Windstream 2012 Annual Report Download - page 159

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
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F-61
8. Employee Benefit Plans and Postretirement Benefits, Continued:
A summary of plan assets, projected benefit obligation and funded status of the plans (including executive retirement
agreements) were as follows at December 31:
Pension Benefits Postretirement Benefits
(Millions) 2012 2011 2012 2011
Fair value of plan assets at beginning of year $ 948.9 $ 870.5 $ 0.2 $ 0.3
Actual return on plan assets 120.7 13.8 — —
Employer contributions 0.7 136.5 3.7 6.9
Participant contributions — — 1.8 1.7
Benefits paid (a) (71.3)(71.9)(5.5)(9.1)
Medicare Part D reimbursement ———0.4
Fair value of plan assets at end of year $ 999.0 $ 948.9 $ 0.2 $ 0.2
Projected benefit obligation at beginning of year $ 1,282.9 $ 1,164.0 $ 45.9 $ 100.0
Interest cost on projected benefit obligations 58.0 60.7 1.8 3.4
Service costs 10.0 9.3 0.1 0.2
Participant contributions — — 1.8 1.7
Plan amendments (b) (c) ——
(1.4)(37.6)
Plan curtailment (d) ———
(13.8)
Actuarial loss (gain) 120.5 120.8 (0.3) 0.7
Benefits paid (a) (71.3)(71.9)(5.5)(9.1)
Medicare Part D reimbursement ———0.4
Projected benefit obligation at end of year $ 1,400.1 $ 1,282.9 $ 42.4 $ 45.9
Plan assets less than projected benefit obligation recognized
in the consolidated balance sheet:
Current liabilities $(20.7)$ (0.7)$ (3.1)$ (5.1)
Noncurrent liabilities (380.4)(333.3)(39.1)(40.6)
Funded status recognized in the consolidated balance sheets $(401.1)$ (334.0)$ (42.2)$ (45.7)
Amounts recognized in accumulated other comprehensive
income (loss):
Net actuarial loss $—$—$
(14.1)$ (16.6)
Prior service credits 0.7 0.9 84.9 104.8
Net amount recognized in accumulated other comprehensive
income $ 0.7 $ 0.9 $ 70.8 $ 88.2
(a) During both 2012 and 2011, pension benefits paid from Windstream's assets totaled $0.7 million respectively. All
postretirement benefits in both years were paid from Windstream's assets.
(b) During 2012, we made changes to our postretirement medical plan, eliminating medical and prescription drug
subsidies for certain active and retired participants effective January 1, 2014. In remeasuring the postretirement
obligations to reflect this amendment, updated assumptions as of June 29, 2012 were used. During the remeasurement,
we updated key assumptions, including the discount rate, which decreased from 3.97 percent to 3.80 percent. The
discount rate was selected based on a hypothetical yield curve incorporating high-quality corporate bonds with various
maturities adjusted to reflect the timing of our expected benefit payments.
(c) During 2011, we amended certain of our postretirement medical plans to reduce the subsidies offered for medical and
prescription drug insurance premiums. The change will be made in two waves. Effective January 1, 2012, the available
subsidy will be reduced to one-half of the current subsidies. Effective January 1, 2013, the subsidy will be further
reduced to either $80 per month for participants who are not eligible for Medicare, or $17 per month for Medicare
eligible participants. These amendments were accounted for as plan amendments which reduced our benefit obligation