PENSION AND OTHER POSTRETIREMENT PLANS

The Company has defined benefit pension plans and a postretirement healthcare benefit plan covering certain current and retired employees. The Company has frozen participation in its defined benefit plans. For one of the plans, certain current plan participants continue to participate in the plan, while other current participants do not accrue future benefits under the plan but participate in an enhanced defined contribution plan which offers an increased Company match.

As discussed in Note A, the Company adopted accounting guidance expanding the required disclosures for pension and other postretirement plans by requiring disclosures about how investment allocation decisions are made by management, major categories of plan assets and significant concentration of risk. The guidance also requires an employer to disclose information about the valuation of plan assets similar to that required under the accounting guidance on fair value measurements. Additional FASB guidance regarding the change in the measurement date of pension and other postretirement plans from a November 1^st date to the Company’s fiscal year-end date was effective for fiscal year 2009.

During the fourth quarter of fiscal year 2009, the method of determining the amortization of unrealized gains and losses included in Accumulated other comprehensive loss related to the U.S. combined nonqualifed plans was changed from a simple average of the remaining years of future service of participants to a weighted average approach to more accurately reflect the expense incurred related to participants over their remaining expected service with the Company. Additionally, the gains and losses being amortized include gains or losses occurring during the year. As a result of this change, a $2,000 charge was recorded which increased pension expense, included in Selling and administrative expenses in the accompanying Consolidated Statements of Earnings. This charge also reduced Earnings before income taxes and minority interests by $2,000 and reduced Net earnings by $1,266. The Company determined that the retroactive effect of applying this change was not material to any prior periods or to fiscal year 2009 and therefore recorded the entire amount during fiscal year 2009.

The Company’s policy is to contribute to its qualified U.S. and non-U.S. pension plans at least the minimum amount required by applicable laws and regulations, to contribute to the U.S. combined nonqualified plans when required for benefit payments, and to contribute to the postretirement healthcare benefit plan an amount equal to the benefit payments. The Company, from time to time, makes voluntary contributions in excess of the minimum amount required as economic conditions warrant. The Company did not make a voluntary contribution to its qualified U.S. pension plans in 2011, 2010 or 2009. The Company expects to contribute $18,968 to its U.S. qualified plans, $219 to its U.S. combined nonqualified plans, $415 to its non-U.S. plan and $99 to its postretirement healthcare benefit plan to pay benefits during 2012.

The projected benefit obligation ("PBO"), accumulated benefit obligation (“ABO”) and fair value of plan assets for qualified pension plans with PBOs and ABOs in excess of plan assets were $164,820, $159,208 and $112,548, respectively, at November 30, 2011.

The U.S. combined nonqualified plans are unfunded; therefore, there are no plan assets; however, the Company has funded $1,131 and $1,258 at November 30, 2011 and 2010, respectively, into a restricted trust for its U.S. combined nonqualified plans, see Note E. This trust is included in Other noncurrent assets in the Consolidated Balance Sheets. The PBO and ABO for the U.S. combined nonqualified plans were $22,022 and $19,750, at November 30, 2011, respectively.

The discount rate is used to calculate the present value of the PBO. The Company’s objective in selecting a discount rate is to select the best estimate of the rate at which the benefit obligations could be effectively settled on the measurement date taking into account the nature and duration of the benefit obligations of the plan. In making this estimate, the Company looks at rates of return on high-quality fixed-income investments currently available and expected to be available during the period to maturity of the benefits. This process includes looking at the bonds available on the measurement date with a quality rating of Aa or better. Similar appropriate benchmarks are used to determine the discount rate for the non-U.S. plan. The difference in the discount rates between the qualified, the nonqualified and the other postretirement plans is due to different expectations as to the period of time in which plan members will participate in the various plans. In general, higher discount rates correspond to longer participation periods. The assumptions for the discount rate, rate of compensation increase and expected rate of return and the asset allocations related to the non-U.S. plan are not materially different than for the U.S. qualified plans.

The rate of compensation increase represents the long-term assumption for expected increases in salaries among continuing active participants accruing benefits in the pay-related plans. The Company considers the impact of profit-sharing payments, merit increases and promotions in setting the salary increase assumption as well as possible future inflation increases and its impact on salaries paid to plan participants at the locations where the Company has facilities.

The following tables show reconciliations of the pension plans and other postretirement benefits plan as of November 30, 2011 and 2010. The accrued pension benefit obligation includes an unfunded benefit obligation of $22,022 and $20,900 as of November 30, 2011 and 2010, respectively, related to the Company’s U.S. combined nonqualified plans.



	Pension Benefits						Other Postretirement Benefits
	2011			2010			2011			2010
Change in benefit obligation
Benefit obligation at beginning of year	$	168,644		$	163,069		$	663		$	843
Currency translation	(14		)	(374		)	—			—
Service cost	1,968			2,119			—			—
Interest cost	8,133			8,108			23			32
Plan participants' contributions	41			39			—			—
Plan amendments	—			(1,124		)	—			—
Actuarial losses (gains)	16,562			6,309			(24		)	(177		)
Benefits paid	(8,493		)	(9,502		)	(483		)	(500		)
Retiree contributions	—			—			371			465
Benefit obligation at end of year	$	186,841		$	168,644		$	550		$	663



	Pension Benefits						Other Postretirement Benefits
	2011			2010			2011			2010
Change in plan assets
Fair value of plan assets at beginning of year	$	100,866		$	95,604		$	—		$	—
Currency translation	(13		)	(313		)	—			—
Actual return on plan assets	5,771			11,516			—			—
Employer contributions	14,376			3,522			483			500
Plan participants' contributions	41			39			—			—
Benefits paid	(8,493		)	(9,502		)	(483		)	(500		)
Fair value of plan assets at end of year	$	112,548		$	100,866		$	—		$	—
Funded status	$	(74,293	)	$	(67,778	)	$	(550	)	$	(663	)

Accumulated benefit obligation at end of year	$	178,959		$	161,298		n/a			n/a

Assumptions:
Discount rate - qualified plans	4.50%			5.25%			3.50%			3.75%
Discount rate - nonqualified plans	2.75%			2.25%			n/a			n/a
Rate of compensation increase - qualified plans	4.00%			4.00%			n/a			n/a
Rate of compensation increase - nonqualified plans	4.00%			4.00%			n/a			n/a
Measurement date	11/30/2011			11/30/2010			11/30/2011			11/30/2010



	Pension Benefits						Other Postretirement Benefits
	2011			2010			2011			2010
Amounts recognized in the Consolidated Balance Sheets as of November 30
Accounts payable and accrued liabilities	$	(219	)	$	(2,194	)	$	(100	)	$	(123	)
Long-term pension and postretirement healthcare benefits liabilities	(74,074		)	(65,584		)	(450		)	(540		)
Funded status	$	(74,293	)	$	(67,778	)	$	(550	)	$	(663	)

Accumulated other comprehensive loss, pre-tax	$	72,687		$	60,306		$	(1,887	)	$	(2,115	)

Amounts recognized in Accumulated Other Comprehensive Loss, as of November 30
Unrecognized net actuarial loss (gain)	$	72,717		$	60,731		$	(1,047	)	$	(1,153	)
Unrecognized net prior service credit	(30		)	(425		)	(840		)	(962		)
Accumulated other comprehensive loss, pre-tax	72,687			60,306			(1,887		)	(2,115		)
Deferred taxes	(26,830		)	(21,924		)	686			775
Accumulated other comprehensive loss, after-tax	$	45,857		$	38,382		$	(1,201	)	$	(1,340	)

The amounts affecting Accumulated other comprehensive loss for the years ended November 30, 2011 and 2010 are as follows:



	Pension Benefits						Other Postretirement Benefits
	2011			2010			2011			2010
Amortization of unrecognized prior service (cost) credit, net of tax of $(149), $(147) and $(45), $(45), respectively	$	246		$	250		$	77		$	78
Amortization of unrecognized actuarial (losses) gains, net of tax of $2,403, $1,831 and $(47), $(47), respectively	(4,075		)	(3,175		)	83			82
Current year actuarial losses (gains), net of tax of $(6,825), $(716) and $9, $65, respectively	11,639			1,126			(15		)	(113		)
Plan amendments, net of tax of $0, $421 and $0, $0, respectively	—			(703		)	—			—
Effect of change in deferred tax rate	(335		)	287			(6		)	(2		)
Total	$	7,475		$	(2,215	)	$	139		$	45

The target allocation for the U.S. plans is 70% equity securities, 25% debt securities and 5% real estate. The target allocation is based on the Company’s desire to maximize total return, considering the long-term funding objectives of the pension plans, but may change in the future. Plan assets are diversified to achieve a balance between risk and return. The Company does not invest plan assets in private equity funds or hedge funds. The Company’s expected long-term rate of return considers historical returns on plan assets as well as future expectation given the current and target asset allocation and current economic conditions with input from investment managers and actuaries. The expected rate of return on plan assets is designed to be a long-term assumption that may be subject to considerable year-to-year variance from actual returns.

As of the November 30^th measurement dates, the fair values of actual pension asset allocations were as follows:



	2011		2010
Equity securities	72.1	%	71.5	%
Debt securities	24.1	%	24.9	%
Real estate and other	3.8	%	3.6	%
	100.0	%	100.0	%

The accounting guidance on fair value measurements specifies a fair value hierarchy based upon the observability of inputs used in valuation techniques (Level 1, 2 and 3). See Note E for a discussion of the fair value hierarchy. The following table summarizes the fair value of the pension plans’ assets.



	Fair Value Measurements at Reporting Date
	Total		Level 1		Level 2		Level 3
November 30, 2011
U.S. equity securities funds	$	68,481	$	—	$	68,481	$	—
Non-U.S. equity securities funds	12,613		5,424		7,189		—
Fixed income securities funds	27,171		1,916		25,255		—
Real estate funds	3,782		—		—		3,782
Cash and equivalents funds	67		67		—		—
Total	112,114		$	7,407	$	100,925	$	3,782
Other items to reconcile to fair value of plan assets	434
Fair value of plan assets	$	112,548



	Fair Value Measurements at Reporting Date
	Total		Level 1		Level 2		Level 3
November 30, 2010
U.S. equity securities funds	$	60,386	$	—	$	60,386	$	—
Non-U.S. equity securities funds	11,747		5,475		6,272		—
Fixed income securities funds	25,094		1,786		23,308		—
Real estate funds	3,203		—		—		3,203
Cash and equivalents funds	16		16		—		—
Total	100,446		$	7,277	$	89,966	$	3,203
Other items to reconcile to fair value of plan assets	420
Fair value of plan assets	$	100,866

U.S. equity securities funds consist primarily of large cap and small cap U.S. companies. Non-U.S. equity securities funds consist primarily of equities of non-U.S. developed markets. Funds that are traded on a national exchange are categorized as Level 1. For fund units not traded on a national exchange, the funds are valued at the net asset value (“NAV”) as determined by the custodian of the funds. The NAV is based on the fair value of the underlying assets owned by the fund, minus its liabilities then divided by the number of units outstanding.

Fixed income securities funds consist primarily of bonds such as governmental agencies, investment grade credit, commercial mortgage backed, residential mortgage backed and asset backed. Funds that are traded on a national exchange are categorized as Level 1. For fund units not traded on a national exchange, the funds are valued at the NAV as determined by the custodian of the funds. The NAV is based on the fair value of the underlying assets owned by the fund, minus its liabilities then divided by the number of units outstanding.

Real estate funds consist of units of other private real estate funds, each of which have different pre-notification and valuation parameters. The NAV for the funds is calculated on a lag of approximately 30 days and the funds only trade on a quarterly basis through the custodian of the funds.

Other items to reconcile to fair value of plan assets is the net of interest receivable, amounts due for securities sold, amounts payable for securities purchased and interest payable.

The following table summarizes changes in the fair value of Level 3 assets for the year ended November 30, 2011.



	2011		2010
Balance at beginning of year	$	3,203	$	3,053
Unrealized gains	579		150
Balance at end of year	$	3,782	$	3,203

The components of net periodic benefit cost for pensions are shown below. Net periodic benefit cost is based on assumptions determined at the prior year-end measurement date. Increases in the liability due to changes in plan benefits are recognized in the net periodic benefit costs through straight-line amortization over the average remaining service period of employees expected to receive benefits.



	Pension Benefits
	2011			2010			2009
Components of net periodic benefit cost
Service cost	$	1,968		$	2,119		$	1,799
Interest cost	8,133			8,108			9,275
Expected return on plan assets	(7,674		)	(7,123		)	(6,938		)
Settlement costs	1,368			—			—
Amortization of unrecognized:
Prior service cost	(395		)	(394		)	127
Net actuarial loss	5,110			5,006			3,559
Net periodic benefit cost	$	8,510		$	7,716		$	7,822

Assumptions:
Discount rate - qualified plans	5.25%			5.50%			8.25%
Discount rate - nonqualified plans	2.75%			2.25%			7.50%
Expected return on plan assets	7.50%			7.75%			8.00%
Rate of compensation increase - qualified plans	4.00%			4.00%			4.00%
Rate of compensation increase - nonqualified plans	4.00%			4.00%			—%
Measurement date - qualified plans	11/30/2010			11/30/2009			11/1/2008
Measurement date - nonqualified plans	11/30/2011			11/30/2010			11/1/2008

For the determination of 2012 expense, the Company expects to change its assumptions as follows: (a) leave the long-term return on assets for its qualified plans unchanged, (b) decrease the discount rates on its qualified plans to 4.50%, and (c) leave the rate of compensation increase unchanged. For its U.S. combined nonqualified plans, the Company expects to leave the discount rates and rate of compensation increase unchanged.

The changes in the fair value of plan assets and in the assumptions will result in a net decrease in fiscal year 2012 expense of approximately $(608) for the qualified U.S. pension plans. The Company also expects a net increase of approximately $594 for the U.S. combined nonqualified plans in fiscal year 2012.

The postretirement obligations represent a fixed dollar amount per retiree. The Company has the right to modify or terminate these benefits. The participants will assume substantially all future healthcare benefit cost increases, and future increases in healthcare costs will not increase the postretirement benefit obligation or cost to the Company. Therefore, the Company has not assumed any annual rate of increase in the per capita cost of covered healthcare benefits for future years. The Company discontinued the prescription drug benefit portion of its plan effective January 31, 2006.

The components of net periodic benefit income for postretirement healthcare benefits are shown below.



	Other Postretirement Benefits
	2011			2010			2009
Components of net periodic benefit income
Interest cost	$	23		$	32		$	61
Amortization of unrecognized:
Prior service cost	(122		)	(123		)	(123		)
Net actuarial gain	(130		)	(129		)	(184		)
Net periodic benefit income	$	(229	)	$	(220	)	$	(246	)

Assumptions:
Discount rate	3.75		%	4.25		%	8.25		%
Measurement date	11/30/2010			11/30/2009			11/1/2008

The Company froze participation in the postretirement healthcare plan to eligible retirees effective January 1, 2007. As a result, unrecognized prior service costs of $1,708 are being amortized over the average remaining years of service for active plan participants. The Company expects to decrease its discount rate assumption to 3.50% in 2012 for its other postretirement benefits plan, which will not significantly affect the fiscal year 2012 expense.

The estimated amounts that will be amortized from Accumulated other comprehensive loss at November 30, 2011 into net periodic benefit cost, pre-tax, in fiscal year 2012 are as follows:



	Pension Benefits		Other Postretirement Benefits
Prior service cost (credit)	$	12	$	(123	)
Actuarial loss (gain)	7,638		(121		)
Total	$	7,650	$	(244	)

The expected cash benefit payments from the plans for the next ten fiscal years are as follows:



	Pension Benefits		Other Postretirement Benefits
2012	$	7,162	$	99
2013	28,088		78
2014	8,063		72
2015	8,424		64
2016	8,754		52
2017-2021	51,142		170

The Company also sponsors various defined contribution plans that provide employees with an opportunity to accumulate funds for their retirement. The Company may match, at its discretion, the contributions of participating employees in the respective plans. The Company recognized expense related to these plans for the past three fiscal years as follows:



2011	$	3,933
2010	3,597
2009	3,658