Registration of securities issued in business combination transactions

EMPLOYEE BENEFIT PLANS (Tables)

v2.4.0.8
EMPLOYEE BENEFIT PLANS (Tables)
12 Months Ended
Dec. 31, 2013
EMPLOYEE BENEFIT PLANS  
Schedule of funded status of the plans and the amounts recognized in the consolidated balance sheets

The following table sets forth the funded status of the plans for us and the amounts recognized in our consolidated balance sheets at December 31, 2013 and 2012 (dollars in millions):

 
  Defined Benefit Plans   Other Postretirement Benefit Plans  
 
  2013   2012   2013   2012  
 
  U.S.
Plans
  Non-U.S.
Plans
  U.S.
Plans
  Non-U.S.
Plans
  U.S.
Plans
  Non-U.S.
Plans
  U.S.
Plans
  Non-U.S.
Plans
 

Change in benefit obligation

                                                 

Benefit obligation at beginning of year

  $ 958   $ 2,755   $ 834   $ 2,331   $ 136   $ 7   $ 128   $ 7  

Service cost

    31     38     26     32     4         4      

Interest cost

    40     90     42     102     5         7     1  

Participant contributions

        9         9     5         5      

Plan amendments

        1     (26 )       (22 )           (1 )

Foreign currency exchange rate changes

        92         80         (1 )        

Settlements/transfers

                (2 )                

Curtailments

        (5 )                        

Special termination benefits

        9                          

Actuarial (gain) loss

    (100 )   39     127     360     (9 )       8      

Benefits paid

    (52 )   (169 )   (45 )   (157 )   (14 )   (1 )   (16 )    
                                   

Benefit obligation at end of year

  $ 877   $ 2,859   $ 958   $ 2,755   $ 105   $ 5   $ 136   $ 7  
                                   
                                   

Change in plan assets

                                                 

Fair value of plan assets at beginning of year

  $ 636   $ 2,237   $ 538   $ 2,026   $   $   $   $  

Actual return on plan assets

    99     198     71     221                  

Foreign currency exchange rate changes

        79         65                  

Participant contributions

        9         9     5         5      

Company contributions

    72     89     72     75     9     1     11      

Settlements/transfers

                (2 )                

Benefits paid

    (52 )   (169 )   (45 )   (157 )   (14 )   (1 )   (16 )    
                                   

Fair value of plan assets at end of year

  $ 755   $ 2,443   $ 636   $ 2,237   $   $   $   $  
                                   
                                   

Funded status

                                                 

Fair value of plan assets

  $ 755   $ 2,443   $ 636   $ 2,237   $   $   $   $  

Benefit obligation

    877     2,859     958     2,755     105     5     136     7  
                                   

Accrued benefit cost

  $ (122 ) $ (416 ) $ (322 ) $ (518 ) $ (105 ) $ (5 ) $ (136 ) $ (7 )
                                   
                                   

Amounts recognized in balance sheet:

                                                 

Noncurrent asset

  $   $ 20   $   $ 1   $   $   $   $  

Current liability

    (6 )   (6 )   (6 )   (5 )   (9 )       (11 )   (1 )

Noncurrent liability

    (116 )   (430 )   (316 )   (514 )   (96 )   (5 )   (125 )   (6 )
                                   

 

  $ (122 ) $ (416 ) $ (322 ) $ (518 ) $ (105 ) $ (5 ) $ (136 ) $ (7 )
                                   
                                   
Schedule of amounts recognized in accumulated other comprehensive loss (income)

 

 
  Defined Benefit Plans   Other Postretirement Benefit
Plans
 
 
  2013   2012   2013   2012  
 
  U.S.
Plans
  Non-U.S.
Plans
  U.S.
Plans
  Non-U.S.
Plans
  U.S.
Plans
  Non-U.S.
Plans
  U.S.
Plans
  Non-U.S.
Plans
 

Amounts recognized in accumulated other comprehensive loss:

                                                 

Net actuarial loss

  $ 266   $ 765   $ 449   $ 867   $ 21   $   $ 32   $ 1  

Prior service cost

    (35 )   5     (42 )   4     (27 )       (8 )    

Transition obligation

            1                      
                                   

 

  $ 231   $ 770   $ 408   $ 871   $ (6 ) $   $ 24   $ 1  
                                   
                                   
Schedule of amounts in accumulated other comprehensive loss that are expected to be recognized as components of net periodic benefit cost during the next fiscal year

The amounts in accumulated other comprehensive loss that are expected to be recognized as components of net periodic benefit cost during the next fiscal year are as follows (dollars in millions):

 
  Defined Benefit
Plans
  Other
Postretirement
Benefit Plans
 
 
  U.S.
Plans
  Non-U.S.
Plans
  U.S.
Plans
  Non-U.S.
Plans
 

Actuarial loss

  $ 19   $ 41   $ 2   $  

Prior service cost

    (6 )       (4 )    
                   

Total

  $ 13   $ 41   $ (2 ) $  
                   
                   
Components of the net periodic benefit costs

Components of net periodic benefit costs for the years ended December 31, 2013, 2012 and 2011 were as follows (dollars in millions):

 
  Defined Benefit Plans  
 
  U.S. plans   Non-U.S. plans  
 
  2013   2012   2011   2013   2012   2011  

Service cost

  $ 31   $ 26   $ 23   $ 38   $ 32   $ 44  

Interest cost

    40     42     44     90     102     110  

Expected return on plan assets

    (50 )   (48 )   (47 )   (124 )   (133 )   (140 )

Amortization of prior service cost

    (7 )   (6 )   (4 )   1     (1 )   (2 )

Amortization of actuarial loss

    35     21     16     49     28     21  

Settlement loss

                12     13      

Special termination benefits

                9         8  
                           

Net periodic benefit cost

  $ 49   $ 35   $ 32   $ 75   $ 41   $ 41  
                           
                           

 
  Other Postretirement Benefit Plans  
 
  U.S. plans   Non-U.S. plans  
 
  2013   2012   2011   2013   2012   2011  

Service cost

  $ 4   $ 4   $ 3   $   $   $  

Interest cost

    5     7     7         1     1  

Amortization of prior service cost

    (2 )   (3 )   (3 )            

Amortization of actuarial loss

    2     2     2              
                           

Net periodic benefit cost

  $ 9   $ 10   $ 9   $   $ 1   $ 1  
                           
                           
Schedule of amounts recognized in net periodic benefit cost and other comprehensive loss (income)

 The amounts recognized in net periodic benefit cost and other comprehensive income (loss) as of December 31, 2013, 2012 and 2011 were as follows (dollars in millions):

 
  Defined Benefit Plans  
 
  U.S. plans   Non-U.S. plans  
 
  2013   2012   2011   2013   2012   2011  

Current year actuarial (gain) loss

  $ (149 ) $ 103   $ 101   $ (39 ) $ 272   $ 182  

Amortization of actuarial loss

    (35 )   (21 )   (16 )   (49 )   (28 )   (21 )

Current year prior service (credits) cost

        (26 )       1         (2 )

Amortization of prior service cost (credits)

    7     6     4     (1 )   1     2  

Curtailment effects

                        (38 )

Settlements

                (12 )   (13 )    
                           

Total recognized in other comprehensive (income) loss

    (177 )   62     89     (100 )   232     123  

Net periodic benefit cost

    49     35     32     75     41     41  
                           

Total recognized in net periodic benefit cost and other comprehensive income (loss)

  $ (128 ) $ 97   $ 121   $ (25 ) $ 273   $ 164  
                           
                           

 

 
  Other Postretirement Benefit Plans  
 
  U.S. plans   Non-U.S. plans  
 
  2013   2012   2011   2013   2012   2011  

Current year actuarial (gain) loss

  $ (8 ) $ 9   $ 1   $ (1 ) $   $  

Amortization of actuarial loss

    (2 )   (2 )   (2 )            

Current year prior service credit

    (22 )                    

Amortization of prior service cost

    2     3     3              
                           

Total recognized in other comprehensive (income) loss

    (30 )   10     2     (1 )        

Net periodic benefit cost

    9     10     9         1     1  
                           

Total recognized in net periodic benefit cost and other comprehensive income (loss)

  $ (21 ) $ 20   $ 11   $ (1 ) $ 1   $ 1  
                           
                           
Schedule of weighted-average assumptions used to determine the projected benefit obligation and the net periodic pension cost

The following weighted-average assumptions were used to determine the projected benefit obligation at the measurement date and the net periodic pension cost for the year:

 
  Defined Benefit Plans  
 
  U.S. plans   Non U.S. plans  
 
  2013   2012   2011   2013   2012   2011  

Projected benefit obligation

                                     

Discount rate

    5.13 %   4.18 %   5.30 %   3.62 %   3.38 %   4.39 %

Rate of compensation increase

    4.17 %   4.19 %   3.88 %   3.37 %   3.34 %   3.44 %

Net periodic pension cost

                                     

Discount rate

    4.18 %   5.30 %   5.70 %   3.38 %   4.39 %   4.69 %

Rate of compensation increase

    4.19 %   3.88 %   3.88 %   3.34 %   3.44 %   3.38 %

Expected return on plan assets

    7.75 %   8.00 %   8.19 %   5.75 %   6.52 %   6.62 %

 

 
  Other Postretirement Benefit Plans  
 
  U.S. plans   Non U.S. plans  
 
  2013   2012   2011   2013   2012   2011  

Projected benefit obligation

                                     

Discount rate

    4.79 %   3.89 %   5.09 %   6.49 %   5.79 %   6.09 %

Net periodic pension cost

                                     

Discount rate

    3.89 %   5.09 %   5.46 %   5.79 %   6.09 %   6.69 %
Schedule of effect on one-percent-point change in assumed health care cost trend rates

A one-percent point change in assumed health care cost trend rates would have the following effects (dollars in millions):

 
  Increase   Decrease  

Asset category

             

Effect on total of service and interest cost

  $ 1   $ (1 )

Effect on postretirement benefit obligation

         
Schedule of projected benefit obligation and fair value of plan assets for the defined benefit plans with projected benefit obligations in excess of fair value of plan assets

The projected benefit obligation and fair value of plan assets for the defined benefit plans with projected benefit obligations in excess of plan assets as of December 31, 2013 and 2012 were as follows (dollars in millions):

 
  U.S. plans   Non-U.S. plans  
 
  2013   2012   2013   2012  

Projected benefit obligation in excess of plan assets

                         

Projected benefit obligation

  $ 871   $ 958   $ 2,234   $ 2,742  

Fair value of plan assets

    749     636     1,797     2,223  
Schedule of defined benefit plans with an accumulated benefit obligation in excess of fair value of plan assets

The projected benefit obligation, accumulated benefit obligation and fair value of plan assets for the defined benefit plans with an accumulated benefit obligation in excess of plan assets as of December 31, 2013 and 2012 were as follows (dollars in millions):

 
  U.S. plans   Non-U.S. plans  
 
  2013   2012   2013   2012  

Accumulated benefit obligation in excess of plan assets

                         

Projected benefit obligation

  $ 871   $ 958   $ 1,868   $ 1,751  

Accumulated benefit obligation

    853     925     1,732     1,603  

Fair value of plan assets

    749     636     1,451     1,266  
Schedule of expected future contributions and benefit payments

 Expected future contributions and benefit payments are as follows (dollars in millions):

 
  U.S. Plans   Non-U.S. Plans  
 
  Defined
Benefit
Plans
  Other
Postretirement
Benefit
Plans
  Defined
Benefit
Plans
  Other
Postretirement
Benefit
Plans
 

2014 expected employer contributions

                         

To plan trusts

  $ 46   $ 9   $ 79   $ 1  

Expected benefit payments

                         

2014

    63     10     149     1  

2015

    63     9     83     1  

2016

    56     9     81     1  

2017

    59     9     83     1  

2018

    61     9     86     1  

2019 - 2023

    340     41     456     2  
Schedule of plan assets measured at fair value on a recurring basis

The fair value of plan assets for the pension plans was $3.2 billion and $2.9 billion at December 31, 2013 and 2012, respectively. The following plan assets are measured at fair value on a recurring basis (dollars in millions):

 
   
  Fair Value Amounts Using  
Asset category
  December 31,
2013
  Quoted prices in
active markets
for identical
assets (Level 1)
  Significant other
observable
inputs
(Level 2)
  Significant
unobservable
inputs
(Level 3)
 

U.S. pension plans:

                         

Equities

  $ 428   $ 245   $ 183   $  

Fixed income

    208     88     120      

Real estate/other

    92     45         47  

Cash

    27     27          
                   

Total U.S. pension plan assets

  $ 755   $ 405   $ 303   $ 47  
                   
                   

Non-U.S. pension plans:

                         

Equities

  $ 1,053   $ 580   $ 473   $  

Fixed income

    908     668     240      

Real estate/other

    400     30     341     29  

Cash

    82     80     2      
                   

Total Non-U.S. pension plan assets

  $ 2,443   $ 1,358   $ 1,056   $ 29  
                   
                   

 

 
   
  Fair Value Amounts Using  
Asset category
  December 31,
2012
  Quoted prices in
active markets
for identical
assets (Level 1)
  Significant other
observable
inputs
(Level 2)
  Significant
unobservable
inputs
(Level 3)
 

U.S. pension plans:

                         

Equities

  $ 340   $ 195   $ 145   $  

Fixed income

    196     116     80      

Real estate/other

    89     48         41  

Cash

    11     11          
                   

Total U.S. pension plan assets

  $ 636   $ 370   $ 225   $ 41  
                   
                   

Non-U.S. pension plans:

                         

Equities

  $ 862   $ 649   $ 213   $  

Fixed income

    905     632     273      

Real estate/other

    357     27     303     27  

Cash

    113     112     1      
                   

Total Non-U.S. pension plan assets

  $ 2,237   $ 1,420   $ 790   $ 27  
                   
                   
Reconciliation of the beginning and ending balances of plan assets measured at fair value using unobservable inputs (level 3)

The following table reconciles the beginning and ending balances of plan assets measured at fair value using unobservable inputs (Level 3) (dollars in millions):

 
  Real Estate/Other  
Fair Value Measurements of Plan Assets Using Significant Unobservable
Inputs (Level 3)
  Year ended
December 31,
2013
  Year ended
December 31,
2012
 

Balance at beginning of period

  $ 68   $ 61  

Return on pension plan assets

    6     4  

Purchases, sales and settlements

    2     10  

Transfers (out of) into Level 3

        (7 )
           

Balance at end of period

  $ 76   $ 68  
           
           
Schedule of asset allocation for pension plans and the target allocation, by asset category

 

 

Asset category
  Target
Allocation
2014
  Allocation at
December 31,
2013
  Allocation at
December 31,
2012
 

U.S. pension plans:

                   

Equities

    54 %   57 %   53 %

Fixed income

    33 %   27 %   31 %

Real estate/other

    13 %   12 %   14 %

Cash

        4 %   2 %
               

Total U.S. pension plans

    100 %   100 %   100 %
               
               

Non-U.S. pension plans:

                   

Equities

    38 %   38 %   38 %

Fixed income

    40 %   40 %   41 %

Real estate/other

    11 %   11 %   20 %

Cash

    11 %   11 %   1 %
               

Total non-U.S. pension plans

    100 %   100 %   100 %