PENSION AND PROFIT SHARING PLANS AND ARRANGEMENTS

Defined Benefit Plans

The Company provides substantially all domestic and foreign employees with retirement benefits. Funding policy for domestic plans, which is primarily comprised of a cash balance pension plan, is in accordance with the Employee Retirement Income Security Act of 1974 (“ERISA”). For foreign plans, funding is determined primarily by local tax laws and other regulations. Pension costs charged to operations totaled $35,188, $37,133 and $28,541 in fiscal years 2012, 2011 and 2010, respectively (these amounts included $735, $728 and $769, of pension cost that have been recorded in discontinued operations in fiscal years 2012, 2011 and 2010, respectively).

Pension Plan Results for Defined Benefit Plans

The following table reflects the change in benefit obligations, change in plan assets and funded status for these plans:



	U.S. Plans						Foreign Plans						Total
	2012			2011			2012			2011			2012			2011
Change in benefit obligation:
Benefit obligation - beginning of year	$	261,491		$	238,809		$	390,619		$	365,680		$	652,110		$	604,489
Curtailments and settlements	—			—			(5,112		)	(8,832		)	(5,112		)	(8,832		)
Service cost	8,924			8,058			4,726			5,260			13,650			13,318
Interest cost	12,722			12,264			18,100			18,495			30,822			30,759
Plan participant contributions	—			—			18			25			18			25
Plan amendments	1,428			4			1,082			(2,806		)	2,510			(2,802		)
Actuarial loss	48,856			14,425			20,679			3,492			69,535			17,917
Total benefits paid	(13,842		)	(12,069		)	(11,916		)	(14,506		)	(25,758		)	(26,575		)
Effect of exchange rates	—			—			(25,895		)	23,811			(25,895		)	23,811
Benefit obligation – end of year	319,579			261,491			392,301			390,619			711,880			652,110



Change in plan assets (a):
Fair value of plan assets – beginning of year	141,338			114,588			287,429			241,883			428,767			356,471
Curtailments and settlements	—			—			(4,861		)	(8,832		)	(4,861		)	(8,832		)
Actual return on plan assets	3,573			14,131			8,008			28,213			11,581			42,344
Company contributions	11,329			24,688			17,895			25,888			29,224			50,576
Plan participant contributions	—			—			18			25			18			25
Benefits paid from plan assets	(13,842		)	(12,069		)	(11,916		)	(14,506		)	(25,758		)	(26,575		)
Effect of exchange rates	—			—			(13,139		)	14,758			(13,139		)	14,758
Fair value of plan assets - end of year	142,398			141,338			283,434			287,429			425,832			428,767
Funded status (a)	$	(177,181	)	$	(120,153	)	$	(108,867	)	$	(103,190	)	$	(286,048	)	$	(223,343	)



Accumulated benefit obligation	$	297,088	$	240,430	$	378,654	$	377,910	$	675,742	$	618,340
Plans with accumulated benefit obligations in excess of plan assets consist of the following:
Accumulated benefit obligation	$	297,088	$	240,430	$	375,177	$	375,368	$	672,265	$	615,798
Projected benefit obligation	319,579		261,491		388,824		387,542		708,403		649,033
Plan assets at fair value	142,398		141,338		279,418		284,667		421,816		426,005

(a)

The Company has certain supplemental defined benefit plans, which provide benefits to eligible executives in the U.S. and employees abroad for which the above tables do not include certain Company assets relating to these plans of $74,420 and $75,012 for the U.S. plans and $17,963 and $20,992 for the foreign plans as of July 31, 2012 and July 31, 2011, respectively. Liabilities, included in the tables above, related to these plans were $128,798 and $99,169 for the U.S. plans and $57,363 and $55,859 for the foreign plans as of July 31, 2012 and July 31, 2011, respectively.



	U.S. Plans						Foreign Plans						Total
	2012			2011			2012			2011			2012			2011
Amounts recognized in the balance sheet consists of:
Non-current assets	$	—		$	—		$	538		$	177		$	538		$	177
Current liabilities	(3,899		)	(3,746		)	(3,077		)	(1,379		)	(6,976		)	(5,125		)
Non-current liabilities	(173,282		)	(116,407		)	(106,328		)	(101,988		)	(279,610		)	(218,395		)
Net amount recognized	$	(177,181	)	$	(120,153	)	$	(108,867	)	$	(103,190	)	$	(286,048	)	$	(223,343	)

Net periodic benefit cost for the Company’s defined benefit pension plans includes the following components:



	U.S. Plans									Foreign Plans									Total
	2012			2011			2010			2012			2011			2010			2012			2011			2010
Service cost	$	8,924		$	8,058		$	7,954		$	4,726		$	5,260		$	4,868		$	13,650		$	13,318		$	12,822
Interest cost	12,722			12,264			12,213			18,100			18,495			17,684			30,822			30,759			29,897
Expected return on plan assets	(9,212		)	(8,381		)	(8,092		)	(15,582		)	(14,319		)	(13,309		)	(24,794		)	(22,700		)	(21,401		)
Amortization of prior service cost	1,779			2,142			1,813			(93		)	310			256			1,686			2,452			2,069
Amortization of actuarial loss	7,998			5,826			2,432			5,237			5,702			2,765			13,235			11,528			5,197
Gain/(loss) due to curtailments and settlements	—			—			—			589			1,776			(43		)	589			1,776			(43		)
Net periodic benefit cost	$	22,211		$	19,909		$	16,320		$	12,977		$	17,224		$	12,221		$	35,188		$	37,133		$	28,541

Other changes in plan assets and benefit obligations recognized in other comprehensive income for the year ending July 31, 2012 are as follows:



	U.S. Plans			Foreign Plans			Total
Net actuarial loss	$	54,495		$	28,253		$	82,748
Recognized actuarial loss (including impact of curtailments and settlements)	(7,998		)	(5,237		)	(13,235		)
Prior service cost	1,428			1,082			2,510
Recognized prior service (cost)/credit	(1,779		)	93			(1,686		)
Impact of curtailments and settlements	—			(841		)	(841		)
Effect of exchange rates on amounts included in accumulated other comprehensive income	—			(6,023		)	(6,023		)
Total recognized in other comprehensive (income)/loss, before tax effects	$	46,146		$	17,327		$	63,473
Total recognized in other comprehensive (income)/loss, net of tax effects	$	29,534		$	13,079		$	42,613
Total recognized in net periodic benefit cost and other comprehensive (income)/loss, before tax effects	$	68,357		$	30,304		$	98,661
Total recognized in net periodic benefit cost and other comprehensive (income)/loss, net of tax effects	$	43,749		$	22,119		$	65,868

Amounts recognized in accumulated other comprehensive income (before tax effects) as of July 31, 2012 are as follows:



	U.S. Plans		Foreign Plans			Total
Prior service cost/(credit)	$	9,162	$	(524	)	$	8,638
Net loss	122,948		115,472			238,420
Total amounts recognized in accumulated other comprehensive income	$	132,110	$	114,948		$	247,058

Amounts recognized in accumulated other comprehensive income (before tax effects) as of July 31, 2011 are as follows:



	U.S. Plans		Foreign Plans			Total
Prior service cost/(credit)	$	9,513	$	(1,716	)	$	7,797
Net loss	76,451		99,337			175,788
Total amounts recognized in accumulated other comprehensive income	$	85,964	$	97,621		$	183,585

Amounts in accumulated other comprehensive income expected to be amortized as components of net periodic benefit cost during fiscal year 2013 are as follows:



	U.S. Plans			Foreign Plans			Total
Prior service cost/(credit)	$	(1,620	)	$	67		$	(1,553	)
Net actuarial loss	$	(9,738	)	$	(5,487	)	$	(15,225	)

Plan Assumptions

The following table provides the weighted-average assumptions used to determine benefit obligations and net periodic benefit cost:



	U.S. Plans						Foreign Plans
	2012		2011		2010		2012		2011		2010
Assumptions used to determine benefit obligations
Discount rate	3.40	%	5.00	%	5.25	%	4.10	%	4.90	%	5.00	%
Rate of compensation increase	3.45	%	4.61	%	4.63	%	3.18	%	3.18	%	3.00	%
Assumptions used to determine net periodic benefit cost
Discount rate	5.00	%	5.25	%	6.00	%	4.90	%	5.00	%	5.66	%
Expected long-term rate of return on plan assets	7.00	%	7.00	%	7.00	%	5.88	%	5.71	%	5.92	%
Rate of compensation increase	4.61	%	4.63	%	4.66	%	3.18	%	3.00	%	3.01	%

The Company determines its actuarial assumptions on an annual basis. To develop the expected long-term rate of return on plan assets assumption, the Company considers the current level of expected returns on risk free investments (primarily government bonds), the historical level of the risk premium associated with the other asset classes in which the portfolio is invested and the expectations for future returns of each asset class. The expected return for each asset class was then weighted based upon the target asset allocation to develop the expected long-term rate of return on plan assets assumption for the portfolio.

Plan Assets and Investment Policies

The Company’s investment objective for defined benefit plan assets is to meet the plans’ benefit obligations, while preserving plan assets. The investment strategies focus on asset class diversification, liquidity to meet benefit payments and an appropriate balance of long-term return and risk. Plan assets are diversified across several investment managers and are generally invested in liquid funds that track broad market equity and bond indices. The target allocations for the plan assets (based on a weighted average) are 51% equity securities, 36% corporate and government securities, 13% to all other types of investments. Equity securities include investments in domestic and international companies. Fixed income securities include corporate bonds of companies from diversified industries and U.S. and foreign government treasury securities. Other types of investments include investments in a limited partnership, insurance contracts, commingled funds (which primarily represent investments in common collective trusts and fund of funds) and a longevity derivative which follow several different strategies. Plan fiduciaries oversee the investment allocation process, which includes selecting investment managers, commissioning periodic asset-liability studies, setting long-term strategic targets and monitoring asset allocations.

The following tables present, for each of the fair value hierarchy levels (as defined in Note 9, Fair Value Measurements) the Company’s U.S. and Foreign defined benefit net pension plan assets as of July 31, 2012 and July 31, 2011:



			Fair Value Measurements
	As of Jul. 31, 2012		Level 1		Level 2		Level 3
U.S. Plans
Assets
Investments
Equity securities	$	74,115	$	74,115	$	—	$	—
Debt securities:
Federal agency	3,567		—		3,567		—
Mortgage/ asset-backed	14,664		—		14,664		—
Corporate	17,015		—		17,015		—
U.S. Treasury	8,642		—		8,642		—
Other investments:
Limited partnership	9,634		—		—		9,634
Commingled funds	17,116		—		17,116		—
Total investments	144,753		74,115		61,004		9,634
Other receivables	1,006		1,006		—		—
Total assets	145,759		75,121		61,004		9,634
Liabilities
Payables	3,361		3,361		—		—
Total liabilities	3,361		3,361		—		—
Net U.S. pension assets	$	142,398	$	71,760	$	61,004	$	9,634
Foreign Plans
Cash equivalents	$	7,871	$	7,871	$	—	$	—
Equity securities	122,204		122,204		—		—
Debt securities:
Corporate	41,852		—		41,852		—
Government bonds	72,132		—		72,132		—
Other investments:
Commingled funds	19,106		—		8,196		10,910
Insurance contracts	12,180		—		—		12,180
Real estate funds	8,701		—		—		8,701
Total foreign pension assets	284,046		130,075		122,180		31,791
Liabilities
Longevity derivative	612		$	—	$	—	$	612
Total liabilities	612		—		—		612
Net foreign pension assets	$	283,434	$	130,075	$	122,180	$	31,179
Total pension assets	$	425,832	$	201,835	$	183,184	$	40,813



			Fair Value Measurements
	As of Jul. 31, 2011		Level 1		Level 2		Level 3
U.S. Plans
Assets
Investments
Equity securities	$	77,753	$	77,753	$	—	$	—
Debt securities:
Federal agency	5,558		—		5,558		—
Mortgage/ asset-backed	12,856		—		12,856		—
Corporate	17,320		—		17,320		—
U.S. Treasury	6,846		—		6,846		—
Other investments:
Limited partnership	10,058		—		—		10,058
Commingled funds	13,168		—		13,168		—
Total investments	143,559		77,753		55,748		10,058
Other receivables	388		388		—		—
Total assets	143,947		78,141		55,748		10,058
Liabilities
Payables	2,609		2,609		—		—
Total liabilities	2,609		2,609		—		—
Net U.S. pension assets	$	141,338	$	75,532	$	55,748	$	10,058
Foreign Plans
Cash equivalents	$	455	$	455	$	—	$	—
Equity securities	126,137		126,137		—		—
Debt securities:	—		—		—		—
Corporate	41,544		—		41,544		—
Government bonds	46,414		—		46,414		—
Other investments:
Commingled funds	51,266		—		39,101		12,165
Insurance contracts	13,631		—		—		13,631
Real estate funds	8,617		—		—		8,617
Total foreign pension assets	288,064		126,592		127,059		34,413
Liabilities
Longevity derivative	635		—		—		635
Total liabilities	635		—		—		635
Net foreign pension assets	$	287,429	$	126,592	$	127,059	$	33,778
Total pension assets	$	428,767	$	202,124	$	182,807	$	43,836

The following tables present an analysis of changes during fiscal year 2012 and fiscal year 2011 in Level 3 plan assets, by plan asset class, for U.S. and Foreign pension plans using significant unobservable inputs to measure fair value:



	Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
	Limited partnership			Commingled funds			Insurance contracts			Real estate funds			Longevity derivative			Total
Beginning Balance at July 31, 2011	$	10,058		$	12,165		$	13,631		$	8,617		$	(635	)	$	43,836
Actual return on plan assets:
Assets held, end of year	(399		)	234			676			435			(3		)	943
Assets sold during the period	(25		)							—						(25		)
Purchases, sales, and settlements, net	—			(841		)	(170		)	—						(1,011		)
Exchange rate changes	—			(648		)	(1,957		)	(351		)	26			(2,930		)
Ending balance at July 31, 2012	$	9,634		$	10,910		$	12,180		$	8,701		$	(612	)	$	40,813



	Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
	Limited partnership		Commingled funds		Insurance contracts			Real estate funds		Longevity derivative			Total
Beginning Balance at July 31, 2010	$	6,794	$	1,618	$	12,309		$	7,711	$	—		$	28,432
Actual return on plan assets:
Assets held, end of year	739		324		509			550		(619		)	1,503
Assets sold during the period	25		—		—			—					25
Purchases, sales, and settlements, net	2,500		9,798		(725		)	6					11,579
Exchange rate changes	—		425		1,538			350		(16		)	2,297
Ending balance at July 31, 2011	$	10,058	$	12,165	$	13,631		$	8,617	$	(635	)	$	43,836

The Plan’s investments in cash equivalents and equity securities are valued using quoted market prices and, as such, are classified within Level 1 of the fair value hierarchy.

The fair value of the Plan’s investments in debt securities, have been valued utilizing third party pricing services and verified by management. The pricing services use inputs to determine fair value which are derived from observable market sources including reportable trades, benchmark curves, credit spreads, broker/dealer quotes, bids, offers, and other industry and economic events. These investments are included in Level 2 of the fair value hierarchy.

The fair value of the Plan’s other investments included in Level 2 of the fair value hierarchy have been reported primarily using the net asset value per share of the investment as the practical expedient for measuring fair value as permitted for these types of investments.

The fair value of the Plan’s other investments included in Level 3 of the fair value hierarchy have been valued using unobservable inputs and in some cases are subject to various redemption restrictions.

Other receivables and payables are valued at cost, which approximates fair value.

Cash Flows

Management’s estimate of the Company’s cash requirements for the defined benefit plans for the year ending July 31, 2012 is $26,791. This is comprised of expected benefit payments of $6,936, which will be paid directly to plan participants from Company assets, as well as expected Company contributions of $19,855. Expected contributions are dependent on many variables, including the variability of the market value of the assets as compared to the obligation and other market or regulatory conditions. Accordingly, actual funding may differ from current estimates.

The following table provides the pension benefits expected to be paid to participants in the next ten fiscal years, which include payments funded from the Company’s assets, as discussed above, as well as payments paid from plan assets:



Expected pension benefit payments
2013	$	32,706
2014	26,297
2015	30,033
2016	31,255
2017	33,257
2018-2022	190,742

Defined Contribution Plans

The Company’s 401(k) and profit sharing plan covers substantially all domestic employees of the Company and its participating subsidiaries, other than those employees covered by a union retirement plan. The Plan provides that participants may voluntarily contribute a percentage of their compensation and the Company will make a matching contribution equal to 100% of the first 3% of each participant’s contributions. The expense associated with the plan for fiscal years 2012, 2011, and 2010 was $5,903, $5,964 and $6,010, respectively.

The Company and its subsidiaries also participate in defined contribution pension plans primarily for the benefit of certain foreign employees. The expense associated with these plans was $18,778, $14,764 and $12,178 for fiscal years 2012, 2011 and 2010, respectively.