XML 51 R47.htm IDEA: XBRL DOCUMENT v2.4.0.6
Retirement-Related Benefits (Tables)
12 Months Ended
Dec. 31, 2011
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block  
Retirement-related benefits net periodic (income)/cost in the Consolidated Statement of Earnings

 

($ in millions)

 

 

 

U.S. Plans

 

Non-U.S. Plans

 

Total

 

For the year ended December 31:

 

2011

 

2010

 

2009

 

2011

 

2010

 

2009

 

2011

 

2010

 

2009

 

Defined benefit pension plans

 

$

(774

)

$

(949

)

$

(919

)

$

734

 

$

541

 

$

521

 

$

(40

)

$

(408

)

$

(398

)

Retention Plan

 

15

 

14

 

13

 

 

 

 

15

 

14

 

13

 

Total defined benefit pension plans (income)/cost

 

$

(759

)

$

(935

)

$

(906

)

$

734

 

$

541

 

$

521

 

$

(25

)

$

(394

)

$

(384

)

IBM 401(k) Plus Plan and Non-U.S. plans

 

$

875

 

$

882

 

$

946

 

$

608

 

$

527

 

$

478

 

$

1,483

 

$

1,409

 

$

1,424

 

Excess 401(k)

 

30

 

20

 

26

 

 

 

 

30

 

20

 

26

 

Total defined contribution plans cost

 

$

905

 

$

902

 

$

972

 

$

608

 

$

527

 

$

478

 

$

1,513

 

$

1,430

 

$

1,450

 

Nonpension postretirement benefit plans cost

 

$

269

 

$

281

 

$

292

 

$

76

 

$

66

 

$

58

 

$

345

 

$

347

 

$

350

 

Total retirement-related benefits net periodic cost

 

$

415

 

$

248

 

$

358

 

$

1,418

 

$

1,134

 

$

1,057

 

$

1,832

 

$

1,382

 

$

1,415

 

 

Summary of the total projected benefit obligation (PBO) for defined benefit plans, accumulated postretirement benefit obligation (APBO) for nonpension postretirement benefit plans (benefit obligations), fair value of plan assets and the associated funded status

 

($ in millions)

 

 

 

Benefit Obligations

 

Fair Value of Plan Assets

 

Funded Status*

 

At December 31:

 

2011

 

2010

 

2011

 

2010

 

2011

 

2010

 

U.S. Plans

 

 

 

 

 

 

 

 

 

 

 

 

 

Overfunded plans

 

 

 

 

 

 

 

 

 

 

 

 

 

Qualified PPP

 

$

 

$

49,663

 

$

 

$

50,259

 

$

 

$

596

 

Underfunded plans

 

 

 

 

 

 

 

 

 

 

 

 

 

Qualified PPP

 

52,318

 

 

51,218

 

 

(1,100

)

 

Excess PPP

 

1,462

 

1,360

 

 

 

(1,462

)

(1,360

)

Retention Plan

 

305

 

271

 

 

 

(305

)

(271

)

Nonpension postretirement benefit plan

 

5,273

 

5,123

 

38

 

35

 

(5,235

)

(5,088

)

Total underfunded U.S. plans

 

$

59,358

 

$

6,753

 

$

51,256

 

$

35

 

$

(8,102

)

$

(6,718

)

Non-U.S. Plans

 

 

 

 

 

 

 

 

 

 

 

 

 

Overfunded plans

 

 

 

 

 

 

 

 

 

 

 

 

 

Qualified defined benefit pension plans

 

$

13,169

 

$

22,625

 

$

16,011

 

$

25,096

 

$

2,843

 

$

2,471

 

Nonpension postretirement benefit plans

 

7

 

8

 

7

 

9

 

0

 

1

 

Total overfunded non-U.S. plans

 

$

13,175

 

$

22,633

 

$

16,018

 

$

25,105

 

$

2,843

 

$

2,472

 

Underfunded plans

 

 

 

 

 

 

 

 

 

 

 

 

 

Qualified defined benefit pension plans

 

$

24,659

 

$

14,507

 

$

19,351

 

$

10,626

 

$

(5,308

)

$

(3,881

)

Nonqualified defined benefit pension plans

 

5,033

 

5,452

 

 

 

(5,033

)

(5,452

)

Nonpension postretirement benefit plans

 

894

 

864

 

105

 

111

 

(789

)

(753

)

Total underfunded non-U.S. plans

 

$

30,587

 

$

20,823

 

$

19,456

 

$

10,737

 

$

(11,131

)

$

(10,086

)

Total overfunded plans

 

$

13,175

 

$

72,296

 

$

16,018

 

$

75,364

 

$

2,843

 

$

3,068

 

Total underfunded plans

 

$

89,944

 

$

27,576

 

$

70,712

 

$

10,772

 

$

(19,232

)

$

(16,804

)

 

*          Funded status is recognized in the Consolidated Statement of Financial Position as follows: Asset amounts as prepaid pension assets; (Liability) amounts as compensation and benefits (current liability) and retirement and nonpension postretirement benefit obligations (noncurrent liability).

 

Changes in benefit obligations and plan assets

 

($ in millions)

 

 

 

Defined Benefit Pension Plans

 

Nonpension Postretirement Benefit Plans

 

 

 

U.S. Plans

 

Non-U.S. Plans

 

U.S. Plan

 

Non-U.S. Plans

 

 

 

2011

 

2010

 

2011

 

2010 *

 

2011

 

2010

 

2011

 

2010

 

Change in benefit obligation

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Benefit obligation at January 1

 

$

51,293

 

$

48,354

 

$

42,584

 

$

41,308

 

$

5,123

 

$

5,100

 

$

872

 

$

767

 

Service cost

 

 

 

505

 

508

 

33

 

33

 

11

 

9

 

Interest cost

 

2,456

 

2,601

 

1,843

 

1,841

 

236

 

262

 

67

 

59

 

Plan participants’ contributions

 

 

 

53

 

57

 

228

 

235

 

 

 

Acquisitions/divestitures, net

 

(0

)

 

(48

)

(75

)

(0

)

 

(1

)

1

 

Actuarial losses/(gains)

 

3,551

 

3,573

 

812

 

1,656

 

244

 

123

 

47

 

32

 

Benefits paid from trust

 

(3,121

)

(3,145

)

(1,995

)

(1,957

)

(623

)

(641

)

(7

)

(7

)

Direct benefit payments

 

(95

)

(92

)

(462

)

(457

)

(32

)

(5

)

(27

)

(25

)

Foreign exchange impact

 

 

 

(423

)

(225

)

 

 

(60

)

37

 

Medicare/Government subsidies

 

 

 

 

 

65

 

16

 

 

 

Amendments/curtailments/settlements/other

 

 

1

 

(8

)

(73

)

 

 

 

0

 

Benefit obligation at December 31

 

$

54,085

 

$

51,293

 

$

42,861

 

$

42,584

 

$

5,273

 

$

5,123

 

$

901

 

$

872

 

Change in plan assets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fair value of plan assets at January 1

 

$

50,259

 

$

47,269

 

$

35,722

 

$

34,305

 

$

35

 

$

33

 

$

120

 

$

104

 

Actual return on plan assets

 

4,080

 

6,135

 

1,052

 

2,983

 

0

 

0

 

13

 

17

 

Employer contributions

 

 

 

728

 

801

 

397

 

408

 

0

 

0

 

Acquisitions/divestitures, net

 

 

 

(27

)

(10

)

 

(0

)

(0

)

(0

)

Plan participants’ contributions

 

 

 

53

 

57

 

228

 

235

 

 

 

Benefits paid from trust

 

(3,121

)

(3,145

)

(1,995

)

(1,957

)

(623

)

(641

)

(7

)

(7

)

Foreign exchange impact

 

 

 

(537

)

(396

)

 

 

(15

)

6

 

Amendments/curtailments/settlements/other

 

 

 

367

**

(61

)

 

 

 

 

Fair value of plan assets at December 31

 

$

51,218

 

$

50,259

 

$

35,362

 

$

35,722

 

$

38

 

$

35

 

$

112

 

$

120

 

Funded status at December 31

 

$

(2,866

)

$

(1,034

)

$

(7,499

)

$

(6,861

)

$

(5,235

)

$

(5,088

)

$

(789

)

$

(752

)

Accumulated benefit obligation+

 

$

54,085

 

$

51,293

 

$

42,063

 

$

41,630

 

N/A

 

N/A

 

N/A

 

N/A

 

 

*                 Excludes a defined benefit pension plan in Brazil due to restrictions on the use of plan assets imposed by governmental regulations.

 

**          Includes the reinstatement of certain plan assets in Brazil due to a 2011 government ruling allowing certain previously restricted plan assets to be returned to IBM. Beginning June 2011, the assets will be returned to IBM monthly over a three year period, with approximately $200 million expected to be returned during 2012. The remaining surplus in Brazil at December 31, 2011 remains excluded from total plan assets due to continued restrictions imposed by the government on the use of those plan assets.

 

+ Represents the benefit obligation assuming no future participant compensation increases.

 

N/A—Not applicable

 

Net funded status

 

($ in millions)

 

 

 

Defined Benefit Pension Plans

 

Nonpension Postretirement Benefit Plans

 

 

 

U.S. Plans

 

Non-U.S. Plans

 

U.S. Plan

 

Non-U.S. Plans

 

 

 

2011

 

2010

 

2011

 

2010

 

2011

 

2010

 

2011

 

2010

 

Prepaid pension assets

 

$

0

 

$

596

 

$

2,843

 

$

2,471

 

$

0

 

$

0

 

$

0

 

$

1

 

Current liabilities—compensation and benefits

 

(96

)

(94

)

(304

)

(289

)

(437

)

(421

)

(22

)

(22

)

Noncurrent liabilities—retirement and nonpension postretirement benefit obligations

 

(2,770

)

(1,536

)

(10,038

)

(9,044

)

(4,798

)

(4,667

)

(768

)

(731

)

Funded status—net

 

$

(2,866

)

$

(1,034

)

$

(7,499

)

$

(6,861

)

$

(5,235

)

$

(5,088

)

$

(789

)

$

(752

)

 

Pre-tax net loss and prior service costs/(credits) and transition (assets)/liabilities recognized in other comprehensive income/(loss) and the changes in pre-tax net loss, prior service costs/(credits) and transition (assets)/liabilities recognized in accumulated other comprehensive income/(loss)

 

($ in millions)

 

 

 

Defined Benefit Pension Plans

 

Nonpension Postretirement Benefit Plans

 

 

 

U.S. Plans

 

Non-U.S. Plans

 

U.S. Plan

 

Non-U.S. Plans

 

 

 

2011

 

2010

 

2011

 

2010

 

2011

 

2010

 

2011

 

2010

 

Net loss at January 1

 

$

15,865

 

$

14,880

 

$

17,580

 

$

17,172

 

$

492

 

$

397

 

$

180

 

$

167

 

Current period loss/(gain)

 

3,514

 

1,456

 

1,696

 

1,130

 

241

 

96

 

45

 

24

 

Curtailments and settlements

 

 

 

(11

)

(10

)

 

 

 

 

Amortization of net loss included in net periodic (income)/cost

 

(818

)

(471

)

(957

)

(712

)

 

 

(13

)

(12

)

Net loss at December 31

 

$

18,561

 

$

15,865

 

$

18,309

 

$

17,580

 

$

734

 

$

492

 

$

211

 

$

180

 

Prior service costs/(credits) at January 1

 

$

149

 

$

159

 

$

(958

)

$

(1,104

)

$

 

$

(14

)

$

(14

)

$

(19

)

Current period prior service costs/(credits)

 

 

 

28

 

(28

)

 

 

(0

)

(0

)

Curtailments and settlements

 

 

 

 

 

 

 

 

 

Amortization of prior service (costs)/credits included in net periodic (income)/cost

 

(10

)

(10

)

162

 

174

 

 

14

 

4

 

5

 

Prior service costs/(credits) at December 31

 

$

139

 

$

149

 

$

(768

)

$

(958

)

$

 

$

 

$

(10

)

$

(14

)

Transition (assets)/liabilities at January 1

 

$

 

$

 

$

(0

)

$

(1

)

$

 

$

 

$

1

 

$

1

 

Amortization of transition assets/(liabilities) included in net periodic (income)/cost

 

 

 

0

 

0

 

 

 

(0

)

(0

)

Transition (assets)/liabilities at December 31

 

$

 

$

 

$

(0

)

$

(0

)

$

 

$

 

$

0

 

$

1

 

Total loss recognized in accumulated other comprehensive income/(loss)*

 

$

18,701

 

$

16,014

 

$

17,541

 

$

16,621

 

$

734

 

$

492

 

$

202

 

$

167

 

 

*                 See note L, “Equity Activity,” on pages 110 to 112 for the total change in the accumulated other comprehensive income/(loss) and the Consolidated Statement of Comprehensive Income for the components of net periodic (income)/cost, including the related tax effects, recognized in other comprehensive income/(loss) for the retirement-related benefit plans.

 

Pre-tax estimated net loss, estimated prior service costs/(credits) and estimated transition (assets)/liabilities of the retirement-related benefit plans that will be amortized from accumulated other comprehensive income/(loss) into net periodic (income)/cost and recorded in the Consolidated Statement of Earnings in 2012

 

($ in millions)

 

 

 

Defined Benefit

 

Nonpension Postretirement

 

 

 

Pension Plans

 

Benefit Plans

 

 

 

U.S. Plans

 

Non-U.S. Plans

 

U.S. Plan

 

Non-U.S. Plans

 

Net loss

 

$

1,343

 

$

1,047

 

$

24

 

$

16

 

Prior service costs/(credits)

 

9

 

(157

)

 

(4

)

Transition (assets)/liabilities

 

 

(0

)

 

0

 

 

Defined benefit pension plans' major asset categories and their associated fair value

 

The following table presents the company’s defined benefit pension plans’ asset classes and their associated fair value at December 31, 2011. The U.S. Plan consists of the Qualified PPP and the Non-U.S. Plans consist of all plans sponsored by the company’s subsidiaries.

 

($ in millions)

 

 

 

U.S. Plan

 

Non-U.S. Plans

 

 

 

Level 1

 

Level 2

 

Level 3

 

Total

 

Level 1

 

Level 2

 

Level 3

 

Total

 

Equity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity securities(a)

 

$

13,618

 

$

11

 

$

 

$

13,629

 

$

6,426

 

$

 

$

 

$

6,427

 

Equity commingled/mutual funds(b)(c)

 

32

 

1,877

 

 

1,909

 

240

 

7,751

 

 

7,991

 

Fixed income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Government and related(d)

 

 

15,105

 

29

 

15,134

 

 

8,479

 

96

 

8,575

 

Corporate bonds (e)

 

 

7,387

 

12

 

7,398

 

 

1,409

 

39

 

1,447

 

Mortgage and asset-backed securities

 

 

838

 

45

 

883

 

 

36

 

 

36

 

Fixed income commingled/mutual funds(b)(f)

 

262

 

715

 

246

 

1,223

 

72

 

7,136

 

 

7,209

 

Insurance contracts

 

 

 

 

 

 

988

 

 

988

 

Cash and short-term investments(g)

 

286

 

2,390

 

 

2,675

 

145

 

361

 

 

506

 

Hedge funds

 

 

1,140

 

713

 

1,853

 

 

417

 

 

417

 

Private equity(h)

 

0

 

 

4,098

 

4,098

 

 

 

262

 

262

 

Private real estate(h)

 

 

 

2,790

 

2,790

 

 

 

580

 

580

 

Derivatives(i)

 

10

 

(15

)

 

(6

)

(2

)

866

 

 

864

 

Other commingled/mutual funds(b)(j)

 

 

 

 

 

9

 

114

 

 

123

 

Subtotal

 

14,207

 

29,446

 

7,932

 

51,586

 

6,890

 

27,557

 

977

 

35,425

 

Other(k)

 

 

 

 

(368

)

 

 

 

(62

)

Fair value of plan assets

 

$

14,207

 

$

29,446

 

$

7,932

 

$

51,218

 

$

6,890

 

$

27,557

 

$

977

 

$

35,362

 

 

(a)  Represents U.S. and international securities. The U.S. Plan includes IBM common stock of $132 million, representing 0.3 percent of the U.S. Plan assets. Non-U.S. Plans include IBM common stock of $35 million, representing 0.1 percent of the non-U.S. Plans assets.

(b)  Commingled funds represent pooled institutional investments.

(c)  Invests in predominantly equity securities.

(d)  Includes debt issued by national, state and local governments and agencies.

(e)  The U.S. Plan includes IBM corporate bonds of $13 million, representing 0.03 percent of the U.S. Plan assets.

(f)  Invests in predominantly fixed income securities.

(g)  Includes cash and cash equivalents and short-term marketable securities.

(h)  Includes limited partnerships and venture capital partnerships.

(i)   Primarily includes interest rate derivatives and, to a lesser extent, forwards, exchange traded and other over-the-counter derivatives.

(j)   Invests in both equity and fixed income securities.

(k)  Represents net unsettled transactions, relating primarily to purchases and sales of plan assets.

 

 

The following table presents the company’s defined benefit pension plans’ asset classes and their associated fair value at December 31, 2010. The U.S. Plan consists of the Qualified PPP and the Non-U.S. Plans consist of all plans sponsored by the company’s subsidiaries.

 

($ in millions)

 

 

 

U.S. Plan

 

Non-U.S. Plans

 

 

 

Level 1

 

Level 2

 

Level 3

 

Total

 

Level 1

 

Level 2

 

Level 3

 

Total

 

Equity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity securities(a)

 

$

16,407

 

$

54

 

$

 

$

16,460

 

$

7,903

 

$

 

$

 

$

7,903

 

Equity commingled/mutual funds(b)(c)

 

27

 

1,829

 

 

1,856

 

276

 

9,252

 

 

9,527

 

Fixed income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Government and related(d)

 

 

12,743

 

 

12,743

 

 

7,574

 

 

7,574

 

Corporate bonds

 

 

6,721

 

 

6,721

 

 

1,252

 

11

 

1,263

 

Mortgage and asset-backed securities

 

 

1,147

 

56

 

1,202

 

 

45

 

 

45

 

Fixed income commingled/mutual funds (b)(e)

 

252

 

662

 

221

 

1,136

 

75

 

6,993

 

 

7,068

 

Insurance contracts

 

 

 

 

 

 

1,095

 

 

1,095

 

Cash and short-term investments(f)

 

244

 

2,000

 

 

2,244

 

147

 

254

 

 

401

 

Hedge funds

 

 

953

 

624

 

1,577

 

 

 

 

 

Private equity(g)

 

 

 

4,251

 

4,251

 

 

 

176

 

176

 

Private real estate(g)

 

 

 

2,634

 

2,634

 

 

 

533

 

533

 

Derivatives(h)

 

31

 

9

 

 

40

 

11

 

131

 

 

142

 

Other commingled/mutual funds(b)(i)

 

 

 

 

 

 

28

 

 

28

 

Subtotal

 

16,960

 

26,117

 

7,786

 

50,863

 

8,411

 

26,623

 

720

 

35,755

 

Other(j)

 

 

 

 

(603

)

 

 

 

(33

)

Fair value of plan assets

 

$

16,960

 

$

26,117

 

$

7,786

 

$

50,259

 

$

8,411

 

$

26,623

 

$

720

 

$

35,722

 

 

(a)  Represents U.S. and international securities. The U.S. Plan includes IBM common stock of $122 million, representing 0.2 percent of the U.S. Plan assets. Non-U.S. Plans include IBM common stock of $32 million, representing 0.1 percent of the non-U.S. Plans assets.

(b)  Commingled funds represent pooled institutional investments.

(c)  Invests in predominantly equity securities.

(d)  Includes debt issued by national, state and local governments and agencies.

(e)  Invests in predominantly fixed income securities.

(f)  Includes cash and cash equivalents and short-term marketable securities.

(g)  Includes limited partnerships and venture capital partnerships.

(h)  Primarily includes interest rate derivatives and, to a lesser extent, forwards, exchange traded and other over-the-counter derivatives.

(i)   Invests in both equity and fixed income securities.

(j)   Represents net unsettled transactions, relating primarily to purchases and sales of plan assets.

 

Defined benefit pension plans with accumulated benefit obligations (ABO) in excess of plan assets

 

($ in millions)

 

 

 

2011

 

2010

 

 

 

Benefit

 

Plan

 

Benefit

 

Plan

 

At December 31:

 

Obligation

 

Assets

 

Obligation

 

Assets

 

Plans with PBO in excess of plan assets

 

$

83,777

 

$

70,570

 

$

21,589

 

$

10,627

 

Plans with ABO in excess of plan assets

 

83,184

 

70,512

 

21,166

 

10,576

 

Plans with assets in excess of PBO

 

13,169

 

16,011

 

72,288

 

75,355

 

 

U.S. Plan(s)
 
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block  
Reconciliation of the beginning and ending balances of Level 3 assets

 

($ in millions)

 

 

 

 

 

 

 

Mortgage

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

and Asset-

 

Fixed Income

 

 

 

 

 

 

 

 

 

 

 

Government

 

Corporate

 

Backed

 

Commingled/

 

Hedge

 

Private

 

Private

 

 

 

 

 

and Related

 

Bonds

 

Securities

 

Mutual Funds

 

Funds

 

Equity

 

Real Estate

 

Total

 

Balance at January 1, 2011

 

$

 

$

 

$

56

 

$

221

 

$

624

 

$

4,251

 

$

2,634

 

$

7,786

 

Return on assets held at end of year

 

(0

)

0

 

(1

)

25

 

(35

)

348

 

131

 

468

 

Return on assets sold during the year

 

0

 

(0

)

(0

)

 

5

 

(30

)

39

 

14

 

Purchases, sales and settlements, net

 

12

 

5

 

(16

)

 

(7

)

(471

)

(14

)

(492

)

Transfers, net

 

17

 

7

 

6

 

 

127

*

 

 

157

 

Balance at December 31, 2011

 

$

29

 

$

12

 

$

45

 

$

246

 

$

713

 

$

4,098

 

$

2,790

 

$

7,932

 

 

* Due to an increase in the redemption term during 2011, the asset was transferred from Level 2 to Level 3.

 

($ in millions)

 

 

 

 

 

Mortgage

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity

 

and Asset-

 

Fixed Income

 

 

 

 

 

 

 

 

 

 

 

Commingled/

 

Backed

 

Commingled/

 

Hedge

 

Private

 

Private

 

 

 

 

 

Mutual Funds

 

Securities

 

Mutual Funds

 

Funds

 

Equity

 

Real Estate

 

Total

 

Balance at January 1, 2010

 

$

26

 

$

37

 

$

192

 

$

587

 

$

3,877

 

$

2,247

 

$

6,964

 

Return on assets held at end of year

 

24

 

3

 

30

 

45

 

829

 

123

 

1,054

 

Return on assets sold during the year

 

(0

)

0

 

 

3

 

(153

)

16

 

(133

)

Purchases, sales and settlements, net

 

139

 

11

 

 

(11

)

(302

)

248

 

85

 

Transfers, net

 

(188

)*

4

 

 

 

 

 

(184

)

Balance at December 31, 2010

 

$

 

$

56

 

$

221

 

$

624

 

$

4,251

 

$

2,634

 

$

7,786

 

 

*            During the year ended December 31, 2010, the fund hired an independent administrator responsible for valuing the fund. As a result of this action the asset was transferred from Level 3 to Level 2.

 

Non-U.S. Plans
 
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block  
Reconciliation of the beginning and ending balances of Level 3 assets

 

($ in millions)

 

 

 

Government

 

Corporate

 

Private

 

Private

 

 

 

 

 

and Related

 

Bonds

 

Equity

 

Real Estate

 

Total

 

Balance at January 1, 2011

 

$

 

$

11

 

$

176

 

$

533

 

$

720

 

Return on assets held at end of year

 

3

 

2

 

30

 

11

 

46

 

Return on assets sold during the year

 

(0

)

(0

)

(2

)

(3

)

(5

)

Purchases, sales and settlements, net

 

100

 

28

 

65

 

44

 

237

 

Transfers, net

 

 

 

(0

)

0

 

0

 

Foreign exchange impact

 

(7

)

(2

)

(7

)

(6

)

(22

)

Balance at December 31, 2011

 

$

96

 

$

39

 

$

262

 

$

580

 

$

977

 

 

($ in millions)

 

 

 

Corporate

 

Private

 

Private

 

 

 

 

 

Bonds

 

Equity

 

Real Estate

 

Total

 

Balance at January 1, 2010

 

$

 

$

93

 

$

492

 

$

585

 

Return on assets held at end of year

 

(0

)

14

 

41

 

55

 

Return on assets sold during the year

 

 

3

 

(3

)

0

 

Purchases, sales and settlements, net

 

4

 

69

 

9

 

82

 

Transfers, net

 

7

 

(0

)

 

7

 

Foreign exchange impact

 

0

 

(3

)

(6

)

(8

)

Balance at December 31, 2010

 

$

11

 

$

176

 

$

533

 

$

720

 

 

Defined Benefit Pension Plans
 
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block  
Cost/Income of Benefit Plans

 

($ in millions)

 

 

 

Defined Benefit Pension Plans

 

 

 

U.S. Plans

 

Non-U.S. Plans

 

For the year ended December 31:

 

2011

 

2010

 

2009

 

2011

 

2010

 

2009

 

Service cost

 

$

 

$

 

$

 

$

505

 

$

508

 

$

585

 

Interest cost

 

2,456

 

2,601

 

2,682

 

1,843

 

1,841

 

1,898

 

Expected return on plan assets

 

(4,043

)

(4,017

)

(4,009

)

(2,521

)

(2,461

)

(2,534

)

Amortization of transition assets

 

 

 

 

(0

)

(0

)

(0

)

Amortization of prior service costs/(credits)

 

10

 

10

 

10

 

(162

)

(174

)

(126

)

Recognized actuarial losses

 

818

 

471

 

411

 

957

 

712

 

624

 

Curtailments and settlements

 

 

1

 

 

1

 

27

 

(126

)

Multi-employer plans/other costs

 

 

 

 

111

 

89

 

200

 

Total net periodic (income)/cost

 

$

(759

)

$

(935

)

$

(906

)

$

734

 

$

541

 

$

521

 

 

Assumptions used to measure the net periodic (income)/cost and benefit obligations

 

 

 

Defined Benefit Pension Plans

 

 

 

U.S. Plans

 

Non-U.S. Plans

 

 

 

2011

 

2010

 

2009

 

2011

 

2010

 

2009

 

Weighted-average assumptions used to measure net periodic (income)/cost for the year ended December 31:

 

 

 

 

 

 

 

 

 

 

 

 

 

Discount rate

 

5.00

%

5.60

%

5.75

%

4.33

%

4.84

%

4.89

%

Expected long-term returns on plan assets

 

8.00

%

8.00

%

8.00

%

6.41

%

6.56

%

6.73

%

Rate of compensation increase*

 

N/A

 

N/A

 

N/A

 

2.37

%

2.92

%

3.09

%

Weighted-average assumptions used to measure benefit obligations at December 31:

 

 

 

 

 

 

 

 

 

 

 

 

 

Discount rate

 

4.20

%

5.00

%

5.60

%

4.28

%

4.33

%

4.84

%

Rate of compensation increase*

 

N/A

 

N/A

 

N/A

 

2.43

%

2.37

%

2.92

%

 

* Rate of compensation increase is not applicable to the U.S. defined benefit pension plans as benefit accruals ceased December 31, 2007 for all participants.

N/A—Not applicable

 

Total expected benefit payments

 

($ in millions)

 

 

 

 

 

 

 

 

 

 

 

Total

 

 

 

Qualified

 

Nonqualified

 

Qualified

 

Nonqualified

 

Expected

 

 

 

U.S. Plan

 

U.S. Plans

 

Non-U.S. Plans

 

Non-U.S. Plans

 

Benefit

 

 

 

Payments

 

Payments

 

Payments

 

Payments

 

Payments

 

2012

 

$

3,273

 

$

98

 

$

2,015

 

$

348

 

$

5,735

 

2013

 

3,313

 

102

 

1,996

 

354

 

5,765

 

2014

 

3,353

 

105

 

2,000

 

358

 

5,816

 

2015

 

3,420

 

108

 

2,024

 

368

 

5,920

 

2016

 

3,401

 

110

 

2,068

 

377

 

5,957

 

2017–2021

 

17,261

 

579

 

10,767

 

2,110

 

30,718

 

 

Nonpension Postretirement Plans
 
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block  
Cost/Income of Benefit Plans

 

($ in millions)

 

 

 

Nonpension Postretirement Benefit Plans

 

 

 

U.S. Plan

 

Non-U.S. Plans

 

For the year ended December 31:

 

2011

 

2010

 

2009

 

2011

 

2010

 

2009

 

Service cost

 

$

33

 

$

33

 

$

41

 

$

11

 

$

9

 

$

10

 

Interest cost

 

236

 

262

 

289

 

67

 

59

 

51

 

Expected return on plan assets

 

 

 

 

(10

)

(9

)

(8

)

Amortization of transition assets

 

 

 

 

0

 

0

 

0

 

Amortization of prior service costs/(credits)

 

 

(14

)

(39

)

(4

)

(5

)

(6

)

Recognized actuarial losses

 

 

 

 

13

 

12

 

11

 

Total net periodic cost

 

$

269

 

$

281

 

$

292

 

$

76

 

$

66

 

$

58

 

 

Assumptions used to measure the net periodic (income)/cost and benefit obligations

 

 

 

Nonpension Postretirement Benefit Plans

 

 

 

U.S. Plan

 

Non-U.S. Plans

 

 

 

2011

 

2010

 

2009

 

2011

 

2010

 

2009

 

Weighted-average assumptions used to measure net periodic cost for the year ended December 31:

 

 

 

 

 

 

 

 

 

 

 

 

 

Discount rate

 

4.80

%

5.40

%

5.75

%

7.75

%

7.92

%

7.36

%

Expected long-term returns

 

 

 

 

 

 

 

 

 

 

 

 

 

on plan assets

 

N/A

 

N/A

 

N/A

 

9.07

%

9.16

%

9.19

%

Weighted-average assumptions used to measure benefit obligations at December 31:

 

 

 

 

 

 

 

 

 

 

 

 

 

Discount rate

 

3.90

%

4.80

%

5.40

%

7.37

%

7.75

%

7.92

%

 

N/A—Not applicable

 

Total expected benefit payments

 

($ in millions)

 

 

 

 

 

Less: IBM

 

 

 

 

 

 

 

 

 

 

 

 

 

Share of

 

 

 

 

 

 

 

Total

 

 

 

 

 

Expected

 

Net Expected

 

Qualified

 

Nonqualified

 

Expected

 

 

 

U.S. Plan

 

Medicare

 

U.S. Plan

 

Non-U.S. Plans

 

Non-U.S. Plans

 

Benefit

 

 

 

Payments

 

Subsidy

 

Payments

 

Payments

 

Payments

 

Payments

 

2012

 

$

492

 

$

(26

)

$

466

 

$

7

 

$

32

 

$

505

 

2013

 

509

 

(26

)

483

 

8

 

36

 

527

 

2014

 

448

 

(25

)

423

 

9

 

39

 

471

 

2015

 

432

 

(23

)

409

 

10

 

42

 

461

 

2016

 

425

 

 

425

 

10

 

45

 

480

 

2017–2021

 

2,003

 

 

2,003

 

63

 

282

 

2,348