BENEFIT PLANS

The Company maintains a number of retirement and other post-retirement employee benefit plans.

Certain subsidiaries sponsor defined contribution plans. Benefits are determined and funded annually based upon the terms of the plans. Amounts recognized as cost under these plans amounted to $15.6 million, $15.1 million, and $15.7 million for the years ended December 31, 2014, 2013, and 2012, respectively.

Certain subsidiaries sponsor defined benefit plans. Benefits are provided to employees primarily based upon years of service and employees’ compensation for certain periods during the last years of employment. Prior to 2002, the Company’s U.S. operations also provided post-retirement medical benefits to their employees. Contributions for medical benefits are related to employee years of service.

The following tables set forth the change in benefit obligation, the change in plan assets, the funded status, and amounts recognized in the consolidated financial statements for the Company’s defined benefit plans and post-retirement plan at December 31, 2014 and 2013:



	U.S. Pension Benefits						Non-U.S. Pension Benefits						Other Benefits						Total
	2014			2013			2014			2013			2014			2013			2014			2013
Change in benefit obligation:
Benefit obligation at beginning of year	$	138,147		$	156,804		$	814,200		$	798,657		$	5,295		$	11,267		$	957,642		$	966,728
Service cost, gross	893			494			28,579			30,315			170			216			29,642			31,025
Interest cost	6,396			5,755			21,445			19,566			240			405			28,081			25,726
Actuarial losses (gains)	25,848			(18,226		)	117,902			(11,477		)	477			(1,988		)	144,227			(31,691		)
Plan amendments and other	—			—			(453		)	293			(1,951		)	(3,733		)	(2,404		)	(3,440		)
Benefits paid	(6,917		)	(6,680		)	(35,279		)	(43,271		)	(477		)	(872		)	(42,673		)	(50,823		)
Impact of foreign currency	—			—			(82,755		)	20,117			—			—			(82,755		)	20,117
Benefit obligation at end of year	$	164,367		$	138,147		$	863,639		$	814,200		$	3,754		$	5,295		$	1,031,760		$	957,642
Change in plan assets:
Fair value of plan assets at beginning of year	$	117,903		$	94,734		$	786,532		$	731,040		$	—		$	—		$	904,435		$	825,774
Actual return on plan assets	2,974			12,073			40,893			42,480			—			—			43,867			54,553
Employer contributions	18,070			17,776			25,448			25,147			343			723			43,861			43,646
Plan participants’ contributions	—			—			13,409			13,255			134			149			13,543			13,404
Benefits paid	(6,917		)	(6,680		)	(35,279		)	(43,271		)	(477		)	(872		)	(42,673		)	(50,823		)
Impact of foreign currency and other	—			—			(79,810		)	17,881			—			—			(79,810		)	17,881
Fair value of plan assets at end of year	$	132,030		$	117,903		$	751,193		$	786,532		$	—		$	—		$	883,223		$	904,435
Funded status	$	(32,337	)	$	(20,244	)	$	(112,446	)	$	(27,668	)	$	(3,754	)	$	(5,295	)	$	(148,537	)	$	(53,207	)

Amounts recognized in the consolidated balance sheets consist of:



	U.S. Pension Benefits						Non-U.S. Pension Benefits						Other Benefits						Total
	2014			2013			2014			2013			2014			2013			2014			2013
Other non-current assets	$	—		$	—		$	38,922		$	105,132		$	—		$	—		$	38,922		$	105,132
Pension and other post-retirement liabilities	(32,337		)	(20,244		)	(151,368		)	(132,800		)	(3,754		)	(5,295		)	(187,459		)	(158,339		)
Accumulated other comprehensive loss (income)	85,636			59,013			213,702			110,965			(15,303		)	(15,910		)	284,035			154,068
Total	$	53,299		$	38,769		$	101,256		$	83,297		$	(19,057	)	$	(21,205	)	$	135,498		$	100,861

The prepaid pension asset is recorded in other non-current assets on the consolidated balance sheet. The short-term and long-term portion of the accrued pension liability is recorded on the consolidated balance sheet within accrued and other liabilities and other non-current liabilities, respectively. The long-term portion of the accrued pension liabilities and other post-retirement liabilities at December 31, 2014 and 2013 was $32.3 million and $20.2 million, respectively, for the U.S. defined benefit pension plan, $146.7 million and $127.8 million, respectively, for the non-U.S. plans, and $3.2 million and $4.8 million, respectively, for the U.S. post-retirement plan. The current portion of accrued pension liabilities was $0.1 million for the U.S. defined benefit pension plan at both December 31, 2014 and 2013, respectively. The current portion of accrued pension liabilities was $4.7 million and $5.0 million for the non-U.S. plans at December 31, 2014 and 2013, respectively. The current portion of the U.S. post-retirement plan was $0.6 million and $0.5 million at December 31, 2014 and 2013, respectively.

The following amounts have been recognized in accumulated other comprehensive income (loss), before taxes, at December 31, 2014 and have not yet been recognized as a component of net periodic pension cost:



	U.S. Pension Benefits		Non-U.S. Pension Benefits			Other Benefits			Total			Total, After Tax
Plan amendments and prior service cost	$	—	$	(19,291	)	$	(4,904	)	$	(24,195	)	$	(18,436	)
Actuarial losses (gains)	85,636		232,993			(10,399		)	308,230			224,481
Total	$	85,636	$	213,702		$	(15,303	)	$	284,035		$	206,045

The following changes in plan assets and benefit obligations were recognized in other comprehensive income (loss), before taxes, for the year ended December 31, 2014:



	U.S. Pension Benefits			Non-U.S. Pension Benefits			Other Benefits			Total			Total, After Tax
Net actuarial losses (gains)	$	31,423		$	114,370		$	477		$	146,270		$	106,837
Plan amendments and prior service cost, net	—			(526		)	(2,085		)	(2,611		)	(1,607		)
Amortization of:
Actuarial (losses) gains	(4,800		)	(4,308		)	1,436			(7,672		)	(5,310		)
Plan amendments and prior service cost	—			4,016			779			4,795			3,696
Impact of foreign currency	—			(10,815		)	—			(10,815		)	(8,089		)
Total	$	26,623		$	102,737		$	607		$	129,967		$	95,527

The accumulated benefit obligations at December 31, 2014 and 2013 were $164.4 million and $138.1 million, respectively, for the U.S. defined benefit pension plan and $834.7 million and $785.8 million, respectively, for all non-U.S. plans. Certain of the plans included within non-U.S. pension benefits have benefit obligations which exceed the fair value of plan assets. The projected benefit obligation, the accumulated benefit obligation, and fair value of assets of these plans as of December 31, 2014 were $200.5 million, $188.9 million, and $49.2 million, respectively.

The assumed discount rates and rates of increase in future compensation levels used in calculating the projected benefit obligations vary according to the economic conditions of the country in which the retirement plans are situated. The weighted average rates used for the purposes of the Company’s plans are as follows:



	U.S.						Non-U.S.
	2014		2013		2012		2014		2013		2012
Discount rate	4.00	%	4.75	%	3.75	%	1.65	%	2.73	%	2.50	%
Compensation increase rate	n/a		n/a		n/a		1.61	%	1.61	%	1.60	%
Expected long-term rate of return on plan assets	7.50	%	7.50	%	7.75	%	4.82	%	4.87	%	4.89	%

The assumed discount rates, rates of increase in future compensation levels, and the long-term rate of return used in calculating the net periodic pension cost vary according to the economic conditions of the country in which the retirement plans are situated. The weighted average rates used for the purposes of the Company’s plans are as follows:



	U.S.						Non-U.S.
	2014		2013		2012		2014		2013		2012
Discount rate	4.75	%	3.75	%	4.25	%	2.73	%	2.50	%	3.10	%
Compensation increase rate	n/a		n/a		n/a		1.61	%	1.60	%	1.75	%
Expected long-term rate of return on plan assets	7.50	%	7.75	%	8.00	%	4.87	%	4.89	%	4.80	%

Net periodic pension cost for the defined benefit plans includes the following components for the years ended December 31:



	U.S.									Non-U.S.
	2014			2013			2012			2014			2013			2012
Service cost, net	$	893		$	494		$	455		$	15,189		$	17,386		$	15,011
Interest cost on projected benefit obligations	6,396			5,755			6,093			21,445			19,566			22,104
Expected return on plan assets	(8,549		)	(7,154		)	(6,965		)	(37,361		)	(35,048		)	(32,989		)
Recognition of actuarial losses/(gains) and prior service costs	4,800			7,782			7,664			292			3,545			210
Net periodic pension cost	$	3,540		$	6,877		$	7,247		$	(435	)	$	5,449		$	4,336

Net periodic post-retirement benefit (credit)/cost for the U.S. post-retirement plan includes the following components for the years ended December 31:



	2014			2013			2012
Service cost	$	170		$	216		$	333
Interest cost on projected benefit obligations	240			405			539
Net amortization and deferral	(2,215		)	(901		)	(753		)
Net periodic post-retirement benefit (credit)/cost	$	(1,805	)	$	(280	)	$	119

The amounts remaining in accumulated other comprehensive income (loss) that are expected to be recognized as a component of net periodic pension cost during 2015 are as follows:



	U.S. Pension Benefits		Non-U.S. Pension Benefits			Other Benefits			Total
Plan amendments and prior service costs	$	—	$	(4,254	)	$	(1,877	)	$	(6,131	)
Actuarial losses (gains)	7,626		16,862			(3,370		)	21,118
Total	$	7,626	$	12,608		$	(5,247	)	$	14,987

The projected post-retirement benefit obligation was principally determined using discount rates of 4.00% in 2014, 4.75% in 2013, and 3.75% in 2012. Net periodic post-retirement benefit cost was principally determined using discount rates of 4.75% in 2014, and 3.75% in 2013, and 4.25% in 2012. The health care cost trend rate ranged from 7.75% to 8.50% in 2014, and was 8.00% in both 2013 and 2012, decreasing to 5.00% in 2021.

The health care cost trend rate assumption has a significant effect on the accumulated post-retirement benefit obligation and net periodic post-retirement benefit cost. A one-percentage-point change in health care cost trend rates would have the following effects:



	One-Percentage-Point Increase		One-Percentage-Point Decrease
Effect on total of service and interest cost components	$	32	$	(29	)
Effect on post-retirement benefit obligation	$	25	$	(25	)

The Company’s overall asset investment strategy is to achieve long-term growth while minimizing volatility by widely diversifying among asset types and strategies. Target asset allocations and investment return criteria are established by the pension committee or designated officers of each plan. Target asset allocation ranges for the U.S. pension plan include 33-53% equity securities, 11-21% fixed income securities, and 30-50% other types of investments. International plan assets relate primarily to the Company’s Swiss plan with target allocations of 25-45% in equities, 35-55% in fixed income securities, and 15-25% in other types of investments. Actual results are monitored against targets and the trustees are required to report to the members of each plan, including an analysis of investment performance on an annual basis at a minimum. Day-to-day asset management is typically performed by third-party asset managers, reporting to the pension committees or designated officers.

The long-term rate of return on plan asset assumptions used to determine pension expense under U.S. GAAP are generally based on estimated future returns for the target investment mix determined by the trustees as well as historical investment performance.

The following table presents the fair value measurement of the Company’s plan assets by hierarchy level:



	December 31, 2014								December 31, 2013
	Quoted Prices in Active Markets for Identical Assets (Level 1)		Observable Inputs for Identical Assets (Level 2)		Unobservable Inputs (Level 3)		Total		Quoted Prices in Active Markets for Identical Assets (Level 1)		Observable Inputs for Identical Assets (Level 2)		Unobservable Inputs (Level 3)		Total
Asset Category:
Cash and Cash Equivalents	$	140,959	$	—	$	—	$	140,959	$	129,932	$	—	$	—	$	129,932
Equity Securities:
Mettler-Toledo Stock	3,638		—		—		3,638		3,425		—		—		3,425
Equity Mutual Funds:
U.S.⁽¹⁾	7,377		30,268		—		37,645		5,960		27,652		—		33,612
International⁽²⁾	39,515		52,476		—		91,991		44,149		54,120		—		98,269
Emerging Markets⁽³⁾	72,360		6,679		—		79,039		78,392		5,773		—		84,165
Fixed Income Securities:
Corporate/Government	124,709		—		—		124,709		129,155		—		—		129,155
Bonds⁽⁴⁾
Fixed Income Mutual Funds:
Insurance Contracts⁽⁵⁾	—		23,288		1,388		24,676		—		24,633		1,475		26,108
Core Bond⁽⁶⁾	120,840		38,757		—		159,597		146,857		36,327		—		183,184
Real Asset Mutual Funds:
Real Estate⁽⁷⁾	61,849		—		—		61,849		66,431		—		—		66,431
Commodities⁽⁸⁾	20,920		3,118		28,196		52,234		23,293		3,323		23,136		49,752
Other Types of Investments:
Global Allocation Funds⁽⁹⁾	13,790		12,145		—		25,935		12,002		11,088		—		23,090
Multi-Strategy Fund of	—		—		80,951		80,951		—		—		77,312		77,312
Hedge Funds⁽¹⁰⁾
	$	605,957	$	166,731	$	110,535	$	883,223	$	639,596	$	162,916	$	101,923	$	904,435

_______________________________________


(1)	Represents primarily large capitalization equity mutual funds tracking the S&P 500 Index.


(2)	Represents all capitalization core and value equity mutual funds located primarily in Switzerland, the United Kingdom, and Canada.


(3)	Represents core and growth mutual funds and funds of mutual funds invested in emerging markets primarily in Eastern Europe, Latin America, and Asia.


(4)	Represents investments in high-grade corporate and government bonds located in Switzerland and the European Union.


(5)	Represents fixed and variable rate annuity contracts provided by insurance companies.


(6)	Represents fixed income mutual funds invested in the U.S., the United Kingdom, Switzerland, and European government bonds, high-grade corporate bonds, mortgage-backed securities, and collateralized mortgage obligations.


(7)	Represents mutual funds invested in real estate located primarily in Switzerland.


(8)	Represents commodity funds invested across a broad range of sectors.


(9)	Represents mutual funds invested globally in both equities and fixed income securities.


(10)	Represents primarily equity investments to profit from long and short equity positions, economic and government driven events and relative value, and tactical trading strategies.

The fair value of the Company’s stock and corporate and government bonds are valued at the year end closing price as reported on the securities exchange on which they are traded. Mutual funds are valued at the exchange-listed year end closing price or at the net asset value of shares held by the fund at the end of the year. Insurance contracts are valued by discounting the related cash flows using a current year end market rate or at cash surrender value, which is presumed to equal fair value. Funds of hedge funds are valued at the net asset value of shares held by the fund at the end of the year.

The following table presents a rollforward of activity for the years ended December 31, 2014 and 2013 for level 3 asset categories:



	Multi- Strategy Fund of Hedge Funds			Commodities			Insurance Contract			Total
Balance at December 31, 2012	$	74,985		$	22,986		$	1,726		$	99,697
Actual return on plan assets:
Related to assets held at end of year	1,420			(449		)	69			1,040
Purchases	11,792			—			127			11,919
Sales	(12,691		)	—			(519		)	(13,210		)
Impact of foreign currency	1,806			599			72			2,477
Balance at December 31, 2013	$	77,312		$	23,136		$	1,475		$	101,923
Actual return on plan assets:
Related to assets held at end of year	4,456			2,952			34			7,442
Related to assets sold during the year	4,811			—			—			4,811
Purchases	22,867			5,030			115			28,012
Sales	(21,649		)	—			(54		)	(21,703		)
Impact of foreign currency	(6,846		)	(2,922		)	(182		)	(9,950		)
Balance at December 31, 2014	$	80,951		$	28,196		$	1,388		$	110,535

There were no transfers between any asset levels during the years ended December 31, 2014 and 2013.

The following benefit payments, which reflect expected future service as appropriate, are expected to be paid:



	U.S. Pension Benefits		Non-U.S. Pension Benefits		Other Benefits Net of Subsidy		Total
2015	$	7,228	$	39,708	$	579	$	47,515
2016	7,467		39,276		505		47,248
2017	7,842		40,098		464		48,404
2018	8,198		40,073		403		48,674
2019	8,480		40,371		348		49,199
2020-2024	46,986		202,059		1,091		250,136

The Company made voluntary incremental pension contributions of $18.0 million in 2014 and $17.6 million in 2013 to increase the funded status of its pension plans. The Company does not expect to receive any refunds from its benefit plans during 2015.

In 2015, the Company expects to make employer pension contributions of approximately $19.6 million to its non-U.S. pension plan and employer contributions of approximately $0.7 million to its U.S. post-retirement medical plan.