XML 207 R45.htm IDEA: XBRL DOCUMENT v3.24.0.1
Pension and Other Postretirement Benefits (Tables)
 12 Months Ended
Dec. 31, 2023
Summary of Information in Curtailment or Settlement of Benefits Requiring Remeasurement, Update to Discount Rates Used to Determine Benefit Obligations of Affected Plans

The following table presents certain information and the financial impacts of these actions on the accompanying Consolidated Financial Statements:

Action #

 

Number of affected plan participants

 

Weighted average
discount rate
as of prior plan remeasurement
date

 

Plan remeasurement date

 

Weighted average discount rate as of plan remeasurement date

 

Increase to accrued pension benefits liability

 

 

Decrease to other noncurrent assets

 

 

Decrease to accrued other postretirement benefits liability

 

 

Settlement loss(1)

 

1

 

~370

 

5.58%

 

March 31, 2023

 

5.20%

 

$

15

 

 

$

—

 

 

$

(9

)

 

$

—

 

2

 

~530

 

5.20%

 

April 30, 2023

 

4.80%

 

 

22

 

 

 

(5

)

 

 

—

 

 

 

21

 

3

 

~50

 

5.08%

 

September 30, 2023

 

5.03%

 

 

—

 

 

 

(2

)

 

 

—

 

 

 

—

 

 

 

~950

 

 

 

 

 

 

 

$

37

 

 

$

(7

)

 

$

(9

)

 

$

21

 

 

 

(1)
This amount represents the net actuarial loss and was reclassified from Accumulated other comprehensive loss to Restructuring and other charges, net (see Note D) on the accompanying Statement of Consolidated Operations.

The following table presents certain information and the financial impacts of these actions on the accompanying Consolidated Financial Statements:

Action #

 

Number of affected plan participants

 

Weighted average
discount rate
as of prior plan remeasurement
date

 

Plan remeasurement date

 

Weighted average discount rate as of plan remeasurement date

 

Increase to accrued pension benefits liability(1)

 

 

Increase (decrease) to other noncurrent assets(1)

 

 

Settlement loss (gain)(2)

 

1

 

~4,400

 

2.90%

 

July 31, 2022

 

4.63%

 

$

5

 

 

$

27

 

 

$

617

 

2

 

~45

 

2.90%

 

July 31, 2022

 

4.63%

 

—

 

 

—

 

 

 

11

 

3

 

~5

 

4.57%

 

September 30, 2022

 

5.71%

 

 

23

 

 

 

(12

)

 

 

1

 

4

 

~25

 

2.46%

 

September 30, 2022

 

4.99%

 

—

 

 

 

21

 

 

 

(3

)

5

 

~20

 

N/A

 

December 31, 2022

 

N/A

 

 

3

 

 

 

—

 

 

 

6

 

 

 

~4,495

 

 

 

 

 

 

 

$

31

 

 

$

36

 

 

$

632

 

 

(1)
Actions 1-4 caused interim plan remeasurements, including an update to the discount rates used to determine the benefit obligations of the affected plans. These amounts include impacts due to interim plan remeasurements.
(2)
These amounts represent the net actuarial loss (gain) and were reclassified from Accumulated other comprehensive loss to Restructuring and other charges, net (see Note D) on the accompanying Statement of Consolidated Operations.

The following table presents certain information and the financial impacts of these actions on the accompanying Consolidated Financial Statements:

Action #

 

Number of affected plan participants

 

Weighted average
discount rate
as of prior plan remeasurement
date

 

Plan remeasurement date

 

Weighted average discount rate as of plan remeasurement date

 

Increase (decrease) to accrued pension benefits liability

 

 

Decrease to accrued other postretirement benefits liability

 

 

Curtailment
gain(1)

 

 

Settlement
loss(1)

 

1

 

~840

 

2.45%

 

March 31, 2021

 

3.06%

 

$

—

 

 

$

(106

)

 

$

(17

)

 

$

26

 

2

 

~120

 

2.38%

 

June 30, 2021

 

2.71%

 

 

(90

)

 

 

—

 

 

 

—

 

 

 

39

 

3

 

~20

 

2.71%

 

September 30, 2021

 

2.74%

 

 

7

 

 

 

—

 

 

 

—

 

 

 

7

 

4

 

~20

 

1.34%

 

September 30, 2021

 

1.53%

 

 

(38

)

 

 

—

 

 

 

—

 

 

 

1

 

5

 

~800

 

N/A

 

N/A

 

N/A

 

N/A

 

 

 

—

 

 

 

—

 

 

 

63

 

6

 

~14,000

 

2.59%

 

November 30, 2021

 

2.79%

 

 

(84

)

 

 

—

 

 

 

—

 

 

 

848

 

7

 

~60

 

2.59%

 

November 30, 2021

 

2.79%

 

 

(1

)

 

 

—

 

 

 

—

 

 

 

10

 

 

 

 

 

 

 

 

 

 

 

$

(206

)

 

$

(106

)

 

$

(17

)

 

$

994

 

 

(1)
These amounts primarily represent the accelerated amortization of a portion of the existing prior service benefit for curtailments and net actuarial loss for settlements and were reclassified from Accumulated other comprehensive loss to Restructuring and other charges, net (see Note D) on the accompanying Statement of Consolidated Operations.
Schedule of Obligations and Funded Status

Obligations and Funded Status

 

 

Pension benefits

 

 

Other
postretirement benefits

 

December 31,

 

2023

 

 

2022

 

 

2023

 

 

2022

 

Change in benefit obligation

 

 

 

 

 

 

 

 

 

 

 

 

Benefit obligation at beginning of year

 

$

2,518

 

 

$

4,594

 

 

$

536

 

 

$

710

 

Service cost

 

 

11

 

 

 

13

 

 

 

3

 

 

 

4

 

Interest cost

 

 

119

 

 

 

107

 

 

 

26

 

 

 

15

 

Amendments

 

 

2

 

 

 

—

 

 

 

—

 

 

 

—

 

Actuarial losses (gains)

 

 

117

 

 

 

(803

)

 

 

(7

)

 

 

(140

)

Settlements

 

 

(280

)

 

 

(1,090

)

 

 

—

 

 

 

—

 

Benefits paid, net of participants’ contributions

 

 

(133

)

 

 

(211

)

 

 

(52

)

 

 

(53

)

Suriname resident election transfer

 

 

12

 

 

 

—

 

 

 

(12

)

 

 

—

 

Foreign currency translation impact

 

 

27

 

 

 

(92

)

 

 

—

 

 

 

—

 

Benefit obligation at end of year

 

$

2,393

 

 

$

2,518

 

 

$

494

 

 

$

536

 

Change in plan assets

 

 

 

 

 

 

 

 

 

 

 

 

Fair value of plan assets at beginning of year

 

$

2,434

 

 

$

4,306

 

 

$

—

 

 

$

—

 

Actual return on plan assets

 

 

141

 

 

 

(528

)

 

 

—

 

 

 

—

 

Employer contributions

 

 

24

 

 

 

18

 

 

 

—

 

 

 

—

 

Participant contributions

 

 

3

 

 

 

4

 

 

 

—

 

 

 

—

 

Benefits paid

 

 

(125

)

 

 

(204

)

 

 

—

 

 

 

—

 

Administrative expenses

 

 

(9

)

 

 

(6

)

 

 

—

 

 

 

—

 

Settlements

 

 

(280

)

 

 

(1,090

)

 

 

—

 

 

 

—

 

Annuity purchase premium refund

 

 

7

 

 

 

22

 

 

 

—

 

 

 

—

 

Foreign currency translation impact

 

 

24

 

 

 

(88

)

 

 

—

 

 

 

—

 

Fair value of plan assets at end of year

 

$

2,219

 

 

$

2,434

 

 

$

—

 

 

$

—

 

Funded status

 

$

(174

)

 

$

(84

)

 

$

(494

)

 

$

(536

)

Less: Amounts attributed to joint venture partners

 

 

(11

)

 

 

(6

)

 

 

—

 

 

 

—

 

Net funded status

 

$

(163

)

 

$

(78

)

 

$

(494

)

 

$

(536

)

Amounts recognized in the Consolidated Balance
   Sheet consist of:

 

 

 

 

 

 

 

 

 

 

 

 

Noncurrent assets

 

$

125

 

 

$

146

 

 

$

—

 

 

$

—

 

Current liabilities

 

 

(10

)

 

 

(11

)

 

 

(51

)

 

 

(55

)

Noncurrent liabilities

 

 

(278

)

 

 

(213

)

 

 

(443

)

 

 

(481

)

Net amount recognized

 

$

(163

)

 

$

(78

)

 

$

(494

)

 

$

(536

)

Amounts recognized in Accumulated Other
   Comprehensive Loss consist of:

 

 

 

 

 

 

 

 

 

 

 

 

Net actuarial loss

 

$

1,098

 

 

$

1,016

 

 

$

88

 

 

$

95

 

Prior service cost (benefit)

 

 

4

 

 

 

2

 

 

 

(97

)

 

 

(111

)

Total, before tax effect

 

 

1,102

 

 

 

1,018

 

 

 

(9

)

 

 

(16

)

Less: Amounts attributed to joint venture partners

 

 

33

 

 

 

27

 

 

 

—

 

 

 

—

 

Net amount recognized, before tax effect

 

$

1,069

 

 

$

991

 

 

$

(9

)

 

$

(16

)

Other Changes in Plan Assets and Benefit Obligations
   Recognized in Other Comprehensive Income (Loss)
   consist of:

 

 

 

 

 

 

 

 

 

 

 

 

Net actuarial loss (benefit)

 

$

131

 

 

$

(141

)

 

$

(2

)

 

$

(140

)

Amortization of accumulated net actuarial loss

 

 

(49

)

 

 

(720

)

 

 

(5

)

 

 

(18

)

Prior service cost

 

 

2

 

 

 

—

 

 

 

—

 

 

 

—

 

Amortization of prior service benefit

 

 

—

 

 

 

—

 

 

 

14

 

 

 

14

 

Total, before tax effect

 

 

84

 

 

 

(861

)

 

 

7

 

 

 

(144

)

Less: Amounts attributed to joint venture partners

 

 

6

 

 

 

(11

)

 

 

—

 

 

 

—

 

Net amount recognized, before tax effect

 

$

78

 

 

$

(850

)

 

$

7

 

 

$

(144

)
Schedule of Pension Plan Benefit Obligations

Pension Plan Benefit Obligations

 

 

Pension benefits

 

 

 

2023

 

 

2022

 

The aggregate projected benefit obligation and accumulated benefit obligation
   for all defined benefit pension plans was as follows:

 

 

 

 

 

 

Projected benefit obligation

 

$

2,393

 

 

$

2,518

 

Accumulated benefit obligation

 

 

2,285

 

 

 

2,453

 

The aggregate projected benefit obligation and fair value of plan assets for
   pension plans with projected benefit obligations in excess of plan assets
   was as follows:

 

 

 

 

 

 

Projected benefit obligation

 

 

1,636

 

 

 

1,465

 

Fair value of plan assets

 

 

1,336

 

 

 

1,232

 

The aggregate accumulated benefit obligation and fair value of plan assets for
   pension plans with accumulated benefit obligations in excess of plan assets
   was as follows:

 

 

 

 

 

 

Accumulated benefit obligation

 

 

1,425

 

 

 

1,458

 

Fair value of plan assets

 

 

1,169

 

 

 

1,232

 
Components of Net Periodic Benefit Cost

Components of Net Periodic Benefit Cost

 

 

Pension benefits(1)

 

 

Other postretirement benefits

 

 

 

2023

 

 

2022

 

 

2021

 

 

2023

 

 

2022

 

 

2021

 

Service cost

 

$

10

 

 

$

13

 

 

$

22

 

 

$

3

 

 

$

4

 

 

$

4

 

Interest cost(2)

 

 

114

 

 

 

104

 

 

 

116

 

 

 

26

 

 

 

15

 

 

 

15

 

Expected return on plan assets(2)

 

 

(146

)

 

 

(151

)

 

 

(281

)

 

 

—

 

 

 

—

 

 

 

—

 

Recognized net actuarial loss(2)

 

 

28

 

 

 

88

 

 

 

190

 

 

 

5

 

 

 

18

 

 

 

21

 

Amortization of prior service cost (benefit)(2)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(14

)

 

 

(14

)

 

 

(14

)

Settlements(3)

 

 

21

 

 

 

632

 

 

 

968

 

 

 

—

 

 

 

—

 

 

 

26

 

Curtailments(4)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(17

)

Net periodic benefit cost(5)

 

$

27

 

 

$

686

 

 

$

1,015

 

 

$

20

 

 

$

23

 

 

$

35

 

 

(1)
In 2023, 2022, and 2021, net periodic benefit cost for U.S pension plans was $6, $698, and $962, respectively.
(2)
These amounts were reported in Other expenses (income), net on the accompanying Statement of Consolidated Operations.
(3)
These amounts were reported in Restructuring and other charges, net on the accompanying Statement of Consolidated Operations (see Note D). In 2023, 2022 and 2021, settlements were due to management actions (see Plan Actions above).
(4)
These amounts were reported in Restructuring and other charges, net on the accompanying Statement of Consolidated Operations (see Note D). In 2021, curtailments were due to management actions (see Plan Actions above).
(5)
Amounts attributed to joint venture partners are not included.
Schedule of Assumed Health Care Cost Trend Rates

Assumed health care cost trend rates for U.S. other postretirement benefit plans were as follows (non-U.S. plans are not material):

 

 

2023

 

 

2022

 

 

2021

 

Health care cost trend rate assumed for next year

 

 

6.5

%

 

 

7.0

%

 

 

5.5

%

Rate to which the cost trend rate gradually declines

 

 

5.0

%

 

 

5.0

%

 

 

4.5

%

Year that the rate reaches the rate at which it is assumed to remain

 

2032

 

 

2028

 

 

2026

 
Schedule of Pension and Postretirement Plans Weighted Average Target and Actual Asset Allocations

Plan Assets. Alcoa’s pension plan weighted average target and actual asset allocations at December 31, 2023 and 2022, by asset class, were as follows:

 

 

Target asset allocation

 

 

Plan assets at
December 31,

 

Asset class

 

2023

 

 

2022

 

 

2023

 

 

2022

 

Equities

 

 

20

%

 

 

20

%

 

 

17

%

 

 

29

%

Fixed income

 

 

65

 

 

 

65

 

 

 

70

 

 

 

57

 

Other investments

 

 

15

 

 

 

15

 

 

 

13

 

 

 

14

 

Total

 

 

100

%

 

 

100

%

 

 

100

%

 

 

100

%
Schedule of Fair Value of Pension Plan Assets

The following table presents the fair value of pension plan assets classified under either the appropriate level of the fair value hierarchy or net asset value:

December 31, 2023

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

Net Asset
Value

 

 

Total

 

Equities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity securities

 

$

108

 

 

$

—

 

 

$

—

 

 

$

134

 

 

$

242

 

Private equity

 

 

—

 

 

 

—

 

 

 

—

 

 

 

127

 

 

 

127

 

 

 

$

108

 

 

$

—

 

 

$

—

 

 

$

261

 

 

$

369

 

Fixed income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Intermediate and long-duration government/credit

 

$

403

 

 

$

517

 

 

$

—

 

 

$

496

 

 

$

1,416

 

Cash and cash equivalent funds

 

 

14

 

 

 

—

 

 

 

—

 

 

 

114

 

 

 

128

 

 

 

$

417

 

 

$

517

 

 

$

—

 

 

$

610

 

 

$

1,544

 

Other investments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Real estate

 

$

21

 

 

$

—

 

 

$

—

 

 

$

253

 

 

$

274

 

Other

 

 

—

 

 

 

—

 

 

 

—

 

 

 

19

 

 

 

19

 

 

 

$

21

 

 

$

—

 

 

$

—

 

 

$

272

 

 

$

293

 

Total(1)

 

$

546

 

 

$

517

 

 

$

—

 

 

$

1,143

 

 

$

2,206

 

December 31, 2022

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

Net Asset
Value

 

 

Total

 

Equities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity securities

 

$

71

 

 

$

—

 

 

$

—

 

 

$

480

 

 

$

551

 

Long/short equity hedge funds

 

 

—

 

 

 

—

 

 

 

—

 

 

 

8

 

 

 

8

 

Private equity

 

 

—

 

 

 

—

 

 

 

—

 

 

 

145

 

 

 

145

 

 

 

$

71

 

 

$

—

 

 

$

—

 

 

$

633

 

 

$

704

 

Fixed income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Intermediate and long-duration government/credit

 

$

390

 

 

$

426

 

 

$

—

 

 

$

420

 

 

$

1,236

 

Cash and cash equivalent funds

 

 

38

 

 

 

—

 

 

 

—

 

 

 

118

 

 

 

156

 

 

 

$

428

 

 

$

426

 

 

$

—

 

 

$

538

 

 

$

1,392

 

Other investments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Real estate

 

$

20

 

 

$

—

 

 

$

—

 

 

$

282

 

 

$

302

 

Other

 

 

—

 

 

 

—

 

 

 

—

 

 

 

28

 

 

 

28

 

 

 

$

20

 

 

$

—

 

 

$

—

 

 

$

310

 

 

$

330

 

Total(2)

 

$

519

 

 

$

426

 

 

$

—

 

 

$

1,481

 

 

$

2,426

 

 

(1)
As of December 31, 2023, the total fair value of pension plan assets excludes a net receivable of $13, which primarily represents securities not yet settled plus interest and dividends earned on various investments.
(2)
As of December 31, 2022, the total fair value of pension plan assets excludes a net receivable of $8, which primarily represents securities not yet settled plus interest and dividends earned on various investments.
Schedule of Benefit Payments Expected to be Paid

Benefit payments expected to be paid to pension and other postretirement benefit plan participants are as follows:

Year ending December 31,

 

Pension
benefits

 

 

Other
postretirement
benefits

 

2024

 

$

180

 

 

$

50

 

2025

 

 

175

 

 

 

50

 

2026

 

 

175

 

 

 

45

 

2027

 

 

180

 

 

 

45

 

2028

 

 

175

 

 

 

45

 

2029 through 2033

 

 

855

 

 

 

195

 

 

 

$

1,740

 

 

$

430

 
Benefit Obligation [Member]  
Schedule of Weighted Average Assumptions Used to Determine Benefit Obligations and Net Periodic Benefit Cost

Weighted average assumptions used to determine benefit obligations for pension and other postretirement benefit plans were as follows:

December 31,

 

2023

 

 

2022

 

Discount rate—pension plans

 

 

5.03

%

 

 

5.41

%

Discount rate—other postretirement benefit plans

 

 

5.19

 

 

 

5.54

 

Rate of compensation increase—pension plans

 

 

3.77

 

 

 

3.21

 
Net Periodic Benefit Cost [Member]  
Schedule of Weighted Average Assumptions Used to Determine Benefit Obligations and Net Periodic Benefit Cost

Weighted average assumptions used to determine net periodic benefit cost for pension and other postretirement benefit plans were as follows:

 

 

2023

 

 

2022

 

 

2021

 

Discount rate—pension plans

 

 

5.34

%

 

 

2.66

%

 

 

1.91

%

Discount rate—other postretirement benefit plans

 

 

5.45

 

 

 

2.46

 

 

 

1.99

 

Expected long-term rate of return on plan assets—pension plans

 

 

6.21

 

 

 

4.94

 

 

 

5.66

 

Rate of compensation increase—pension plans

 

 

3.21

 

 

 

3.11

 

 

 

2.58