Parker-Hannifin Corporation - Page 5

                                        - 5 -                                         
               The person primarily responsible for the implementation and            
          funding of the VEBA Trust was Joseph B. Dorn (Dorn).  Dorn was              
          director of taxation for petitioner on June 30, 1987.  Dorn                 
          computed the VEBA contribution and claimed deduction on a single            
          sheet of paper.  Dorn is not an actuary.                                    
               The explanation of the calculation of each portion of the              
          1987 contribution follows below.                                            
          Incurred But Unpaid Medical, Dental, and Short-Term Disability              
          Benefits                                                                    
               Dorn contacted Provident to obtain an estimate of the                  
          reserve for medical, dental, life, and short-term disability                
          expenses incurred but unpaid before June 30, 1987.  Provident               
          provided Dorn with the amount of $9,022,227.                                
               Expenses incurred but unpaid before June 30, 1987, for                 
          employees covered under collective bargaining agreements were               
          included in the $9,022,227.  Expenses estimated to be incurred              
          but unpaid after June 30, 1987, for employees covered under a               
          collective bargaining agreement were included in the $3,210,000             
          contribution for union medical benefits.                                    
               Petitioner's 1987 contribution included $9,022,227 for                 
          incurred but unpaid medical, dental, and short-term disability              
          benefits.                                                                   
          Postretirement Benefits--Retirees                                           
               Reserve Computation                                                    
               Dorn obtained the actual fiscal 1987 expenses incurred                 
          through April 1987 for benefits paid to hourly and salaried                 



Page:  Previous  1  2  3  4  5  6  7  8  9  10  11  12  13  14  15  16  17  18  19  20  Next

Last modified: May 25, 2011