Annual report pursuant to Section 13 and 15(d)

COMPANY-SPONSORED EMPLOYEE BENEFIT PLANS (Tables)

v3.3.1.900
COMPANY-SPONSORED EMPLOYEE BENEFIT PLANS (Tables)
12 Months Ended
Dec. 31, 2015
Net Periodic Benefit Cost for Pension and Postretirement Benefit Plans
Information about net periodic benefit cost for the company-sponsored pension and postretirement benefit plans is as follows (in millions):
 
U.S. Pension Benefits
 
U.S. Postretirement
Medical Benefits
 
International
Pension Benefits
 
2015
 
2014
 
2013
 
2015
 
2014
 
2013
 
2015
 
2014
 
2013
Net Periodic Benefit Cost:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Service cost
$
1,527

 
$
1,137

 
$
1,349

 
$
34

 
$
62

 
$
103

 
$
48

 
$
43

 
$
47

Interest cost
1,694

 
1,604

 
1,449

 
117

 
152

 
185

 
44

 
49

 
44

Expected return on assets
(2,489
)
 
(2,257
)
 
(2,147
)
 
(17
)
 
(25
)
 
(33
)
 
(61
)
 
(61
)
 
(55
)
Amortization of:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Transition obligation

 

 

 

 

 

 

 

 

Prior service cost
168

 
169

 
172

 
5

 

 
4

 
1

 
1

 
2

Actuarial (gain) loss
70

 
991

 

 
17

 
767

 

 
31

 
48

 

Curtailment and settlement loss

 

 

 

 
356

 

 

 

 

Other

 

 

 

 

 

 

 
4

 
(5
)
Net periodic benefit cost
$
970

 
$
1,644

 
$
823

 
$
156

 
$
1,312

 
$
259

 
$
63

 
$
84

 
$
33

Effects of One Percent Change in Assumed Health Care Cost Trend
A one percent change in assumed healthcare cost trend rates would have had the following effects on 2015 results (in millions):
 
1% Increase
 
1% Decrease
Effect on total of service cost and interest cost
$
4

 
$
(4
)
Effect on postretirement benefit obligation
$
73

 
$
(79
)
Reconciliation of the Changes in the Plans' Benefit Obligations and Fair Value of Plan Assets
The following table provides a reconciliation of the changes in the plans’ benefit obligations and fair value of plan assets as of the respective measurement dates in each year (in millions).
 
U.S. Pension Benefits
 
U.S. Postretirement
Medical Benefits
 
International
Pension
Benefits
 
2015
 
2014
 
2015
 
2014
 
2015
 
2014
Benefit Obligations:
 
 
 
 
 
 
 
 
 
 
 
Projected benefit obligation at beginning of year
$
37,521

 
$
29,508

 
$
2,883

 
$
4,046

 
$
1,274

 
$
1,076

Service cost
1,527

 
1,137

 
34

 
62

 
48

 
43

Interest cost
1,694

 
1,604

 
117

 
152

 
44

 
49

Gross benefits paid
(1,056
)
 
(924
)
 
(262
)
 
(255
)
 
(30
)
 
(26
)
Plan participants’ contributions

 

 
21

 
15

 
6

 
5

Plan amendments

 
5

 

 
65

 
(2
)
 

Actuarial (gain)/loss
(2,840
)
 
6,191

 
(120
)
 
1,069

 
13

 
194

Foreign currency exchange rate changes

 

 

 

 
(138
)
 
(103
)
Curtailments and settlements

 

 

 
(2,271
)
 
(3
)
 
(2
)
Other

 

 

 

 
7

 
38

Projected benefit obligation at end of year
$
36,846

 
$
37,521

 
$
2,673

 
$
2,883

 
$
1,219

 
$
1,274

 
 
 
 
 
 
 
 
 
 
 
 
 
U.S. Pension Benefits
 
U.S. Postretirement
Medical Benefits
 
International
Pension
Benefits
 
2015
 
2014
 
2015
 
2014
 
2015
 
2014
Fair Value of Plan Assets:
 
 
 
 
 
 
 
 
 
 
 
Fair value of plan assets at beginning of year
$
28,828

 
$
26,224

 
$
259

 
$
355

 
$
1,042

 
$
931

Actual return on plan assets
67

 
2,471

 

 
22

 
43

 
106

Employer contributions
1,048

 
1,057

 
111

 
122

 
70

 
79

Plan participants’ contributions

 

 
21

 
15

 
3

 
3

Gross benefits paid
(1,056
)
 
(924
)
 
(261
)
 
(255
)
 
(30
)
 
(26
)
Foreign currency exchange rate changes

 

 

 

 
(113
)
 
(79
)
Curtailments and settlements

 

 

 

 
(3
)
 
(2
)
Other

 

 

 

 
2

 
30

Fair value of plan assets at end of year
$
28,887

 
$
28,828

 
$
130

 
$
259

 
$
1,014

 
$
1,042

Funded Status as of the Respective Measurement Dates in Each Year and the Amounts Recognized in Balance Sheet
The following table discloses the funded status of our plans and the amounts recognized in our consolidated balance sheets as of December 31 (in millions):
 
U.S. Pension Benefits
 
U.S. Postretirement
Medical Benefits
 
International
Pension Benefits
 
2015
 
2014
 
2015
 
2014
 
2015
 
2014
Funded Status:
 
 
 
 
 
 
 
 
 
 
 
Fair value of plan assets
$
28,887

 
$
28,828

 
$
130

 
$
259

 
$
1,014

 
$
1,042

Benefit obligation
(36,846
)
 
(37,521
)
 
(2,673
)
 
(2,883
)
 
(1,219
)
 
(1,274
)
Funded status recognized at December 31
$
(7,959
)
 
$
(8,693
)
 
$
(2,543
)
 
$
(2,624
)
 
$
(205
)
 
$
(232
)
Funded Status Recognized in our Balance Sheet:
 
 
 
 
 
 
 
 
 
 
 
Other non-current assets
$

 
$

 
$

 
$

 
$
48

 
$
25

Other current liabilities
(16
)
 
(17
)
 
(98
)
 
(102
)
 
(3
)
 
(3
)
Pension and postretirement benefit obligations
(7,943
)
 
(8,676
)
 
(2,445
)
 
(2,522
)
 
(250
)
 
(254
)
Net liability at December 31
$
(7,959
)
 
$
(8,693
)
 
$
(2,543
)
 
$
(2,624
)
 
$
(205
)
 
$
(232
)
Amounts Recognized in AOCI:
 
 
 
 
 
 
 
 
 
 
 
Unrecognized net prior service cost
$
(954
)
 
$
(1,122
)
 
$
(26
)
 
$
(32
)
 
$
(4
)
 
$
(7
)
Unrecognized net actuarial gain (loss)
(3,263
)
 
(3,752
)
 
32

 
(89
)
 
(103
)
 
(103
)
Gross unrecognized cost at December 31
(4,217
)
 
(4,874
)
 
6

 
(121
)
 
(107
)
 
(110
)
Deferred tax assets (liabilities) at December 31
1,585

 
1,833

 
(2
)
 
45

 
26

 
29

Net unrecognized cost at December 31
$
(2,632
)
 
$
(3,041
)
 
$
4

 
$
(76
)
 
$
(81
)
 
$
(81
)
Projected Benefit Obligation, Accumulated Benefit Obligation, and Fair Value of Plan Assets for Pension Plans With an Accumulated Benefit Obligation in Excess of Plan Assets
At December 31, 2015 and 2014, the projected benefit obligation, the accumulated benefit obligation and the fair value of plan assets for pension plans with benefit obligations in excess of plan assets were as follows (in millions):
 
Projected Benefit Obligation
Exceeds the Fair Value of Plan Assets
 
Accumulated Benefit Obligation
Exceeds the Fair Value of Plan Assets
2015
 
2014
 
2015
 
2014
U.S. Pension Benefits:
 
 
 
 
 
 
 
Projected benefit obligation
$
36,846

 
$
37,521

 
$
36,846

 
$
37,521

Accumulated benefit obligation
34,210

 
34,725

 
34,210

 
34,725

Fair value of plan assets
28,887

 
28,828

 
28,887

 
28,828

International Pension Benefits:
 
 
 
 
 
 
 
Projected benefit obligation
$
493

 
$
510

 
$
477

 
$
474

Accumulated benefit obligation
416

 
426

 
401

 
398

Fair value of plan assets
247

 
261

 
232

 
232

Fair Values of U.S. Pension and Postretirement Benefit Plan Assets by Asset Category as Well as the Percentage That Each Category Comprises of Total Plan Assets and the Respective Target Allocations
The fair values of U.S. and international pension and postretirement benefit plan assets by asset category as of December 31, 2015 are presented below (in millions), as well as the percentage that each category comprises of our total plan assets and the respective target allocations.
 
Level 1
 
Level 2
 
Level 3
 
Total
Assets
 
Percentage of
Plan Assets -
2015
 
Target
Allocation
2015
Asset Category (U.S. Plans):
 
 
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
$
716

 
$
95

 
$

 
$
811

 
2.8
%
 
0-5
Equity Securities:
 
 
 
 
 
 
 
 
 
 
 
U.S. Large Cap
2,542

 
1,704

 

 
4,246

 
 
 
 
U.S. Small Cap
310

 
42

 

 
352

 
 
 
 
Emerging Markets
1,271

 
155

 

 
1,426

 
 
 
 
Global Equity
2,935

 

 

 
2,935

 
 
 
 
International Equity
2,308

 
781

 

 
3,089

 
 
 
 
Total Equity Securities
9,366

 
2,682

 

 
12,048

 
41.5

 
35-55
Fixed Income Securities:
 
 
 
 
 
 
 
 
 
 
 
U.S. Government Securities
3,257

 
212

 

 
3,469

 
 
 
 
Corporate Bonds

 
3,682

 
279

 
3,961

 
 
 
 
Global Bonds

 
147

 
586

 
733

 
 
 
 
Municipal Bonds

 
36

 

 
36

 
 
 
 
Total Fixed Income Securities
3,257

 
4,077

 
865

 
8,199

 
28.2

 
25-35
Other Investments:
 
 
 
 
 
 
 
 
 
 
 
Hedge Funds

 

 
3,617

 
3,617

 
12.5

 
5-15
Private Equity

 

 
1,415

 
1,415

 
4.9

 
1-10
Real Estate
126

 
155

 
1,567

 
1,848

 
6.4

 
1-10
Structured Products(1)

 
324

 

 
324

 
1.1

 
0-5
Risk Parity Funds

 

 
755

 
755

 
2.6

 
1-10
Total U.S. Plan Assets
$
13,465

 
$
7,333

 
$
8,219

 
$
29,017

 
100.0
%
 
 
Asset Category (International Plans):
 
 
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
$
9

 
$
16

 
$

 
25

 
2.5

 
0-5
Equity Securities:
 
 
 
 
 
 
 
 
 
 
 
Local Markets Equity
133

 
107

 

 
240

 
 
 
 
U.S. Equity
16

 

 

 
16

 
 
 
 
Emerging Markets
16

 

 

 
16

 
 
 
 
International / Global Equity
84

 
92

 

 
176

 
 
 
 
Total Equity Securities
249

 
199

 

 
448

 
44.1

 
50-65
Fixed Income Securities:
 
 
 
 
 
 
 
 
 
 
 
Local Government Bonds
72

 

 

 
72

 
 
 
 
Corporate Bonds
56

 
93

 

 
149

 
 
 
 
Total Fixed Income Securities
128

 
93

 

 
221

 
21.8

 
15-35
Other Investments:
 
 
 
 
 
 
 
 
 
 
 
Real Estate

 
111

 

 
111

 
10.9

 
0-17
Other

 
160

 
49

 
209

 
20.7

 
0-20
Total International Plan Assets
$
386

 
$
579

 
$
49

 
$
1,014

 
100.0
%
 
 
Total Plan Assets
$
13,851

 
$
7,912

 
$
8,268

 
$
30,031

 
 
 
 
(1) Represents mortgage and asset-backed securities.


The fair values of U.S. and international pension and postretirement benefit plan assets by asset category as of December 31, 2014 are presented below (in millions), as well as the percentage that each category comprises of our total plan assets and the respective target allocations.
 
Level 1
 
Level 2
 
Level 3
 
Total
Assets
 
Percentage of
Plan Assets -
2014
 
Target
Allocation
2014
Asset Category (U.S. Plans):
 
 
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
$
744

 
$
1,028

 
$

 
$
1,772

 
6.1
%
 
0-5
Equity Securities:
 
 
 
 
 
 
 
 
 
 
 
U.S. Large Cap
2,066

 
2,082

 

 
4,148

 
 
 
 
U.S. Small Cap
322

 
44

 

 
366

 
 
 
 
Emerging Markets
1,270

 
116

 

 
1,386

 
 
 
 
Global Equity
2,788

 

 

 
2,788

 
 
 
 
International Equity
1,154

 
792

 

 
1,946

 
 
 
 
Total Equity Securities
7,600

 
3,034

 

 
10,634

 
36.6

 
35-55
Fixed Income Securities:
 
 
 
 
 
 
 
 
 
 
 
U.S. Government Securities
4,541

 
239

 

 
4,780

 
 
 
 
Corporate Bonds
6

 
2,921

 
269

 
3,196

 
 
 
 
Global Bonds

 
159

 
613

 
772

 
 
 
 
Municipal Bonds

 
100

 

 
100

 
 
 
 
Total Fixed Income Securities
4,547

 
3,419

 
882

 
8,848

 
30.4

 
25-35
Other Investments:
 
 
 
 
 
 
 
 
 
 
 
Hedge Funds

 

 
3,595

 
3,595

 
12.4

 
5-15
Private Equity

 

 
1,323

 
1,323

 
4.5

 
1-10
Real Estate
412

 
47

 
1,307

 
1,766

 
6.1

 
1-10
Structured Products(1)

 
332

 

 
332

 
1.1

 
0-5
Risk Parity Funds

 

 
817

 
817

 
2.8

 
1-10
Total U.S. Plan Assets
$
13,303

 
$
7,860

 
$
7,924

 
$
29,087

 
100.0
%
 
 
Asset Category (International Plans):
 
 
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
$
6

 
$
26

 
$

 
32

 
3.1

 
0-5
Equity Securities:
 
 
 
 
 
 
 
 
 
 
 
Local Markets Equity
145

 
105

 

 
250

 
 
 
 
U.S. Equity
17

 

 

 
17

 
 
 
 
Emerging Markets
19

 

 

 
19

 
 
 
 
International / Global Equity
82

 
95

 

 
177

 
 
 
 
Total Equity Securities
263

 
200

 

 
463

 
44.3

 
50-65
Fixed Income Securities:
 
 
 
 
 
 
 
 
 
 
 
Local Government Bonds
78

 

 

 
78

 
 
 
 
Corporate Bonds
55

 
94

 

 
149

 
 
 
 
Total Fixed Income Securities
133

 
94

 

 
227

 
21.8

 
15-35
Other Investments:
 
 
 
 
 
 
 
 
 
 
 
Real Estate

 
108

 

 
108

 
10.4

 
0-17
Other

 
159

 
53

 
212

 
20.4

 
0-20
Total International Plan Assets
$
402

 
$
587

 
$
53

 
$
1,042

 
100.0
%
 
 
Total Plan Assets
$
13,705

 
$
8,447

 
$
7,977

 
$
30,129

 
 
 
 

(1) Represents mortgage and asset-backed securities.

Fair Value Measurement of Plan Assets Using Significant Unobservable Inputs (Level 3)
The following table presents the changes in the Level 3 instruments measured on a recurring basis for the years ended December 31, 2015 and 2014 (in millions).
 
Corporate
Bonds
 
Hedge
Funds
 
Real
Estate
 
Private
Equity
 
Global Bonds
 
Risk Parity Funds
 
Other
 
Total
Balance on January 1, 2014
$
223

 
$
3,738

 
$
1,091

 
$
1,397

 
$

 
$
756

 
$
55

 
$
7,260

Actual Return on Assets:
 
 
 
 
 
 
 
 

 
 
 
 
 
 
Assets Held at End of Year

 
71

 
104

 
11

 

 
61

 
(2
)
 
245

Assets Sold During the Year

 
(9
)
 
23

 
126

 

 

 

 
140

Purchases
108

 
1,043

 
350

 
166

 
735

 

 

 
2,402

Sales
(62
)
 
(1,248
)
 
(261
)
 
(377
)
 
(122
)
 

 

 
(2,070
)
Transfers Into (Out of) Level 3

 

 

 

 

 

 

 

Balance on December 31, 2014
$
269

 
$
3,595

 
$
1,307

 
$
1,323

 
$
613

 
$
817

 
$
53

 
$
7,977

Actual Return on Assets:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Assets Held at End of Year
(8
)
 
62

 
79

 
(39
)
 
11

 
(62
)
 
(4
)
 
39

Assets Sold During the Year

 
39

 
45

 
149

 
(2
)
 

 

 
231

Purchases
22

 
283

 
545

 
347

 
130

 

 

 
1,327

Sales
(4
)
 
(362
)
 
(409
)
 
(365
)
 
(166
)
 

 

 
(1,306
)
Transfers Into (Out of) Level 3

 

 

 

 

 

 

 

Balance on December 31, 2015
$
279

 
$
3,617

 
$
1,567

 
$
1,415

 
$
586

 
$
755

 
$
49

 
$
8,268

Amounts in AOCI Expected to be Amortized and Recognized as a Component of Net Periodic Benefit Cost
The estimated amounts of prior service cost in AOCI expected to be amortized and recognized as a component of net periodic benefit cost in 2016 are as follows (in millions):
 
U.S. Pension Benefits
 
U.S. Postretirement
Medical Benefits
 
International Pension
Benefits
Prior service cost / (benefit)
$
166

 
$
5

 
$
1

Expected Cash Flows for Pension and Postretirement Benefit Plans
Information about expected cash flows for the pension and postretirement benefit plans is as follows (in millions):
 
U.S.
Pension Benefits
 
U.S. Postretirement
Medical Benefits
 
International Pension
Benefits
Expected Employer Contributions:
 
 
 
 
 
2016 to plan trusts
$
1,161

 
$

 
$
55

2016 to plan participants
16

 
101

 
3

Expected Benefit Payments:
 
 
 
 
 
2016
$
1,067

 
$
237

 
$
23

2017
1,168

 
236

 
23

2018
1,278

 
232

 
26

2019
1,398

 
232

 
29

2020
1,529

 
228

 
32

2021 - 2025
9,822

 
1,005

 
222

schedule of one basis point change in discount rate on the projected benefit obligation [Table Text Block]
As of December 31, 2015, the impact of each basis point change in the discount rate on the projected benefit obligation of the pension and postretirement medical benefit plans are as follows (in millions):
 
Increase (Decrease) in the Projected Benefit Obligation
 
Pension Benefits
 
Postretirement Medical Benefits
One basis point increase in discount rate
$
(60
)
 
$
(2
)
One basis point decrease in discount rate
$
66

 
$
3

Net Periodic Benefit Cost  
Weighted Average Actuarial Assumptions Used Disclosure
The table below provides the weighted-average actuarial assumptions used to determine the net periodic benefit cost.
 
U.S. Pension Benefits
 
U.S. Postretirement
Medical Benefits
 
International
Pension Benefits
 
2015
 
2014
 
2013
 
2015
 
2014
 
2013
 
2015
 
2014
 
2013
Discount rate
4.40
%
 
5.32
%
 
4.42
%
 
4.18
%
 
4.89
%
 
4.21
%
 
3.56
%
 
4.35
%
 
4.00
%
Rate of compensation increase
4.29
%
 
4.29
%
 
4.16
%
 
N/A

 
N/A

 
N/A

 
3.08
%
 
3.22
%
 
3.03
%
Expected return on assets
8.75
%
 
8.75
%
 
8.75
%
 
8.75
%
 
8.75
%
 
8.75
%
 
6.03
%
 
6.29
%
 
6.90
%