Employee Benefit Obligations (Tables)

12 Months Ended

Dec. 31, 2017

Schedule of employee benefit obligations


	December 31,
($ in millions)	2017		2016

Underfunded defined benefit pension liabilities	$	945	$	963
Less: Current portion		(27)		(25)
Long-term defined benefit pension liabilities		918		938
Long-term retiree medical liabilities		196		208
Deferred compensation plans		275		272
Other		74		79
	$	1,463	$	1,497

Components of net periodic benefit cost


	Years Ended December 31,
	2017							2016						2015
($ in millions)	U.S.			Foreign		Total		U.S.		Foreign		Total		U.S.		Foreign		Total

Ball-sponsored plans:
Service cost	$	49		$	17	$	66	$	58	$	14	$	72	$	52	$	15	$	67
Interest cost		124			92		216		96		58		154		57		18		75
Expected return on plan assets		(126)			(110)		(236)		(106)		(70)		(176)		(79)		(20)		(99)
Amortization of prior service cost		2			—		2		(1)		—		(1)		(1)		—		(1)
Recognized net actuarial loss		34			5		39		32		6		38		39		9		48
Curtailment and settlement losses including special termination benefits		47	(a)		(1)		46		—		80		80		5		—		5
Net periodic benefit cost for Ball sponsored plans		130			3		133		79		88		167		73		22		95

Net periodic benefit cost for multi-employer plans		2			—		2		2		—		2		1		—		1
Total net periodic benefit cost	$	132		$	3	$	135	$	81	$	88	$	169	$	74	$	22	$	96

In 2017, the company recorded a $47 million loss of which $44 million is related to the purchase of non-participating group annuity contracts, as well as lump sum settlements for certain U.S. plans; see below for further discussion. The company recorded an additional $3 million for plant shut-down benefits in 2017. Included in 2016 is a curtailment charge of $80 million related to the sale of the Divestment Business. The expense in both years is included in business consolidation and other activities.

Schedule of amounts recognized in accumulated other comprehensive (earnings) loss, including other post employment benefits


	December 31,
	2017						2016
($ in millions)	U.S.		Foreign		Total		U.S.		Foreign		Total

Net actuarial (loss) gain	$	(611)	$	36	$	(575)	$	(585)	$	(272)	$	(857)
Net prior service (cost) credit		(1)		—		(1)		(11)		—		(11)
Tax effect and currency exchange rates		224		(10)		214		232		46		278
	$	(388)	$	26	$	(362)	$	(364)	$	(226)	$	(590)

Defined Benefit Pension Plans

Employee Benefit Obligations

Schedule of amounts recognized in the consolidated balance sheets


	December 31,
	2017						2016
($ in millions)	U.S.		Foreign		Total		U.S.		Foreign		Total

Long-term pension asset	$	—	$	504	$	504	$	—	$	147	$	147
Defined benefit pension liabilities (a)		(641)		(304)		(945)		(679)		(284)		(963)
	$	(641)	$	200	$	(441)	$	(679)	$	(137)	$	(816)

(a)

Included is an unfunded, non-qualified U.S. plan obligation of $34 million at December 31, 2017, that has been annuitized with a corresponding asset of $34 million ($3 million in other current assets and $31 million in other assets). At December 31, 2016, the unfunded non-qualified U.S. plan obligation of $33 million was annuitized with a corresponding asset of $33 million recorded in other assets.

Summary of information for plans with an accumulated benefit obligation in excess of plan assets


	December 31,
	2017						2016
($ in millions)	U.S.		Foreign		Total		U.S.		Foreign		Total

Projected benefit obligation	$	3,061	$	389	$	3,450	$	3,186	$	326	$	3,512
Accumulated benefit obligation		2,996		385		3,381		3,130		322		3,452
Fair value of plan assets (a)		2,420		85		2,505		2,507		43		2,550

(a)

The German, Swedish and certain U.S. plans are unfunded and, therefore, there is no fair value of plan assets associated with these plans.

Schedule of target asset allocations established


	U.S.
	Legacy Ball		Legacy Rexam		Canada		Ireland		U.K.

Cash and cash equivalents	0-10	%	0-10	%	—	%	—	%	50-80	%(c)
Equity securities	10-75	%(a)	10-25	%(d)	5	%	39-47	%	5-30	%
Fixed income securities	25-70	%(b)	75-90	%	95	%	42-52	%	50-80	%(c)
Alternative investments	0-35	%	—	%	—	%	9-11	%	0-20	%

(a)

Equity securities may consist of: (1) up to 25 percent large cap equities, (2) up to 10 percent mid cap equities, (3) up to 10 percent small cap equities, (4) up to 35 percent foreign equities and (5) up to 35 percent special equities. Holdings in Ball Corporation common stock or Ball bonds cannot exceed 5 percent of the trust’s assets.

(b)

Debt securities may include up to 10 percent non-investment grade bonds, up to 10 percent bank loans and up to 15 percent international bonds.

(c)

The combined target allocation for fixed income securities and cash and cash equivalents is 50 to 80 percent.

(d)

Equity securities may consist of: (1) up to 20 percent domestic equities, (2) up to 10 percent international equities, and (3) up to 10 percent private equities.

Schedule of actual weighted average asset allocations


	2017		2016
Cash and cash equivalents	2	%	6	%
Equity securities	17	%	18	%
Fixed income securities	74	%	68	%
Alternative investments	7	%	8	%
	100	%	100	%

Defined Benefit Pension Plans | U.S.

Employee Benefit Obligations

Summary of fair value measurement levels assigned to the plan assets


	December 31, 2017
($ in millions)	Level 1		Level 2		Total

U.S. pension assets, at fair value (includes U.S. Rexam assets):
Cash and cash equivalents	$	1	$	124	$	125
Corporate equity securities:
Consumer discretionary		54		—		54
Financials		47		—		47
Healthcare		45		—		45
Industrials		81		—		81
Information technology		97		—		97
Other		74		—		74
U.S. government and agency securities:
FHLMC mortgage backed securities		—		35		35
FNMA mortgage backed securities		—		69		69
Municipal bonds		—		61		61
Treasury bonds		54		—		54
Other		—		15		15
Corporate bonds and notes:
Communications		—		86		86
Consumer discretionary		—		83		83
Consumer staples		—		64		64
Financials		—		329		329
Healthcare		—		136		136
Industrials		—		137		137
Information technology		—		87		87
Oil and gas		—		122		122
Private placement		—		128		128
Utilities		—		128		128
Other		—		70		70
Commingled funds		22		80		102
Total level 1 and level 2	$	475	$	1,754		2,229
Other investments measured at net asset value (a)						191
Total assets					$	2,420

(a)

Certain investments measured at fair value using the NAV per share (or its equivalent) practical expedient have not been classified within the fair value hierarchy. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the amounts presented in the change in plan assets reconciliation.


	December 31, 2016
($ in millions)	Level 1		Level 2		Total

U.S. pension assets, at fair value (includes U.S. Rexam assets):
Cash and cash equivalents	$	—	$	185	$	185
Corporate equity securities:
Consumer discretionary		53		—		53
Financials		43		—		43
Healthcare		27		—		27
Industrials		47		—		47
Information technology		66		—		66
Other		39		—		39
U.S. government and agency securities:
FHLMC mortgage backed securities		—		17		17
FNMA mortgage backed securities		—		64		64
Municipal bonds		—		49		49
Treasury bonds		85		—		85
Other		8		18		26
Corporate bonds and notes:
Communications		—		58		58
Consumer discretionary		—		57		57
Consumer staples		—		64		64
Financials		—		280		280
Healthcare		—		98		98
Industrials		—		115		115
Information technology		—		84		84
Oil and gas		—		122		122
Private placement		—		76		76
Utilities		—		139		139
Other		—		71		71
Commingled funds
International		17		—		17
Total level 1 and level 2	$	385	$	1,497		1,882
Other investments measured at net asset value (a)						625
Total assets					$	2,507

(a)

Certain investments measured at fair value using the NAV per share (or its equivalent) practical expedient have not been classified in the fair value hierarchy. The fair value amounts presented within this table are intended to permit reconciliation of the fair value hierarchy to the amounts presented in the change in plan assets reconciliation.

Defined Benefit Pension Plans | North America

Employee Benefit Obligations

Summary of weighted average assumptions used to determine benefit obligations


	U.S.						Canada
	2017	(a)	2016	(a)	2015		2017		2016		2015
Discount rate	3.72	%	4.26	%	4.60	%	2.80	%	3.50	%	3.50	%
Rate of compensation increase	4.15	%	4.14	%	4.80	%	N/A	(b)	N/A	(b)	3.00	%

(a)

In 2017 and 2016, the weighted average assumptions for U.S. pension plans include pension plans assumed as part of the Rexam acquisition.

(b)

The Canadian plans are frozen.

Summary of weighted average assumptions used to determine net periodic benefit cost


	U.S.						Canada
	2017	(a)	2016	(a)	2015		2017		2016		2015
Discount rate	4.27	%	4.60	%	4.15	%	3.50	%	3.50	%	3.50	%
Rate of compensation increase	4.14	%	4.98	%	4.80	%	N/A	(b)	N/A	(b)	3.00	%
Expected long-term rate of return on assets	5.50	%	6.88	%	7.25	%	4.00	%	4.00	%	4.00	%

(a)

In 2017 and 2016, the weighted average assumptions for U.S. pension plans include pension plans assumed as part of the Rexam acquisition.

(b)

The Canadian plans are frozen.

Defined Benefit Pension Plans | U.K.

Employee Benefit Obligations

Summary of fair value measurement levels assigned to the plan assets


		December 31,
($ in millions)		2017		2016

U.K. pension assets, at fair value:
Cash and cash equivalents	$	43	$	279
U.K. government bonds		2,184		1,538
Other		14		31
Total level 1		2,241		1,848
Other investments measured at net asset value (a)		1,306		1,374
Total assets	$	3,547	$	3,222

Defined Benefit Pension Plans | Europe

Employee Benefit Obligations

Summary of weighted average assumptions used to determine benefit obligations


	U.K.						Germany
	2017	(a)	2016	(a)	2015		2017	(a)	2016	(a)	2015
Discount rate	2.55	%	2.70	%	3.75	%	1.68	%	1.54	%	2.25	%
Rate of compensation increase	4.41	%	4.30	%	3.00	%	2.50	%	2.50	%	2.50	%
Pension increase	3.41	%	3.30	%	3.15	%	1.50	%	1.50	%	1.75	%

(a)

In 2017 and 2016, the U.K. weighted average assumptions are for the acquired Rexam plan only, and the German assumptions include pension plans assumed as part of the Rexam acquisition and one legacy Ball plan.

Summary of weighted average assumptions used to determine net periodic benefit cost


	U.K.						Germany
	2017	(a)	2016	(a)	2015		2017	(a)	2016	(a)	2015
Discount rate	2.70	%	2.90	%	3.75	%	1.52	%	1.29	%	1.75	%
Rate of compensation increase	4.30	%	3.80	%	3.00	%	2.50	%	2.00	%	2.50	%
Pension increase	3.41	%	2.80	%	3.15	%	1.50	%	1.50	%	1.75	%
Expected long-term rate of return on assets	3.20	%	3.40	%	6.50	%	N/A		N/A		N/A

(a)

In 2017 and 2016, the U.K. assumption is for the acquired Rexam plan only, and the German weighted average assumptions include pension plans assumed as part of the Rexam acquisition and one legacy Ball plan.

The discount and compensation increase rates used above to determine the December 31, 2017, benefit obligations will be used to determine net periodic benefit cost for 2018. A reduction of the expected return on pension assets assumption by one quarter of a percentage point would result in an approximate $15 million increase in 2018 pension expense, while a quarter of a percentage point reduction in the discount rate applied to the pension liability would result in an estimated reduction of pension expense of approximately $3 million in 2018.