Pension and Postretirement Plans

12 Months Ended

Dec. 31, 2011

Jan. 02, 2011

Pension and Postretirement Plans [Abstract]

Pensions and Other Postretirement Plans [Text Block]

13. PENSIONS AND OTHER POSTRETIREMENT PLANS

The Company maintains various pension and incentive savings plans and contributes to several multiemployer plans on behalf of certain union-represented employee groups. Most of the Company's employees are covered by these plans.

The Company also provides health care and life insurance benefits to certain retired employees. These employees become eligible for benefits after meeting age and service requirements.

The Company uses a measurement date of December 31 for its pension and other postretirement benefit plans.

Defined Benefit Plans. The Company's defined benefit pension plans consist of various pension plans and a Supplemental Executive Retirement Plan (SERP) offered to certain executives of the Company.

In 2011, the Company offered a Voluntary Retirement Incentive Program to certain employees of Robinson Terminal Warehouse Corporation and the Post and recorded early retirement expense of $0.6 million. The early retirement program expense for these programs is funded mostly from the assets of the Company's pension plans.

In connection with the Newsweek sale in 2010, the Company recorded $5.3 million in special termination benefits expense and $2.4 million in prior service cost expense; these amounts are included in discontinued operations.

In 2009, 44 Newsweek employees accepted a Voluntary Retirement Incentive Program. Early retirement program expense of $6.6 million was recorded in 2009 and is included in discontinued operations. The early retirement program expense for this program is funded mostly from the assets of the Company's pension plans.

In 2009, a total of 221 employees of The Washington Post newspaper accepted a Voluntary Retirement Incentive Program, and early retirement program expense of $56.8 million was recorded, funded mostly from the assets of the Company's pension plans. In 2009, the Company offered a Voluntary Retirement Incentive Program to certain employees at Robinson Terminal Warehouse Corporation; $1.1 million in early retirement program expense was recorded, also funded mostly from the assets of the Company's pension plans.

The following table sets forth obligation, asset and funding information for the Company's defined benefit pension plans at December 31, 2011 and January 2, 2011:

	Pension Plans
(in thousands)	2011		2010
Change in Benefit Obligation
Benefit obligation at beginning of year	$	1,113,205	$	1,031,371
Service cost		27,619		26,976
Interest cost		60,033		60,329
Amendments		2,776		5,295
Actuarial loss		140,126		53,822
Benefits paid and other		(64,444)		(64,588)
Benefit obligation at end of year	$	1,279,315	$	1,113,205
Change in Plan Assets
Fair value of assets at beginning of year	$	1,651,958	$	1,440,816
Actual return on plan assets		229,063		275,730
Benefits paid and other		(64,444)		(64,588)
Fair value of assets at end of year	$	1,816,577	$	1,651,958
Funded status	$	537,262	$	538,753

	SERP
(in thousands)	2011		2010
Change in Benefit Obligation
Benefit obligation at beginning of year	$	79,403	$	73,845
Service cost		1,655		1,381
Interest cost		4,342		4,244
Amendments		369		―
Actuarial loss		9,059		2,847
Benefits paid and other		(1,965)		(2,914)
Benefit obligation at end of year	$	92,863	$	79,403
Change in Plan Assets
Fair value of assets at beginning of year	$	―	$	―
Employer contributions and other		3,114		2,914
Benefits paid		(3,114)		(2,914)
Fair value of assets at end of year	$	―	$	―
Funded status	$	(92,863)	$	(79,403)

The accumulated benefit obligation for the Company's pension plans at December 31, 2011 and January 2, 2011, was $1,191.9 million and $1,040.5 million, respectively. The accumulated benefit obligation for the Company's SERP at December 31, 2011 and January 2, 2011, was $86.6 million and $72.0 million, respectively. The amounts recognized in the Company's Consolidated Balance Sheets for its defined benefit pension plans at December 31, 2011 and January 2, 2011 are as follows:

	Pension Plans				SERP
(in thousands)	2011		2010		2011		2010
Noncurrent asset	$	537,262	$	538,753	$	―	$	―
Current liability		―		―		(4,002)		(3,601)
Noncurrent liability		―		―		(88,861)		(75,802)
Recognized asset (liability)	$	537,262	$	538,753	$	(92,863)	$	(79,403)

Key assumptions utilized for determining the benefit obligation at December 31, 2011 and January 2, 2011 are as follows:

	Pension Plans		SERP
	2011	2010	2011	2010
Discount rate	4.7%	5.6%	4.7%	5.6%
Rate of compensation increase	4.0%	4.0%	4.0%	4.0%

The Company made no contributions to its pension plans in 2011, 2010 and 2009, and the Company does not expect to make any contributions in 2012. The Company made contributions to its SERP of $3.1 million and $2.9 million for the years ended December 31, 2011 and January 2, 2011, respectively. As the plan is unfunded, the Company makes contributions to the SERP based on actual benefit payments.

At December 31, 2011, future estimated benefit payments, excluding charges for early retirement programs, are as follows:

(in millions)	Pension Plans		SERP
2012	$	70.9	$	4.3
2013	$	69.2	$	4.5
2014	$	69.2	$	4.8
2015	$	69.1	$	4.9
2016	$	70.1	$	5.5
2017–2021	$	375.2	$	29.8

The total (benefit) cost arising from the Company's defined benefit pension plans for the years ended December 31, 2011, January 2, 2011andJanuary 3, 2010, including a portion included in discontinued operations, consists of the following components:

		Pension Plans
(in thousands)		2011		2010		2009
Service cost		$	27,619	$	26,976	$	29,214
Interest cost			60,033		60,329		56,994
Expected return on assets			(95,983)		(95,340)		(98,780)
Amortization of transition asset			―		(29)		(42)
Amortization of prior service cost			3,605		4,201		4,505
Recognized actuarial loss			―		―		40
Net periodic benefit for the year			(4,726)		(3,863)		(8,069)
Early retirement programs expense			634		―		64,541
Special termination benefits			―		5,295		―
Recognition of prior service cost			―		2,369		―
Total (benefit) cost for the year		$	(4,092)	$	3,801	$	56,472
Other Changes in Plan Assets and Benefit Obligations
	Recognized in Other Comprehensive Income
Current year actuarial loss (gain)		$	7,046	$	(126,568)	$	(141,362)
Amortization of transition asset			―		29		42
Amortization of prior service cost			(1,463)		(6,570)		(4,505)
Recognized actuarial loss			―		―		(40)
Total recognized in other comprehensive income (before tax effects)		$	5,583	$	(133,109)	$	(145,865)
Total recognized in total cost (benefit) and other
	comprehensive income (before tax effects)	$	1,491	$	(129,308)	$	(89,393)

		SERP
(in thousands)		2011		2010		2009
Service cost		$	1,655	$	1,381	$	1,334
Interest cost			4,342		4,244		4,128
Plan amendment			369		―		―
Amortization of prior service cost			260		406		446
Recognized actuarial loss			1,411		1,068		1,676
Total cost for the year		$	8,037	$	7,099	$	7,584
Other Changes in Benefit Obligations Recognized in
	Other Comprehensive Income
Current year actuarial loss		$	9,059	$	2,656	$	2,778
Amortization of prior service cost			(260)		(406)		(446)
Recognized net actuarial loss			(1,411)		(877)		(1,676)
Total recognized in other comprehensive income (before tax effects)		$	7,388	$	1,373	$	656
Total recognized in total cost and other comprehensive
	income (before tax effects)	$	15,425	$	8,472	$	8,240

The costs for the Company's defined benefit pension plans are actuarially determined. Below are the key assumptions utilized to determine periodic cost for the years ended December 31, 2011, January 2, 2011 and January 3, 2010:

	Pension Plans			SERP
	2011	2010	2009	2011	2010	2009
Discount rate	5.6%	6.0%	5.75%	5.6%	6.0%	5.75%
Expected return on plan assets	6.5%	6.5%	6.5%	―	―	―
Rate of compensation increase	4.0%	4.0%	4.0%	4.0%	4.0%	4.0%

At December 31, 2011 and January 2, 2011, accumulated other comprehensive income (AOCI) includes the following components of unrecognized net periodic cost for the defined benefit plans:

	Pension Plans				SERP
(in thousands)	2011		2010		2011		2010
Unrecognized actuarial (gain) loss	$	(105,051)	$	(112,096)	$	26,385	$	18,742
Unrecognized prior service cost		19,626		21,089		245		506
Gross amount		(85,425)		(91,007)		26,630		19,248
Deferred tax liability (asset)		34,170		36,403		(10,652)		(7,698)
Net amount	$	(51,255)	$	(54,604)	$	15,978	$	11,550

During 2012, the Company expects to recognize the following amortization components of net periodic cost for the defined benefit plans:

		2012
(in thousands)	Pension Plans			SERP
Actuarial loss recognition		$	6,281	$	2,298
Prior service cost recognition		$	3,695	$	54

Defined Benefit Plan Assets. The Company's defined benefit pension obligations are funded by a portfolio made up of a relatively small number of stocks and high-quality fixed-income securities that are held by a third-party trustee. As of December 31,2011 and December 31, 2010, the assets of the Company's pension plans were allocated as follows:

	Pension Plan Asset Allocations
	December 31,			December 31,
	2011			2010
U.S. equities		69	%		66	%
U.S. fixed income		10	%		19	%
International equities		21	%		15	%
Total		100	%		100	%

Essentially all of the assets are actively managed by two investment companies. The goal of the investment managers is to produce moderate long-term growth in the value of these assets, while protecting them against large decreases in value. Both of these managers may invest in a combination of equity and fixed-income securities and cash. The managers are not permitted to invest in securities of the Company or in alternative investments. The investment managers cannot invest more than 20% of the assets at the time of purchase in the stock of Berkshire Hathaway or more than 10% of the assets in the securities of any other single issuer, except for obligations of the U.S. Government, without receiving prior approval by the Plan administrator. As of December 31, 2011, the managers can invest no more than 24% of the assets in international stocks at the time the investment is made, and no less than 10% of the assets could be invested in fixed-income securities. None of the assets is managed internally by the Company.

In determining the expected rate of return on plan assets, the Company considers the relative weighting of plan assets, the historical performance of total plan assets and individual asset classes and economic and other indicators of future performance. In addition, the Company may consult with and consider the input of financial and other professionals in developing appropriate return benchmarks.

The Company evaluated its defined benefit pension plan asset portfolio for the existence of significant concentrations (defined as greater than 10% of plan assets) of credit risk as of December 31, 2011. Types of concentrations that were evaluated include, but are not limited to, investment concentrations in a single entity, type of industry, foreign country and individual fund. At December 31, 2011 the pension plan held common stock in one investment which exceeded 10% of total plan assets. This investment was valued at $222.4 million and $134.8 million at December 31, 2011 and December 31, 2010, respectively, or approximately 12% and 8%, respectively, of total plan assets. Assets also included $154.0 million and $161.6 million of Berkshire Hathaway Class A and Class B common stock at December 31,2011 and December 31, 2010, respectively. At December 31, 2011 the pension plan held investments in one foreign country which exceeded 10% of total plan assets. These investments were valued at $241.4 million and $155.0 million at December 31,2011 and December 31, 2010, respectively, or approximately 13% and 9%, respectively, of total plan assets.

Fair value measurements are determined based on the assumption that a market participant would use in pricing an asset or liability based on a three-tiered hierarchy that draws a distinction between market participant assumptions based on (i) observable inputs, such as quoted prices in active markets (Level 1); (ii) inputs other than quoted prices in active markets that are observable either directly or indirectly (Level 2); and (iii) unobservable inputs that require the Company to use present value and other valuation techniques in the determination of fair value (Level 3). Financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measure. The Company's assessment of the significance of a particular input to the fair value measurements requires judgment and may affect the valuation of the assets and liabilities being measured and their placement within the fair value hierarchy.

The Company's pension plan assets measured at fair value on a recurring basis were as follows:

(in thousands)		Level 1		Level 2		Total
At December 31, 2011
Cash equivalents and other short-term investments		$	120,101	$	43,166	$	163,267
Equity securities
	U.S. equities		1,249,079		―		1,249,079
	International equities		381,924		―		381,924
Fixed-income securities
	U.S. Federal agency mortgage-backed securities		―		1,071		1,071
	Corporate debt securities		―		9,203		9,203
	Other fixed income		2,531		8,121		10,652
Total investments		$	1,753,635	$	61,561	$	1,815,196
Receivables							1,381
Total						$	1,816,577

Cash equivalents and other short-term investments.These investments are primarily held in U.S. Treasury securities and registered money market funds. These investments are valued using a market approach based on the quoted market prices of the security, or inputs that include quoted market prices for similar instruments, and are classified as either Level 1 or Level 2 in the valuation hierarchy.

U.S. equities.These investments are held in common and preferred stock of U.S. corporations and American Depositary Receipts (ADRs) traded on U.S. exchanges. Common and preferred shares and ADRs are traded actively on exchanges, and price quotes for these shares are readily available. These investments are classified as Level 1 in the valuation hierarchy.

International equities. These investments are held in common and preferred stock issued by non-U.S. corporations. Common and preferred shares are traded actively on exchanges, and price quotes for these shares are readily available. These investments are classified as Level 1 in the valuation hierarchy.

U.S. Federal agency mortgage-backed securities. These investments consist of fixed-income securities issued by Federal Agencies and are valued using a bid evaluation process, with bid data provided by independent pricing sources. These investments are classified as Level 2 in the valuation hierarchy.

Corporate debt securities. These investments consist of fixed-income securities issued by U.S. corporations and are valued using a bid evaluation process, with bid data provided by independent pricing sources. These investments are classified as Level 2 in the valuation hierarchy.

Other fixed income. These investments consist of fixed-income securities issued by the U.S. Treasury and in private placements and are valued using a quoted market price or bid evaluation process, with bid data provided by independent pricing sources. These investments are classified as Level 1 or Level 2 in the valuation hierarchy.

Other Postretirement Plans. The following table sets forth obligation, asset and funding information for the Company's other postretirement plans at December 31, 2011 and January 2, 2011:

	Postretirement Plans
(in thousands)	2011		2010
Change in Benefit Obligation
Benefit obligation at beginning of year	$	68,818	$	79,031
Service cost		2,872		3,275
Interest cost		3,063		3,934
Amendments		―		(6,336)
Actuarial gain		(55)		(3,073)
Curtailment gain		―		(3,630)
Benefits paid, net of Medicare subsidy		(2,286)		(4,383)
Benefit obligation at end of year	$	72,412	$	68,818
Change in Plan Assets
Fair value of assets at beginning of year	$	―	$	―
Employer contributions		2,286		4,383
Benefits paid, net of Medicare subsidy		(2,286)		(4,383)
Fair value of assets at end of year	$	―	$	―
Funded status	$	(72,412)	$	(68,818)

The amounts recognized in the Company's Consolidated Balance Sheets for its other postretirement plans at December 31, 2011 and January 2, 2011 are as follows:

	Postretirement Plans
(in thousands)	2011		2010
Current liability	$	(4,548)	$	(4,476)
Noncurrent liability		(67,864)		(64,342)
Recognized liability	$	(72,412)	$	(68,818)

The Company recorded a curtailment gain of $8.5 million in 2010 due to the sale of Newsweek; the gain is included in discontinued operations.

In 2009, the Company made changes to the cable television division's retiree health care benefits program, resulting in a $7.7 million curtailment gain. Also in 2009, the Company eliminated life insurance benefits for new retirees on or after January 1, 2009, resulting in a $0.7 million curtailment gain.

The discount rates utilized for determining the benefit obligation at December 31, 2011 and January 2, 2011 for the postretirement plans were 3.90% and 4.60%, respectively. The assumed health care cost trend rate used in measuring the postretirement benefit obligation at December 31, 2011 was 8.5% for pre-age 65, decreasing to 5.0% in the year 2019 and thereafter. The assumed health care cost trend rate used in measuring the postretirement benefit obligation at December 31, 2011 was 20.4% for the post-age 65 Medicare Advantage Prescription Drug (MA-PD) plan, decreasing to 5.0% in the year 2021 and thereafter, and was 7.5% for the post-age 65 non MA-PD plan, decreasing to 5.0% in the year 2017 and thereafter.

Assumed health care cost trend rates have a significant effect on the amounts reported for the health care plans. A change of one percentage point in the assumed health care cost trend rates would have the following effects:

	1%		1%
(in thousands)	Increase		Decrease
Benefit obligation at end of year	$	5,934	$	(5,268)
Service cost plus interest cost	$	728	$	(626)

The Company made contributions to its postretirement benefit plans of $2.3 million and $4.4 million for the years ended December 31, 2011 and January 2, 2011, respectively. As the plans are unfunded, the Company makes contributions to its postretirement plans based on actual benefit payments.

At December 31, 2011, future estimated benefit payments are as follows:

	Postretirement
(in millions)	Plans
2012		$	4.5
2013		$	4.8
2014		$	5.1
2015		$	5.3
2016		$	5.6
2017–2021		$	29.8

The total cost (benefit) arising from the Company's other postretirement plans for the years ended December 31, 2011, January 2, 2011 and January 3, 2010, including a portion included in discontinued operations, consists of the following components:

		Postretirement Plans
	(in thousands)	2011		2010		2009
Service cost		$	2,872	$	3,275	$	3,871
Interest cost			3,063		3,934		4,168
Amortization of prior service credit			(5,650)		(5,026)		(4,607)
Recognized actuarial gain			(1,921)		(2,032)		(3,128)
Net periodic (benefit) cost			(1,636)		151		304
Curtailment gain			―		(8,583)		(8,353)
Total benefit for the year		$	(1,636)	$	(8,432)	$	(8,049)
Other changes in plan assets and benefit obligations in other comprehensive income:
Current year actuarial (gain) loss		$	(55)	$	(3,073)	$	10,673
Current year prior service credit			―		(6,336)		(1,399)
Amortization of prior service credit			5,650		5,026		4,607
Recognized actuarial gain			1,921		2,032		3,128
Curtailment loss (gain)			―		4,953		(719)
Total recognized in other comprehensive income (before tax effect)		$	7,516	$	2,602	$	16,290
Total recognized in net periodic cost (benefit) and other comprehensive income
	(before tax effect)	$	5,880	$	(5,830)	$	8,241

The costs for the Company's postretirement plans are actuarially determined. The discount rates utilized to determine periodic cost for the years ended December 31, 2011, January 2, 2011 and January 3, 2010 were 4.60%, 5.25% and 5.75%, respectively.

At December 31, 2011and January 2, 2011, accumulated other comprehensive income (AOCI) included the following components of unrecognized net periodic benefit for the postretirement plans, respectively:

(in thousands)	2011		2010
Unrecognized actuarial gain	$	(15,510)	$	(17,376)
Unrecognized prior service credit		(31,736)		(37,386)
Gross amount		(47,246)		(54,762)
Deferred tax liability		18,898		21,905
Net amount	$	(28,348)	$	(32,857)

During 2012, the Company expects to recognize the following amortization components of net periodic cost for the other postretirement plans:

(in thousands)	2012
Actuarial gain recognition	$	(1,479)
Prior service credit recognition	$	(5,607)

Multiemployer Pension Plans. The Company contributes to a number of multiemployer defined benefit pension plans under the terms of collective-bargaining agreements that cover certain union-represented employees. The risks of participating in these multiemployer pension plans are different from single-employer plans as follows:

• Assets contributed to the multiemployer pension plan by one employer may be used to provide benefits to employees of other participating employers.
• If a participating employer stops contributing to the plan, the unfunded obligations of the plan may be borne by the remaining participating employers.
• If the Company chooses to stop participating in some of its multiemployer pension plans, the Company may be required to pay those plans an amount based on the underfunded status of the plan, referred to as a withdrawal liability.

The Company, through The Washington Post and The Daily Herald newspapers, contributed to the CWA/ITU Negotiated Pension Plan (Employer Identification Number – 13-6212879, Plan Number 001) on behalf of mailers, helpers and utility mailers. As of December 31, 2010 and 2009, the CWA/ITU Negotiated Pension Plan (the Plan)was in critical (red) status as currently defined by the Pension Protection Act of 2006, and a rehabilitation plan was in effect. There are no surcharges for employers who have adopted the rehabilitation plan, and there is no minimum contribution requirement other than the normal requirement to contribute as provided in the collective bargaining agreement. The Company's collective bargaining agreement expired on May 18, 2003. The Company's contributions to the Plan amounted to $0.1 million in 2011, $0.6 million in 2010 and $0.7 million in 2009. The Washington Post was listed in the Plan's Form 5500 as providing more than 5% of the total contribution to the Plan for the years ended December 31, 2010 and 2009.

In 2010, The Washington Post notified the union and the Plan of its unilateral withdrawal from the Plan effective November 30, 2010. In connection with this action, The Washington Post recorded a $20.4 million charge in 2010based on an estimate of the withdrawal liability. In 2011, the Daily Herald notified the union and the Plan of its unilateral withdrawal from the Plan effective December 18, 2011. In connection with this action, The Daily Herald recorded a $2.4 million charge in 2011 based on an estimate of the withdrawal liability. Payment of the actual withdrawal liability will relieve The Washington Post and The Daily Herald of further liability to the Plan absent certain circumstances prescribed by law.

The Company's total contributions to multiemployer pension plans that are not individually significant amounted to $0.3 million in 2011, $0.4 million in 2010 and $0.4 million in 2009. The Company's total contributions to all multiemployer pension plans amounted to $0.4 million in 2011, $1.0 million in 2010 and $1.1 million in 2009.

Savings Plans. The Company recorded expense associated with retirement benefits provided under incentive savings plans (primarily 401(k) plans) of approximately $20.9 million in 2011, $19.1 million in 2010 and $19.9 million in 2009.

(in thousands)		Level 1		Level 2		Total
At January 2, 2011
Cash equivalents and other short-term investments		$	207,929	$	68,091	$	276,020
Equity securities
	U.S. equities		1,090,693		―		1,090,693
	International equities		250,604		―		250,604
Fixed-income securities
	U.S. Federal agency mortgage-backed securities		―		1,699		1,699
	Corporate debt securities		―		15,854		15,854
	Other fixed income		7,106		8,338		15,444
Total investments		$	1,556,332	$	93,982	$	1,650,314
Receivables							1,644
Total						$	1,651,958