Pensions and Other Post-Retirement Benefits

12 Months Ended

Dec. 31, 2012

Compensation And Retirement Disclosure [Abstract]

Pensions and Other Post-Retirement Benefits

9. Pensions and Other Post-Retirement Benefits

Nielsen sponsors both funded and unfunded defined benefit pension plans (the “Pension Plans”) for some of its employees in the Netherlands, the United States and other international locations.

A summary of the activity for the Pension Plans follows:

	Year Ended December 31, 2012
(IN MILLIONS)	The Netherlands			United States			Other			Total
Change in projected benefit obligation
Benefit obligation at beginning of period	$	606		$	284		$	551		$	1,441
Service cost		3			—			14			17
Interest cost		28			13			25			66
Plan participants’ contributions		—			—			2			2
Actuarial losses		112			8			84			204
Benefits paid		(33	)		(10	)		(26	)		(69	)
Expenses paid		(2	)		—			(1	)		(3	)
Premiums paid		—			—			(1	)		(1	)
Amendments		—			—			(2	)		(2	)
Curtailments		—			—			(1	)		(1	)
Settlements		—			—			(2	)		(2	)
Acquisition		—			—			2			2
Effect of foreign currency translation		13			—			19			32
Benefit obligation at end of period		727			295			664			1,686
Change in plan assets
Fair value of plan assets at beginning of period		639			221			412			1,272
Actual return on plan assets		79			29			39			147
Employer contributions		7			8			49			64
Plan participants’ contributions		—			—			2			2
Benefits paid		(33	)		(10	)		(26	)		(69	)
Expenses paid		(2	)		—			(1	)		(3	)
Premiums paid		—			—			(1	)		(1	)
Settlements		—			—			(2	)		(2	)
Insurance		4			—			—			4
Effect of foreign currency translation		13			—			14			27
Fair value of plan assets at end of period		707			248			486			1,441
Funded status	$	(20	)	$	(47	)	$	(178	)	$	(245	)
Amounts recognized in the Consolidated Balance Sheets
Pension assets included in other non-current assets	$	—		$	—		$	9		$	9
Current liabilities		—			—			(2	)		(2	)
Accrued benefit liability included in other non-current liabilities		(20	)		(47	)		(185	)		(252	)
Net amount recognized	$	(20	)	$	(47	)	$	(178	)	$	(245	)
Amounts recognized in Accumulated Other Comprehensive Income/(Loss), before tax
Net loss/(gain)	$	65		$	(3	)	$	75		$	137
Amortization of net loss		(3	)		(4	)		(4	)		(11	)
Total recognized in other comprehensive income/(loss)	$	62		$	(7	)	$	71		$	126
Amounts not yet reflected in net periodic benefit cost and included in Accumulated
Other Comprehensive Income/(Loss), before tax
Unrecognized losses	$	165		$	74		$	150		$	389

	Year Ended December 31, 2011
(IN MILLIONS)	The Netherlands			United States			Other			Total
Change in projected benefit obligation
Benefit obligation at beginning of period	$	594		$	267		$	517		$	1,378
Service cost		4			—			13			17
Interest cost		31			15			26			72
Plan participants’ contributions		1			—			2			3
Actuarial losses		29			12			27			68
Benefits paid		(35	)		(10	)		(23	)		(68	)
Expenses paid		(3	)		—			(1	)		(4	)
Premiums paid		—			—			(1	)		(1	)
Curtailments		—			—			(2	)		(2	)
Settlements		—			—			(2	)		(2	)
Effect of foreign currency translation		(15	)		—			(5	)		(20	)
Benefit obligation at end of period		606			284			551			1,441
Change in plan assets
Fair value of plan assets at beginning of period		663			204			396			1,263
Actual return on plan assets		22			8			15			45
Employer contributions		5			19			29			53
Plan participants’ contributions		1			—			2			3
Benefits paid		(35	)		(10	)		(23	)		(68	)
Expenses paid		(3	)		—			(1	)		(4	)
Premiums paid		—			—			(1	)		(1	)
Settlements		—			—			(2	)		(2	)
Effect of foreign currency translation		(14	)		—			(3	)		(17	)
Fair value of plan assets at end of period		639			221			412			1,272
Funded status	$	33		$	(63	)	$	(139	)	$	(169	)
Amounts recognized in the Consolidated Balance Sheets
Pension assets included in other non-current assets	$	36		$	—		$	8		$	44
Current liabilities		—			—			(2	)		(2	)
Accrued benefit liability included in other non-current liabilities		(3	)		(63	)		(145	)		(211	)
Net amount recognized	$	33		$	(63	)	$	(139	)	$	(169	)
Amounts recognized in Accumulated Other Comprehensive Income/(Loss), before tax
Net loss	$	39		$	22		$	38		$	99
Amortization and impact of curtailments/settlements		—			(3	)		(1	)		(4	)
Total recognized in other comprehensive income/(loss)	$	39		$	19		$	37		$	95
Amounts not yet reflected in net periodic benefit cost and included in Accumulated Other Comprehensive Income/(Loss), before tax
Unrecognized losses	$	103		$	81		$	79		$	263

The total accumulated benefit obligation and minimum liability changes for the Pension Plans were as follows:

(IN MILLIONS)	Year Ended December 31, 2012		Year Ended December 31, 2011		Year Ended December 31, 2010
Accumulated benefit obligation	$	1,618	$	1,392	$	1,318

	Pension Plans with Accumulated Benefit Obligation in Excess of Plan Assets at December 31, 2012
(IN MILLIONS)	The Netherlands		United States		Other		Total
Projected benefit obligation	$	727	$	295	$	528	$	1,550
Accumulated benefit obligation		724		295		479		1,498
Fair value of plan assets		707		248		347		1,302

	Pension Plans with Projected Benefit Obligation in Excess of Plan Assets at December 31, 2012
(IN MILLIONS)	The Netherlands		United States		Other		Total
Projected benefit obligation	$	727	$	295	$	625	$	1,647
Accumulated benefit obligation		724		295		563		1,582
Fair value of plan assets		707		248		439		1,394

	Pension Plans with Accumulated Benefit Obligation in Excess of Plan Assets at December 31, 2011
(IN MILLIONS)	The Netherlands		United States		Other		Total
Projected benefit obligation	$	48	$	284	$	517	$	849
Accumulated benefit obligation		46		284		472		802
Fair value of plan assets		45		221		369		635

	Pension Plans with Projected Benefit Obligation in Excess of Plan Assets at December 31, 2011
(IN MILLIONS)	The Netherlands		United States		Other		Total
Projected benefit obligation	$	48	$	284	$	517	$	849
Accumulated benefit obligation		46		284		472		802
Fair value of plan assets		45		221		369		635

Net periodic benefit cost for the years ended December 31, 2012, 2011 and 2010, respectively, includes the following components:

	Net Periodic Pension Cost
(IN MILLIONS)	The Netherlands			United States			Other			Total
Year ended December 31, 2012
Service cost	$	3		$	—		$	14		$	17
Interest cost		28			13			25			66
Expected return on plan assets		(34	)		(18	)		(29	)		(81	)
Amortization of net loss		3			4			4			11
Net periodic pension cost	$	—		$	(1	)	$	14		$	13
Year ended December 31, 2011
Service cost	$	4		$	—		$	13		$	17
Interest cost		31			15			26			72
Expected return on plan assets		(37	)		(18	)		(28	)		(83	)
Amortization of net loss		—			2			1			3
Curtailment gain		—			—			(1	)		(1	)
Net periodic pension cost	$	(2	)	$	(1	)	$	11		$	8
Year ended December 31, 2010
Service cost	$	4		$	—		$	10		$	14
Interest cost		29			15			25			69
Expected return on plan assets		(37	)		(18	)		(26	)		(81	)
Amortization of net gain		(1	)		—			—			(1	)
Curtailment gain		—			—			(2	)		(2	)
Net periodic pension cost	$	(5	)	$	(3	)	$	7		$	(1	)

The curtailment gains of $1 million and $2 million in 2011 and 2010, respectively, resulted from employee terminations primarily in Europe.

The deferred loss included as a component of accumulated other comprehensive income/(loss) that is expected to be recognized as a component of net periodic benefit cost during 2013 is as follows:

	The Netherlands			United States			Other			Total
Net actuarial loss	$	(6	)	$	(5	)	$	(10	)	$	(21	)

The weighted average assumptions underlying the pension computations were as follows:

	Year Ended December 31,
(IN MILLIONS)	2012			2011			2010
Pension benefit obligation:
—discount rate		3.8	%		4.7	%		5.2	%
—rate of compensation increase		2.1	%		2.0	%		2.1	%
Net periodic pension costs:
—discount rate		4.7	%		5.2	%		5.7	%
—rate of compensation increase		2.0	%		2.1	%		2.1	%
—expected long-term return on plan assets		6.2	%		6.3	%		6.5	%

The assumptions for the expected return on plan assets for the Pension Plans were based on a review of the historical returns of the asset classes in which the assets of the Pension Plans are invested and long-term economic forecast for the type of investments held by the plans. The historical returns on these asset classes were weighted based on the expected long-term allocation of the assets of the Pension Plans.

Nielsen’s pension plans’ weighted average asset allocations by asset category are as follows:

	The Netherlands			United States			Other			Total
At December 31, 2012
Equity securities		22	%		60	%		47	%		37	%
Fixed income securities		62			40			49			54
Other		16			—			4			9
Total		100	%		100	%		100	%		100	%
At December 31, 2011
Equity securities		23	%		60	%		44	%		36	%
Fixed income securities		61			39			52			55
Other		16			1			4			9
Total		100	%		100	%		100	%		100	%

No Holdings shares are held by the pension plans.

Nielsen’s primary objective with regard to the investment of the Pension Plans assets is to ensure that in each individual plan, sufficient funds are available to satisfy future benefit obligations. For this purpose, asset and liability management studies are made periodically at each pension fund. For each of the Pension Plans, an appropriate mix is determined on the basis of the outcome of these studies, taking into account the national rules and regulations. The overall target asset allocation among all plans for 2012 was 40% equity securities and 56% long-term interest-earning investments (debt or fixed income securities), and 4% other securities.

Equity securities primarily include investments in U.S. and non U.S. companies. Fixed income securities include corporate bonds of companies from diversified industries and mortgage-backed securities. Other types of investments are primarily insurance contracts.

Assets at fair value (See Note 7—“Fair Value Measurements” for additional information on fair value measurement and the underlying fair value hierarchy) as of December 31, 2012 and 2011 are as follows:

(IN MILLIONS)	December 31, 2012								December 31, 2011
	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
Asset Category
Cash and equivalents	$	2	$	1	$	—	$	3	$	10	$	1	$	—	$	11
Equity securities—U.S.		31		137		—		168		27		119		—		146
Equity securities—non-U.S.		35		326		—		361		33		281		—		314
Real estate		—		—		32		32		—		—		32		32
Corporate bonds		110		433		—		543		103		393		—		496
Debt issued by national, state or local government		41		195		—		236		53		142		—		195
Other		3		18		77		98		3		15		60		78
Total Assets at Fair Value	$	222	$	1,110		109	$	1,441	$	229	$	951	$	92	$	1,272

The following is a summary of changes in the fair value of the Pension Plans’ Level 3 assets for the years ended December 31, 2012 and 2011:

(IN MILLIONS)	Real Estate			Other			Total
Balance, end of year December 31, 2010	$	32		$	53		$	85
Actual return on plan assets:
Unrealized gains		1			9			10
Effect of foreign currency translation		(1	)		(2	)		(3	)
Balance, end of year December 31, 2011	$	32		$	60		$	92
Actual return on plan assets:
Unrealized gains		—			16			16
Effect of foreign currency translation		—			1			1
Balance, end of year December 31, 2012	$	32		$	77		$	109

Contributions to the Pension Plans in 2013 are expected to be approximately $7 million for the Dutch plans and $40 million for other plans. No contribution is expected to be made to the U.S. pension plan.

Estimated future benefit payments are as follows:

(IN MILLIONS)	The Netherlands		United States		Other		Total
For the years ending December 31,
2013	$	35	$	10	$	21	$	66
2014		36		10		22		68
2015		37		11		24		72
2016		37		11		25		73
2017		38		12		27		77
2018-2022		192		68		152		412

Defined Contribution Plans

Nielsen also offers defined contribution plans to certain participants, primarily in the United States. Nielsen’s expense related to these plans was $37 million, $37 million and $35 million for the years ended December 31, 2012, 2011 and 2010, respectively. In the United States, Nielsen contributes cash to each employee’s account in an amount up to 3% of compensation (subject to IRS limitations). No contributions are made in shares of the Holdings’s common stock. Effective October 7, 2011, participants were allowed to invest in The Nielsen Company Stock Fund, which is an investment fund that exclusively invests in the common stock of Nielsen Holdings N.V.