Pizza Hut 2004 Annual Report Download - page 66
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Please find page 66 of the 2004 Pizza Hut annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report. Postretirement
PensionBenefits MedicalBenefits
2004 2003 2004 2003
Amountsrecognizedinthe
statementoffinancial
positionconsistof:
Accruedbenefitliability $(111) $(125) $(58) $(53)
Intangibleasset 11 14 — —
Accumulatedother
comprehensiveloss 153 162 — —
$ 53 $ 51 $(58) $(53)
Additionalinformation
Othercomprehensive
(income)lossattributableto
changeinadditional
minimumliabilityrecognition $ (9) $ 48
Additionalyear-endinformation
forpensionplanswith
accumulatedbenefitobligations
inexcessofplanassets
Projectedbenefitobligation $ 700 $ 629
Accumulatedbenefitobligation 629 563
Fairvalueofplanassets 518 438
WhilewearenotrequiredtomakecontributionstothePlanin
2005,wemaymakediscretionarycontributionsduringtheyear
basedonourestimateofthePlan’sexpectedSeptember30,
2005fundedstatus.
ComponentsofNetPeriodicBenefitCost
PensionBenefits
2004 2003 2002
Servicecost $ 32 $ 26 $ 22
Interestcost 39 34 31
Amortizationofpriorservicecost 3 4 1
Expectedreturnonplanassets (40) (30) (28)
Recognizedactuarialloss 19 6 1
Netperiodicbenefitcost $ 53 $ 40 $ 27
Additionallossrecognizeddueto:
Curtailment $ — $ — $ 1
PostretirementMedicalBenefits
2004 2003 2002
Servicecost $ 2 $ 2 $ 2
Interestcost 5 5 4
Amortizationofpriorservicecost — — —
Recognizedactuarialloss 1 1 1
Netperiodicbenefitcost $ 8 $ 8 $ 7
Priorservicecostsareamortizedonastraight-linebasisover
theaverageremainingserviceperiodofemployeesexpected
toreceivebenefits.Curtailmentgainsandlosseshavebeen
recognizedinfacilityactionsastheyhaveresultedprimarily
fromrefranchisingandclosureactivities.
Weighted-AverageAssumptionsUsedtoDetermineBenefit
ObligationsatSeptember30:
Postretirement
PensionBenefits MedicalBenefits
2004 2003 2004 2003
Discountrate 6.15% 6.25% 6.15% 6.25%
Rateofcompensationincrease 3.75% 3.75% 3.75% 3.75%
Weighted-AverageAssumptionsUsedtoDeterminetheNet
PeriodicBenefitCostforFiscalYears:
Postretirement
PensionBenefits MedicalBenefits
2004 2003 2002 2004 2003 2002
Discountrate 6.25% 6.85% 7.60% 6.25% 6.85% 7.58%
Long-termrate
ofreturnon
planassets 8.50% 8.50%10.00% — — —
Rateofcompen-
sationincrease 3.75% 3.85% 4.60% 3.75% 3.85% 4.60%
Ourestimatedlong-termrateofreturnonplanassetsrepre-
sentstheweightedaverageofexpectedfuturereturnson
theassetcategoriesincludedinourtargetinvestmentalloca-
tionbasedprimarilyonthehistoricalreturnsforeachasset
category, adjusted for an assessment of current market
conditions.
AssumedHealthCareCostTrendRatesatSeptember30:
Postretirement
MedicalBenefits
2004 2003
Healthcarecosttrendrateassumedfornextyear 11% 12%
Ratetowhichthecosttrendrateisassumedto
decline(theultimatetrendrate) 5.5% 5.5%
Yearthattheratereachestheultimatetrendrate 2012 2012
Thereisacaponourmedicalliabilityforcertainretirees.
ThecapforMedicareeligibleretireeswasreachedin2000
andthecapfornon-Medicareeligibleretireesisexpectedto
bereachedbetweentheyears2007-2008;oncethecapis
reached,ourannualcostperretireewillnotincrease.
Assumedhealthcarecosttrendrateshaveasignificant
effectontheamountsreportedforourpostretirementhealth
careplans.Aone-percentage-pointchangeinassumedhealth
carecosttrendrateswouldhavethefollowingeffects:
1-Percentage- 1-Percentage-
Point Point
Increase Decrease
Effectontotalofserviceandinterestcost $— $—
Effectonpostretirementbenefitobligation $ 2 $ (2)
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