RETIREMENT BENEFITS

9 Months Ended

Sep. 30, 2012

RETIREMENT BENEFITS

RETIREMENT BENEFITS

8.     RETIREMENT BENEFITS

Pension and Postretirement Plans

        The Company has several non-contributory defined benefit pension plans covering certain U.S. employees and has various defined benefit pension and termination indemnity plans covering employees outside the United States. The U.S. qualified defined benefit plan was frozen effective January 1, 2008, for most employees. Accordingly, no additional compensation-based contributions have been credited to the cash balance portion of the plan for existing plan participants after 2007. However, certain employees covered under the prior final pay plan formula continue to accrue benefits. The Company also offers postretirement health care and life insurance benefits to certain eligible U.S. retired employees, as well as to certain eligible employees outside the United States.

        The following tables summarize the components of net (benefit) expense recognized in the Consolidated Statement of Income for the Company's U.S. qualified and nonqualified pension plans, postretirement plans and plans outside the United States.

Net (Benefit) Expense

	Three Months Ended September 30,
	Pension plans												Postretirement benefit plans
	U.S. plans						Non-U.S. plans						U.S. plans						Non-U.S. plans
In millions of dollars	2012			2011			2012			2011			2012			2011			2012			2011
Qualified Plans
Benefits earned during the period	$	3		$	3		$	50		$	51		$	—		$	—		$	7		$	7
Interest cost on benefit obligation		141			153			93			97			11			13			29			30
Expected return on plan assets		(224	)		(222	)		(101	)		(108	)		(1	)		(1	)		(27	)		(31	)
Amortization of unrecognized
Net transition obligation		—			—			—			—			—			—			—			—
Prior service cost (benefit)		—			—			1			1			—			—			—			—
Net actuarial loss		24			16			19			18			1			—			6			6
Curtailment (gain) loss		—			—			4			29			—			—			—			—
Net qualified plans (benefit) expense	$	(56	)	$	(50	)	$	66		$	88		$	11		$	12		$	15		$	12
Net nonqualified plans expense	$	11		$	10		$	—		$	—		$	—		$	—		$	—		$	—
Total net (benefit) expense	$	(45	)	$	(40	)	$	66		$	88		$	11		$	12		$	15		$	12

	Nine Months Ended September 30,
	Pension plans												Postretirement benefit plans
	U.S. plans						Non-U.S. plans						U.S. plans						Non-U.S. plans
In millions of dollars	2012			2011			2012			2011			2012			2011			2012			2011
Qualified Plans
Benefits earned during the period	$	9		$	11		$	150		$	152		$	—		$	—		$	21		$	22
Interest cost on benefit obligation		423			463			277			292			33			42			87			91
Expected return on plan assets		(672	)		(666	)		(302	)		(324	)		(3	)		(5	)		(81	)		(92	)
Amortization of unrecognized
Net transition obligation		—			—			—			(1	)		—			—			—			—
Prior service cost (benefit)		—			—			3			3			(1	)		(2	)		—			—
Net actuarial loss		72			50			58			55			3			8			19			18
Curtailment (gain) loss		—			—			12			29			—			—			—			—
Net qualified plans (benefit) expense	$	(168	)	$	(142	)	$	198		$	206		$	32		$	43		$	46		$	39
Net nonqualified plans expense	$	31		$	30		$	—		$	—		$	—		$	—		$	—		$	—
Total net (benefit) expense	$	(137	)	$	(112	)	$	198		$	206		$	32		$	43		$	46		$	39

Contributions

        The Company's funding policy for U.S. and non-U.S. pension and postretirement plans is generally to fund to minimum funding requirements in accordance with applicable local laws and regulations. The Company may increase its contributions above the minimum required contribution, if appropriate.

        The following table summarizes the actual cash contributions (including benefits paid directly by the Company) and the expected contributions for the remainder of 2012 for the Company's U.S. qualified and nonqualified pension plans, postretirement plans and plans outside the United States.

	Pension plans						Postretirement plans
	U.S. Plans
					Non-U.S. plans		U.S. plans		Non-U.S. plans
In millions of dollars	Qualified		Non-qualified
Actual year-to-date cash contributions & benefits paid directly by the employer	$	—	$	35	$	213	$	41	$	4
Expected 2012 contributions for the remainder of the year	$	—	$	11	$	100	$	14	$	86

Postemployment Plans

        The Company sponsors U.S. postemployment plans that provide income continuation and health and welfare benefits to certain eligible U.S. employees on long-term disability.

        The following table summarizes the components of net expense recognized in the Consolidated Statement of Income for the Company's U.S. postemployment plans.

	Postemployment plans (U.S. only)
	Three Months Ended September 30,				Nine months Ended September 30,
In millions of dollars	2012		2011		2012		2011
Service cost	$	12	$	10	$	36	$	29
Interest cost		4		3		11		9
Expected return on assets		—		—		—		—
Prior service cost		2		2		6		6
Net actuarial loss		3		2		9		6
Net expense recognized	$	21	$	17	$	62	$	50