Siemens 2006 Annual Report Download - page 199

Notes to Consolidated Financial Statements
(in millions of €, except where otherwise stated and per share amounts) 195
The measurement dates for the valuation of certain Siemens pension funds, particularly
the funds in the U.S. and U.K., do not coincide with the end of the Company’s fiscal year. While
the actual return over the last twelve months amounted to 6.60% or €1,366, the aggregate
return on plan assets between their respective measurement dates amounted to 6.23% or
€1,291. For the domestic pension plans, €741 or 5.41% was realized, as compared to an expect-
ed return on plan assets of 6.7% or an amount of €923 that was included in the NPPC. For the
foreign pension plans, €550 or 7.85% was realized, as compared to an expected return on plan
assets of 6.7% or an amount of €465 that was included in the NPPC.
Pension benefits: Plan assets
The asset allocation of the plan assets of the principal pension benefit plans as of the measure-
ment date for fiscal 2006 and 2005 as well as the target asset allocation for fiscal year 2007, are
as follows:
The asset allocation represents the plan assets exposure to market risk. For example, an
equity instrument whose risk is hedged by a derivative is not reported as equity but under
cash. Current asset allocation is biased towards high quality government and selected corpo-
rate bonds.
Siemens constantly reviews the asset allocation in light of the duration of its pension liabili-
ties and analysis trends and events that may affect asset values in order to initiate appropriate
measures at a very early stage.
Pension benefits: Pension plan funding
Contributions made by the Company to its principal pension benefit plans in fiscal 2006 and
2005, as well as those planned in fiscal 2007, are as follows:
In fiscal 2006, no supplemental cash contributions were made. In fiscal 2005, €1,496 in cash
was contributed in October 2004, as follows: €1,380 to the domestic pension plans and €116 to
the pension plans in the U.S.
Notes to Consolidated Financial Statements
Target asset
allocation Asset allocation as of the measurement date
September September 30, 2006 September 30, 2005
Asset class 30, 2007 Total Domestic Foreign Total Domestic Foreign
Equity 20–50% 33% 26% 44% 31% 25% 43%
Fixed income 40 –70% 48% 51% 43% 56% 63% 40%
Real estate 5 –15% 8% 7% 10% 8% 7% 9%
Cash 5– 15% 11% 16% 3% 5% 5% 8%
100% 100% 100% 100% 100% 100%
(Unaudited) Year ending
September 30, 2007 (expected) Year ended September 30, 2006 Year ended September 30, 2005
Total Domestic Foreign Total Domestic Foreign Total Domestic Foreign
Regular funding 751 317 434 730 320 410 535 159 376
Supplemental cash Contributions – – – – – – 1,496 1,380 116
Total 751 317 434 730 320 410 2,031 1,539 492