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Postretirement Benefit Plans (Tables)
 12 Months Ended
Dec. 31, 2013
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block  
Schedule of Net Benefit Costs
The components of net periodic benefit cost for other postretirement employee benefit plans are as follows:
 
Year Ended December 31,
(in millions)
2013
 
2012
 
2011
Service cost
$
1

 
$
1

 
$
1

Interest cost
3

 
3

 
1

Amortization of net actuarial loss
2

 
1

 
—

Net periodic benefit cost
$
6

 
$
5

 
$
2
Schedule of Changes in Accumulated Postemployment Benefit Obligations
Other changes in plan assets and benefit obligations recognized in other comprehensive income, as they pertain to other postretirement employee benefit plans are as follows:

 
Year Ended December 31,
(in millions)
2013
 
2012
 
2011
Net (gain) loss
$
(2
)
 
$
14

 
$
3

Amortization of net actuarial loss
(2
)
 
(1
)
 
—

Change recognized in other comprehensive (income) loss (a)
$
(4
)
 
$
13

 
$
3

Total recognized in comprehensive loss
$
2

 
$
18

 
$
5
Defined benefit contributions by employer
Matching obligations, the majority of which were funded in cash in connection with the plans, along with transition credits and other company contributions are as follows:
(in millions)
Defined Contribution
2013
$
35

2012
30

2011
28
Summary of amounts recorded within accumulated other comprehensive income
The following table provides a summary of the funded status of our postretirement plans, the presentation of such balances and a summary of amounts recorded within accumulated other comprehensive income.
(in millions)
December 31, 2013
 
December 31, 2012
 
Pension
 
Other
 
Total
 
Pension
 
Other
 
Total
Fair value of plan assets
$
524

 
$
—

 
$
524

 
$
477

 
$
—

 
$
477

Projected benefit obligation
(777
)
 
(63
)
 
(840
)
 
(790
)
 
(65
)
 
(855
)
Funded status
$
(253
)
 
$
(63
)
 
$
(316
)
 
$
(313
)
 
$
(65
)
 
$
(378
)
Amounts recognized in the balance sheet
 
 
 
 
 
 
 
 
 
 
 
Other non-current assets
$
46

 
$
—

 
$
46

 
$
36

 
$
—

 
$
36

Accrued and other current liabilities
(11
)
 
(3
)
 
(14
)
 
(11
)
 
(3
)
 
(14
)
Accrued postretirement benefits
(288
)
 
(60
)
 
(348
)
 
(338
)
 
(62
)
 
(400
)
Net amount recognized
$
(253
)
 
$
(63
)
 
$
(316
)
 
$
(313
)
 
$
(65
)
 
$
(378
)
Accumulated other comprehensive income (loss):
 
 
 
 
 
 
 
 
 
 
 
Net actuarial losses
$
(228
)
 
$
(20
)
 
$
(248
)
 
$
(277
)
 
$
(24
)
 
$
(301
)
Prior service cost
—

 
—

 
—

 
(5
)
 
—

 
(5
)
Total
$
(228
)
 
$
(20
)
 
$
(248
)
 
$
(282
)
 
$
(24
)
 
$
(306
)
Summary of the funded status of postretirement plans
The benefit obligation, fair value of plan assets, funded status, and amounts recognized in the consolidated and combined financial statements for our defined benefit domestic and international pension plans were:
 
Domestic Plans
 
International Plans
 
December 31,
 
December 31,
(in millions)
2013
 
2012
 
2013
 
2012
Change in benefit obligation:
 
 
 
 
 
 
 
Benefit obligation at beginning of year
$
83

 
$
71

 
$
707

 
$
599

Service cost
3

 
3

 
14

 
11

Interest cost
3

 
3

 
28

 
29

Benefits paid
(3
)
 
(3
)
 
(32
)
 
(33
)
Actuarial (gain) loss
(8
)
 
9

 
(9
)
 
69

Plan amendments, settlements and curtailments
(4
)
 
—

 
(2
)
 
—

Foreign currency translation/other
—

 
—

 
(3
)
 
32

Benefit obligation at end of year
$
74

 
$
83

 
$
703

 
$
707

Change in plan assets:
 
 
 
 
 
 
 
Fair value of plan assets at beginning of year
$
51

 
44

 
$
426

 
$
373

Employer contributions
4

 
5

 
36

 
38

Actual return on plan assets
6

 
5

 
42

 
37

Benefits paid
(3
)
 
(3
)
 
(32
)
 
(33
)
Plan amendments, settlements and curtailments
—

 
—

 
(1
)
 
(1
)
Foreign currency translation/other
—

 
—

 
(5
)
 
12

Fair value of plan assets at end of year
$
58

 
$
51

 
$
466

 
$
426

Funded (unfunded) status of the plans
$
(16
)
 
$
(32
)
 
$
(237
)
 
$
(281
)
Accumulated benefit obligation and fair value of the plans' assets
For defined benefit pension plans in which the accumulated benefit obligation was in excess of the fair value of the plans’ assets, the projected benefit obligation (“PBO”), ABO and fair value of the plans’ assets were as follows:
 
December 31,
(in millions)
2013
 
2012
Projected benefit obligation
$
404

 
$
516

Accumulated benefit obligation
375

 
469

Fair value of plan assets
106

 
171
Components of net periodic benefit cost and other amounts recognized in other comprehensive income
The components of net periodic benefit cost for our defined benefit pension plans are as follows:
 
Year Ended December 31,
(in millions)
2013
 
2012
 
2011
Domestic defined benefit pension plans:
 
 
 
 
 
Service cost
$
3

 
$
3

 
$
2

Interest cost
3

 
3

 
3

Expected return on plan assets
(4
)
 
(4
)
 
(4
)
Amortization of prior service cost
1

 
1

 
1

Amortization of net actuarial loss
2

 
2

 
—

Net periodic benefit cost
$
5

 
$
5

 
$
2

International defined benefit pension plans:
 
 
 
 
 
Service cost
$
14

 
$
11

 
$
6

Interest cost
28

 
29

 
12

Expected return on plan assets
(31
)
 
(30
)
 
(6
)
Amortization of net actuarial loss
13

 
8

 
2

Settlement and special termination benefits
—

 
2

 
1

Net periodic benefit cost
$
24

 
$
20

 
$
15

Total net periodic benefit cost
$
29

 
$
25

 
$
17

Other changes in plan assets and benefit obligations recognized in other comprehensive income, as they pertain to our defined benefit pension plans are as follows:
 
Year Ended December 31,
(in millions)
2013
 
2012
 
2011
Domestic defined benefit pension plans:
 
 
 
 
 
Net (gain) loss
$
(11
)
 
$
8

 
$
14

Prior service (credit) cost
(4
)
 
1

 
—

Amortization of prior service cost
(1
)
 
(1
)
 
(1
)
Amortization of net actuarial loss
(2
)
 
(2
)
 
—

Change recognized in other comprehensive income
$
(18
)
 
$
6

 
$
13

International defined benefit pension plans:
 
 
 
 
 
Net (gain) loss
$
(21
)
 
$
62

 
$
57

Amortization of net actuarial loss
(13
)
 
(8
)
 
(2
)
Settlement
—

 
(2
)
 
—

Foreign exchange
(2
)
 
8

 
—

Change recognized in other comprehensive (income) loss (a)
$
(36
)
 
$
60

 
$
55

Total recognized in other comprehensive (income) loss
$
(54
)
 
$
66

 
$
68

Total recognized in comprehensive (income) loss
$
(25
)
 
$
91

 
$
85


(a)
The 2011 amount excludes $97 million ($68 million net of tax) of deferred losses assumed upon Spin-off.
The components of net periodic benefit cost for other postretirement employee benefit plans are as follows:
Weighted-average assumptions used to determine projected benefit obligations and net periodic benefit cost
The following table provides the weighted-average assumptions used to determine projected benefit obligations and net periodic benefit cost, as they pertain to our pension plans.
 
2013
 
2012
 
2011
 
U.S.
 
Int’l
 
U.S.
 
Int’l
 
U.S.
 
Int’l
Benefit Obligation Assumptions
 
 
 
 
 
 
 
 
 
 
 
Discount rate
4.79
%
 
4.23
%
 
4.13
%
 
4.04
%
 
4.87
%
 
4.76
%
Rate of future compensation increase
NM

 
3.48
%
 
4.50
%
 
3.50
%
 
4.50
%
 
3.58
%
Net Periodic Benefit Cost Assumptions
 
 
 
 
 
 
 
 
 
 
 
Discount rate
4.13
%
 
4.04
%
 
4.87
%
 
4.76
%
 
5.83
%
 
5.53
%
Expected long-term return on plan assets
8.00
%
 
7.33
%
 
8.00
%
 
7.35
%
 
9.00
%
 
7.34
%
Rate of future compensation increase
4.50
%
 
3.50
%
 
4.50
%
 
3.58
%
 
4.50
%
 
3.37
%
Actual plan returns
The table below provides the weighted average actual rate of return generated on plan assets during each of the years presented as compared to the weighted average expected long-term rates of return utilized in calculating the net periodic benefit costs.
 
2013
 
2012
 
2011
Expected long-term rate of return on plan assets
7.40
%
 
7.42
%
 
7.52
 %
Actual rate of return on plan assets
10.17
%
 
10.09
%
 
(1.40
)%
Allocation of plan assets
The following table provides the fair value of plan assets held by our pension benefit plans by asset class.
 
December 31,
 
2013
 
2012
(in millions)
Total
 
Level 1
 
Level 2
 
Level 3
 
Total
 
Level 1
 
Level 2
 
Level 3
Asset Category
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equity securities
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Global stock funds/securities
$
123

 
$
108

 
$
11

 
$
4

 
$
93

 
$
79

 
$
11

 
$
3

Index funds
40

 
3

 
37

 
—

 
46

 
3

 
43

 
—

Emerging markets funds
3

 
3

 
—

 
—

 
—

 
—

 
—

 
—

Fixed income
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Corporate bonds
95

 
40

 
48

 
7

 
100

 
32

 
59

 
9

Government bonds
35

 
35

 
—

 
—

 
26

 
23

 
3

 
—

Hedge funds
123

 
9

 
95

 
19

 
140

 
44

 
76

 
20

Private equity
22

 
—

 
—

 
22

 
24

 
—

 
—

 
24

Insurance contracts and other
83

 
62

 
4

 
17

 
48

 
44

 
—

 
4

Total
$
524

 
$
260

 
$
195

 
$
69

 
$
477

 
$
225

 
$
192

 
$
60


The following table provides the actual asset allocations of plan assets as of December 31, 2013 and 2012, and the related asset target allocation ranges by asset category.
 
2013
 
2012
 
Target
Allocation
Ranges
Equity securities
31.7
%
 
29.2
%
 
20-40%
Fixed income
24.7
%
 
26.4
%
 
20-50%
Hedge funds
23.5
%
 
29.4
%
 
20-60%
Private equity
4.2
%
 
5.1
%
 
0-15%
Insurance contracts and other
15.9
%
 
9.9
%
 
0-30%
Reconciliation of the beginning and ending balances of fair value measurements with pension plans using significant unobservable inputs (level 3)
The following table presents a reconciliation of the beginning and ending balances of fair value measurement within our pension plans using significant unobservable inputs (Level 3).
(in millions)
Equity
Securities
 
Fixed Income
 
Hedge funds
 
Private Equity
 
Other
 
Total
Balance, December 31, 2011
$
2

 
$
—

 
$
37

 
$
24

 
$
4

 
$
67

Purchases, sales, settlements
—

 
8

 
8

 
(1
)
 
—

 
15

Unrealized loss
—

 
1

 
1

 
1

 
—

 
3

Realized gains
1

 
—

 
1

 
—

 
—

 
2

Net transfers
—

 
—

 
(25
)
 
—

 
—

 
(25
)
Currency impact
—

 
—

 
(2
)
 
—

 
—

 
(2
)
Balance, December 31, 2012
3

 
9

 
20

 
24

 
4

 
60

Purchases, sales, settlements
—

 
(3
)
 
10

 
(4
)
 
12

 
15

Unrealized gains
—

 
1

 
1

 
1

 
1

 
4

Realized gains
1

 
—

 
—

 
—

 
—

 
1

Net transfers
—

 
—

 
(12
)
 
—

 
—

 
(12
)
Currency impact
—

 
—

 
—

 
1

 
—

 
1

Balance, December 31, 2013
$
4

 
$
7

 
$
19

 
$
22

 
$
17

 
$
69
Expected benefit payments
The following benefit payments, which reflect expected future service, as appropriate, are expected to be paid as follows:
(in millions)
Pension
 
Other Benefits
2014
$
35

 
$
3

2015
36

 
3

2016
37

 
3

2017
38

 
3

2018
39

 
3

Years 2019 – 2023
222

 
20
Other postretirement benefit plans
  
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block  
Projected benefit obligations
The following table provides a rollforward of the projected benefit obligation for the other postretirement employee benefit plans:
(in millions)
2013
 
2012
Change in benefit obligation:
 
 
 
Benefit obligation at beginning of year
$
65

 
$
46

Service cost
1

 
1

Interest cost
3

 
3

Benefits paid
(3
)
 
(3
)
Actuarial (gain) loss
(2
)
 
15

Other
(1
)
 
3

Benefit Obligation at the end of year
$
63

 
$
65