UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 11-K
(MARK ONE)
\X\ ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 FOR THE FISCAL YEAR ENDED DECEMBER 31, 2008.
OR
\ \ TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
COMMISSION FILE NUMBER 1-6682
A. FULL TITLE OF THE PLAN AND ADDRESS OF THE PLAN, IF DIFFERENT
FROM THAT OF ISSUER NAMED BELOW:
HASBRO, INC. RETIREMENT SAVINGS PLAN
B. NAME OF ISSUER OF THE SECURITIES HELD PURSUANT TO THE PLAN AND
THE ADDRESS OF ITS PRINCIPAL EXECUTIVE OFFICE:
HASBRO, INC.
1027 NEWPORT AVENUE
PAWTUCKET, RI 02862-1059
REQUIRED INFORMATION
I. FINANCIAL STATEMENTS
The following Plan financial statements and schedule prepared in accordance
with the financial reporting requirements of the Employee Retirement Income
Security Act of 1974 are filed herewith, as permitted by Item 4 of Form 11-K:
Report of Independent Registered Public Accounting Firm
Statements of Net Assets Available for Plan Benefits as of
December 31, 2008 and 2007
Statements of Changes in Net Assets Available for Plan Benefits for
the years ended December 31, 2008 and 2007
Notes to Financial Statements
Supplemental Schedule:
Schedule H, Line 4i - Schedule of Assets (Held at End of Year)
Other schedules are omitted as the required information is not applicable.
II. EXHIBITS
23 Consent of Independent Registered Public Accounting Firm
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Committee appointed by the Board of Directors of Hasbro, Inc. to administer the
Plan has duly caused this Annual Report on Form 11-K to be signed on its behalf
by the undersigned hereunto duly authorized.
Hasbro, Inc. Retirement Savings Plan
------------------------------------
Date: June 26, 2009 /s/ Deborah Thomas
------------- ------------------------------------
Deborah Thomas
Chief Financial Officer
Report of Independent Registered Public Accounting Firm
The Plan Administrator
Hasbro, Inc. Retirement Savings Plan:
We have audited the accompanying statements of net assets available for plan
benefits of the Hasbro, Inc. Retirement Savings Plan (the Plan) as of
December 31, 2008 and 2007, and the related statements of changes in net assets
available for plan benefits for the years then ended. These financial
statements are the responsibility of the Plan's management. Our responsibility
is to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we
plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the net assets available for plan benefits of the Plan
as of December 31, 2008 and 2007, and the changes in net assets available for
plan benefits for the years ended December 31, 2008 and 2007, in conformity
with U.S. generally accepted accounting principles.
Our audits were performed for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental Schedule H, Line 4i -
Schedule of Assets (Held at End of Year) as of December 31, 2008 is presented
for the purpose of additional analysis and is not a required part of the basic
financial statements but is supplementary information required by the
Department of Labor's Rules and Regulations for Reporting and Disclosure under
the Employee Retirement Income Security Act of 1974. The supplemental schedule
is the responsibility of the Plan's management. The supplemental schedule has
been subjected to the auditing procedures applied in the audits of the basic
financial statements and, in our opinion, is fairly stated in all material
respects in relation to the basic financial statements taken as a whole.
/s/ KPMG LLP
Providence, Rhode Island
June 25, 2009
HASBRO, INC. RETIREMENT SAVINGS PLAN
Statements of Net Assets Available for Plan Benefits
December 31, 2008 and 2007
2008 2007
---- ----
Assets:
Cash and cash equivalents $ 2,972,030 199,604
Investments, at fair value 222,863,954 316,518,663
Wrapper contracts, at fair value 101,978 -
----------- -----------
Total investments and cash (note 3) 225,937,962 316,718,267
----------- -----------
Receivables:
Loans to participants 5,349,883 5,257,464
Investment income 186,168 735
Employer contributions 9,213,459 -
Due from brokers for securities sold 185,824 4,097
----------- -----------
Total receivables 14,935,334 5,262,296
----------- -----------
Total assets 240,873,296 321,980,563
----------- -----------
Liabilities:
Due to brokers for securities purchased - 21,127
Other liabilities 200,247 11,165
Accrued administrative expenses 112,171 -
----------- -----------
Total liabilities 312,418 32,292
----------- -----------
Net assets, reflecting investments at
fair value 240,560,878 321,948,271
Adjustment from fair value to contract
value for fully benefit-responsive
investment contracts 2,036,852 233,839
----------- -----------
Net assets available for plan benefits $242,597,730 322,182,110
=========== ===========
See accompanying notes to financial statements.
HASBRO, INC. RETIREMENT SAVINGS PLAN
Statements of Changes in Net Assets Available for Plan Benefits
Years ended December 31, 2008 and 2007
2008 2007
----- -----
Changes in net assets attributed to:
Investment (loss) income:
Net (depreciation) appreciation in
fair value of investments $ (98,045,208) 11,586,244
Dividends and interest 6,493,608 13,410,245
----------- -----------
Total investment (loss) income (note 3) (91,551,600) 24,996,489
----------- -----------
Contributions:
Rollovers 765,039 1,068,893
Employee contributions 15,249,665 14,681,244
Employer matching and other contributions 19,015,732 9,191,005
----------- -----------
Total contributions 35,030,436 24,941,142
----------- -----------
Transfer from other plan 1,114,514 -
Termination, withdrawal and retirement
payments directly to participants (23,768,134) (29,575,801)
Administrative expenses (409,596) (88,292)
---------- -----------
Net (decrease) increase (79,584,380) 20,273,538
Net assets available for plan benefits:
Beginning of year 322,182,110 301,908,572
------------ -----------
End of year $ 242,597,730 322,182,110
============ ===========
See accompanying notes to financial statements.
HASBRO, INC. RETIREMENT SAVINGS PLAN
Notes to Financial Statements
December 31, 2008 and 2007
(1) Description of Plan
The following brief description of the Hasbro, Inc. Retirement Savings Plan
(the Plan) is provided for general information purposes only. Participants
should refer to the Plan agreement for more complete information.
(a) General
The Plan is a defined contribution plan subject to the provisions of
the Employee Retirement Income Security Act of 1974 (ERISA) and is
available to substantially all domestic employees of Hasbro, Inc. and
certain subsidiaries (collectively the Company or Plan Administrator).
Participation in the Plan is voluntary and eligibility provisions
apply.
(b) Plan Merger and Transfer of Plan Assets
Hasbro, Inc. acquired Cranium, Inc. in January 2008. As a result, the
Cranium, Inc. 401(k) Plan was merged into the Hasbro, Inc. Retirement
Savings Plan on July 1, 2008. Assets totaling $1,114,514 were
transferred into the Plan as a result of the merger.
(c) Contributions
Eligible employees could contribute up to 50% of their eligible pay,
limited to an annual maximum of $15,500 in 2008 and 2007.
Contributions may be limited to less than the maximum percentage of
eligible pay to enable the Company to meet IRS discrimination
regulations. The Company makes a matching contribution, except for
Milton Bradley union employees, of 200% of the first 2% of the
participants' eligible pay that they contribute per pay period, plus a
50% match of the next 4% of participants' eligible pay that they
contribute per pay period up to a maximum matching contribution of 6%
of a participant's eligible pay per pay period. For Milton Bradley
union employees, from January 1, 2006 to February 4, 2007 the Company
made a 30% matching contribution, up to a maximum of 6% of a
participant's eligible pay per pay period. For the remainder of 2007,
the Company's matching contribution was 35%, up to a maximum of 6% of a
participant's eligible pay per pay period. From January 1, 2008 through
December 31, 2008 the Company's matching contribution for Milton
Bradley union employees was 40%, up to a maximum of 6% of a
participant's eligible pay per pay period.
All eligible employees at least age 50 by the end of the calendar year
are permitted to make additional pre-tax deferrals over and above the
otherwise applicable limits. These additional deferrals are called
"catch-up contributions." The Company does not make a matching
contribution. Catch-up contributions may be made up to an additional
$5,000 for 2008 and 2007.
HASBRO, INC. RETIREMENT SAVINGS PLAN
Notes to Financial Statements
December 31, 2008 and 2007
Effective at the end of December 2007, the Company froze defined
benefit pension benefits being accrued for its non-union employees in
the Hasbro, Inc. Pension Plan in the United States. These pension
benefits were replaced by additional employer contributions made to
this Plan beginning in 2008. These additional contributions for non-
union employees include an annual Company contribution equal to 3% of
an employee's eligible yearly pay. In addition, for eligible employees
who met certain requirements that were based on a combination of age
and years of vesting service in the pension plan as of December 31,
2007, the Company will make an annual transition contribution of
between 1% and 9% of an employee's eligible yearly pay. The annual
transition contribution is effective for Plan years 2008 through 2012.
(d) Vesting
All participants currently employed by the Company own, or are vested
in, 100% of both employee contributions and the Company's matching
contribution to the Plan. Participants become 100% vested in the
Company's other contributions, including the annual 3% Company
contribution and the annual transition contribution, after three years
of vesting service. Participants earn one year of vesting service for
each calendar year in which the participant has worked at least 1,000
hours.
(e) Forfeitures
The unvested portion of a terminated Participant's account is
forfeited and used to reduce future employer contributions. In 2008 and
2007 there were no forfeitures.
(f) Payment of Benefits
Payments to participants will be paid upon retirement, disability, or
termination of employment. The account balance will be paid to a
beneficiary upon death of the participant. Participants in the Plan
have the option of receiving their benefit payments either in a lump
sum or in periodic installments. Participants, except for terminated
participants, may also make in-service withdrawals from their Pre-Tax
Savings Contribution Account in the event of a demonstrated severe
financial hardship as defined by the IRS Safe Harbor rules.
Participants who have reached age 59 1/2 may make in-service
withdrawals from their vested accounts in the Plan for any reason.
(g) Participant Loans
The maximum loan available to each participant is the lesser of (1)
$50,000 reduced by the highest outstanding loan balance due from the
participant during the preceding twelve months, or (2) 50% of the
participant's vested account balance, reduced by the current
HASBRO, INC. RETIREMENT SAVINGS PLAN
Notes to Financial Statements
December 31, 2008 and 2007
outstanding loan balance due from the participant. The minimum loan
amount available to participants is $500. Each loan shall bear a fixed
interest rate on the 1st day of the month (for each month) at prime as
published in the Wall Street Journal on the prior day. Repayment of the
loan must be made over a period not to exceed five years, unless it is
for the purchase of a primary residence, then the loan period cannot
exceed ten years.
(2) Summary of Accounting Policies
(a) Basis of Accounting
The preparation of financial statements in conformity with accounting
principles generally accepted in the United States of America requires
the Plan Administrator to make estimates and assumptions that affect
the reported amounts in the financial statements and accompanying
notes. Actual results could differ from those estimates. The
accompanying financial statements are presented on the accrual basis of
accounting. Benefits payable at year end are not accrued for as they
are considered to be a component of the net assets available for plan
benefits.
(b) Investments
Investments are stated at fair value. See Note 8 for a discussion of
the methods used to determine the fair value of investments held by the
plan.
In 2008 and 2007 certain investment options offered by the Plan were
deemed to be fully benefit-responsive within the meaning of Financial
Accounting Standards Board Staff Position (FSP) AAG INV-1 and Statement
of Position 94-4-1, Reporting of Fully Benefit-Responsive Investment
Contracts Held by Certain Investment Companies Subject to the AICPA
Investment Company Audit Guide and Defined-Contribution Health and
Welfare and Pension Plans (the "FSP"). The FSP requires that these
investments be reported at fair value. However, contract value is the
relevant measure to the Plan because it is the amount that is available
for Plan benefits. Accordingly, investments as reflected in the
Statements of Net Assets Available for Plan Benefits are stated at
their fair values, with corresponding adjustments to reflect these
investments at contract value. See Note 3 for further information on
these investments.
Participant loans receivable are recorded at amortized cost.
Security transactions received prior to 4:00 pm Eastern time by the
Trustee are recognized on that business day. Transactions received
after 4:00 pm Eastern time are valued as of the next business day.
HASBRO, INC. RETIREMENT SAVINGS PLAN
Notes to Financial Statements
December 31, 2008 and 2007
Interest income is recorded on the accrual basis and dividend income is
recorded on the ex-dividend date.
Net (depreciation) appreciation in the fair value of investments
includes both realized and unrealized gains and losses.
(c) Contributions
Contributions from employees are accounted for when deducted from
employees' wages. The Company's matching contributions are accrued at
the time the employee's contributions are deducted. For the years ended
December 31, 2008 and 2007, employer and employee contributions for the
last pay period of the year were paid to the Plan prior to the Plan's
year end. The annual 3% company contribution and transition
contributions are paid to the Plan subsequent to the end of each Plan
year and are recorded as employer contributions receivable on the
Statement of Net Assets Available for Plan Benefits at year end.
(d) Payments of Benefits
Benefits are recorded when paid.
(e) Administrative Expenses
The Plan bears all costs and general expenses incurred with regard to
investment consulting, audit, legal and communication fees, other
professional fees, independent fund managers and the purchase and sale
of investments. Other costs of administration are paid for by the Plan
Administrator.
3) Investment Information
Participants may elect to have their accounts invested in one or more of the
investment funds offered by the Plan. At December 31, 2008, investment funds
offered by the Plan include the following nationally traded mutual funds:
the Fidelity Growth Company Fund, the Fidelity Diversified International
Fund, the PIMCO Total Return Fund, the Dodge & Cox Stock Fund, the Vanguard
Small-Cap Index Fund, the Vanguard Mid-Cap Index Fund, the Dreyfus Limited
Term High Yield Bond Fund and the JP Morgan US Large Cap Core Plus Fund.
Investment funds offered by the Plan at December 31, 2008 also included the
following commingled funds: BGI S&P 500 Index, JPM SmartRetirement Income,
JPM SmartRetirement 2010, JPM SmartRetirement 2015, JPM SmartRetirement
2020, JPM SmartRetirement 2025, JPM SmartRetirement 2030, JPM
SmartRetirement 2035, JPM SmartRetirement 2040, JPM SmartRetirement 2045 and
JPM SmartRetirement 2050. The BGI S&P 500 Index Fund replaced the Spartan
U.S. Equity Index Fund on January 2, 2008, the JPM SmartRetirement Funds
replaced the Fidelity Freedom Funds on February 1, 2008, and the Dodge & Cox
Stock Fund replaced the Fidelity Equity Income Fund on August 1, 2008.
HASBRO, INC. RETIREMENT SAVINGS PLAN
Notes to Financial Statements
December 31, 2008 and 2007
Participants can elect to invest up to 25% of their contributions in the
Hasbro Stock Fund which is a unitized stock fund that invests in the stock
of Hasbro, Inc. and other short term investments designed to allow
participants to buy and sell without the usual trade settlement period for
individual stock transactions. Ownership is measured in units of the fund
instead of shares of stock. In addition, participants cannot elect to
reallocate their investment funds that would result in greater than 25% of
their account invested in the Hasbro Stock Fund. The fair value of the cash
and investments of the Hasbro Stock Fund was $4,873,876 as of December 31,
2008 and $3,545,519 as of December 31, 2007.
During 2008, the Plan began investing in fully benefit-responsive synthetic
guaranteed investment contracts ("synthetic GICs") as part of offering the
JP Morgan Stable Asset Fund investment option to participants. Participant
contributions to this fund are primarily used to purchase units of
commingled funds, which are invested in a high-quality fixed income
portfolio.
The JP Morgan Stable Asset Fund entered into wrapper contracts with
insurance companies which provide a guarantee with respect to the
availability of funds to make distributions from this investment option.
These contracts are carried at contract value in the participants' accounts.
The issuer of the wrapper contracts is contractually obligated to repay the
principal, as well as a specified interest rate that is set on a quarterly
basis. There are no reserves against contract value for credit risk of the
contract issuer or otherwise.
To the extent that the underlying portfolio has unrealized and/or realized
losses, a positive adjustment is made when reconciling from fair value to
contract value under contract value accounting. As a result, the future
crediting rate may be lower over time than the current market rates.
Similarly, if the underlying portfolio generates unrealized and/or realized
gains, a negative adjustment is made when reconciling from fair value to
contract value and, in the future, the crediting rate may be higher than the
current market rates. The contracts cannot credit an interest rate that is
less than zero percent.
The JP Morgan Stable Asset Fund and the wrapper contracts purchased by that
fund are designed to pay all participants at contract value. However,
certain events limit the ability of the Plan to transact at contract value.
These events include but are not limited to premature termination of the
contracts by the Plan or Plan termination. The Plan Sponsor has not
expressed any intention to take either of these actions.
HASBRO, INC. RETIREMENT SAVINGS PLAN
Notes to Financial Statements
December 31, 2008 and 2007
The synthetic guaranteed investment contracts in the JP Morgan Stable Asset
Fund as of December 31, 2008 are summarized below:
Major Investments Wrapper Adjustment
Credit at Contracts at to Contract
Rating Fair Value Fair Value Value
------ ------------ ------------ -------------
Monumental Life
Insurance Co. AA 24,352,256 50,989 1,018,426
ING Life Insurance
and Annuity Co. AA 24,352,236 50,989 1,018,426
------------ ------- ---------
All Contracts 48,704,492 101,978 2,036,852
============ ======= =========
Participant accounts in the Fund are credited with interest at a fixed rate
that is based on an agreed-upon formula as defined in the contracts. The
rate typically resets quarterly; however, the rate may reset more frequently
under certain circumstances. The primary variables which could impact the
future crediting rates include (1) the amount and timing of participant
contributions, (2) transfers and withdrawals into/out of the contract,
(3) the current yield of the assets underlying the contract, (4) the
duration of the assets underlying the contract and (5) the existing
difference between fair value of the securities and the contract value of
the assets within the insurance contract. The crediting rate of security-
backed contracts will track current market yields on a trailing basis. The
rate reset allows the contract value to converge with the fair value of the
underlying portfolio over time, assuming the portfolio continues to earn the
current yield for a period of time equal to the current portfolio duration.
The average yield earned by the entire JP Morgan Stable Asset Fund for the
year ended December 31, 2008 was 6.67%. The average yield earned by the
entire fund, adjusted to reflect the actual interest rate credited to
participants in the fund, for the year ended December 31, 2008 was 4.33%.
Through July 31, 2008, participants could also elect to invest their funds
in the Stable Asset Fund for Employee Benefit Plans. This fund was managed
by Columbia Management Advisors, LLC and invested in fixed income contracts.
In the 2007 Statement of Net Assets Available for Plan Benefits, the Plan
was required to reflect this investment at fair value, with a corresponding
adjustment to contract value (see Note 2(b)). The fair value of this fund as
of December 31, 2007 was $49,561,320. The contract value of the fund as of
December 31, 2007, which is a component of net assets available for plan
benefits, totaled $49,795,159. This fund yielded approximately 4.82% in
2007.
HASBRO, INC. RETIREMENT SAVINGS PLAN
Notes to Financial Statements
December 31, 2008 and 2007
In addition to the JP Morgan Stable Asset Fund described above, the
following table represents the carrying value of other investments which
were 5% or more of the Plan's net assets as of December 31, 2008 and
December 31, 2007:
2008 2007
------ ------
Fidelity Growth Company Fund $29,713,208 52,115,894
BGI S&P 500 Index 26,913,608 N/A
Fidelity Diversified International Fund 19,925,879 39,247,849
PIMCO Total Return Fund 19,874,282 N/A
Dodge & Cox Stock Fund 19,853,552 N/A
Stable Asset Fund for Employee Benefit Plans N/A 49,795,159
Spartan US Equity Index Fund N/A 48,035,796
Fidelity Equity Income Fund N/A 39,490,871
During 2008 and 2007, the Plan's investments (including gains and losses on
investments bought and sold, as well as held during the year) (depreciated)
appreciated in value by $(98,045,208) and $11,586,244, respectively, as
follows:
Year Ended December 31,
2008 2007
------ ------
Shares in Registered Investment Companies $ (70,920,497) 11,782,956
Units in common collective trusts (27,658,855) -
Hasbro Stock Fund 534,144 (196,712)
----------- ----------
$ (98,045,208) 11,586,244
=========== ==========
(4) Related Party Transactions
Certain Plan investments are shares of mutual funds managed by Fidelity
Management and Research Company, an affiliate of the Trustee, and,
therefore, qualify as party-in-interest transactions. Additionally, the
Plan holds investments in shares of Hasbro, Inc. common stock. The Plan had
159,026 and 130,802 shares of Hasbro, Inc. common stock valued at
$4,638,788 and $3,345,915, respectively, as of December 31, 2008 and 2007.
These transactions qualify as exempt party-in-interest transactions.
(5) Plan Termination
Upon termination of the Plan and trust, each Participant shall be entitled
to receive the vested amount standing to the credit of their account as of
the final valuation date. The Trustee shall make payments of such amounts
as directed by the Plan Administrator.
HASBRO, INC. RETIREMENT SAVINGS PLAN
Notes to Financial Statements
December 31, 2008 and 2007
Although the Company has not expressed any intent to do so, it reserves the
right to terminate the Plan at any time subject to ERISA provisions.
(6) Risks and Uncertainties
The Plan provides for investments in various funds, which invest in equity
and debt securities and other investments. Such investments are exposed to
risks and uncertainties, such as interest rate risk, credit risk, economic
and political risks, regulatory changes, and foreign currency risk. In
addition, participants may elect to invest up to 25% of their contributions
in the Hasbro Stock Fund. The underlying performance of this fund is
dependent upon the performance of the Company and the market's evaluation
of such performance. The Plan's exposure to a concentration of credit risk
is subject to the Plan's investment funds selected by participants. These
risks and uncertainties could impact participants' account balances and the
amounts reported in the financial statements.
(7) Federal Income Taxes
The Internal Revenue Service issued a determination letter on January 21,
2003, which stated that the Plan and its underlying trust are designed in
accordance with applicable sections of the Internal Revenue Code (IRC), and
therefore, are exempt from federal income taxes. Although the Plan has been
amended since receiving the determination letter, the Plan Administrator
and the Plan's tax counsel believe that the Plan is designed and is
currently being operated in compliance with the applicable requirements of
the IRC.
(8) Fair Value Measurements
Effective January 1, 2008, the Plan adopted Statement of Financial
Accounting Standards No. 157, "Fair Value Measurements," ("SFAS No. 157")
which defines fair value, establishes a framework for measuring fair value
in generally accepted accounting principles and expands disclosure
requirements regarding fair value measurements. The SFAS No. 157 fair value
hierarchy consists of three levels: Level 1 fair values are valuations
based on quoted market prices in active markets for identical assets or
liabilities that the entity has the ability to access; Level 2 fair values
are those valuations based on quoted prices for similar assets or
liabilities, quoted prices in markets that are not active, or other inputs
that are observable or can be corroborated by observable data for
substantially the full term of the assets or liabilities; and Level 3 fair
values are valuations based on inputs that are supported by little or no
market activity and that are significant to the fair value of the assets or
liabilities. The adoption of SFAS No. 157 did not have an impact on the
Plan's Statement of Net Assets Available for Plan Benefits or the Statement
of Changes in Net Assets Available for Plan Benefits.
HASBRO, INC. RETIREMENT SAVINGS PLAN
Notes to Financial Statements
December 31, 2008 and 2007
At December 31, 2008, the Plan had the following assets measured at fair
value in its Statement of Net Assets Available for Plan Benefits:
Fair Value Measurements at
December 31, 2008 Using:
------------------------------
Quoted
Prices in
Active
Markets Significant
For Other Significant
Identical Observable Unobservable
Fair Assets Inputs Inputs
Value (Level 1) (Level 2) (Level 3)
-------- -------- --------- ----------
Investments
-----------
Hasbro, Inc.
Common Stock $ 4,638,788 4,638,788 - -
Mutual Funds 106,834,748 106,834,748 - -
Commingled Funds 62,685,926 - 62,685,926 -
Synthetic GICs:
Cash and Cash
Equivalents 30,236 30,236 - -
U.S. Treasury Bonds 263,895 263,895 - -
Commingled Funds 48,410,361 - 48,410,361 -
Wrapper Contracts 101,978 - - 101,978
----------- ----------- ----------- ---------
Total Synthetic
GICs 48,806,470 294,131 48,410,361 101,978
----------- ----------- ----------- ---------
Total Investments $222,965,932 111,767,667 111,096,287 101,978
=========== =========== =========== =========
HASBRO, INC. RETIREMENT SAVINGS PLAN
Notes to Financial Statements
December 31, 2008 and 2007
The following is a description of the valuation methodologies used for
assets measured at fair value. There have been no changes in the
methodologies used at December 31, 2008 and 2007.
Hasbro, Inc. Common Stock: Valued at the composite closing price reported
on the New York Stock Exchange.
Mutual Funds: Valued at the net asset value ("NAV") of shares held by the
plan at year-end.
Commingled Funds: Valued using the NAV which is quoted on a private market
that is not active; however, the unit price is based on underlying
investments which are traded on an active market.
U.S. Treasury Bonds: Valued at the closing price reported in the active
market in which the individual security is traded.
Synthetic Guaranteed Investment Contracts: The synthetic GICs are comprised
of wrapper contracts and underlying investments as detailed in the table
above and described in Note 3. The fair value of the wrapper contracts
represents the difference between the replacement cost and actual cost of
the contracts and is calculated using a discounted cash flow model which
considers recent fee bids as determined by recognized dealers, an
appropriate discount rate and the duration of the underlying portfolio
securities. These inputs are considered unobservable inputs in that they
reflect the Plan's own assumptions about the inputs that market
participants would use in pricing the asset or liability. The Plan believes
that this is the best information available for use in the fair value
measurement. The underlying assets are valued as described above.
The following is a reconciliation of the beginning and ending balances of
the fair value measurements of the wrapper contracts which use significant
unobservable inputs (Level 3):
Balance at December 31, 2007 $ -
Unrealized gains (losses) 101,978
--------
Balance at December 31, 2008 $ 101,978
========
HASBRO, INC. RETIREMENT SAVINGS PLAN
Notes to Financial Statements
December 31, 2008 and 2007
(9) Reconciliation to Form 5500
The following is a reconciliation of net assets available for plan benefits
per the financial statements to the Form 5500 at December 31, 2008.
Per financial statements $ 242,597,730
Employer contributions receivable (9,213,459)
Accrued administrative expenses 112,171
Adjustment from contract value to fair value
for fully-benefit responsive investment contracts (2,036,852)
-----------
Per Form 5500 $ 231,459,590
===========
The following is a reconciliation of the change in net assets available for
plan benefits per the financial statements to the Form 5500 at December 31,
2008.
Per financial statements $ (79,584,380)
Employer contributions receivable (9,213,459)
Accrued administrative expenses 112,171
Adjustment from contract value to fair value
for fully-benefit responsive investment contracts (2,036,852)
-----------
Per Form 5500 $ (90,722,520)
===========
The accompanying financial statements are presented on the accrual basis of
accounting and include accrued administrative expenses and employer
contributions receivable which are not accrued on the Form 5500.
HASBRO, INC. RETIREMENT SAVINGS PLAN
Schedule H, Line 4i - Schedule of Assets (Held at End of Year)
Year ended December 31, 2008
Issuer Investment Description Fair Value
------ ----------------------- -----------
Mutual Funds
------------
Fidelity Growth Company Fund* 606,887 shares in registered $ 29,713,208 **
investment company
Fidelity Diversified 926,354 shares in registered 19,925,879 **
International Fund* investment company
PIMCO Total Return Fund 1,959,988 shares in registered 19,874,282 **
investment company
Dodge & Cox Stock Fund 266,956 shares in registered 19,853,552 **
investment company
Vanguard Small-Cap Index 377,168 shares in registered 7,694,228
Fund investment company
Vanguard Mid-Cap Index Fund 556,091 shares in registered 6,572,997
investment company
Dreyfus Limited Term 337,652 shares in registered 1,708,518
High Yield Bond Fund investment company
JPMorgan US Large Cap 111,267 shares in registered 1,492,084
Core Plus Fund investment company
Commingled Funds
----------------
BGI S&P 500 Index 920,753 units in common 26,913,608 **
collective trust
JPM SmartRetirement 2020 843,399 units in common 7,911,079
collective trust
JPM SmartRetirement 2015 593,051 units in common 5,598,404
collective trust
JPM SmartRetirement 2025 492,046 units in common 5,520,752
collective trust
JPM SmartRetirement 2030 617,818 units in common 5,473,868
collective trust
JPM SmartRetirement 2035 364,259 units in common 3,890,287
collective trust
JPM SmartRetirement 2010 387,183 units in common 3,782,780
collective trust
JPM SmartRetirement 2040 228,640 units in common 2,002,887
collective trust
JPM SmartRetirement Income 90,489 units in common 880,453
collective trust
JPM SmartRetirement 2045 64,370 units in common 677,815
collective trust
JPM SmartRetirement 2050 3,403 units in common 33,993
collective trust
Synthetic Guaranteed
Investment Contracts
----------------------
Cash and Cash Equivalents 30,236
Wrapper Contracts:
Monumental Life Insurance Co. Wrapper contract 50,989
ING Life Insurance and
Annuity Co. Wrapper contract 50,989
Commingled Funds:
JPMCB Intermediate Bond Fund 4,272,191 units in common 48,275,758 **
collective trust
JPMCB Liquidity Fund 134,341 units in common 134,603
collective trust
U.S. Treasury Bonds:
U.S. Treasury N/B 160,000 par; 2.375% interest; 166,147
Security ID: 912828JJ Maturity date: 08/31/2010
U.S. Treasury N/B 85,000 par; 2.000% interest; 87,573
Security ID: 912828JL Maturity date: 09/30/2010
U.S. Treasury N/B 10,000 par; 1.500% interest; 10,175
Security ID: 912828JP Maturity date: 10/31/2010
Common Stock
------------
Hasbro Stock Fund * 159,026 shares of Hasbro, Inc. 4,638,788
common stock
Cash and Cash Equivalents
-------------------------
Fidelity STIF * Cash equivalents 2,736,942
Hasbro Stock Fund * Cash 235,088
-----------
Investments and Cash $ 225,937,962
===========
Loans to Participants* 759 loans with interest rates
from 4.0% to 8.25% and maturity
dates from 2009 to 2017 $ 5,349,883
===========
*Party-in-interest
**Represents greater than 5% of Plan assets at December 31, 2008.
See accompanying report of independent registered public accounting firm.