Anixter International Inc. Financial Statement Analysis
ANIXTER INTERNATIONAL INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)
The pension committees meet regularly to assess investment performance and reallocate assets that fall outside of its
allocation guidelines. The variations between the allocation guidelines and actual asset allocations reflect relative performance
differences in asset classes. From time to time, the Company periodically rebalances its asset portfolios to be in line with its
allocation guidelines.
For 2019, the U.S. investment policy guidelines were as follows:
•
Each asset class is managed by one or more active and passive investment managers
•
.
•
•
Each asset class may be invested in a commingled fund, mutual fund, or separately managed account
Investment in Exchange Traded Funds ("ETFs") is permissible
Each manager is expected to be "fully invested" with minimal cash holdings
Derivative instruments such as futures, swaps and options may be used on a limited basis; For funds that
employ derivatives, the loss of invested capital to the Trust should be limited to the amount invested in the
fund
The equity portfolio is diversified by sector and geography
The real assets portfolio is invested Real Estate Investment Trusts ("REITs") and private real estate
The fixed income is invested in U.S. Treasuries, investment grade corporate debt (denominated in U.S.
dollars), and other credit investments including below investment grade rated bonds and loans, securitized
credit, and emerging market debt
The investment policies for the Foreign plans are the responsibility of the various trustees. Generally, the investment
policy guidelines are as follows:
Make sure that the obligations to the beneficiaries of the Plan can be met
•
•
Maintain funds at a level to meet the minimum funding requirements
The investment managers are expected to provide a return, within certain tracking tolerances, close to that of
the relevant market's indices
The expected long-term rate of return on both the Domestic and Foreign Plans' assets reflects the average rate of earnings
expected on the invested assets and future assets to be invested to provide for the benefits included in the projected benefit
obligation. The Company uses historic plan asset returns combined with current market conditions to estimate the rate of return.
The expected rate of return on plan assets is a long-term assumption based on an analysis of historical and forward looking
returns considering the respective plan's actual and target asset mix. The weighted-average expected rate of return on plan
assets used in the determination of net periodic pension cost for 2019 is 6.01%.
63View entire presentation