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In addition to providing pension benefits, the Company provides other postretirement benefits, primarily retiree healthcare
benefits, in certain countries. The Company funds those other postretirement benefit plans as claims are incurred.
The table below provides a summary of the changes in the accumulated postretirement benefit obligations for 2007 and 2008.
It also provides a reconciliation of the obligations to the amounts recognized in the consolidated balance sheets.
All the postretirement benefit plans are unfunded and therefore no plan asset disclosures are presented.
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Accumulated postretirement benefit obligation
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Accumulated benefit obligation at beginning of year
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Exchange rate differences
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Accumulated benefit obligation at end of year
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Amounts recognized in the consolidated balance sheet
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Net pension liability at year-end
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Amounts recognized in accumulated other comprehensive income
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Accumulated other comprehensive income
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Accumulated postretirement benefit obligation
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Accumulated benefit obligation at beginning of year
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Exchange rate differences
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Accumulated benefit obligation at end of year
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Amounts recognized in the consolidated balance sheet
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Net pension liability at year-end
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Amounts recognized in accumulated other comprehensive income
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Accumulated other comprehensive income
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The components of the net periodic cost of postretirement benefits other than pensions are:
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Interest cost on accumulated postretirement benefit obligation
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Amortization of unrecognized transition obligation
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Net actuarial loss recognized
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Items recognized in other comprehensive income
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Net actuarial loss (gain)
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Prior-service cost (credit)
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Reclassified/included in pension costs
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Amortization of net actuarial gains and losses
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Amortization of transition amounts
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Recognized in net periodic benefit cost and other comprehensive income
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Interest cost on accumulated postretirement benefit obligation
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Amortization of unrecognized transition obligation
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Net actuarial loss recognized
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Items recognized in other comprehensive income
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Net actuarial loss (gain)
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Prior-service cost (credit)
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Reclassified/included in pension costs
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Amortization of net actuarial gains and losses
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Amortization of transition amounts
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Recognized in net periodic benefit cost and other comprehensive income
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Interest cost on accumulated postretirement benefit obligation
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Amortization of unrecognized transition obligation
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Net actuarial loss recognized
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The weighted averages of the assumptions used to calculate the postretirement benefit obligations as of December 31 were as
follows:
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Compensation increase (where applicable)
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The weighted averages of the assumptions used to calculate the net periodic cost for years ended December 31 were as follows:
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Compensation increase (where applicable)
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Assumed healthcare cost trend rates at December 31:
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Healthcare cost trend rate assumed for next years
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Rate that the cost trend rate will gradually reach
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Year of reaching the rate at which it is assumed to remain
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Assumed healthcare cost trend rates have a significant effect on the amounts reported for the retiree medical plans. A one-percentage-point
change in assumed healthcare cost trend rates would have the following effects:
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one-percentage-point increase
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one-percentage-point decrease
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Effect on total of service and interest cost
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Effect on postretirement benefit obligation
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