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NOTE 11 - Pension Plans
The Company has qualified defined benefit plans covering substantially
all ot its employees. The benefits are based on years of service and the
employee's compensation at the time of retirement, or years of service
and a benefit multiplier. The Company funds its pension plans based on
allowable federal income tax deductions. Contributions are intended to
provide not only for benefits attributed to service to date but also for
benefits expected to be earned in the future. The Company also has two
non-qualified plans that provide benefits in addition to those provided
in the qualified plans.
Pension fund assets are invested in a broadly
diversified portfolio consisting primarily of publicly-traded common stocks
and fixed income securities.
The following sets forth the reconciliation
of the benefit obligations and plan assets and the funded status for all
Company pension plans:
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2001 |
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2000 |
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CHANGE IN BENEFIT OBLIGATION |
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Benefit obligation at beginning
of year |
$411,220 |
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$403,831 |
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Service cost |
11,873 |
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|
12,203 |
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Interest cost |
27,707 |
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|
29,469 |
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Early retirement window |
--- |
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4,064 |
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Amendments |
--- |
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|
(88) |
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Actuarial loss |
32,839 |
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|
13,258 |
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Benefits paid |
(76,201) |
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(51,517) |
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Benefit obligation at end of
year |
$407,438 |
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$411,220 |
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CHANGE IN PLAN ASSETS |
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Fair value of plan assets at
beginning of year |
$494,185 |
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$484,946 |
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Actual return on plan assets |
(40,923) |
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56,974 |
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Participants' contributions |
--- |
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|
870 |
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Employer contributions |
7,723 |
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|
2,912 |
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Benefits paid |
(76,201) |
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(51,517) |
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Fair value of plan assets at
end of year |
$384,784 |
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$494,185 |
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Funded status |
$(22,654) |
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$ 82,965 |
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Unrecognized net actuarial loss |
130,518 |
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|
8,682 |
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Unrecognized prior service cost |
2,224 |
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4,938 |
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Minimum pension liability |
(2,411) |
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(2,309) |
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Prepaid pension expense shown
in balance sheet |
$107,677 |
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$ 94,276
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MINIMUM PENSION LIABILITY |
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Intangible asset |
$514 |
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$ 745 |
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Deferred income tax benefit |
764 |
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|
630 |
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Accumulated comprehensive losses |
1,133 |
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|
934 |
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Total |
$ 2,411 |
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$ 2,309 |
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Net periodic benefit income includes the
following components:
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2001 |
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2000 |
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1999 |
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Service cost of benefits earned |
$11,873 |
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$12,203 |
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$11,778 |
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Interest cost on projected benefit obligation |
27,707 |
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|
29,469 |
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29,587 |
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Expected return on plan assets |
(48,395) |
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(52,773) |
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(51,987) |
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Amortization of prior service costs |
1,861 |
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|
2,348 |
|
2,358 |
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Curtailment loss |
853 |
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|
568 |
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--- |
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Amortization of net loss from prior periods |
321 |
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|
232 |
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160 |
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Cost of early retirement window |
--- |
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4,064 |
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--- |
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Net periodic benefit income |
$ (5,780) |
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$ (3,889) |
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$ (8,104) |
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The fluctuation in unrecognized net actuarial
loss for 2001 compared with 2000 is due primarily to the actual return
on plan assets for 2001 being less than the expected return and changing
the discount rate for the determination of the accumulated benefit obligations
for 2001 from 7.5% to 7.0%.
The weighted average discount rates used
in determining the actuarial present value of the projected benefit obligation
were 7.0% for 2001 and 7.5% for 2000 and 1999. The rate of increase for
future compensation levels used in determining the obligation was 5.0%
for 2001, 2000, and 1999. The expected long-term rate of return on plan
assets was 10.0% in 2001 and 10.5% in 2000 and 1999.
The Company's two non-qualified plans have
no plan assets. The total unfunded projected benefit obligations of these
two plans were $15,122, $21,477, and $18,406 at the respective 2001, 2000,
and 1999 year-ends. The related accumulated benefit obligations were $12,197;
$17,808; and $14,857 at the same respective year-ends.
Substantially all of the Company's employees
are eligible to participate in a 401(k) savings plan. Expenses recorded
for employer matching contributions under this plan totaled $2,542; $2,913;
and $1,172 for 2001, 2000, anil 1999, respectively.
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