Components of Net Periodic Benefit Cost

3 Months Ended

Mar. 31, 2020

Retirement Benefits [Abstract]

Components of Net Periodic Benefit Cost

Note 2 – Components of Net Periodic Benefit Cost

Southwest has a noncontributory qualified retirement plan with defined benefits covering substantially all employees and a separate unfunded supplemental retirement plan (“SERP”) which is limited to officers. Southwest also provides postretirement benefits other than pensions (“PBOP”) to its qualified retirees for health care, dental, and life insurance.

The service cost component of net periodic benefit costs included in the table below are components of an overhead loading process associated with the cost of labor. The overhead process ultimately results in allocation of that portion of overall net periodic benefit costs to the same accounts to which productive labor is charged. As a result, service costs become components of various accounts, primarily operations and maintenance expense, net utility plant, and deferred charges and other assets for both the Company and Southwest. The other components of net periodic benefit cost are reflected in Other income (deductions) on the Condensed Consolidated Statements of Income of each entity.

	Qualified Retirement Plan
	March 31,
	Three Months						Twelve Months
	2020			2019			2020			2019
(Thousands of dollars)
Service cost	$	8,574		$	6,466		$	27,972		$	27,882
Interest cost	11,388			12,252			48,142			45,383
Expected return on plan assets	(16,324		)	(15,061		)	(61,507		)	(59,127		)
Amortization of net actuarial loss	9,007			5,589			25,774			29,675
Net periodic benefit cost	$	12,645		$	9,246		$	40,381		$	43,813
	SERP
	March 31,
	Three Months						Twelve Months
	2020			2019			2020			2019
(Thousands of dollars)
Service cost	$	98		$	66		$	298		$	250
Interest cost	401			440			1,721			1,683
Amortization of net actuarial loss	451			255			1,216			1,382
Net periodic benefit cost	$	950		$	761		$	3,235		$	3,315
	PBOP
	March 31,
	Three Months						Twelve Months
	2020			2019			2020			2019
(Thousands of dollars)
Service cost	$	396		$	319		$	1,353		$	1,424
Interest cost	645			762			2,929			2,823
Expected return on plan assets	(852		)	(789		)	(3,219		)	(3,577		)
Amortization of prior service costs	289			317			1,243			1,318
Net periodic benefit cost	$	478		$	609		$	2,306		$	1,988