EXHIBIT 14-16 Components of Expense (Income)
|
|
Yew Ended 31 December |
||
|
|
2008 |
2007 |
2006 |
|
Components of expense/(income) |
|
|
|
|
Service cost |
$908 |
$910 |
$831 |
|
Interest cost |
2,497 |
2,457 |
2,378 |
|
Expected return on plan assets |
(3,455) |
(3,515) |
(3,378) |
|
Amortization of prior service costs |
188 |
185 |
180 |
|
Recognized net actuarial loss/(gain) |
912 |
1,266 |
440 |
|
Net periodic benefit coat |
$1,050 |
$I,303 |
$451 |
EXHIBIT 14-17 Funded Status of Plan
|
At 31 December ($ millions) |
2008 |
2007 |
|
Change in benefit obligation |
|
|
|
Beginning balance |
$45,183 |
$42,781 |
|
Service cost |
908 |
910 |
|
Interest cost |
2,497 |
2,457 |
|
Plan participants” contributions |
9 |
12 |
|
Amendments |
156 |
270 |
|
Actuarial (gain)/losses |
(925) |
2,778 |
|
Settlement/curtailment/acquisitions/dispositions, net |
85 |
(1,774) |
|
Benefit paid |
(2,331) |
(2,251) |
|
Ending balance |
$45,582 |
$45,183 |
|
Change in plan assets |
|
|
|
Beginning at fair value |
$43,484 |
$38,977 |
|
Actual return on plan assets |
4,239 |
5,460 |
|
Company contribution |
526 |
2,604 |
|
Plan participants” contributions |
9 |
12 |
|
Settlement/curtailment/acquisitions/dispositions, net |
216 |
(1,393) |
|
Benefit paid |
(2,286) |
(2,208) |
|
Exchange rate adjustment.( |
15 |
32 |
|
Ending balance at fair value |
$46,203 |
$43,484 |
EXHIBIT 14-18 Volatility Assumptions Used to Value Stock Option Grants
|
Grant year |
Weighted average expected volatility |
|
2008 valuation |
|
|
2004-2008 |
21.50% |
|
2008 valuation |
|
|
2003-2007 |
23.00% |
Passaic Industries is based in the United States and offers its employees both a defined-benefit pension plan and stock options. Several of the disclosures related to these plans are presented in Exhibits 14-16, 14-17, and 14-18.
Compared to 2008 net income as reported, if Passaic Industries had used the same expected volatility assumption for its 2008 option grants that it had used in 2007, its 2008 net income would have been
a. lower.
b. higher.
c. the same.