Employee Benefit Plan

9 Months Ended

Sep. 30, 2011

Note 6. Employee Benefit Plan

The Bank has a qualified noncontributory defined benefit pension plan that covers substantially all of its employees. The benefits are primarily based on years of service and earnings. The following is a summary of net periodic pension costs for the nine-month and three-month periods ended September 30, 2011 and 2010.

	Nine-months ended Sep 30,						Three-months ended Sep 30,
	2011			2010			2011			2010

Service cost	$	343,497		$	308,880		$	114,499			102,960
Interest cost		329,802			312,774			109,934			104,258
Expected return on plan assets		(581,046	)		(495,213	)		(193,682	)		(165,071	)
Amortization of prior service cost		2,424			2,424			808			808
Amortization of net (gain) or loss		33,762			29,097			11,254			9,699
Net periodic benefit cost	$	128,439		$	157,962		$	42,813		$	52,654

It is Bank policy to contribute the maximum tax-deductible amount each year as determined by the plan administrator. A contribution of $1,021,577 was made in the second quarter of 2011.

- Definition

The entire disclosure for pension and other postretirement benefits.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef

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-Name Accounting Standards Codification

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+ Details

GRAYSON BANKSHARES INC 10-Q