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PENSION AND OTHER POSTRETIREMENT BENEFIT PLANS (Tables)
12 Months Ended
Dec. 31, 2012
Pension and Other Postretirement Benefit Plans [Abstract]  
Changes in benefit obligations and the fair value of plan assets for our benefit plans
The following table sets forth the changes in benefit obligations and the fair value of plan assets for our benefit plans (in millions):
 
Pension Benefits  
 
Other Benefits  
 
2012

 
2011

 
2012

 
2011

Benefit obligation at beginning of year1
$
8,255

 
$
7,292

 
$
953

 
$
889

Service cost
291

 
249

 
34

 
32

Interest cost
388

 
391

 
43

 
45

Foreign currency exchange rate changes
(7
)
 
30

 
3

 
2

Amendments
(3
)
 
(57
)
 
(2
)
 
(12
)
Actuarial loss (gain)
1,259

 
773

 
115

 
45

Benefits paid2
(420
)
 
(440
)
 
(53
)
 
(63
)
Settlements
(35
)
 
(24
)
 

 

Curtailments
6

 

 

 

Special termination benefits
1

 
8

 

 
3

Other3
(42
)
 
33

 
11

 
12

Benefit obligation at end of year1
$
9,693

 
$
8,255

 
$
1,104

 
$
953

Fair value of plan assets at beginning of year
$
6,171

 
$
5,497

 
$
185

 
$
187

Actual return on plan assets
822

 
73

 
16

 
(4
)
Employer contributions
1,056

 
1,001

 

 

Foreign currency exchange rate changes
(17
)
 
(1
)
 

 

Benefits paid
(366
)
 
(374
)
 
(2
)
 
(1
)
Settlements
(34
)
 
(27
)
 

 

Other3
(48
)
 
2

 
3

 
3

Fair value of plan assets at end of year
$
7,584

 
$
6,171

 
$
202

 
$
185

Net liability recognized
$
(2,109
)
 
$
(2,084
)
 
$
(902
)
 
$
(768
)
1 
For pension benefit plans, the benefit obligation is the projected benefit obligation. For other benefit plans, the benefit obligation is the accumulated postretirement benefit obligation. The accumulated benefit obligation for our pension plans was $9,345 million and $7,958 million as of December 31, 2012 and 2011, respectively.
2 
Benefits paid to pension plan participants during 2012 and 2011 included $54 million and $66 million, respectively, in payments related to unfunded pension plans that were paid from Company assets. Benefits paid to participants of other benefit plans during 2012 and 2011 included $51 million and $62 million, respectively, that were paid from Company assets.
3 
In 2012, primarily relates to the transfer of assets and liabilities associated with the Company's consolidated Philippine bottling operations to assets held for sale and liabilities held for sale as of December 31, 2012. Refer to Note 2 for additional information.
Pension and other benefit amounts recognized in consolidated balance sheets
Pension and other benefit amounts recognized in our consolidated balance sheets are as follows (in millions):
 
Pension Benefits  
 
Other Benefits  
December 31,
2012

 
2011

 
2012

 
2011

Noncurrent asset
$
395

 
$
468

 
$

 
$

Current liability
(73
)
 
(68
)
 
(21
)
 
(21
)
Long-term liability
(2,431
)
 
(2,484
)
 
(881
)
 
(747
)
Net liability recognized
$
(2,109
)
 
$
(2,084
)
 
$
(902
)
 
$
(768
)
Schedule of pension plans with projected benefit obligation in excess of fair value of plan assets
For these plans, the projected benefit obligations and the fair value of plan assets were as follows (in millions):
December 31,
2012

 
2011

Projected benefit obligation
$
9,161

 
$
7,591

Fair value of plan assets
6,659

 
5,048

Accumulated benefit obligations in excess of fair value of plan assets
For these plans, the accumulated benefit obligations and the fair value of plan assets were as follows (in millions):
December 31,
2012

 
2011

Accumulated benefit obligation
$
8,736

 
$
7,277

Fair value of plan assets
6,546

 
4,998

Total pension assets for U.S. and non-U.S. plans
The following table presents total assets for our U.S. and non-U.S. pension plans (in millions):
 
U.S. Plans  
 
Non-U.S. Plans  
December 31,
2012

 
2011

 
2012

 
2011

Cash and cash equivalents
$
299

 
$
104

 
$
87

 
$
123

Equity securities:
 
 
 
 
 
 
 
U.S.-based companies
1,844

 
1,362

 
37

 
33

International-based companies
324

 
630

 
640

 
323

Fixed-income securities:
 
 
 
 
 
 
 
Government bonds
399

 
358

 
163

 
415

Corporate bonds and debt securities
856

 
669

 
126

 
49

Mutual, pooled and commingled funds1
1,057

 
323

 
453

 
406

Hedge funds/limited partnerships
496

 
458

 
29

 
31

Real estate
248

 
256

 
9

 
14

Other
26

 
114

 
491

 
503

Total pension plan assets2
$
5,549

 
$
4,274

 
$
2,035

 
$
1,897

1 
Mutual, pooled and commingled funds include investments in equity securities, fixed-income securities and combinations of both. There are a significant number of mutual, pooled and commingled funds from which investors can choose. The selection of the type of fund is dictated by the specific investment objectives and needs of a given plan. These objectives and needs vary greatly between plans.
2 
Fair value disclosures related to our pension assets are included in Note 16. Fair value disclosures include, but are not limited to, the levels within the fair value hierarchy on which the fair value measurements in their entirety fall; a reconciliation of the beginning and ending balances of Level 3 assets; and information about the valuation techniques and inputs used to measure the fair value of our pension and other postretirement assets.
Other postretirement benefit plan assets
The following table presents total assets for our other postretirement benefit plans (in millions):
December 31,
2012

 
2011

Cash and cash equivalents
$
13

 
$
86

Equity securities:
 
 
 
U.S.-based companies
81

 
70

International-based companies
4

 
13

Fixed-income securities:
 
 
 
Government bonds
78

 
2

Corporate bonds and debt securities
5

 
6

Mutual, pooled and commingled funds
16

 
3

Hedge funds/limited partnerships
3

 
2

Real estate
2

 
2

Other

 
1

Total other postretirement benefit plan assets1
$
202

 
$
185

1 
Fair value disclosures related to our other postretirement benefit plan assets are included in Note 16. Fair value disclosures include, but are not limited to, the levels within the fair value hierarchy on which the fair value measurements in their entirety fall; a reconciliation of the beginning and ending balances of Level 3 assets; and information about the valuation techniques and inputs used to measure the fair value of our pension and other postretirement assets.
Net periodic benefit cost for pension and other postretirement benefit plans
Net periodic benefit cost for our pension and other postretirement benefit plans consisted of the following (in millions):
 
Pension Benefits  
 
Other Benefits  
Year Ended December 31,
2012

 
2011

 
2010

 
2012

 
2011

 
2010

 
 
 
As Adjusted
 
 
 
 
 
 
Service cost
$
291

 
$
249

 
$
143

 
$
34

 
$
32

 
$
24

Interest cost
388

 
391

 
260

 
43

 
45

 
30

Expected return on plan assets
(573
)
 
(508
)
 
(285
)
 
(8
)
 
(8
)
 
(8
)
Amortization of prior service cost (credit)
(2
)
 
5

 
5

 
(52
)
 
(61
)
 
(61
)
Amortization of actuarial loss
137

 
82

 
83

 
6

 
2

 
3

Net periodic benefit cost (credit)
$
241

 
$
219

 
$
206

 
$
23

 
$
10

 
$
(12
)
Settlement charge
3

 
3

 
6

 

 

 

Curtailment charge
6

 

 

 

 

 

Special termination benefits1
1

 
8

 

 

 
3

 
1

Total cost (credit) recognized in the statements of income
$
251

 
$
230

 
$
212

 
$
23

 
$
13

 
$
(11
)
1 
The special termination benefits primarily relate to the Company's productivity, restructuring and integration initiatives. Refer to Note 18 for additional information related to our productivity, restructuring and integration initiatives.
Changes in AOCI for benefit plans
The following table sets forth the changes in AOCI for our benefit plans (in millions, pretax):
 
Pension Benefits  
 
Other Benefits  
December 31,
2012

 
2011

 
2012

 
2011

 
 
 
As Adjusted

 
 
 
 
Beginning balance in AOCI
$
(2,169
)
 
$
(1,101
)
 
$
(34
)
 
$
72

Recognized prior service cost (credit)
(2
)
 
5

 
(52
)
 
(61
)
Recognized net actuarial loss (gain)
140

 
85

 
6

 
2

Prior service credit (cost) arising in current year
3

 
57

 
2

 
12

Net actuarial (loss) gain arising in current year
(1,009
)
 
(1,208
)
 
(107
)
 
(57
)
Foreign currency translation gain (loss)
5

 
(7
)
 
(1
)
 
(2
)
Ending balance in AOCI
$
(3,032
)
 
$
(2,169
)
 
$
(186
)
 
$
(34
)
Amounts in AOCI for benefit plans (pretax)
The following table sets forth amounts in AOCI for our benefit plans (in millions, pretax):
 
Pension Benefits  
 
Other Benefits  
December 31,
2012

 
2011

 
2012

 
2011

 
 
 
As Adjusted

 
 
 
 
Prior service credit (cost)
$
16

 
$
14

 
$
23

 
$
73

Net actuarial loss
(3,048
)
 
(2,183
)
 
(209
)
 
(107
)
Ending balance in AOCI
$
(3,032
)
 
$
(2,169
)
 
$
(186
)
 
$
(34
)
Amounts in AOCI expected to be recognized as components of net periodic pension cost in next fiscal year

Amounts in AOCI expected to be recognized as components of net periodic pension cost in 2013 are as follows (in millions, pretax):
 
Pension Benefits
 
Other Benefits
Amortization of prior service cost (credit)
$
(3
)
 
$
(10
)
Amortization of actuarial loss
238

 
11

 
$
235

 
$
1

Certain weighted average assumptions used in computing the benefit obligations and net periodic benefit cost
Certain weighted-average assumptions used in computing the benefit obligations are as follows:
 
Pension Benefits  
 
Other Benefits  
December 31,
2012

 
2011

 
2012

 
2011

Discount rate
4.00
%
 
4.75
%
 
4.00
%
 
4.75
%
Rate of increase in compensation levels
3.50
%
 
3.25
%
 
N/A

 
N/A

Certain weighted-average assumptions used in computing net periodic benefit cost are as follows:
 
Pension Benefits  
 
Other Benefits  
December 31,
2012

 
2011

 
2010

 
2012

 
2011

 
2010

Discount rate
4.75
%
 
5.50
%
 
5.75
%
 
4.75
%
 
5.25
%
 
5.50
%
Rate of increase in compensation levels
3.25
%
 
4.00
%
 
3.75
%
 
N/A

 
N/A

 
N/A

Expected long-term rate of return on plan assets
8.25
%
 
8.25
%
 
8.00
%
 
4.75
%
 
4.75
%
 
4.75
%
Assumed health care cost trend rates
The assumed health care cost trend rates are as follows:
December 31,
2012

 
2011

Health care cost trend rate assumed for next year
8.00
%
 
8.00
%
Rate to which the cost trend rate is assumed to decline (the ultimate trend rate)
5.00
%
 
5.00
%
Year that the rate reaches the ultimate trend rate
2019

 
2018

Estimated future benefit payments for funded and unfunded plans
Our estimated future benefit payments for funded and unfunded plans are as follows (in millions):
Year Ended December 31,
2013

 
2014

 
2015

 
2016

 
2017

 
2018-2022

Pension benefit payments
$
452

 
$
473

 
$
493

 
$
510

 
$
542

 
$
2,929

Other benefit payments1
58

 
61

 
64

 
65

 
66

 
352

Total estimated benefit payments
$
510

 
$
534

 
$
557

 
$
575

 
$
608

 
$
3,281

1 
The expected benefit payments for our other postretirement benefit plans are net of estimated federal subsidies expected to be received under the Medicare Prescription Drug, Improvement and Modernization Act of 2003. Federal subsidies are estimated to be approximately $18 million for the period 2013–2017, and $22 million for the period 2018–2022.