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PENSION AND OTHER POSTRETIREMENT BENEFITS
 6 Months Ended
Jan. 03, 2020
Retirement Benefits [Abstract]  
PENSION AND OTHER POSTRETIREMENT BENEFITS
NOTE 15: PENSION AND OTHER POSTRETIREMENT BENEFITS
Defined Contribution Plan
As of January 3, 2020, we sponsor numerous defined contribution savings plans, which allow our eligible employees to contribute a portion of their pre-tax and/or after-tax income in accordance with specified guidelines. The plans include several match contribution formulas which requires us to match a percentage of the employee contributions up to certain limits, generally totaling between 2.0% to 6.0% of employee eligible pay. Matching contributions charged to expense were $105 million for the two quarters ended January 3, 2020. Matching contributions charged to expense were $85 million, $83 million and $80 million for fiscal 2019, 2018 and 2017, respectively, including both continuing and discontinued operations.

Deferred Compensation Plan
We also sponsor a supplemental executive retirement plan, which is a nonqualified deferred compensation arrangement for highly compensated employees (within the meaning of section 201(2) of ERISA). The plan obligations are funded by investments held in a Rabbi Trust.
The following table provides the fair value of our deferred compensation plan investments and liabilities by category and by fair value hierarchy level:
 
January 3, 2020
 
June 28, 2019
 
June 29, 2018
 
Total
 
Level 1
 
Total
 
Level 1
 
Total
 
Level 1
 
 
 
 
 
 
 
 
 
 
 
 
 
(In millions)
Assets
 
 
 
 
 
 
 
 
 
 
 
Deferred compensation plan assets:(1)
 
 
 
 
 
 
 
 
 
 
 
Equity and fixed income securities(2)
$
58

 
$
58

 
$
99

 
$
99

 
$
109

 
$
109

Investments measured at NAV:
 
 
 
 
 
 
 
 
 
 
 
Corporate-owned life insurance
29

 
 
 
28

 
 
 
27

 
 
Total fair value of deferred compensation plan assets
$
87

 
 
 
$
127

 
 
 
$
136

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Liabilities
 
 
 
 
 
 
 
 
 
 
 
Deferred compensation plan liabilities:(3)
 
 
 
 
 
 
 
 
 
 
 
Equity securities and mutual funds
$
2

 
$
2

 
$
25

 
$
25

 
$
38

 
$
38

Investments measured at NAV:
 
 
 
 
 
 
 
 
 
 
 
Common/collective trusts and guaranteed investment contracts
69

 
 
 
132

 
 
 
111

 
 
Total fair value of deferred compensation plan liabilities
$
71

 
 
 
$
157

 
 
 
$
149

 
 

_______________
(1)
Represents diversified assets held in a “rabbi trust” associated with our non-qualified deferred compensation plans, which we include in the “Other current
assets” and “Other non-current assets” line items in our Consolidated Balance Sheet, and which are measured at fair value.
(2)
We have reclassified certain prior-year amounts to conform with current period classifications. Reclassifications include certain equity and fixed income funds that were previously included under “Investments Measured at NAV” and are now reflected in “Equity and fixed income securities” under “Level 1.”
(3)
Primarily represents obligations to pay benefits under certain non-qualified deferred compensation plans, which we include in the “Compensation and
benefits” and “Other long-term liabilities” line items in our Consolidated Balance Sheet. Under these plans, participants designate
investment options (including stock and fixed-income funds), which serve as the basis for measurement of the notional value of their accounts.
Defined Benefit Plans
We sponsor numerous defined benefit pension plans for eligible employees. Benefits for most participants under the terms of these plans are based on the employee’s years of service and compensation. We fund these plans as required by statutory regulations and through voluntary contributions. Some of our employees also participate in other postretirement defined benefit plans such as health care and life insurance plans.
The U.S. Salaried Retirement Plan (“U.S. SRP”) is our largest defined benefit pension plan, with assets valued at $4.5 billion and a projected benefit obligation of $5.6 billion as of January 3, 2020. Effective December 31, 2016, accruals under the U.S. SRP benefit formula were frozen for all employees and replaced with a 1% cash balance benefit formula for certain employees who were not highly compensated on December 31, 2016.
Balance Sheet Information
Amounts recognized in our Consolidated Balance Sheet for defined benefit pension plans and other postretirement defined benefit plans (collectively, “defined benefit plans”) reflect the funded status of our plans. The following table provides a summary of the funded status of our defined benefit plans and the presentation of such balances within our Consolidated Balance Sheet:
 
January 3, 2020
 
June 28, 2019
 
June 29, 2018
 
Pension
 
Other
Benefits
 
Pension
 
Other
Benefits
 
Pension
 
Other
Benefits
 
 
 
 
 
 
 
 
 
 
 
 
 
(In millions)
Fair value of plan assets
$
8,618

 
$
274

 
$
4,958

 
$
201

 
$
5,098

 
$
207

Projected benefit obligation
(10,268
)
 
(369
)
 
(6,123
)
 
(221
)
 
(5,774
)
 
(233
)
Funded status
$
(1,650
)
 
$
(95
)
 
$
(1,165
)
 
$
(20
)
 
$
(676
)
 
$
(26
)
Consolidated Balance Sheet line item amounts:
Other non-current assets
$
91

 
$
1

 
$
12

 
$
—

 
$
15

 
$
—

Compensation and benefits
(10
)
 
(8
)
 
(7
)
 
—

 
(2
)
 
(1
)
Liabilities of disposal group held for sale
—

 
—

 
(16
)
 
—

 
—

 
—

Defined benefit plans
(1,731
)
 
(88
)
 
(1,154
)
 
(20
)
 
(689
)
 
(25
)

A portion of our projected benefit obligation includes amounts that have not yet been recognized as expense (or reductions of expense) in our results of operations. Such amounts are recorded within accumulated other comprehensive loss until they are amortized as a component of net periodic benefit cost. The following table provides a summary of pre-tax amounts recorded within accumulated other comprehensive loss:
 
January 3, 2020
 
June 28, 2019
 
June 29, 2018
 
Pension
 
Other
Benefits
 
Pension
 
Other
Benefits
 
Pension
 
Other
Benefits
 
 
 
 
 
 
 
 
 
 
 
 
 
(In millions)
Net actuarial loss (gain)
$
819

 
$
(34
)
 
$
781

 
$
(36
)
 
$
156

 
$
(46
)
Net prior service cost (credit)
(282
)
 
(1
)
 
6

 
(1
)
 
4

 
(1
)
 
$
537

 
$
(35
)
 
$
787

 
$
(37
)
 
$
160

 
$
(47
)

The following table provides a roll-forward of the projected benefit obligations for our defined benefit plans:
 
January 3, 2020
 
June 28, 2019
 
June 29, 2018
 
Pension
 
Other
Benefits
 
Pension
 
Other
Benefits
 
Pension
 
Other
Benefits
 
 
 
 
 
 
 
 
 
 
 
 
 
(In millions)
Change in benefit obligation
 
 
 
 
 
 
 
 
 
 
 
Benefit obligation at beginning of fiscal year
$
6,123

 
$
221

 
$
5,774

 
$
233

 
$
6,140

 
$
265

Benefit obligation assumed in L3Harris Merger
4,474

 
156

 
—

 
—

 
—

 
—

Service cost
42

 
1

 
36

 
—

 
39

 
1

Interest cost
149

 
5

 
209

 
8

 
195

 
7

Actuarial loss (gain)
301

 
7

 
514

 
(1
)
 
(169
)
 
(22
)
Amendments
(292
)
 
—

 
3

 
—

 
2

 
—

Benefits paid
(342
)
 
(21
)
 
(381
)
 
(19
)
 
(402
)
 
(18
)
Settlements
(5
)
 
—

 
—

 
—

 
—

 
—

Expenses paid
(43
)
 
—

 
(30
)
 
—

 
(35
)
 
—

Curtailments
(35
)
 
—

 
1

 
—

 
—

 
—

Foreign currency exchange rate changes
3

 
—

 
(3
)
 
—

 
4

 
—

Plan participants' contributions
1

 
—

 
—

 
—

 
—

 
—

Divestiture
(108
)
 
—

 
—

 
—

 
—

 
—

Benefit obligation at end of fiscal year
$
10,268

 
$
369

 
$
6,123

 
$
221

 
$
5,774

 
$
233


The following table provides a roll-forward of the assets and the ending funded status of our defined benefit plans:
 
January 3, 2020
 
June 28, 2019
 
June 29, 2018
 
Pension
 
Other
Benefits
 
Pension
 
Other
Benefits
 
Pension
 
Other
Benefits
 
 
 
 
 
 
 
 
 
 
 
 
 
(In millions)
Change in plan assets
 
 
 
 
 
 
 
 
 
 
 
Plan assets at beginning of fiscal year
$
4,958

 
$
201

 
$
5,098

 
$
207

 
$
4,921

 
$
212

Plan assets acquired in L3Harris Merger
3,183

 
68

 
—

 
—

 
—

 
—

Actual return on plan assets
548

 
18

 
271

 
11

 
307

 
14

Employer contributions
406

 
8

 
3

 
2

 
303

 
(1
)
Benefits paid
(342
)
 
(21
)
 
(381
)
 
(19
)
 
(402
)
 
(18
)
Settlements
(5
)
 
—

 
—

 
—

 
—

 
—

Expenses paid
(43
)
 
—

 
(30
)
 
—

 
(35
)
 
—

Foreign currency exchange rate changes
4

 
—

 
(3
)
 
—

 
4

 
—

Plan participants' contributions
1

 
—

 
—

 
—

 
—

 
—

Divestiture
(92
)
 
—

 
—

 
—

 
—

 
—

Plan assets at end of fiscal year
$
8,618

 
$
274

 
$
4,958

 
$
201

 
$
5,098

 
$
207

 
 
 
 
 
 
 
 
 
 
 
 
Funded status at end of fiscal year
$
(1,650
)
 
$
(95
)
 
$
(1,165
)
 
$
(20
)
 
$
(676
)
 
$
(26
)
The accumulated benefit obligation for all defined benefit pension plans was $10.2 billion at January 3, 2020. The following table provides information for defined benefit pension plans with an accumulated benefit obligation in excess of plan assets:
 
January 3, 2020
 
June 28, 2019
 
June 29, 2018
 
 
 
 
 
 
 
(In millions)
Projected benefit obligation
$
9,670

 
$
6,041

 
$
5,694

Accumulated benefit obligation
9,656

 
6,041

 
5,694

Fair value of plan assets
7,931

 
4,864

 
5,004


Income Statement Information
The following table provides the components of net periodic benefit income and other amounts recognized in other comprehensive income for the two quarters ended January 3, 2020 and fiscal 2019, 2018 and 2017 as they pertain to our defined benefit plans:
 
Pension
 
Two Quarters Ended
 
Fiscal Years Ended
 
January 3, 2020
 
June 28, 2019
 
June 29, 2018
 
June 30, 2017
 
 
 
 
 
 
 
 
 
(In millions)
Net periodic benefit income
 
 
 
 
 
 
 
Service cost
$
42

 
$
36

 
$
39

 
$
58

Interest cost
149

 
209

 
195

 
184

Expected return on plan assets
(314
)
 
(382
)
 
(369
)
 
(340
)
Amortization of net actuarial loss (gain)
1

 
—

 
—

 
1

Amortization of prior service credit
(5
)
 
—

 
—

 
—

Effect of curtailments or settlements(1)
(18
)
 
1

 
—

 
—

Net periodic benefit income
$
(145
)
 
$
(136
)
 
$
(135
)
 
$
(97
)
Other changes in plan assets and benefit obligations recognized in other comprehensive loss
 
 
 
 
 
 
 
Net actuarial loss (gain)
$
55

 
$
625

 
$
(106
)
 
$
(284
)
Prior service (credit) cost
(292
)
 
3

 
2

 
—

Amortization of net actuarial gain (loss)
(5
)
 
—

 
—

 
(1
)
Amortization of prior service credit (cost)
5

 
(1
)
 
—

 
—

Recognized net loss due to divestiture
(13
)
 
—

 
—

 
—

Total change recognized in other comprehensive loss
(250
)
 
627

 
(104
)
 
(285
)
Total impact from net periodic benefit cost and changes in other comprehensive loss
$
(395
)
 
$
491

 
$
(239
)
 
$
(382
)
_______________
(1)
Effective January 1, 2020, for certain acquired L3 U.S. defined benefit pension plans, benefit accruals were frozen and replaced with a 1% cash balance benefit formula for certain employees who were not considered highly compensated on December 31, 2018. During the two quarters ended January 3, 2020, we recognized a $23 million curtailment gain as a result of this change, and a $5 million settlement loss resulting from the payout of the liabilities of a non-qualified benefit plan due to the change in control provisions.
 
Other Benefits
 
Two Quarters Ended
 
Fiscal Years Ended
 
January 3, 2020
 
June 28, 2019
 
June 29, 2018
 
June 30, 2017
 
 
 
 
 
 
 
 
 
(In millions)
Net periodic benefit income
 
 
 
 
 
 
 
Service cost
$
1

 
$
—

 
$
1

 
$
1

Interest cost
5

 
8

 
7

 
8

Expected return on plan assets
(10
)
 
(16
)
 
(16
)
 
(17
)
Amortization of net actuarial loss (gain)
(3
)
 
(6
)
 
(1
)
 
—

Net periodic benefit income
$
(7
)
 
$
(14
)
 
$
(9
)
 
$
(8
)
Other changes in plan assets and benefit obligations recognized in other comprehensive loss
 
 
 
 
 
 
 
Net actuarial loss (gain)
$
(1
)
 
$
4

 
$
(20
)
 
$
(38
)
Amortization of net actuarial gain (loss)
3

 
6

 
1

 
—

Total change recognized in other comprehensive loss
2

 
10

 
(19
)
 
(38
)
Total impact from net periodic benefit cost and changes in other comprehensive loss
$
(5
)
 
$
(4
)
 
$
(28
)
 
$
(46
)

The following table provides estimated amounts for net actuarial gain and prior service cost to be amortized from accumulated other comprehensive loss into net periodic benefit income during the next twelve months for plans in existence as of January 3, 2020.
 
Pension
 
Other
Benefits
 
Total
 
 
 
 
 
 
 
(In millions)
Net actuarial (gain) loss
$
10

 
$
(3
)
 
$
7

Prior service cost
(28
)
 
—

 
(28
)
 
$
(18
)
 
$
(3
)
 
$
(21
)

Defined Benefit Plan Assumptions
The determination of the assumptions related to defined benefit plans are based on the provisions of the applicable accounting pronouncements, review of various market data and discussions with our actuaries. We develop each assumption using relevant Company experience in conjunction with market-related data. Assumptions are reviewed annually and adjusted as appropriate.
The following tables provide the weighted-average assumptions used to determine projected benefit obligations and net periodic benefit cost, as they pertain to our defined benefit pension plans in existence as of January 3, 2020:
Obligation assumptions as of:
January 3, 2020
 
June 28, 2019
 
June 29, 2018
 
 
Discount rate
3.14
%
 
3.35
%
 
4.05
%
 
 
Rate of future compensation increase
2.80
%
 
2.76
%
 
2.76
%
 
 
 
 
 
 
 
 
 
 
Cost assumptions for fiscal periods ended:
January 3, 2020
 
June 28, 2019
 
June 29, 2018
 
June 30, 2017
Discount rate to determine service cost
3.11
%
 
3.89
%
 
3.48
%
 
3.80
%
Discount rate to determine interest cost
2.94
%
 
3.75
%
 
3.28
%
 
2.94
%
Expected return on plan assets
7.68
%
 
7.66
%
 
7.66
%
 
7.65
%
Rate of future compensation increase
2.97
%
 
2.76
%
 
2.76
%
 
2.75
%
Key assumptions for the U.S. SRP (our largest defined benefit pension plan with approximately 54% of the total projected benefit obligation) included a discount rate for obligation assumptions of 3.10% and expected return on plan assets of 7.75% for the two quarters ended January 3, 2020, which is being maintained at 7.75% for fiscal 2020.
The following table provides the weighted-average assumptions used to determine projected benefit obligations and net periodic benefit cost, as they pertain to our other postretirement defined benefit plans in existence as of January 3, 2020:
Obligation assumptions as of:
January 3, 2020
 
June 28, 2019
 
June 29, 2018
 
 
Discount rate
2.97
%
 
3.21
%
 
3.99
%
 
 
Rate of future compensation increase
N/A

 
N/A

 
N/A

 
 
 
 
 
 
 
 
 
 
Cost assumptions for fiscal periods ended:
January 3, 2020
 
June 28, 2019
 
June 29, 2018
 
June 30, 2017
Discount rate to determine service cost
3.47
%
 
4.14
%
 
3.62
%
 
3.52
%
Discount rate to determine interest cost
2.74
%
 
3.62
%
 
3.04
%
 
2.60
%
Rate of future compensation increase
N/A

 
N/A

 
N/A

 
N/A


The expected long-term rate of return on plan assets reflects the expected returns for each major asset class in which the plans invest, the weight of each asset class in the strategic allocation, the correlations among asset classes and their expected volatilities. Our expected rate of return on plan assets is estimated by evaluating both historical returns and estimates of future returns. Specifically, the determination of the expected long-term rate of return takes into consideration: (1) the plan’s actual historical annual return on assets over the past 15-, 20- and 25-year time periods, (2) historical broad market returns over long-term timeframes weighted by the plan’s strategic allocation, and (3) independent estimates of future long-term asset class returns, weighted by the plan’s strategic allocation. Based on this approach, the long-term annual rate of return on assets is estimated at 7.75% for fiscal 2020 for the U.S. defined benefit pension plans. The weighted average long-term annual rate of return on assets for all defined benefit pension plans is estimated at 7.68% for fiscal 2020. In the two quarters ended January 3, 2020, we adopted updated mortality tables, which resulted in a decrease in the defined benefit plans’ projected benefit obligation as of January 3, 2020 and estimated net periodic benefit cost beginning with fiscal 2020.
The assumed composite rate of future increases in the per capita healthcare costs (the healthcare trend rate) was 6.80% for fiscal 2020, decreasing ratably to 4.70% by fiscal 2030. Increasing or decreasing the healthcare cost trend rates by one percent per year would not have a material effect on the benefit obligation or the aggregate annual service and interest cost components. To the extent that actual experience differs from these assumptions, the effect will be accumulated and generally amortized for each plan to the extent required over the estimated future life expectancy or, if applicable, the future working lifetime of the plan’s active participants.
Investment Policy
The investment strategy for managing defined benefit plan assets is to seek an optimal rate of return relative to an appropriate level of risk. We manage substantially all defined benefit plan assets on a commingled basis in a master investment trust. In making these asset allocation decisions, we take into account recent and expected returns and volatility of returns for each asset class, the expected correlation of returns among the different investments, as well as anticipated funding and cash flows. To enhance returns and mitigate risk, we diversify our investments by strategy, asset class, geography and sector and engage a large number of managers to gain broad exposure to the markets.
The following table provides the current strategic target asset allocation ranges by asset category:
 
Target Asset
Allocation
Equity investments
40
%
—
60%
Fixed income investments
20
%
—
40%
Hedge funds
0
%
—
30%
Cash and cash equivalents
0
%
—
10%

Fair Value of Plan Assets
The following is a description of the valuation techniques and inputs used to measure fair value for major categories of investments as reflected in the table that follows such description:
•
Domestic and international equities, which include common and preferred shares, domestic listed and foreign listed equity securities, open-ended and closed-ended mutual funds, real estate investment trusts and exchange traded funds, are generally valued at the closing price reported on the major market exchanges on which the individual securities are traded at the measurement date. Because these assets are traded predominantly on liquid, widely traded public exchanges, equity securities are categorized as Level 1 assets.
•
Private equity funds, which include buy-out, mezzanine, venture capital, distressed asset and secondary funds, are typically limited partnership investment structures. Private equity funds are valued using a market approach based on NAV calculated by the funds and are not publicly available. Private equity funds generally have liquidity restrictions that extend for ten or more years. At January 3, 2020, June 28, 2019 and June 29, 2018, our defined benefit plans had future unfunded commitments totaling $325 million, $355 million and $246 million, respectively, related to private equity fund investments.
•
Hedge funds, which include equity long/short, event-driven, fixed-income arbitrage and global macro strategies, are typically limited partnership investment structures. Limited partnership interests in hedge funds are valued using a market approach based on NAV calculated by the funds and are not publicly available. Hedge funds generally permit redemption on a quarterly or more frequent basis with 90 or fewer days-notice. At each of January 3, 2020, June 28, 2019 and June 29, 2018, our defined benefit plans had no future unfunded commitments related to hedge fund investments.
•
Fixed income investments, which include U.S. Government securities, investment and non-investment grade corporate bonds and securitized bonds are generally valued using pricing models that use verifiable, observable market data such as interest rates, benchmark yield curves and credit spreads, bids provided by brokers or dealers, or quoted prices of securities with similar characteristics. Fixed income investments are generally categorized as Level 2 assets. Fixed income funds valued at the closing price reported on the major market exchanges on which the individual fund is traded are categorized as Level 1 assets.
•
Other is comprised of guaranteed insurance contracts valued at book value, which approximates fair value, calculated using the prior-year balance adjusted for investment returns and changes in cash flows and corporate owned life insurance policies valued at the accumulated benefit.
•
Cash and cash equivalents are primarily comprised of short-term money market funds valued at cost, which approximates fair value, or valued at quoted market prices of identical instruments. Cash and currency are categorized as Level 1 assets; cash equivalents, such as money market funds or short-term commingled funds, are categorized as Level 2 assets.
•
Certain investments that are valued using the NAV per share (or its equivalent) as a practical expedient are not categorized in the fair value hierarchy and are included in the table to permit reconciliation of the fair value hierarchy to the aggregate postretirement benefit plan assets.
The following tables provide the fair value of plan assets held by our defined benefit plans by asset category and by fair value hierarchy level:
 
January 3, 2020
 
Total
 
Level 1
 
Level 2
 
Level 3
 
 
 
 
 
 
 
 
 
(In millions)
Asset Category
 
 
 
 
 
 
 
Equities:
 
 
 
 
 
 
 
Domestic equities
$
2,968

 
$
2,968

 
$
—

 
$
—

International equities
1,217

 
1,217

 
—

 
—

Real Estate Investment Trusts
211

 
211

 
—

 
—

Fixed income:
 
 
 
 
 
 
 
Corporate bonds
1,176

 
—

 
1,159

 
17

Government securities
489

 
—

 
489

 
—

Securitized Assets
131

 
—

 
131

 
—

Fixed Income Funds
101

 
101

 
—

 
—

Other
2

 
—

 
—

 
2

Cash and cash equivalents
691

 
17

 
674

 
—

Total
6,986

 
$
4,514

 
$
2,453

 
$
19

Investments Measured at NAV
 
 
 
 
 
 
 
Equity funds
933

 
 
 
 
 
 
Fixed income funds
323

 
 
 
 
 
 
Hedge funds
342

 
 
 
 
 
 
Private equity funds
302

 
 
 
 
 
 
Other
1

 
 
 
 
 
 
Total Investments Measured at NAV
1,901

 
 
 
 
 
 
Receivables, net
5

 
 
 
 
 
 
Total fair value of plan assets
$
8,892

 
 
 
 
 
 
 
June 28, 2019
 
Total
 
Level 1
 
Level 2
 
Level 3
 
 
 
 
 
 
 
 
 
(In millions)
Asset Category
 
 
 
 
 
 
 
Equities:
 
 
 
 
 
 
 
Domestic equities
$
1,173

 
$
1,173

 
$
—

 
$
—

International equities
896

 
896

 
—

 
—

Fixed income:
 
 
 
 
 
 
 
Corporate bonds
923

 
—

 
906

 
17

Government securities
332

 
—

 
332

 
—

Other
2

 
—

 
—

 
2

Cash and cash equivalents
59

 
12

 
47

 
—

Total
3,385

 
$
2,081

 
$
1,285

 
$
19

Investments Measured at NAV
 
 
 
 
 
 
 
Equity funds
703

 
 
 
 
 
 
Fixed income funds
362

 
 
 
 
 
 
Hedge funds
331

 
 
 
 
 
 
Private equity funds
294

 
 
 
 
 
 
Total Investments Measured at NAV
1,690

 
 
 
 
 
 
Receivables, net
84

 
 
 
 
 
 
Total fair value of plan assets
$
5,159

 
 
 
 
 
 

 
June 29, 2018
 
Total
 
Level 1
 
Level 2
 
Level 3
 
 
 
 
 
 
 
 
 
(In millions)
Asset Category
 
 
 
 
 
 
 
Equities:
 
 
 
 
 
 
 
Domestic equities
$
1,221

 
$
1,189

 
$
32

 
$
—

International equities
903

 
899

 
4

 
—

Fixed income:
 
 
 
 
 
 
 
Corporate bonds
811

 
—

 
800

 
11

Government securities
335

 
—

 
335

 
—

Other
2

 
—

 
—

 
2

Cash and cash equivalents
209

 
6

 
203

 
—

Total
3,481

 
$
2,094

 
$
1,374

 
$
13

Investments Measured at NAV
 
 
 
 
 
 
 
Equity funds
714

 
 
 
 
 
 
Fixed income funds
318

 
 
 
 
 
 
Hedge funds
395

 
 
 
 
 
 
Private equity funds
401

 
 
 
 
 
 
Total Investments Measured at NAV
1,828

 
 
 
 
 
 
Payables, net
(4
)
 
 
 
 
 
 
Total fair value of plan assets
$
5,305

 
 
 
 
 
 

Contributions
Funding requirements under Internal Revenue Service (“IRS”) rules are a major consideration in making contributions to our postretirement benefit plans. With respect to U.S. qualified pension plans, we intend to contribute annually not less than the required minimum funding thresholds.
The Highway and Transportation Funding Act of 2014 and the Bipartisan Budget Act of 2015 (“BBA 2015”) further extended the interest rate stabilization provision of MAP-21 until 2020. We made voluntary contributions to our U.S. qualified defined benefit pension plans of $302 million in the two quarters ended January 3, 2020 and $300 million and $400 million in fiscal 2018 and 2017, respectively. As a result, we currently do not anticipate making any contributions to our U.S. qualified defined benefit pension plans and only minor contributions to our non-U.S. pension plans in fiscal 2020.
Estimated Future Benefit Payments
The following table provides the projected timing of payments for benefits earned to date and benefits expected to be earned for future service by current active employees under our defined benefit plans in existence as of January 3, 2020.
 
Pension
 
Other
    Benefits(1)
 
Total
 
 
 
 
 
 
 
(In millions)
Fiscal Years:
 
 
 
 
 
2020
$
572

 
$
32

 
$
604

2021
576

 
31

 
607

2022
583

 
30

 
613

2023
584

 
29

 
613

2024
581

 
27

 
608

2025 — 2028
2,896

 
117

 
3,013


_______________
(1)
Projected payments for Other Benefits reflect net payments from the Company, which include subsidies that reduce the gross payments by less than 10 percent.
Multi-employer Benefit Plans
Certain of our businesses acquired in connection with the L3Harris Merger participate in multi-employer defined benefit pension plans. We make cash contributions to these plans under the terms of collective-bargaining agreements that cover union employees based on a fixed rate per hour of service worked by the covered employees. The risks of participating in these multi-employer plans are different from single-employer plans in the following aspects: (1) assets contributed to the multi-employer plan by one employer may be used to provide benefits to employees of other participating employers, (2) if a participating employer stops contributing to the plan, the unfunded obligations of the plan may be borne by the remaining participating employers and (3) if we choose to stop participating in some of our multi-employer plans, we may be required to pay those plans an amount based on the underfunded status of the plan, referred to as a withdrawal liability. Cash contributed and expenses recorded for our multi-employer plans were not material in the two quarters ended January 3, 2020.
See Note 5: Business Combination in these Notes for information regarding postretirement benefit plan liabilities assumed in connection with the L3Harris Merger.