Target 2006 Annual Report Download - page 62

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Obligations and Funded Status
Pension Benefits Postretirement
Qualified Plans Nonqualified Plans Health Care Benefits
(millions) 2006 2005 2006 2005 2006 2005
Change in Projected Benefit
Obligation
Benefit obligation at beginning of
measurement period (a) $1,626 $1,515 $33 $34 $105 $107
Service cost 82 66 1132
Interest cost 91 85 2266
Actuarial loss 32 55 5413 3
Participant contributions ————917
Benefits paid (76) (94) (5) (5) (21) (30)
Plan amendments 9(1) —(3) ——
Benefit obligation at end of
measurement period $1,764 $1,626 $36 $33 $115 $105
(a) Measurement date is October 31 of each year.
Pension Benefits Postretirement
Qualified Plans Nonqualified Plans Health Care Benefits
(millions) 2006 2005 2006 2005 2006 2005
Change in Plan Assets
Fair value of plan assets at beginning
of measurement period $1,845 $1,698 $— $— $— $—
Actual return on plan assets 303 174 ————
Employer contribution 367 5512 13
Participant contributions ————917
Benefits paid (76) (94) (5) (5) (21) (30)
Fair value of plan assets at end of
measurement period 2,075 1,845 ————
Funded status $ 311 $ 219 $(36) $(33) $(115) $(105)
The net overfunded status of the qualified plans of $311 million at February 3, 2007 is recognized in
the accompanying Consolidated Statement of Financial Position as $325 million within other non-current
assets and $14 million within other non-current liabilities. The underfunded amount for the nonqualified
plans, including the postretirement health care benefits liability, of $151 million at February 3, 2007 is
recognized as $16 million within accrued and other current liabilities and $135 million within other
non-current liabilities.
No plan assets are expected to be returned to us during 2007.
Included in accumulated other comprehensive loss at February 3, 2007 are the following amounts that
have not yet been recognized in net periodic pension expense: unrecognized actuarial losses $425 million
($259 million net of tax) partially offset by unrecognized prior service costs of $20 million ($12 million net of
tax). The actuarial loss included in accumulated other comprehensive loss and expected to be recognized in
net periodic pension expense during 2007 is $46 million ($28 million net of tax), which will be offset by prior
service cost of $4 million ($2 million net of tax).
2005 Reconciliation of Prepaid (Accrued) Pension and Benefit Expense to Funded Status
Pension Benefits Postretirement
Qualified Plans Nonqualified Plans Health Care Benefits
(millions) 2005 2005 2005
Funded status $219 $(33) $(105)
Unrecognized actuarial loss 561 16 8
Unrecognized prior service cost (32) — —
Net amount recognized $748 $(17) $ (97)
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