Wells Fargo 2010 Annual Report Download - page 210

Note 19: Employee Benefits and Other Expenses (continued)
transaction. Also includes investments in exchange-traded
equity securities described above.
Multi-Strategy Hedge Funds and Private Equity – the fair values
of hedge funds are valued based on the proportionate share of
the underlying net assets of the investment funds that comprise
the fund, based on valuations supplied by the underlying
investment funds. Investments in private equity funds are valued
at the NAV provided by the fund sponsor. Market values are
estimates and the actual market price of the investments can
only be determined by negotiation between independent third
parties in a sales transaction.
Other – the fair values of miscellaneous investments are valued
at the NAV provided by the fund sponsor. Market values are
estimates and the actual market price of the investments can
only be determined by negotiation between independent third
parties in a sales transaction. Also includes insurance contracts
that are generally stated at cash surrender value.
The methods described above may produce a fair value
calculation that may not be indicative of net realizable value or
reflective of future fair values. While we believe our valuation
methods are appropriate and consistent with other market
participants, the use of different methodologies or assumptions
to determine the fair value of certain financial instruments could
result in a different fair value measurement at the reporting
date.
Defined Contribution Retirement Plans
We sponsor a defined contribution retirement plan named the
Wells Fargo & Company 401(k) Plan (401(k) Plan). The
Wachovia Savings Plan was merged with the 401(k) Plan
effective December 31, 2009. We also have a frozen defined
contribution plan resulting from a company acquired by
Wachovia; no contributions are permitted to this frozen plan
which will merge with the 401(k) Plan on June 30, 2011. Under
the 401(k) Plan, after one month of service, eligible employees
may contribute up to 50% of their certified compensation,
although there may be a lower limit for certain highly
compensated employees in order to maintain the qualified status
of the 401(k) Plan. Eligible employees who complete one year of
service are eligible for company matching contributions, which
are generally a 100% match up to 6% of an employee's certified
compensation. Effective January 1, 2010, previous and future
matching contributions are 100% vested for active participants.
In 2009, the 401(k) Plan was amended to permit us to make
discretionary profit sharing contributions. Based on 2010 and
2009 earnings, we committed to make a contribution in shares
of common stock to eligible employees’ 401(k) Plan accounts
equaling 2% and 1% of certified compensation, respectively,
which resulted in recognizing $316 million and $150 million of
defined contribution retirement plan expense recorded in 2010
and 2009, respectively. Total defined contribution retirement
plan expenses were $1,092 million, $862 million and
$411 million in 2010, 2009 and 2008, respectively.
Other Expenses
Expenses exceeding 1% of total interest income and noninterest
income in any of the years presented that are not otherwise
shown separately in the financial statements or Notes to
Financial Statements were:
Year ended December 31,
(in millions) 2010 2009 2008
Outside professional services $ 2,370 1,982 847
Contract services 1,642 1,088 407
Foreclosed assets 1,537 1,071 414
Operating losses 1,258 875 142
Outside data processing 1,046 1,027 480
Postage, stationery and supplies 944 933 556
Insurance 464 845 725
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