PENSION AND OTHER POSTRETIREMENT PLANS

The Company has defined benefit pension plans and a postretirement healthcare benefit plan covering certain current and retired employees. The Company has frozen participation in its defined benefit plans. For one of the plans, certain current plan participants continue to participate in the plan, while other current participants do not accrue future benefits under the plan but participate in an enhanced defined contribution plan which offers an increased Company match.

The Company’s policy is to contribute to its qualified U.S. and non-U.S. pension plans at least the minimum amount required by applicable laws and regulations, to contribute to the U.S. combined nonqualified plans when required for benefit payments, and to contribute to the postretirement healthcare benefit plan an amount equal to the benefit payments. The Company, from time to time, makes voluntary contributions in excess of the minimum amount required as economic conditions warrant. During 2012, the Company made voluntary contributions to its qualified U.S. pension plans of $15,793. The Company did not make a voluntary contribution to its qualified U.S. pension plans in 2011 or 2010. The Company expects to contribute $6,156 to its U.S. qualified plans, $21,372 to its U.S. combined nonqualified plans, $340 to its non-U.S. plan and $70 to its postretirement healthcare benefit plan to pay benefits during 2013.

The projected benefit obligation ("PBO"), accumulated benefit obligation (“ABO”) and fair value of plan assets for qualified pension plans with PBOs and ABOs in excess of plan assets were $194,650, $186,343 and $146,307, respectively, at November 30, 2012.

The U.S. combined nonqualified plans are unfunded; therefore, there are no plan assets; however, the Company has funded $1,070 and $1,131 at November 30, 2012 and 2011, respectively, into a restricted trust for its U.S. combined nonqualified plans, see Note E. This trust is included in Other noncurrent assets in the Consolidated Balance Sheets. The PBO and ABO for the U.S. combined nonqualified plans were $23,337 and $23,229, at November 30, 2012, respectively.

A discount rate is used to calculate the present value of the PBO. The Company’s objective in selecting a discount rate is to select the best estimate of the rate at which the benefit obligations could be effectively settled on the measurement date, taking into account the nature and duration of the benefit obligations of the plan. In making this estimate, the Company looks at rates of return on high-quality fixed-income investments currently available and expected to be available during the period to maturity of the benefits. This process includes looking at the bonds available on the measurement date with a quality rating of Aa or better. Similar appropriate benchmarks are used to determine the discount rate for the non-U.S. plan. The difference in the discount rates between the qualified, the nonqualified and the other postretirement plans is due to different expectations as to the period of time in which plan members will participate in the various plans. In general, higher discount rates correspond to longer expected participation periods. The assumptions for the discount rate, rate of compensation increase and expected rate of return and the asset allocations related to the non-U.S. plan are not materially different than for the U.S. qualified plans.

The rate of compensation increase represents the long-term assumption for expected increases in salaries among continuing active participants accruing benefits in the pay-related plans. The Company considers the impact of profit-sharing payments, merit increases and promotions in setting the salary increase assumption as well as possible future inflation increases and its impact on salaries paid to plan participants at the locations where the Company conducts operations.

The following tables show reconciliations of the changes in benefit obligations and plan assets for our pension plans and other postretirement benefits plan as of November 30, 2012 and 2011. The accrued pension benefit obligation includes an unfunded benefit obligation of $23,337 and $22,022 as of November 30, 2012 and 2011, respectively, related to the Company’s U.S. combined nonqualified plans.



	Pension Benefits						Other Postretirement Benefits
	2012			2011			2012			2011
Change in benefit obligation
Benefit obligation at beginning of year	$	186,841		$	168,644		$	550		$	663
Currency translation	200			(14		)	—			—
Service cost	2,126			1,968			—			—
Interest cost	7,715			8,133			17			23
Plan participants' contributions	42			41			—			—
Actuarial losses (gains)	28,119			16,562			(189		)	(24		)
Benefits paid	(7,056		)	(8,493		)	(282		)	(483		)
Retiree contributions	—			—			346			371
Benefit obligation at end of year	$	217,987		$	186,841		$	442		$	550



	Pension Benefits						Other Postretirement Benefits
	2012			2011			2012			2011
Change in plan assets
Fair value of plan assets at beginning of year	$	112,548		$	100,866		$	—		$	—
Currency translation	175			(13		)	—			—
Actual return on plan assets	18,325			5,771			—			—
Employer contributions	22,273			14,376			282			483
Plan participants' contributions	42			41			—			—
Benefits paid	(7,056		)	(8,493		)	(282		)	(483		)
Fair value of plan assets at end of year	$	146,307		$	112,548		$	—		$	—
Funded status	$	(71,680	)	$	(74,293	)	$	(442	)	$	(550	)

Accumulated benefit obligation at end of year	$	209,572		$	178,959		n/a			n/a

Assumptions:
Discount rate - qualified plans	3.50%			4.50%			2.25%			3.50%
Discount rate - nonqualified plans	1.75%			2.75%			n/a			n/a
Rate of compensation increase - qualified plans	4.00%			4.00%			n/a			n/a
Rate of compensation increase - nonqualified plans	4.00%			4.00%			n/a			n/a
Measurement date	11/30/2012			11/30/2011			11/30/2012			11/30/2011



	Pension Benefits						Other Postretirement Benefits
	2012			2011			2012			2011
Amounts recognized in the Consolidated Balance Sheets as of November 30
Accounts payable and accrued liabilities	$	(21,372	)	$	(219	)	$	(70	)	$	(100	)
Long-term pension and postretirement healthcare benefits liabilities	(50,308		)	(74,074		)	(372		)	(450		)
Funded status	$	(71,680	)	$	(74,293	)	$	(442	)	$	(550	)

Accumulated other comprehensive loss, pre-tax	$	83,392		$	72,687		$	(1,832	)	$	(1,887	)

Amounts recognized in Accumulated Other Comprehensive Loss, as of November 30
Unrecognized net actuarial loss (gain)	$	83,413		$	72,717		$	(1,114	)	$	(1,047	)
Unrecognized net prior service credit	(21		)	(30		)	(718		)	(840		)
Accumulated other comprehensive loss, pre-tax	83,392			72,687			(1,832		)	(1,887		)
Deferred taxes	(31,336		)	(26,830		)	666			686
Accumulated other comprehensive loss, after-tax	$	52,056		$	45,857		$	(1,166	)	$	(1,201	)

The amounts affecting Accumulated other comprehensive loss for the years ended November 30, 2012 and 2011 are as follows:



	Pension Benefits						Other Postretirement Benefits
	2012			2011			2012			2011
Amortization of unrecognized prior service (cost) credit, net of tax of $(6), $(149) and $(45), $(45), respectively	$	3		$	246		$	77		$	77
Amortization of unrecognized actuarial (losses) gains, net of tax of $3,164, $2,403 and $(44), $(47), respectively	(5,159		)	(4,075		)	77			83
Current year actuarial losses (gains), net of tax of $(7,143), $(6,825) and $68, $9, respectively	11,876			11,639			(120		)	(15		)
Effect of change in deferred tax rate	(521		)	(335		)	1			(6		)
Total	$	6,199		$	7,475		$	35		$	139

The target allocation of invested assets for the U.S. plans is 60% equity securities and 40% debt securities. The target allocation is based on the Company’s desire to maximize total return, considering the long-term funding objectives of the pension plans, but may change in the future. Plan assets are diversified to achieve a balance between risk and return. The Company does not invest plan assets in private equity funds or hedge funds. The Company’s expected long-term rate of return considers historical returns on plan assets as well as future expectation given the current and target asset allocation and current economic conditions with input from investment managers and actuaries. The expected rate of return on plan assets is designed to be a long-term assumption that may be subject to considerable year-to-year variance from actual returns.

As of the November 30^th measurement dates, the fair values of actual pension asset allocations were as follows:



	2012		2011
Equity securities	60.6	%	72.1	%
Debt securities	38.9	%	24.1	%
Real estate	—	%	3.4	%
Cash and cash equivalents	0.5	%	0.4	%
	100.0	%	100.0	%

The accounting guidance on fair value measurements specifies a fair value hierarchy based upon the observability of inputs used in valuation techniques (Level 1, 2 and 3). See Note E for a discussion of the fair value hierarchy. The following table summarizes the fair value of the pension plans’ assets.



	Fair Value Measurements at Reporting Date
	Total		Level 1		Level 2		Level 3
November 30, 2012
U.S. equity securities funds	$	61,272	$	61,272	$	—	$	—
Non-U.S. equity securities funds	27,422		27,422		—		—
Fixed income securities funds	56,854		56,854		—		—
Cash and equivalents funds	618		618		—		—
Total	146,166		$	146,166	$	—	$	—
Other items to reconcile to fair value of plan assets	141
Fair value of plan assets	$	146,307



	Fair Value Measurements at Reporting Date
	Total		Level 1		Level 2		Level 3
November 30, 2011
U.S. equity securities funds	$	68,481	$	—	$	68,481	$	—
Non-U.S. equity securities funds	12,613		5,424		7,189		—
Fixed income securities funds	27,171		1,916		25,255		—
Real estate funds	3,782		—		—		3,782
Cash and equivalents funds	67		67		—		—
Total	112,114		$	7,407	$	100,925	$	3,782
Other items to reconcile to fair value of plan assets	434
Fair value of plan assets	$	112,548

U.S. equity securities funds consist primarily of large cap and small cap U.S. companies. Non-U.S. equity securities funds consist primarily of equities of non-U.S. developed markets. Funds that are traded on a national exchange are categorized as Level 1. For fund units not traded on a national exchange, the funds are valued at the net asset value (“NAV”) as determined by the custodian of the funds. The NAV is based on the fair value of the underlying assets owned by the fund, minus its liabilities then divided by the number of units outstanding.

Fixed income securities funds consist primarily of bonds such as governmental agencies, investment grade credit, commercial mortgage backed, residential mortgage backed and asset backed. Funds that are traded on a national exchange are categorized as Level 1. For fund units not traded on a national exchange, the funds are valued at the NAV as determined by the custodian of the funds. The NAV is based on the fair value of the underlying assets owned by the fund, minus its liabilities then divided by the number of units outstanding.

Real estate funds consist of units of other private real estate funds, each of which have different pre-notification and valuation parameters. The NAV for the funds is calculated on a lag of approximately 30 days and the funds only trade on a quarterly basis through the custodian of the funds.

Other items to reconcile to fair value of plan assets is the net of interest receivable, amounts due for securities sold, amounts payable for securities purchased and interest payable.

The following table summarizes changes in the fair value of Level 3 assets for the year ended November 30, 2012.



	2012			2011
Balance at beginning of year	$	3,782		$	3,203
Unrealized gains	—			579
Realized gains	279			—
Sale of assets	(4,061		)	—
Balance at end of year	$	—		$	3,782

The components of net periodic benefit cost for pensions are shown below. Net periodic benefit cost is based on assumptions determined at the prior year-end measurement date. Increases in the liability due to changes in plan benefits are recognized in the net periodic benefit costs through straight-line amortization over the average remaining service period of employees expected to receive benefits.



	Pension Benefits
	2012			2011			2010
Components of net periodic benefit cost
Service cost	$	2,126		$	1,968		$	2,119
Interest cost	7,715			8,133			8,108
Expected return on plan assets	(9,181		)	(7,674		)	(7,123		)
Settlement costs	—			1,368			—
Amortization of unrecognized:
Prior service cost	(10		)	(395		)	(394		)
Net actuarial loss	8,323			5,110			5,006
Net periodic benefit cost	$	8,973		$	8,510		$	7,716

Assumptions:
Discount rate - qualified plans	4.50%			5.25%			5.50%
Discount rate - nonqualified plans	1.75%			2.75%			2.25%
Expected return on plan assets	7.50%			7.50%			7.75%
Rate of compensation increase - qualified plans	4.00%			4.00%			4.00%
Rate of compensation increase - nonqualified plans	4.00%			4.00%			4.00%
Measurement date - qualified plans	11/30/2011			11/30/2010			11/30/2009
Measurement date - nonqualified plans	11/30/2012			11/30/2011			11/30/2010

For the determination of 2013 expense, the Company changed its assumptions as follows: (a) leave the long-term return on assets for its qualified plans unchanged, (b) decrease the discount rates on its qualified plans to 3.50%, and (c) leave the rate of compensation increase unchanged. For its U.S. combined nonqualified plans, the Company expects to leave the discount rates and rate of compensation increase unchanged.

The changes in the fair value of plan assets, plan liabilities and in the assumptions will result in a net decrease in fiscal year 2013 expense of approximately $774 for the qualified U.S. pension plans. The Company also expects a net decrease of approximately $838 for the U.S. combined nonqualified plans in fiscal year 2013.

The postretirement obligations represent a fixed dollar amount per retiree. The Company has the right to modify or terminate these benefits. The participants will assume substantially all future healthcare benefit cost increases, and future increases in healthcare costs will not increase the postretirement benefit obligation or cost to the Company. Therefore, the Company has not assumed any annual rate of increase in the per capita cost of covered healthcare benefits for future years. The Company discontinued the prescription drug benefit portion of its plan effective January 31, 2006.

The components of net periodic benefit income for postretirement healthcare benefits are shown below.



	Other Postretirement Benefits
	2012			2011			2010
Components of net periodic benefit income
Interest cost	$	17		$	23		$	32
Amortization of unrecognized:
Prior service cost	(122		)	(122		)	(123		)
Net actuarial gain	(121		)	(130		)	(129		)
Net periodic benefit income	$	(226	)	$	(229	)	$	(220	)

Assumptions:
Discount rate	3.50		%	3.75		%	4.25		%
Measurement date	11/30/2011			11/30/2010			11/30/2009

The Company froze participation in the postretirement healthcare plan to eligible retirees effective January 1, 2007. As a result, unrecognized prior service costs of $1,708 are being amortized over the average remaining years of service for active plan participants. The Company expects to decrease its discount rate assumption to 2.25% in 2013 for its other postretirement benefits plan, which will not significantly affect the fiscal year 2013 expense.

The estimated amounts that will be amortized from Accumulated other comprehensive loss at November 30, 2012 into net periodic benefit cost, pre-tax, in fiscal year 2013 are as follows:



	Pension Benefits			Other Postretirement Benefits
Prior service cost (credit)	$	(10	)	$	(123	)
Actuarial loss (gain)	6,704			(149		)
Total	$	6,694		$	(272	)

The expected cash benefit payments from the plans for the next ten fiscal years are as follows:



	Pension Benefits		Other Postretirement Benefits
2013	$	28,821	$	70
2014	8,069		64
2015	8,424		59
2016	8,769		47
2017	9,225		39
2018-2022	54,131		129

The Company also sponsors various defined contribution plans that provide employees with an opportunity to accumulate funds for their retirement. The Company may match, at its discretion, the contributions of participating employees in the respective plans. The Company recognized expense related to these plans for the past three fiscal years as follows:



2012	$	4,377
2011	3,933
2010	3,597