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CITY OF ROSEVILLE NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 2011 NOTE 5 -OTHER INFORMATION (Continued) E. Annual pension cost and net pension obligation The annual pension cost and net pension obligation for the current year were as follows: Annual required contribution $ 312,017 Interest on net pension obligation (8,842) Adjustment to annual required contribution 22,901 Annual pension cost 326,076 Contributions made (312,017) Increase (decrease) in net pension obligation 14,059 Negative net pension obligation beginning of year (176,833) Negative net pension obligation end of year $ (162,774) The annual required contribution was determined as part of the January 1, 2010 actuarial valuation. The actuarial assumptions included (a) 5% investment rate of return (net of administrative expenses); (b) a mortality table of the 1983 Group Annuity Mortality Table for Males and Females; (c) termination of 6 percent rate from age 20 -30, grading to no terminations after age 50; (d) disability rates based upon 75 percent of the Railroad Retirement Board Disability Rates; (e) entry age actuarial cost method based upon age on employment date; (f) retirement age based upon the later of age 55 or 20 years of service; (g) 85 percent of members are assumed to be married, with wives three years younger than husbands; (h) normal form of payment based upon joint and 100 percent to survivor annuity; (i) asset basis based upon market value; and (j) level dollar amortization which is sufficient to amortize the unfunded actuarial accrued liability by a closed period ending December 31, 2011 and a closed period of 11 years for Plan amendments. The Fire Relief Association is required to have an actuarial valuation completed once every two years. The latest actuarial value of plan liability on December 31, 2011 was $8,937,648. The value of the plan assets, valued at market, totaled $7,402,826 on December 31, 2011. A six -year summary of Assets, Liabilities and funding ratios are listed below: 71