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SEC Filings

10-K
LIQUIDITY SERVICES INC filed this Form 10-K on 11/21/2014
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Table of Contents


Liquidity Services, Inc. and Subsidiaries

Notes to Consolidated Financial Statements (Continued)

14. Defined Benefit Pension Plan (Continued)

    3)
    Security—to ensure that the solvency position of the Plan is expected to improve. The Trustees will take into account the strength of employer's covenant when determining the expected improvement in the solvency position of the Plan.

        Assets were initially invested based on the target allocations stated below. The assets are allocated among equity investments and fixed income securities. The Trustees review the investment policy on an ongoing basis, to determine whether a change in the policy or asset allocation targets is necessary. The assets are not rebalanced and consisted of the following as of September 30, 2014:

 
  Target
Allocation
  Actual
2014
 

Equity securities

    70 %   45.9 %

Fixed-income securities

    30 %   53.6 %

Cash equivalents

    0 %   0.5 %
           

Total

    100.0 %   100.0 %
           
           

        The class of equity securities consists of one pooled fund whose strategy is to invest in approximately 70% UK company shares (domestic) and 30% international equity securities. The class of fixed-income securities consists of one pooled fund whose strategy is to invest in a limited number of government and corporate bonds.

        The expected long-term rate of return for the plan's total assets is based on the expected returns of each of the above categories, weighted based on the current target allocation for each class. The Trustees evaluate whether adjustments are needed based on historical returns to more accurately reflect expectations of future returns.

        The Company is required to present certain fair value disclosures related to its postretirement benefit plan assets, even though those assets are not included on the Company's Consolidated Balance Sheets. The following table presents the fair value of the assets of the Company's qualified defined benefit pension plan by asset category and their level within the fair value hierarchy, which has three levels based on reliability of the inputs used to determine fair value. Level 1 refers to fair values determined based on quoted prices in active markets for identical assets, Level 2 refers to fair values estimated using significant other observable inputs, and Level 3 includes fair values estimated using significant unobservable inputs.

Balance as of September 30, 2014
  Level 1   Level 2   Level 3   Total  
 
  (in thousands)
 

Equity securities

      $ 11,450       $ 11,450  

Fixed-income securities

        13,371         13,371  

Cash equivalents

  $ 125             125  
                   

Total

  $ 125   $ 24,821       $ 24,946  
                   
                   

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