Question

1. Select a firm from the list at the bottom of this page.

2. Locate the financial statements for that firm from the Securities Exchange Commission's EDGAR website (www.sec.gov).  These should be in the firm's 10-K report.

3. Using the firm's financial statements and footnotes, fill out the data sheet on page 2 of this file. For all but the actual pension return data your dollar amounts should correspond to the fiscal year ending 2016. You will need to collect 6 years of actual pension return data, which should require 3 years of financial statements (2012, 2014, and 2016). Record all numbers, with the exception of percentages, "in millions," e.g, $200 million is recorded as $200.0, $2 billion is recorded as $2,000.0.

4.  Answer the questions listed below.

Data

From 2016 financial statements

Company name ________________________________________________________

Total liabilities ($millions)         $ ____________

Total assets ($millions)               $ ____________

Net operating cash flows ($millions)                            $ ____________

Income from continuing operations ($millions)           $ ____________

  

Pension plan assumptions

      Discount rate ________%      Expected asset return ________%    Rate of salary increase _______ %

Pension plan disclosures

Projected benefit obligation ($millions)                       $ ____________

Fair value of pension plan assets ($millions)               $ ____________

Accumulated benefit obligation ($millions)                 $ ____________

Cash contributions to the pension plan during the year ($millions)                                 $ ___________

% of pension assets invested in equities                                                  ___________ %

% of pension assets invested in bonds ___________ %

OPEB disclosures

Expected postemployment benefit obligation ($millions)                                     $ ____________

Accumulated postemployment benefit obligation ($millions)                                     $ ____________

Fair value of plan assets ($millions)   $ ____________

From 2016 and previous financial statements

Actual percentage return on pension plan assets ($ actual return / $ beginning of year fair value of plan assets)

2016 _____ %    2015 _____ %   2014 _____%   2013 _____ %   2012 _____%    2011_______%

Required questions

1. What dollar amount does your firm report for its defined-benefit pension plan and its OPEB plan on its year-end 2016 balance sheet? Prove this amount by reconciling from the related off-balance sheet footnote accounts.

2. What dollar amount does your firm report for its defined-benefit pension plan and its OPEB plan on its year-ending 2016 income statement?

3. Are your firm's defined-benefit pension plan and/or its OPEB plan material to your firm's financial position and financial performance? Explain using selected data from your firm's financial statements.

4. Are your firm's defined-benefit pension plan and its OPEB plan well-funded or poorly funded as of year-end 2016? Explain.

5.  Is your firm's 2016 expected return on plan assets assumption reasonable? Explain.

NOTE: At a minimum compare your firm's expected return on plan assets in 2016 with its average (geometric mean) return over the past 6 years. See details on computing the mean return below.

6. Defined-benefit pension plans and OPEB plans typically generate temporary differences between financial books and tax books. Discuss the significance of your firm's defined-benefit pension plans and OPEB plans to its year-end 2016 deferred tax accounts. Use dollar amounts from the tax footnote.

*Compute average (geometric mean) return

Suppose that in 3 successive years the return on an investment is 5%, 20%, and -4%. The geometric mean, or compound annual rate of return, is computed as:

             [(1.05)*(1.20)*0.96)]^1/3 -1 = 0.065 = 6.5%

Firms to choose from:

ABX AIR INC

ACCURIDE CORP

ACE AVIATION HOLDINGS INC

AGERE SYSTEMS INC

AK STEEL HOLDING CORP

ALCOA INC

ALERIS INTERNATIONAL INC

ALGOMA STEEL INC

ALLEGHENY TECHNOLOGIES INC

ALLIANT TECHSYSTEMS INC

ALTRIA GROUP INC

AMERICAN AIRLINES INC

AMERICAN AXLE & MFG HLDGS

AMERICAN CRYSTAL SUGAR CO

AMERICAN STANDARD COS INC

AMPCO-PITTSBURGH CORP

AMR CORP/DE

ANHEUSER-BUSCH COS INC

APPLETON PAPERS INC

ARCH COAL INC

ARGO-TECH CORP

ASHLAND INC

AVAYA INC

AVON PRODUCTS

BADGER METER INC

BARNES GROUP INC

BCE INC

BECKMAN COULTER INC

BECTON DICKINSON & CO

BLOUNT INTL INC

BOEING CO

BORDEN CHEMICAL INC

BORGWARNER INC

BOWATER INC

BRIGGS & STRATTON

BRINKS CO

BRUSH ENGINEERED MATERIALS

BUCYRUS INTERNATIONAL INC

CABOT CORP

CAMPBELL SOUP CO

CARPENTER TECHNOLOGY CORP

CATERPILLAR INC

CELANESE CORP

CENTRAL MAINE POWER CO

CENTRAL STEEL & WIRE CO

CENTURY ALUMINUM CO

CENTURYTEL INC

CINCINNATI BELL INC

CITGO PETROLEUM CORP

CLEVELAND-CLIFFS INC

CNF INC

CNH GLOBAL NV

COMMSCOPE INC

CONSOL ENERGY INC

COOPER INDUSTRIES LTD

COOPER TIRE & RUBBER CO

CORNING NATURAL GAS CORP

CROMPTON CORP

CROWN HOLDINGS INC

CT COMMUNICATIONS INC

CUMMINS INC

CURTISS-WRIGHT CORP

CYTEC INDUSTRIES INC

DAIMLERCHRYSLER AG

DANA CORP

DAY INTERNATIONAL GROUP INC

DEERE & CO

DELTA AIR LINES INC

DU PONT (E I) DE NEMOURS

DUN & BRADSTREET CORP

EASTMAN CHEMICAL CO

EASTMAN KODAK CO

EATON CORP

EL PASO ELECTRIC CO

EMC INSURANCE GROUP INC

ENERGY EAST CORP

ENGELHARD CORP

FALCONBRIDGE LTD

FARMER BROS CO

FEDERAL SCREW WORKS

FEDERAL-MOGUL CORP

FIRSTENERGY CORP

FOOT LOCKER INC

FORD MOTOR CO

FOSTER WHEELER LTD

FOUNDATION COAL HOLDINGS INC

FREIGHTCAR AMERICA INC

GARDNER DENVER INC

GENCORP INC

GENERAL DYNAMICS CORP

GENERAL MOTORS CORP

GENTEK INC

GEORGIA-PACIFIC CORP

GLATFELTER

GOODRICH CORP

GOODYEAR TIRE & RUBBER CO

GORMAN-RUPP CO

GRACE (W R) & CO

GRAFTECH INTERNATIONAL LTD

GRAYBAR ELECTRIC CO INC

HANCOCK FABRICS INC

HAYES LEMMERZ INTL INC

HERCULES INC

HERSHEY CO

HONEYWELL INTERNATIONAL INC

HORMEL FOODS CORP

IMPERIAL SUGAR CO

INCO LTD

INGERSOLL-RAND CO LTD

INTL FLAVORS & FRAGRANCES

ISPAT INLAND INC

ITT INDUSTRIES INC

JOY GLOBAL INC

K & F INDUSTRIES INC

KAYDON CORP

KEYSPAN CORP

KIMBERLY-CLARK CORP

KNOLL INC

KRAFT FOODS INC

LADISH CO INC

LAFARGE NORTH AMERICA INC

LAMSON & SESSIONS CO

LEVCOR INTERNATIONAL INC

LEVI STRAUSS & CO

LIBBEY INC

LOCKHEED MARTIN CORP

LORAL SPACE & COMMUNICATIONS

LUCENT TECHNOLOGIES INC

LUFKIN INDUSTRIES INC

MASSEY ENERGY CO

MAUI LAND & PINEAPPLE CO

MAYTAG CORP

MCCORMICK & COMPANY INC

MEMC ELECTRONIC MATRIALS INC

MICHIGAN CONSOLIDATED GAS CO

MILACRON INC

MONARCH CEMENT CO

MONSANTO CO

NAVISTAR INTERNATIONAL CORP

NCR CORP

NEENAH PAPER INC

NEW YORK ST ELEC & GAS CORP

NEWELL RUBBERMAID INC

NEWMARKET CORP

NORTEL NETWORKS CORP

NORTH PITTSBURGH SYSTEMS

NORTHROP GRUMMAN CORP

NORTHWEST AIRLINES CORP

OILGEAR CO

OVERNITE CORP

OWENS CORNING

PARK OHIO HOLDINGS CORP

PEABODY ENERGY CORP

PENFORD CORP

PEPSICO INC

POLYONE CORP

POPE & TALBOT INC

POTASH CORP SASK INC

POTLATCH CORP

POTOMAC ELECTRIC POWER CO

PPG INDUSTRIES INC

PULITZER INC

QWEST COMMUNICATION INTL INC

RAYTECH CORP/DE

RBS GLOBAL INC

READERS DIGEST ASSN

REUNION INDUSTRIES

REYNOLDS AMERICAN INC

ROCHESTER GAS & ELECTRC CORP

ROCKWELL AUTOMATION

ROCKWELL COLLINS INC

ROHM AND HAAS CO

RTI INTL METALS INC

RYERSON TULL INC

SAMSONITE CORP

SARA LEE CORP

SCHLUMBERGER LTD

SEARS ROEBUCK & CO

SIGMA-ALDRICH CORP

SILGAN HOLDINGS INC

SNAP-ON INC

SOLUTIA INC

STANDARD MOTOR PRODS

STANDARD REGISTER CO

STEELCASE INC

SUNOCO INC

SWANK INC

TASTY BAKING CO

TELECOMUNICAC DE PUERTO RICO

TELEDYNE TECHNOLOGIES INC

TENNECO AUTOMOTIVE INC

TESORO CORP

TIMKEN CO

TODD SHIPYARDS CORP

TRW AUTOMOTIVE HOLDINGS CORP

TUPPERWARE CORP

TWIN DISC INC

U S CAN CORP

UAL CORP

UNIFIED WESTERN GROCERS INC

UNION CARBIDE CORP

UNITED AIRLINES INC

UNITED INDUSTRIAL CORP

UNITED PARCEL SERVICE INC

UNITED REFINING CO

UNITED STATES STEEL CORP

US AIRWAYS GROUP INC

USEC INC

USG CORP

UST INC

VERIZON COMMUNICATIONS INC

VISKASE COMPANIES INC

VISTEON CORP

WALTER INDUSTRIES INC

WAUSAU PAPER CORP

WESTMORELAND COAL CO

WHIRLPOOL CORP

WILLIAMS CONTROLS INC

WISCONSIN GAS CO

WOLVERINE TUBE INC

WOODWARD GOVERNOR CO

WYETH

XERIUM TECHNOLOGIES INC

XEROX CORP

YORK INTERNATIONAL CORP

Answer 1

Answer :-

DATA

Comany Name :- XEROX CORP

Total liabilities ($millions)         $ 13090

Total assets ($millions)               $ 18051

Net operating cash flows ($millions)                            $ 1095

Income from continuing operations ($millions)           $ 1349

  

Pension plan assumptions

      Discount rate 4.1 %      Expected asset return 5.8 %    Rate of salary increase 21  %

Pension plan disclosures

Projected benefit obligation ($millions)                       $ 1120

Fair value of pension plan assets ($millions)               $ 1123

Accumulated benefit obligation ($millions)                 $ 2230

Cash contributions to the pension plan during the year ($millions)                                 $ 1350

% of pension assets invested in equities 23 %

% of pension assets invested in bonds 28 %

OPEB disclosures

Expected postemployment benefit obligation ($millions)                                     $ 2305

Accumulated postemployment benefit obligation ($millions)                                     $ 4421

Fair value of plan assets ($millions)   $ 2230

From 2016 and previous financial statements

Actual percentage return on pension plan assets ($ actual return / $ beginning of year fair value of plan assets)

2016 5.6 %    2015 4.55 %   2014 6.3 %   2013 4.2  %   2012 3.98 %    2011 2.22 %