HP 2009 Annual Report Download - page 148

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HEWLETT-PACKARD COMPANY AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Continued)
Note 16: Retirement and Post-Retirement Benefit Plans (Continued)
The weighted-average assumptions used to calculate the benefit obligation disclosed as of the 2009
and 2008 fiscal close were as follows:
Non-U.S.
U.S. Defined Defined Post-Retirement
Benefit Plans Benefit Plans Benefit Plans
2009 2008 2009 2008 2009 2008
Discount rate ............................. 5.9% 8.0% 5.0% 6.0% 5.4% 7.8%
Average increase in compensation levels .......... 2.0% 2.0% 2.5% 2.6% — —
Current medical cost trend rate ................ ———— — 9.5%
Ultimate medical cost trend rate ............... ———— — 5.5%
Year the rate reaches ultimate trend rate ......... ———— —2013
Stemming from the plan changes announced in November 2008, the employer subsidy for the U.S.
retiree medical plans will ‘‘freeze’’ in fiscal 2010. Therefore, trend rates for 2010 and beyond are no
longer relevant to the liability calculation since the excess cost will be picked up by retirees.
A 1.0 percentage point increase in the medical cost trend rate would have increased the total
post-retirement benefit obligation reported at October 31, 2009 by $3 million, while a 1.0 percentage
point decrease would have resulted in a decrease of $3 million.
Defined benefit plans with projected benefit obligations exceeding the fair value of plan assets
were as follows:
Non-U.S.
U.S. Defined Defined
Benefit Plans Benefit Plans
2009 2008 2009 2008
In millions
Aggregate fair value of plan assets ....................... $3,516 $3,178 $ 9,247 $4,076
Aggregate projected benefit obligation ..................... $6,144 $4,330 $12,167 $5,782
Defined benefit plans with accumulated benefit obligations exceeding the fair value of plan assets
were as follows:
Non-U.S.
U.S. Defined Defined
Benefit Plans Benefit Plans
2009 2008 2009 2008
In millions
Aggregate fair value of plan assets ........................ $3,515 $3,178 $7,040 $3,710
Aggregate accumulated benefit obligation ................... $6,141 $4,328 $9,263 $4,962
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