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Retirement Benefits
9 Months Ended
Sep. 30, 2011
Retirement Benefits [Abstract] 
Retirement Benefits
Retirement Benefits
The Company maintains qualified and non-qualified defined benefit pension plans for its U.S. and non-U.S. eligible employees. The Company’s policy for funding its tax qualified defined benefit retirement plans is to contribute amounts at least sufficient to meet the funding requirements set forth by U.S. law and the laws of the non-U.S. jurisdictions in which the Company offers defined benefit plans.
The target asset allocation for the U.S. Plan is 58% equities and 42% fixed income. At the end of the third quarter of 2011, the actual allocation for the U.S. Plan was 57% equities and 43% fixed income. The target asset allocation for the U.K. Plan, which comprises approximately 82% of non-U.S. Plan assets, is 58% equities and 42% fixed income. At the end of the third quarter of 2011, the actual allocation for the U.K. Plan was 49% equities and 51% fixed income.
The components of the net periodic benefit cost for defined benefit and other post-retirement plans are as follows:
 
Combined U.S. and significant non-U.S. Plan
Pension
 
Postretirement
For the Three Months Ended September 30,
Benefits
 
Benefits
(In millions of dollars)
2011

 
2010

 
2011

 
2010

Service cost
$
55

 
$
49

 
$
1

 
$
—

Interest cost
153

 
145

 
2

 
4

Expected return on plan assets
(223
)
 
(204
)
 
—

 
—

Amortization of prior service credit
(5
)
 
(5
)
 
(3
)
 
(3
)
Recognized actuarial loss (credit)
54

 
36

 
(3
)
 
—

Net periodic benefit cost (credit)
$
34

 
$
21

 
$
(3
)
 
$
1

 
 
 
 
 
 
 
 
Combined U.S. and significant non-U.S. Plans
Pension
 
Postretirement
For the Nine Months Ended September 30,
Benefits
 
Benefits
(In millions of dollars)
2011

 
2010

 
2011

 
2010

Service cost
$
169

 
$
147

 
$
4

 
$
3

Interest cost
458

 
431

 
9

 
11

Expected return on plan assets
(668
)
 
(608
)
 
—

 
—

Amortization of prior service credit
(14
)
 
(15
)
 
(10
)
 
(10
)
Recognized actuarial loss (credit)
162

 
108

 
(3
)
 
—

Net periodic benefit cost
$
107

 
$
63

 
$
—

 
$
4

 
 
 
 
 
 
 
 
U.S. Plans only
Pension
 
Postretirement
For the Three Months Ended September 30,
Benefits
 
Benefits
(In millions of dollars)
2011

 
2010

 
2011

 
2010

Service cost
$
20

 
$
19

 
$
—

 
$
—

Interest cost
58

 
57

 
1

 
3

Expected return on plan assets
(79
)
 
(74
)
 
—

 
—

Amortization of prior service credit
(4
)
 
(4
)
 
(3
)
 
(3
)
Recognized actuarial loss (credit)
25

 
17

 
(3
)
 
—

Net periodic benefit cost (credit)
$
20

 
$
15

 
$
(5
)
 
$
—

U.S. Plans only
Pension
 
Postretirement
For the Nine Months Ended September 30,
Benefits
 
Benefits
(In millions of dollars)
2011

 
2010

 
2011

 
2010

Service cost
$
62

 
$
57

 
$
2

 
$
2

Interest cost
173

 
170

 
6

 
8

Expected return on plan assets
(236
)
 
(221
)
 
—

 
—

Amortization of prior service credit
(12
)
 
(13
)
 
(10
)
 
(10
)
Recognized actuarial loss (credit)
75

 
53

 
(3
)
 
—

Net periodic benefit cost (credit)
$
62

 
$
46

 
$
(5
)
 
$
—

 
Significant non-U.S. Plans only
Pension
 
Postretirement
For the Three Months Ended September 30,
Benefits
 
Benefits
(In millions of dollars)
2011

 
2010

 
2011

 
2010

Service cost
$
35

 
$
30

 
$
1

 
$
—

Interest cost
95

 
88

 
1

 
1

Expected return on plan assets
(144
)
 
(130
)
 
—

 
—

Amortization of prior service cost
(1
)
 
(1
)
 
—

 
—

Recognized actuarial loss
29

 
19

 
—

 
—

Net periodic benefit cost
$
14

 
$
6

 
$
2

 
$
1

 
Significant non-U.S. Plans only
Pension
 
Postretirement
For the Nine Months Ended September 30,
Benefits
 
Benefits
(In millions of dollars)
2011

 
2010

 
2011

 
2010

Service cost
$
107

 
$
90

 
$
2

 
$
1

Interest cost
285

 
261

 
3

 
3

Expected return on plan assets
(432
)
 
(387
)
 
—

 
—

Amortization of prior service cost
(2
)
 
(2
)
 
—

 
—

Recognized actuarial loss
87

 
55

 
—

 
—

Net periodic benefit cost
$
45

 
$
17

 
$
5

 
$
4


The weighted average actuarial assumptions utilized to calculate the net periodic benefit costs for the U.S. and significant non-U.S. defined benefit plans are as follows:
 
Combined U.S. and significant non-U.S. Plans
Pension
Benefits
 
Postretirement
Benefits
  
2011

 
2010

 
2011

 
2010

Weighted average assumptions:
 
 
 
 
 
 
 
Expected return on plan assets
8.2
%
 
8.1
%
 
—
%
 
—
%
Discount rate
5.6
%
 
6.0
%
 
5.8
%
 
6.3
%
Rate of compensation increase
4.1
%
 
4.2
%
 
—
%
 
—
%

The Company made $247 million of contributions to its U.S. non-qualified and non-U.S. pension plans in the first nine months of 2011 and expects to contribute approximately $70 million to these plans during the remainder of 2011.