NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (table dollar amounts in thousands, except share data) NOTE 16 EMPLOYEE BENEFIT PLANS continued The table below sets forth the plans' funded status and amounts recognized in the consolidated balance sheets at December 31, using measurement dates of September 30, 2003 and 2002. December 31 2003 2002 ====================================================================================== Change in benefit obligation Benefit obligation at beginning of year ............ $ 44,718 $ 20,172 Obligation acquired in acquisition ................. 17,712 Service cost ....................................... 1,564 2,007 Interest cost ...................................... 2,617 2,470 Actuarial (gain) loss .............................. (1,667) 3,971 Benefits paid ...................................... (1,653) (1,614) -------- -------- Benefit obligation at end of year .................. 45,579 44,718 -------- -------- Change in plan assets Fair value of plan assets at beginning of year ..... 31,650 20,638 Fair value of plan assets acquired in acquisition... 15,507 Actual return (loss) on plan assets ................ 3,876 (2,881) Benefits paid ...................................... (1,653) (1,614) Employer contributions ............................. 67 -------- -------- Fair value of plan assets at end of year ........... 33,940 31,650 -------- -------- Unfunded status .................................... (11,639) (13,068) Unrecognized net actuarial loss..................... 9,656 12,940 Unrecognized prior service cost .................... 1,834 1,986 Unrecognized transition asset ...................... (178) (329) -------- -------- Prepaid benefit cost (liability) ................... (327) 1,529 Additional pension liability ....................... (4,924) (3,810) -------- -------- Net minimum liability............................... $ (5,251) $ (2,281) ======== ======== Amounts recognized in the balance sheets consist of: Prepaid benefit cost (liability) ................... $ (327) $ 1,529 Additional pension liability ....................... (4,924) (3,810) Intangible asset ................................... 1,834 1,613 Deferred taxes ..................................... 1,236 879 Accumulated other comprehensive loss ............... 1,854 1,318 -------- -------- Net amount recognized ................................... $ (327) $ 1,529 ======== ======== At December 31, 2003 and 2002, the plans’ accumulated benefit obligation totaled $39,192,000 and $33,929,000. The Corporation’s planned contributions to its defined-benefit pension plans in 2004 total $3,314,000, of which $2,108,000 is required and $1,206,000 is discretionary. At September 30, 2003 the plans’ assets were allocated 67 percent to equity securities, 25 percent to debt securities, and 8 percent to real estate and other plan assets. The targeted allocation for those categories of plan assets are 40 to 80 percent, 20 to 60 percent, and 0 to 15 percent, respectively. 49