The long-term expected rate of return on the IFRRF plan investments was determined by using a building-block method in which best estimate ranges of expected future real rate of returns (expected returns, net of pension plan investments expense and inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return for each major asset class included in the IFRRF’s target asset allocations as of December 31, 2016 are summarized below:
Actuarially Determined Contribution (ADC) rate - A target or recommended contribution to a defined benefit pension plan for the reporting period, determined in conformity with Actuarial Standards of Practice based on the most recent measurement available when the contribution for the reporting period was adopted.