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Pension and Other Postretirement Benefits (Tables)
 12 Months Ended
Dec. 31, 2014
Compensation and Retirement Disclosure [Abstract]  
Pension and other postretirement benefit costs
Summarized information regarding the Company’s significant defined benefit pension and other postretirement benefit plans related to both continuing and discontinued operations is as follows:

 
 
Pension
 
Other Postretirement Benefits
In millions
 
2014
 
2013
 
2012
 
2014
 
2013
 
2012
Components of net periodic benefit cost:
 
 
 
 
 
 
 
 
 
 
 
 
Service cost
 
$
80

 
$
87

 
$
100

 
$
10

 
$
12

 
$
13

Interest cost
 
103

 
100

 
107

 
24

 
24

 
27

Expected return on plan assets
 
(159
)
 
(157
)
 
(157
)
 
(25
)
 
(22
)
 
(20
)
Amortization of actuarial (gain) loss
 
48

 
65

 
57

 
(4
)
 
1

 
1

Amortization of prior service cost
 
1

 
—

 
1

 
1

 
1

 
3

Settlement/curtailment (gain) loss
 
1

 
49

 
14

 
(9
)
 
—

 
—

 
 
$
74

 
$
144

 
$
122

 
$
(3
)
 
$
16

 
$
24


Net periodic benefit cost was included in the statement of income as follows:

 
 
Pension
 
Other Postretirement Benefits
In millions
 
2014
 
2013
 
2012
 
2014
 
2013
 
2012
Income from continuing operations
 
$
69

 
$
131

 
$
112

 
$
6

 
$
14

 
$
22

Income from discontinued operations
 
5

 
13

 
10

 
(9
)
 
2

 
2

 
 
$
74

 
$
144

 
$
122

 
$
(3
)
 
$
16

 
$
24
Change in benefit obligation
The following tables provide a rollforward of the plan benefit obligations, plan assets and a reconciliation of funded status for the years ended December 31, 2014 and 2013 for continuing and discontinued operations:

 
 
Pension
 
Other Postretirement Benefits
In millions
 
2014
 
2013
 
2014
 
2013
Change in benefit obligation:
 
 
 
 
 
 
 
 
Benefit obligation at January 1
 
$
2,545

 
$
2,655

 
$
519

 
$
589

Service cost
 
80

 
87

 
10

 
12

Interest cost
 
103

 
100

 
24

 
24

Plan participants’ contributions
 
3

 
5

 
13

 
15

Amendments
 
(5
)
 
—

 
—

 
—

Actuarial (gain) loss
 
240

 
(68
)
 
97

 
(77
)
Acquisitions/divestitures
 
(97
)
 
(12
)
 
(18
)
 
—

Benefits paid
 
(192
)
 
(247
)
 
(46
)
 
(47
)
Medicare subsidy received
 
—

 
—

 
2

 
3

Liabilities from (to) other immaterial plans
 
—

 
10

 
—

 
—

Settlement/curtailment (gain) loss
 
(2
)
 
(1
)
 
(10
)
 
—

Foreign currency translation
 
(68
)
 
16

 
—

 
—

Benefit obligation at December 31
 
$
2,607

 
$
2,545

 
$
591

 
$
519
Change in plan assets
 
 
Pension
 
Other Postretirement Benefits
In millions
 
2014
 
2013
 
2014
 
2013
Change in plan assets:
 
 
 
 
 
 
 
 
Fair value of plan assets at January 1
 
$
2,487

 
$
2,288

 
$
370

 
$
328

Actual return on plan assets
 
264

 
294

 
28

 
66

Company contributions
 
127

 
136

 
7

 
8

Plan participants’ contributions
 
3

 
5

 
13

 
15

Acquisitions/divestitures
 
(65
)
 
(16
)
 
—

 
—

Benefits paid
 
(192
)
 
(247
)
 
(46
)
 
(47
)
Assets from immaterial plans
 
—

 
12

 
—

 
—

Foreign currency translation
 
(67
)
 
15

 
—

 
—

Fair value of plan assets at December 31
 
$
2,557

 
$
2,487

 
$
372

 
$
370

Funded status
 
$
(50
)
 
$
(58
)
 
$
(219
)
 
$
(149
)
Other immaterial plans
 
(52
)
 
(61
)
 
(5
)
 
(6
)
Net liability at December 31
 
$
(102
)
 
$
(119
)
 
$
(224
)
 
$
(155
)
The amounts recognized in the statement of financial position as of December 31 consist of:
 
 
 
 
 
 
 
 
Other assets
 
$
165

 
$
134

 
$
—

 
$
—

Accrued expenses
 
(10
)
 
(16
)
 
(4
)
 
(5
)
Liabilities held for sale
 
—

 
(24
)
 
—

 
(23
)
Other noncurrent liabilities
 
(257
)
 
(213
)
 
(220
)
 
(127
)
Net liability at end of year
 
$
(102
)
 
$
(119
)
 
$
(224
)
 
$
(155
)
The pre-tax amounts recognized in accumulated other comprehensive income consist of:
 
 
 
 
 
 
 
 
Net actuarial loss
 
$
638

 
$
568

 
$
(6
)
 
$
(112
)
Prior service cost
 
1

 
6

 
(1
)
 
—

 
 
$
639

 
$
574

 
$
(7
)
 
$
(112
)
Accumulated benefit obligation
 
$
2,361

 
$
2,273

 
 
 
 
Plans with accumulated benefit obligation in excess of plan assets as of December 31:
 
 
 
 
 
 
 
 
Projected benefit obligation
 
$
168

 
$
263

 
 
 
 
Accumulated benefit obligation
 
$
154

 
$
249

 
 
 
 
Fair value of plan assets
 
$
26

 
$
91

 
 
 
 
Weighted-average assumptions used in the valuations of pension and other postretirement benefits
The weighted-average assumptions used in the valuations of pension and other postretirement benefits were as follows:

 
Pension
 
Other Postretirement Benefits
 
2014
 
2013
 
2012
 
2014
 
2013
 
2012
Assumptions used to determine benefit obligations at December 31:
 
 
 
 
 
 
 
 
 
 
 
Discount rate
3.70
%
 
4.32
%
 
3.85
%
 
4.15
%
 
4.95
%
 
4.15
%
Rate of compensation increases
3.72
%
 
3.72
%
 
3.86
%
 
—
%
 
—
%
 
—
%
Assumptions used to determine net periodic benefit cost for years ended December 31:
 
 
 
 
 
 
 
 
 
 
 
Discount rate
4.32
%
 
3.85
%
 
4.64
%
 
4.95
%
 
4.15
%
 
4.95
%
Expected return on plan assets
7.02
%
 
7.28
%
 
7.23
%
 
7.00
%
 
7.00
%
 
7.00
%
Rate of compensation increases
3.72
%
 
3.86
%
 
3.86
%
 
—
%
 
—
%
 
—
%
Postretirement benefit obligation
The assumed health care cost trend rates used to determine the postretirement benefit obligation at December 31 were as follows:

 
2014
 
2013
 
2012
Health care cost trend rate assumed for the next year
8.00
%
 
8.00
%
 
7.35
%
Ultimate trend rate
4.50
%
 
5.00
%
 
5.00
%
Year the rate reaches the ultimate trend rate
2022

 
2020

 
2019
One-percentage-point change in assumed health care cost trend rates
A one percentage-point change in assumed health care cost trend rates would have the following impact:

In millions
 
1 Percentage-Point Increase
 
1 Percentage-Point Decrease
Change in service cost and interest cost for 2014
 
$
1

 
$
(1
)
Change in postretirement benefit obligation at December 31, 2014
 
$
13

 
$
(15
)
Defined benefit plan assets for plan benefits
The following tables present the fair value of the Company’s pension and other postretirement benefit plan assets at December 31, 2014 and 2013, by asset category and valuation methodology. Level 1 assets are valued using unadjusted quoted prices for identical assets in active markets. Level 2 assets are valued using quoted prices or other observable inputs for similar assets. Level 3 assets are valued using unobservable inputs, but reflect the assumptions market participants would be expected to use in pricing the assets. Each financial instrument’s categorization is based on the lowest level of input that is significant to the fair value measurement.

 
 
2014
In millions
 
Level 1
 
Level 2
 
Level 3
 
Total
Pension Plan Assets:
 
 
 
 
 
 
 
 
Cash and equivalents
 
$
164

 
$
—

 
$
—

 
$
164

Equity securities:
 
 
 
 
 
 
 
 
Domestic
 
1

 
—

 
—

 
1

Foreign
 
72

 
—

 
—

 
72

Fixed income securities:
 
 
 
 
 
 
 
 
Government securities
 
—

 
286

 
—

 
286

Corporate debt securities
 
—

 
378

 
—

 
378

Mortgage-backed securities
 
—

 
8

 
—

 
8

Investment contracts with insurance companies
 
—

 
—

 
1

 
1

Commingled funds:
 
 
 
 
 
 
 
 
Mutual funds
 
317

 
—

 
—

 
317

Collective trust funds
 
—

 
1,252

 
—

 
1,252

Partnerships/private equity interests
 
—

 
—

 
77

 
77

        Other
 
—

 
—

 
1

 
1

 
 
$
554

 
$
1,924

 
$
79

 
$
2,557

Other Postretirement Benefit Plan Assets:
 
 
 
 
 
 
 
 
Cash and equivalents
 
$
11

 
$
—

 
$
—

 
$
11

Life insurance policies
 
—

 
—

 
361

 
361

 
 
$
11

 
$
—

 
$
361

 
$
372

 
 
 
2013
In millions
 
Level 1
 
Level 2
 
Level 3
 
Total
Pension Plan Assets:
 
 
 
 
 
 
 
 
Cash and equivalents
 
$
27

 
$
—

 
$
—

 
$
27

Equity securities:
 
 
 
 
 
 
 
 
Domestic
 
—

 
—

 
—

 
—

Foreign
 
77

 
—

 
—

 
77

Fixed income securities:
 
 
 
 
 
 
 
 
Government securities
 
—

 
314

 
—

 
314

Corporate debt securities
 
—

 
316

 
—

 
316

Mortgage-backed securities
 
—

 
10

 
—

 
10

Investment contracts with insurance companies
 
—

 
—

 
67

 
67

Commingled funds:
 
 
 
 
 
 
 
 
Mutual funds
 
459

 
—

 
—

 
459

Collective trust funds
 
—

 
1,135

 
—

 
1,135

Partnerships/private equity interests
 
—

 
—

 
81

 
81

Other
 
—

 
1

 
—

 
1

 
 
$
563

 
$
1,776

 
$
148

 
$
2,487

Other Postretirement Benefit Plan Assets:
 
 
 
 
 
 
 
 
Cash and equivalents
 
$
9

 
$
—

 
$
—

 
$
9

Life insurance policies
 
—

 
—

 
361

 
361

 
 
$
9

 
$
—

 
$
361

 
$
370
Assets measured at fair value for pension and other postretirement benefit plan
The following table presents a reconciliation of Level 3 assets measured at fair value for pension and other postretirement benefit plans during the years ended December 31, 2014 and 2013: 

In millions
 
Investment
Contracts with
Insurance
Companies
 
Partnerships/
Private  Equity
Interests
 
Life
Insurance
Policies
 
Other
 
Total
December 31, 2012
 
$
75

 
$
84

 
$
294

 
$
—

 
$
453

2013 Activity:
 
 
 
 
 
 
 
 
 
 
Realized gains (losses)
 
—

 
7

 
—

 
—

 
7

Unrealized gains (losses)
 
5

 
(1
)
 
67

 
—

 
71

Purchases and sales
 
(13
)
 
(9
)
 
—

 
—

 
(22
)
December 31, 2013
 
67

 
81

 
361

 
—

 
509

2014 Activity:
 
 
 
 
 
 
 
 
 
 
Realized gains (losses)
 
—

 
—

 
2

 
—

 
2

Unrealized gains (losses)
 
—

 
2

 
26

 
—

 
28

Purchases and sales
 
—

 
(6
)
 
(28
)
 
1

 
(33
)
Acquistions/divestitures
 
(66
)
 
—

 
—

 
—

 
(66
)
December 31, 2014
 
$
1

 
$
77

 
$
361

 
$
1

 
$
440
Portion of the benefit payments are expected to be paid
The Company’s portion of the benefit payments that are expected to be paid during the years ending December 31 is as follows:

In millions
 
Pension
 
Other Postretirement Benefits
2015
 
$
206

 
$
37

2016
 
172

 
37

2017
 
179

 
38

2018
 
179

 
39

2019
 
180

 
40

Years 2020-2024
 
895

 
206