Note 5: Retirement and Post-Retirement Benefit Plans

The components of HP's pension and post-retirement benefit (credit) cost recognized in the Consolidated Condensed Statements of Earnings were as follows:

	Three months ended April 30
	U.S. Defined Benefit Plans						Non-U.S. Defined Benefit Plans						Post- Retirement Benefit Plans
	2016			2015			2016			2015			2016			2015
	In millions
Service cost	$	—		$	—		$	12		$	63		$	—		$	1
Interest cost		136			139			6			89			5			7
Expected return on plan assets		(183	)		(217	)		(12	)		(189	)		(8	)		(9	)
Amortization and deferrals:
Actuarial loss (gain)		14			12			6			70			(3	)		(3	)
Prior service benefit		—			—			(1	)		(5	)		(4	)		(5	)

Net periodic benefit (credit) cost		(33	)		(66	)		11			28			(10	)		(9	)
Settlement loss		1			—			1			2			—			—
Special termination benefits		—			—			—			7			9			—
Plan (credit) expense allocation(1)		—			—			—			(7	)		—			8

Total periodic benefit (credit) cost from continuing operations		(32	)		(66	)		12			30			(1	)		(1	)

Summary of total periodic benefit (credit) cost:
Continuing operations		(32	)		(66	)		12			30			(1	)		(1	)
Discontinued operations		—			5			—			26			—			(8	)

Total periodic benefit (credit) cost	$	(32	)	$	(61	)	$	12		$	56		$	(1	)	$	(9	)

	Six months ended April 30
	U.S. Defined Benefit Plans						Non-U.S. Defined Benefit Plans						Post- Retirement Benefit Plans
	2016			2015			2016			2015			2016			2015
	In millions
Service cost	$	—		$	—		$	23		$	131		$	—		$	2
Interest cost		272			278			12			188			10			14
Expected return on plan assets		(366	)		(434	)		(24	)		(395	)		(16	)		(18	)
Amortization and deferrals:
Actuarial loss (gain)		28			25			12			147			(6	)		(6	)
Prior service benefit		—			—			(2	)		(10	)		(8	)		(10	)

Net periodic benefit (credit) cost		(66	)		(131	)		21			61			(20	)		(18	)
Settlement loss		1			—			1			2			—			—
Special termination benefits		—			—			—			8			9			—
Plan (credit) expense allocation(1)		—			—			—			(11	)		—			16

Total periodic benefit (credit) cost from continuing operations		(65	)		(131	)		22			60			(11	)		(2	)

Summary of total periodic benefit (credit) cost:
Continuing operations		(65	)		(131	)		22			60			(11	)		(2	)
Discontinued operations		—			10			—			53			—			(16	)

Total periodic benefit (credit) cost	$	(65	)	$	(121	)	$	22		$	113		$	(11	)	$	(18	)


(1)	Plan (credit) expense allocation relates to the employees of HP covered under Hewlett Packard Enterprise plans or employees of Hewlett Packard Enterprise covered under HP plans.

Employer Contributions and Funding Policy

HP's policy is to fund its pension plans so that it makes at least the minimum contribution required by local government, funding and taxing authorities.

During the three months ended April 30, 2016, HP lowered its initial estimates related to expected contributions in fiscal 2016 by $11 million due primarily to changes in the funding structure of its post-retirement benefit plans. HP now expects its fiscal 2016 contributions to be approximately $18 million to its non-U.S. pension plans, approximately $33 million to cover benefit payments to U.S. non-qualified plan participants and approximately $35 million to cover benefit claims for HP's post-retirement benefit plans.

During the six months ended April 30, 2016, HP contributed $10 million to its non-U.S. pension plans, paid $17 million to cover benefit payments to U.S. non-qualified plan participants, and paid $18 million to cover benefit claims under HP's post-retirement benefit plans. During the remainder of fiscal 2016, HP anticipates making additional contributions of approximately $8 million to its non-U.S. pension plans and approximately $16 million to its U.S. non-qualified plan participants and expects to pay approximately $17 million to cover benefit claims under HP's post-retirement benefit plans.

HP's pension and other post-retirement benefit costs and obligations depend on various assumptions. Differences between expected and actual returns on investments and changes in discount rates and other actuarial assumptions are reflected as unrecognized gains or losses, and such gains or losses are amortized to earnings in future periods. A deterioration in the funded status of a plan could result in a need for additional company contributions or an increase in net pension and post-retirement benefit costs in future periods. Actuarial gains or losses are determined at the measurement date and amortized over the remaining service life for active plans or the life expectancy of plan participants for frozen plans.