could differ from  the assumptions used. A quarter percentage point  change in the defined benefit plans' discount rate and the expected  long-term rate of return on plan assets would increase or decrease  earnings before income taxes by $0.8 million and $0.4 million,  respectively. A quarter percentage point change in our postretire-  ment benefit plan discount rate would increase or decrease earnings  before income taxes by $0.1 million. A one percentage point  increase in the health care cost trend rates would have increased the  accumulated postretirement benefit obligation (APBO) by $4 mil-  lion at May 30, 2004, and the aggregate of the service cost and  interest cost components of net periodic postretirement benefit  cost by $0.3 million for fiscal 2004. A one percentage point decrease  in the health care cost trend rates would have decreased the APBO  by $3 million at May 30, 2004, and the aggregate of the service cost  and interest cost components of net periodic postretirement benefit  cost by $0.3 million for fiscal 2004. These changes in assumptions  would not significantly impact our funding requirements. We are not aware of any trends or  events that would materially  affect our capital requirements or liquidity. We believe that our  internal cash-generating capabilities, borrowings available under  our shelf registration for unsecured debt securities, and short-term  commercial paper program should be sufficient to finance our capi-  tal expenditures, stock repurchase program, and other operating  activities through fiscal 2005. We are exposed to a variety of market risks, including fluctuations  in interest rates, foreign currency exchange rates, and commodity  prices. To manage this exposure, we periodically enter into inter-  est rate, foreign currency exchange, and commodity instruments  for other than trading purposes (see Notes 1 and 8 of the Notes to  Consolidated Financial Statements). We use the variance/covariance method to measure value at risk,  over time horizons ranging from one week to one year, at the  95 percent confidence level. At May 30, 2004, our potential losses  in future net earnings resulting from changes in foreign currency  exchange rate instruments, commodity instruments, and floating  rate debt interest rate exposures were approximately $2 million  over a period of one year (including the impact of the interest rate  swap agreements discussed in Note 8 to the Notes to Consolidated  Financial Statements). The value at risk from an increase in the fair  value of all of our long-term fixed rate debt, over a period of one  year, was approximately $22 million. The fair value of our long-  term fixed rate debt during fiscal 2004 averaged $690 million, with  a high of $714 million and a low of $669 million. Our interest rate  risk management objective is to limit the impact of interest rate  changes on earnings and cash flows by targeting an appropriate  mix of variable and fixed rate debt. Our current assets totaled $346 million at May 30,2004, compared  to $326 million at May 25, 2003. The increase resulted primarily  from increases in inventories of $25 million that resulted from oppor-  tunistic product purchases made during fiscal 2004. We are not a party to any off-balance sheet arrangements that have,  or are reasonably likely to have, a current or future material effect  on our financial condition, changes in financial condition, revenues  or expenses, results of operations, liquidity, capital expenditures,  or capital resources. Our current liabilities were $683 million at May 30,2004, compared  to $640 million at May 25, 2003. At May 30, 2004, $15 million of  s hort-term debt was outstanding under our commercial paper  FINANCIAL CONDITION  OFF-BALANCE SHEET ARRANGEMENTS  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK program, which was used to fund current operations and capital  expenditures. Accrued payroll of $103 m illion at May 30, 2004,  increased from $86 million at May 25, 2003, principally due to  higher incentive compensation earned in fiscal 2004. Other cur-  rent liabilities of $228 million at May 30, 2004, increased from  $202 million at May 25, 2003, principally due to a $19 million  increase in liabilities associated with our non-qualified deferred  compensation plan and a $7 million increase in sales tax payable as  a result of higher fourth quarter sales in fiscal 2004. Accrued income  taxes of $49 million at May 30, 2004, decreased from $68 million  at May 25, 2003, principally due to timing of income tax payments  made and changes in temporary differences included in the deferred  tax balances associated with current income tax deductions for  certain land, buildings, and equipment. The $ 19 million decrease  in accrued income taxes is offset by the related increase in net non-  current deferred income tax liabilities at May 30, 2004. Financial Review 2004 Darden Restaurants  31