Benefit Plans (Tables)

12 Months Ended

Sep. 30, 2020

Net Pension and Other Postretirement Cost

Net pension cost for the years ended September 30 included the following components:

	Pension Plans
(Millions of dollars)	2020		2019		2018
Service cost	$	153	$	134	$	136
Interest cost	84		107		90
Expected return on plan assets	(188)		(180)		(154)
Amortization of prior service credit	(13)		(13)		(13)
Amortization of loss	97		78		78
Settlements	4		10		2
Net pension cost	$	137	$	135	$	137
Net pension cost included in the preceding table that is attributable to international plans	$	41	$	32	$	34

Change in Benefit Obligation, Change in Fair Value of Plan Assets

The change in benefit obligation, change in fair value of pension plan assets, funded status and amounts recognized in the Consolidated Balance Sheets for these plans were as follows:

	Pension Plans
(Millions of dollars)	2020		2019
Change in benefit obligation:
Beginning obligation	$	3,731	$	3,246
Service cost	153		134
Interest cost	84		107
Plan amendments	—		3
Benefits paid	(186)		(153)
Impact of acquisitions (divestitures)	10		(9)
Actuarial loss	104		514
Settlements	(17)		(63)
Other, includes translation	74		(49)
Benefit obligation at September 30	$	3,953	$	3,731
Change in fair value of plan assets:
Beginning fair value	$	2,926	$	2,642
Actual return on plan assets	222		279
Employer contribution	42		258
Benefits paid	(186)		(153)
Impact of acquisitions (divestitures)	7		(7)
Settlements	(17)		(63)
Other, includes translation	51		(30)
Plan assets at September 30	$	3,045	$	2,926
Funded Status at September 30:
Unfunded benefit obligation	$	(908)	$	(804)
Amounts recognized in the Consolidated Balance Sheets at September 30:
Other	$	16	$	11
Salaries, wages and related items	(23)		(22)
Long-term Employee Benefit Obligations	(901)		(793)
Net amount recognized	$	(908)	$	(804)
Amounts recognized in Accumulated other comprehensive income (loss) before income taxes at September 30:
Prior service credit	$	31	$	44
Net actuarial loss	(1,281)		(1,289)
Net amount recognized	$	(1,250)	$	(1,246)

Pension Plans with Accumulated Benefit Obligations

Pension plans with accumulated benefit obligations in excess of plan assets and plans with projected benefit obligations in excess of plan assets consist of the following at September 30:

	Accumulated Benefit Obligation Exceeds the Fair Value of Plan Assets				Projected Benefit Obligation Exceeds the Fair Value of Plan Assets
(Millions of dollars)	2020		2019		2020		2019
Projected benefit obligation	$	3,844	$	3,623	$	3,920	$	3,698
Accumulated benefit obligation	$	3,703	$	3,476
Fair value of plan assets	$	2,936	$	2,821	$	2,996	$	2,882

Weighted Average Assumptions Determining Pension Plan

The weighted average assumptions used in determining pension plan information were as follows:

	2020		2019		2018
Net Cost
Discount rate:
U.S. plans (a)	3.21	%	4.26	%	3.71	%
International plans	1.39		2.30		2.30
Expected return on plan assets:
U.S. plans	7.25		7.25		7.20
International plans	5.05		4.98		4.95
Rate of compensation increase:
U.S. plans	4.29		4.29		4.51
International plans	2.35		2.36		2.31
Benefit Obligation
Discount rate:
U.S. plans	2.80		3.21		4.26
International plans	1.44		1.39		2.30
Rate of compensation increase:
U.S. plans	4.30		4.29		4.29
International plans	2.20		2.35		2.36

(a)The Company calculated the service and interest components utilizing an approach that discounts the individual expected cash flows using the applicable spot rates derived from the yield curve over the projected cash flow period.

Expected Benefit Payments

Expected benefit payments are as follows:

(Millions of dollars)	Pension Plans
2021	$	209
2022	162
2023	171
2024	176
2025	186
2026-2030	1,068

Fair Value Measurements of U.S. Plan Assets

The following table provides the fair value measurements of U.S. plan assets, as well as the measurement techniques and inputs utilized to measure fair value of these assets, at September 30, 2020 and 2019. The categorization of fund investments is based upon the categorization of these funds’ underlying assets.

(Millions of dollars)	Total U.S. Plan Asset Balances				Investments Measured at Net Asset Value (a)				Quoted Prices in Active Markets for Identical Assets (Level 1)				Significant Other Observable Inputs (Level 2)				Significant Unobservable Inputs (Level 3)
	2020		2019		2020		2019		2020		2019		2020		2019		2020		2019
Fixed Income:
Corporate bonds	656		401		—		—		273		48		383		353		—		—
Government and agency-U.S.	95		108		—		—		74		85		21		23		—		—
Government and agency-Foreign	40		85		—		—		—		69		40		16		—		—
Other fixed income	141		37		—		—		—		—		141		37		—		—
Equity securities	737		922		43		782		694		140		—		—		—		—
Cash and cash equivalents	147		254		—		—		147		254		—		—		—		—
Other	291		261		151		124		141		138		—		—		—		—
Fair value of plan assets	$	2,108	$	2,068	$	193	$	906	$	1,330	$	733	$	584	$	429	$	—	$	—

(a)As per applicable disclosure requirements, certain investments that were measured at net asset value per share or its equivalent have not been categorized within the fair value hierarchy. Values of such assets are based on the corroborated net asset value provided by the fund administrator.

Fair Value Measurements of Foreign Plan Assets

The following table provides the fair value measurements of international plan assets, as well as the measurement techniques and inputs utilized to measure fair value of these assets, at September 30, 2020 and 2019.

(Millions of dollars)	Total International Plan Asset Balances				Investments Measured at Net Asset Value (a)				Quoted Prices in Active Markets for Identical Assets (Level 1)				Significant Other Observable Inputs (Level 2)				Significant Unobservable Inputs (Level 3) (b)
	2020		2019		2020		2019		2020		2019		2020		2019		2020		2019
Fixed Income:
Corporate bonds	$	34	$	33	$	—	$	—	$	15	$	15	$	19	$	18	$	—	$	—
Government and agency-U.S.	3		3		—		—		—		—		3		3		—		—
Government and agency-Foreign	212		199		—		—		115		105		97		94		—		—
Other fixed income	102		100		—		—		63		63		39		37		—		—
Equity securities	335		319		—		14		335		305		—		—		—		—
Cash and cash equivalents	12		8		—		—		12		8		—		—		—		—
Real estate	34		30		—		—		—		—		24		30		10		—
Insurance contracts	131		113		—		—		—		—		—		—		131		113
Other	72		53		—		—		70		52		1		1		—		—
Fair value of plan assets	$	935	$	859	$	—	$	14	$	611	$	549	$	183	$	182	$	141	$	113

(a)As per applicable disclosure requirements, certain investments that were measured at net asset value per share or its equivalent have not been categorized within the fair value hierarchy. Values of such assets are based on the corroborated net asset value provided by the fund administrator.

(b)Changes in the fair value of international pension assets measured using Level 3 inputs for the years ended September 30, 2020 and 2019 were immaterial.