13. RETIREMENT PLANS

The Company has a noncontributory defined benefit pension plan for eligible employees of GT&T who meet certain age and employment criteria. Company contributions to fund the plan are intended to provide not only for benefits attributed for service to date but also for those expected to be earned in the future. The Company's funding policy is to contribute to the plan such amounts as are actuarially determined to meet funding requirements. The benefits are based on the participants' average salary or hourly wages during the last three years of employment and credited service years.

The weighted-average rates assumed in the actuarial calculations for the pension plan are as follows as of December 31, 2011, 2012 and 2013:



Discount rate	6.25	%	6.00	%	5.75	%
Annual salary increase	7.50	%	7.50	%	7.50	%
Expected long-term return on plan assets	8.00	%	8.00	%	7.00	%

The expected long-term rate of return on pension plan assets was determined based on several factors including input from pension investment consultants, projected long-term returns of equity and bond indices in Guyana and elsewhere, including the United States, and historical returns over the life of the related obligations of the fund. The Company, in conjunction with its pension investment consultants, reviews its asset allocation periodically and rebalances its investments when appropriate in an effort to earn the expected long-term returns. The Company will continue to evaluate its long-term rate of return assumptions at least annually and will adjust them as necessary.

Changes during the year in the projected benefit obligations and in the fair value of plan assets are as follows for 2012 and 2013 (in thousands):

	2012			2013

Projected benefit obligations:
Balance at beginning of year:	$	13,355		$	11,660
Service cost		612			543
Interest cost		810			665
Benefits and settlements paid		(674	)		(1,444	)
Actuarial (loss) gain		(2,443	)		1,127
Exchange rate adjustment		—			(314	)


Actuarial loss	$	11,660		$	12,237




Plan net assets:
Balance at beginning of year:	$	11,994		$	12,932
Actual return on plan assets		759			657
Company contributions		853			854
Benefits and settlements paid		(674	)		(1,444	)
Exchange rate adjustment		—			(326	)


Balance at end of year	$	12,932		$	12,673




Over funded status of plan	$	1,272		$	436

The Company's investment policy for its pension assets is to have a reasonably balanced investment approach, with a long-term bias toward debt investments. The Company's strategy allocates plan assets among equity, debt and other assets in both Guyana and the United States to achieve long-term returns without significant risk to principal. The fund is prohibited under Guyana law from investing in the equity, debt or other securities of the employer, its subsidiaries or associates of the employer or any company of which the employer is a subsidiary or an associate. Furthermore, the plan must invest between 70%-80% of its total plan assets within Guyana.

The fair values for the pension plan's net assets, by asset category, at December 31, 2013 are as follows (in thousands):

Asset Category	Total		Level 1		Level 2		Level 3

Cash, cash equivalents, money markets and other	$	10,008	$	9,331	$	—	$	—
Equity securities		1,438		1,438		—		—
Fixed income securities		1,552		841		1,388		—


Total	$	12,998	$	11,610	$	1,388	$	—

The plan's weighted-average asset allocations at December 31, 2012 and 2013, by asset category are as follows:



Cash, cash equivalents, money markets and other	78.7	%	77.0	%
Equity securities	9.2		11.1
Fixed income securities	12.1		11.9


Total	100.0	%	100	%

Amounts recognized on the Company's consolidated balance sheets consist of (in thousands):

	As of December 31,

	2012			2013
Other assets	$	1,272		$	436
Accumulated other comprehensive loss, net of tax		(1,318	)		(1,949	)

Amounts recognized in accumulated other comprehensive loss consist of (in thousands):

	2012			2013

Net actuarial loss	$	(2,918	)	$	(2,154	)
Prior service cost		—			—


Accumulated other comprehensive loss, pre-tax	$	(2,918	)	$	(2,154	)




Accumulated other comprehensive loss, net of tax	$	(1,318	)	$	(1,949	)

Components of the plan's net periodic pension cost are as follows for the years ended December 31, 2011, 2012 and 2013 (in thousands):

	2011			2012			2013

Service cost	$	617		$	612		$	543
Interest cost		865			810			665
Expected return on plan assets		(961	)		(972	)		(949	)
Amortization of unrecognized net actuarial loss		229			242			150
Amortization of prior service costs		11			—			—


Net periodic pension cost	$	761		$	692		$	409

For 2014, the Company expects to contribute approximately $518,000 to its pension plan.

The following estimated pension benefits, which reflect expected future service, as appropriate, are expected to be paid over the next ten years as indicated below (in thousands):

Fiscal Year	Pension Benefits

2014	$	355
2015		492
2016		534
2017		562
2018		730
2019 - 2023		4,401


	$	7,074