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Note 13. Employee Benefit Plans
Archer Daniels Midland Company
Notes to Consolidated Financial Statements (Continued)
The Company provides substantially all domestic employees and employees at certain international subsidiaries
with pension benefits. The Company also provides substantially all domestic salaried employees with
postretirement health care and life insurance benefits.
The Company has savings and investment plans available to employees. The Company also maintains stock
ownership plans for qualifying employees. The Company contributes shares of its stock to the plans to match
qualifying employee contributions. Employees have the choice of retaining Company stock in their accounts or
diversifying the shares into other investment options. Expense is measured and recorded based upon the fair
market value of the stock contributed to the plans each month. The number of shares designated for use in the
plans is not significant compared to the shares outstanding for the periods presented. Assets of the Company’s
defined contribution savings plans consist primarily of listed common stocks and pooled funds. The Company’s
defined contribution savings plans held 16.4 million shares of Company common stock at June 30, 2008, with a
market value of $555 million. Cash dividends received on shares of Company common stock held by these
plans during the year ended June 30, 2008 were $9 million.
Pension Benefits Postretirement Benefits
2008 2007 2006 2008 2007 2006
(In millions) (In millions)
Retirement plan expense
Defined benefit plans:
Service cost (benefits earned during the
period) $ 68 $ 62 $ 59 $ 9 $ 7 $ 6
Interest cost 109 94 87 12 10 9
Expected return on plan assets (121) (102) (81) – – –
Curtailment – – 10 – – –
Amortization of actuarial loss 17 19 35 2 1 –
Other amortization
Net periodic defined benefit plan
5 6 4 (1) (1) –
expense 78 79 114 22 17 15
Defined contribution plans 31 29 27 – – –
Total retirement plan expense $ 109 $ 108 $ 141 $ 22 $ 17 $ 15
On June 30, 2007, the Company adopted the recognition and disclosure provisions of SFAS No. 158. SFAS No.
158 required the Company to recognize the funded status of its pension plans in the June 30, 2007, consolidated
balance sheet, with a corresponding adjustment to accumulated other comprehensive income. The adjustment to
accumulated other comprehensive income at adoption represented the net unrecognized actuarial losses,
unrecognized prior service costs, and unrecognized transition obligation remaining from the initial adoption of
SFAS No. 87, Employers’ Accounting for Pensions, all of which were previously netted against the plans’ funded
status in the Company’s consolidated balance sheet pursuant to the provisions of SFAS No. 87. These amounts are
subsequently recognized as net periodic pension cost pursuant to the Company’s historical accounting policy for
amortizing such amounts. Further, actuarial gains and losses that arise in subsequent periods and are not
recognized as net periodic pension cost in the same periods are recognized as a component of other comprehensive
income. Those amounts are subsequently recognized as a component of net periodic pension cost on the same
basis as the amounts recognized in accumulated other comprehensive income pursuant to the provisions of SFAS
No. 158.
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