Benefit Plans (Tables)

12 Months Ended

Sep. 30, 2018

Net Pension and Other Postretirement Cost

Net pension cost for the years ended September 30 included the following components:

	Pension Plans
(Millions of dollars)	2018			2017			2016
Service cost	$	136		$	110		$	81
Interest cost	90			61			72
Expected return on plan assets	(154		)	(112		)	(109		)
Amortization of prior service credit	(13		)	(14		)	(15		)
Amortization of loss	78			92			77
Settlements	2			—			7
Net pension cost	$	137		$	138		$	113
Net pension cost included in the preceding table that is attributable to international plans	$	34		$	43		$	35

Change in Benefit Obligation, Change in Fair Value of Plan Assets

The change in benefit obligation, change in fair value of pension plan assets, funded status and amounts recognized in the Consolidated Balance Sheets for these plans were as follows:

	Pension Plans
(Millions of dollars)	2018			2017
Change in benefit obligation:
Beginning obligation	$	2,647		$	2,719
Service cost	136			110
Interest cost	90			61
Plan amendments	—			(1		)
Benefits paid	(162		)	(123		)
Impact of acquisitions (divestitures)	758			(19		)
Actuarial gain	(82		)	(134		)
Settlements	(122		)	(1		)
Other, includes translation	(19		)	36
Benefit obligation at September 30	$	3,246		$	2,647
Change in fair value of plan assets:
Beginning fair value	$	1,932		$	1,855
Actual return on plan assets	70			134
Employer contribution	400			54
Benefits paid	(162		)	(123		)
Impact of acquisitions (divestitures)	539			(13		)
Settlements	(122		)	(1		)
Other, includes translation	(15		)	26
Plan assets at September 30	$	2,642		$	1,932
Funded Status at September 30:
Unfunded benefit obligation	$	(604	)	$	(715	)
Amounts recognized in the Consolidated Balance Sheets at September 30:
Other	$	15		$	9
Salaries, wages and related items	(15		)	(17		)
Long-term Employee Benefit Obligations	(604		)	(707		)
Net amount recognized	$	(604	)	$	(715	)
Amounts recognized in Accumulated other comprehensive income (loss) before income taxes at September 30:
Prior service credit	$	60		$	74
Net actuarial loss	(982		)	(1,065		)
Net amount recognized	$	(921	)	$	(991	)

Pension Plans with Accumulated Benefit Obligations

Pension plans with accumulated benefit obligations in excess of plan assets and plans with projected benefit obligations in excess of plan assets consist of the following at September 30:

	Accumulated Benefit Obligation Exceeds the Fair Value of Plan Assets				Projected Benefit Obligation Exceeds the Fair Value of Plan Assets
(Millions of dollars)	2018		2017		2018		2017
Projected benefit obligation	$	2,618	$	2,551	$	3,121	$	2,613
Accumulated benefit obligation	$	2,533	$	2,470
Fair value of plan assets	$	2,012	$	1,833	$	2,502	$	1,889

Weighted Average Assumptions Determining Pension Plan

The weighted average assumptions used in determining pension plan information were as follows:

	2018		2017		2016
Net Cost
Discount rate:
U.S. plans (a)	3.71	%	3.42	%	4.15	%
International plans	2.30		1.70		2.84
Expected return on plan assets:
U.S. plans	7.20		7.25		7.50
International plans	4.95		4.65		5.02
Rate of compensation increase:
U.S. plans	4.51		4.25		4.25
International plans	2.31		2.33		2.33
Benefit Obligation
Discount rate:
U.S. plans	4.26		3.72		3.42
International plans	2.30		2.25		1.70
Rate of compensation increase:
U.S. plans	4.29		4.51		4.25
International plans	2.36		2.30		2.33

(a) The Company calculated the service and interest components utilizing an approach that discounts the individual expected cash flows using the applicable spot rates derived from the yield curve over the projected cash flow period.

Expected Benefit Payments

Expected benefit payments are as follows:

(Millions of dollars)	Pension Plans		Other Postretirement Benefits
2019	$	213	$	14
2020	202		14
2021	208		13
2022	209		13
2023	214		12
2024-2028	1,096		54

Fair Value Measurements of U.S. Plan Assets

The following table provides the fair value measurements of U.S. plan assets, as well as the measurement techniques and inputs utilized to measure fair value of these assets, at September 30, 2018 and 2017. The categorization of fund investments is based upon the categorization of these funds’ underlying assets.

(Millions of dollars)	Total U.S. Plan Asset Balances				Investments Measured at Net Asset Value (a)				Quoted Prices in Active Markets for Identical Assets (Level 1)				Significant Other Observable Inputs (Level 2)				Significant Unobservable Inputs (Level 3)
	2018		2017		2018		2017		2018		2017		2018		2017		2018		2017
Fixed Income:
Mortgage and asset-backed securities	$	28	$	155	$	—	$	—	$	—	$	—	$	28	$	155	$	—	$	—
Corporate bonds	484		232		—		—		101		89		383		144		—		—
Government and agency-U.S.	257		107		—		—		199		83		57		25		—		—
Government and agency-Foreign	122		98		8		12		85		63		28		22		—		—
Equity securities	536		369		360		307		176		62		—		—		—		—
Cash and cash equivalents	39		40		—		—		39		40		—		—		—		—
Other	356		252		356		217		—		34		—		—		—		—
Fair value of plan assets	$	1,821	$	1,254	$	724	$	537	$	600	$	371	$	497	$	346	$	—	$	—

(a) As per applicable disclosure requirements, certain investments that were measured at net asset value per share or its equivalent have not been categorized within the fair value hierarchy. Values of such assets are based on the corroborated net asset value provided by the fund administrator.

Fair Value Measurements of Foreign Plan Assets

The following table provides the fair value measurements of international plan assets, as well as the measurement techniques and inputs utilized to measure fair value of these assets, at September 30, 2018 and 2017.

(Millions of dollars)	Total International Plan Asset Balances				Investments Measured at Net Asset Value (a)				Quoted Prices in Active Markets for Identical Assets (Level 1)				Significant Other Observable Inputs (Level 2)				Significant Unobservable Inputs (Level 3)
	2018		2017		2018		2017		2018		2017		2018		2017		2018		2017
Fixed Income:
Corporate bonds	$	28	$	14	$	—	$	—	$	14	$	—	$	14	$	13	$	—	$	—
Government and agency-U.S.	6		5		—		—		3		1		3		3		—		—
Government and agency-Foreign	150		127		—		—		104		83		46		45		—		—
Other fixed income	96		64		—		—		63		57		33		7		—		—
Equity securities	314		256		15		13		299		242		—		—		—		—
Cash and cash equivalents	9		28		—		—		9		28		—		—		—		—
Real estate	30		26		—		—		—		—		30		26		—		—
Insurance contracts	114		98		—		—		—		—		—		—		114		98
Other	74		62		—		—		55		47		20		15		—		—
Fair value of plan assets	$	821	$	678	$	15	$	13	$	546	$	459	$	146	$	108	$	114	$	98

(a) As per applicable disclosure requirements, certain investments that were measured at net asset value per share or its equivalent have not been categorized within the fair value hierarchy. Values of such assets are based on the corroborated net asset value provided by the fund administrator.

Pension Plans | Foreign Plans

Changes in Fair Value Pension Assets Measured Using Level 3 Inputs

The following table summarizes the changes, for the years ended September 30, 2018 and 2017, in the fair value of international pension assets measured using Level 3 inputs:

(Millions of dollars)	Insurance Contracts
Balance at September 30, 2016	$	102
Actual return on plan assets:
Relating to assets held at September 30, 2016	1
Purchases, sales and settlements, net	(11		)
Transfers in from other categories	1
Exchange rate changes	4
Balance at September 30, 2017	$	98
Actual return on plan assets:
Relating to assets held at September 30, 2017	2
Purchases, sales and settlements, net	15
Transfers in from other categories	1
Exchange rate changes	(2		)
Balance at September 30, 2018	$	114