Company: GHC
Filing Date: 2025-02-26
Form Type: 10-K
Source: 0000104889-25-000022
Chunk: 40

Company: Graham Holdings Co
Filing Date: 2025-02-26
Form: 10-K
Item: Item 16
Chunk 40
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 23.2% in 2023 and (23.4%) in 2022. The 10-year and 20-year actual returns on plan assets on an annual basis were 8.8% and 9.6%, respectively. 

Accumulated and projected benefit obligations are measured as the present value of future cash payments. The Company discounts those cash payments using the weighted average of market-observed yields for high-quality fixed-income securities with maturities that correspond to the payment of benefits. Lower discount rates increase present values and generally increase subsequent-year pension costs; higher discount rates decrease present values and decrease subsequent-year pension costs. The Company’s discount rate at December 31, 2024, 2023 and 2022, was 5.8%, 5.2% and 5.5%, respectively, reflecting market interest rates.

Changes in key assumptions for the Company’s pension plan would have had the following effects on the 2024 pension credit, excluding curtailment gains, settlement gains and special termination benefits:

•    Expected return on assets – A 1% increase or decrease to the Company’s assumed expected return on plan assets would have increased or decreased the pension credit by approximately $26.5 million.

•    Discount rate – A 1% decrease to the Company’s assumed discount rate would have decreased the pension credit by approximately $7.2 million. A 1% increase to the Company’s assumed discount rate would have increased the pension credit by approximately $5.7 million.

The Company’s net pension credit includes an expected return on plan assets component, calculated using the expected return on plan assets assumption applied to a market-related value of plan assets. The market-related value of plan assets is determined using a five-year average market value method, which recognizes realized and unrealized appreciation and depreciation in market values over a five-year period. The value resulting from applying this method is adjusted, if necessary, such that it cannot be less than 80% or more than 120% of the market value of plan assets as of the relevant measurement date. As a result, year-to-year increases or decreases in the market-related value of plan assets impact the return on plan assets component of pension credit for the year.

At the end of each year, differences between the actual return on plan assets and the expected return on plan assets are combined with other differences in actual versus expected experience to form a net unamortized actuarial gain or loss in accumulated other comprehensive income. Only those