR VALUE OF ASSETS
Principal pension plans Other pension plans
(In millions) 2005 2004 2005
2004
Balance at January 1 $ 46,665 $ 43,879 $ 4,602 $ 2,989
Actual gain on plan assets 4,558 4,888 670 294
Employer contributions 106 102 365 364
Participant contributions 174 163 36 31
Benefits paid (2,407) (2,367)
(256) (226)
Acquired plans
–
–
29 868
Exchange rate adjustments and other
–
–
(233) 282
Balance at December 31 $ 49,096 $ 46,665 $ 5,213 $ 4,602
Our pension plan assets are held in trust, as follows:
PLAN ASSET ALLOCATION
Principal pension plans
2005 2004
December 31
Target
allocation
Actual
allocation
Actual
allocation
U.S. equity securities 30-45% 42 % 44%
Non-U.S. equity securities 15-25 21
19
Debt securities 15-30 18
19
Real estate 4-10 6
6
Private equities 5-11 7
6
Other
1-12 6
6
Total
100 % 100%
Plan fiduciaries of the GE Pension Plan set investment policies and strategies for the GE Pension Trust. Long-term
strategic investment objectives include preserving the funded status of the trust and balancing risk and return. These
plan fiduciaries oversee the investment allocation process, which includes selecting investment managers,
commissioning periodic asset-liability studies, setting long-term strategic targets and monitoring asset allocations.
Target allocation ranges are guidelines, not limitations, and occasionally plan fiduciaries will approve allocations
above or below a target range.
GE Pension Trust assets are invested subject to the following additional guidelines:
• Short-term securities must be rated A1/P1 or better, other than 15% of short-term holdings which may be rated
A2/P2,
• Real estate may not exceed 25% of total assets (6% of trust assets at December 31, 2005),
• Investments in securities not freely tradable may not exceed 20% of total assets (12% of trust assets at
December 31, 2005), and
• GE stock is limited by statute when it reaches 10% of total trust assets (6.4% and 7.0% at the end of 2005 and
2004, respectively).