Employee Plans (Tables)

12 Months Ended

Dec. 31, 2013

Fair Value Assumptions on Stock Options

The fair value of stock option awards was estimated using the Black-Scholes option pricing model with the following assumptions and weighted-average fair values as follows:

Year Ended December 31		2013			2012			2011
Weighted-average fair value of grant	$	8.79		$	9.73		$	20.10
Risk-free interest rate		.54	%		.54	%		1.71	%
Expected volatility		50.19	%		71.29	%		71.31	%
Expected life of options in years		3.69			3.65			3.62
Expected dividend yield		–			–			–

Summary of Stock Option Activity

A summary of stock option activity for the year ended December 31, 2013 follows (shares in thousands):

Options	Shares			Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Term (years)		Aggregate Intrinsic Value ($ in millions)
Outstanding at December 31, 2012		2,766		$	35.50
Granted		777			23.71
Exercised		(554	)		9.78
Forfeited and expired		(291	)		78.07
Outstanding at December 31, 2013		2,698			32.74		2.56	$	20.0
Expected to vest at December 31, 2013		1,358			24.39		3.54	$	13.4
Exercisable at December 31, 2013		1,313			41.58		1.52	$	6.3

Summary of Restricted Stock Unit Activity

A summary of restricted stock unit activity for the year ended December 31, 2013 follows (shares in thousands):

	Restricted Stock Units			Weighted-Average Grant-Date Fair Value
Outstanding at December 31, 2012		361		$	25.12
Granted		223			23.79
Vested		(156	)		28.62
Forfeited and expired		(27	)		27.05
Outstanding at December 31, 2013		401			23.45

Schedule of Accumulated Benefit Obligation in Excess of Plan Assets

Information for defined benefit retirement plans with an accumulated benefit obligation in excess of plan assets at December 31, 2013 and 2012 follows:

December 31 (millions)	2013		2012
Accumulated benefit obligation	$	7,210.4	$	7,645.6
Fair value of plan assets		5,646.7		5,247.8

Schedule of Projected Benefit Obligation in Excess of Plan Assets

Information for defined benefit retirement plans with a projected benefit obligation in excess of plan assets at December 31, 2013 and 2012 follows:

December 31 (millions)	2013		2012
Projected benefit obligation	$	7,217.4	$	8,167.4
Fair value of plan assets		5,646.7		5,758.7

Company's Investment Policy Targets and Ranges for Each Asset Category

The company’s investment policy targets and ranges for each asset category are as follows:

	U.S.				Int’l.
Asset Category	Target		Range		Target		Range
Equity securities		58%		52-64%		38%		32-44%
Debt securities		36%		33-39%		55%		48-61%
Real estate		6%		3-9%		1%		0-3%
Cash		0%		0-5%		1%		0-5%
Other		0%		0%		5%		0-10%

Assumed Health Care Cost Trend Rates

In 2014, the company expects to contribute approximately $19 million to its postretirement benefit plan.

Assumed health care cost trend rates at December 31	2013			2012
Health care cost trend rate assumed for next year		6.6	%		6.6	%
Rate to which the cost trend rate is assumed to decline (the ultimate trend rate)		4.8	%		4.8	%
Year that the rate reaches the ultimate trend rate		2023			2023

Effect of 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 effects (in millions of dollars):

	1-Percentage- Point Increase		1-Percentage- Point Decrease
Effect on service and interest cost	$	.2	$	(.2	)
Effect on postretirement benefit obligation		5.5		(4.1	)

Schedule of Plans' Assets (Liabilities) at Fair Value

The following table sets forth by level, within the fair value hierarchy, the plans’ assets (liabilities) at fair value at December 31, 2013.

	U.S. Plans										International Plans
December 31, 2013 (millions)	Fair Value			Level 1			Level 2		Level 3		Fair Value			Level 1			Level 2		Level 3
Pension plans
Equity Securities
Common Stocks	$	1,916.2		$	1,916.2						$	1.8		$	1.8
Commingled Funds		494.3					$	494.3				1,046.7					$	1,046.7
Debt Securities
U.S. and UK Govt. Securities		148.8			148.8
Other Fixed Income		978.1						978.1				268.9						268.9
Insurance Contracts		79.5							$	79.5		151.3							$	151.3
Commingled Funds												983.7						983.7
Real Estate
Real Estate Investment Trusts		145.7			145.7							1.3			1.3
Real Estate		34.7								34.7		42.8								42.8
Other
Derivatives		(4.2	)		(4.5	)		.3				19.1						19.1
Private Equity		16.5								16.5
Commingled Funds		93.3						93.3				141.0						90.8		50.2
Pooled Funds		236.1						236.1				3.2						3.2
Cash		5.7			5.7							22.1			22.1
Receivables		45.5			45.5
Payables		(142.2	)		(142.2	)						(.1	)		(.1	)
Total	$	4,048.0		$	2,115.2		$	1,802.1	$	130.7	$	2,681.8		$	25.1		$	2,412.4	$	244.3
Other postretirement plans
Insurance Contracts	$	7.5							$	7.5
Exchange Traded Fund – Bond		1.3		$	1.3
Pooled Funds		.4					$	.4
Total	$	9.2		$	1.3		$	.4	$	7.5

The following table sets forth by level, within the fair value hierarchy, the plans’ assets (liabilities) at fair value at December 31, 2012.

	U.S. Plans											International Plans
December 31, 2012 (millions)	Fair Value			Level 1			Level 2			Level 3		Fair Value		Level 1		Level 2		Level 3
Pension plans
Equity Securities
Common Stocks	$	1,760.8		$	1,760.8							$	1.9	$	1.9
Commingled Funds		426.1					$	426.1					885.8			$	885.8
Debt Securities
U.S. and UK Govt. Securities		145.9			145.9
Other Fixed Income		983.9						983.9					264.0				264.0
Insurance Contracts		90.9								$	90.9		146.7					$	146.7
Commingled Funds													886.8				886.8
Real Estate
Real Estate Investment Trusts		134.4			134.4								.9		.9
Real Estate		34.8									34.8		31.1						31.1
Other
Derivatives		(5.2	)		(3.5	)		(1.7	)				35.4				35.4
Private Equity		20.8									20.8
Commingled Funds		91.3						91.3					130.2				72.1		58.1
Pooled Funds		190.2						190.2					1.7				1.7
Cash		4.8			4.8								14.7		14.7
Receivables		47.9			47.9
Payables		(139.9	)		(139.9	)
Total	$	3,786.7		$	1,950.4		$	1,689.8		$	146.5	$	2,399.2	$	17.5	$	2,145.8	$	235.9
Other postretirement plans
Insurance Contracts	$	7.9								$	7.9
Exchange Traded Fund – Bond		1.4		$	1.4
Pooled Funds		.4					$	.4
Total	$	9.7		$	1.4		$	.4		$	7.9

Summary of Changes in the Fair Value of the Plans' Level 3 Assets

The following table sets forth a summary of changes in the fair value of the plans’ Level 3 assets for the year ended December 31, 2013.

(millions)		January 1, 2013		Realized gains (losses)			Purchases or acquisitions		Sales or dispositions			Currency and unrealized gains (losses) relating to instruments still held at December 31, 2013			December 31, 2013
U.S. plans
Pension plan
Real Estate	$	34.8	$	.5				$	(2.4	)	$	1.8		$	34.7
Private Equity		20.8		(17.5	)				(5.8	)		19.0			16.5
Insurance Contracts		90.9							(6.7	)		(4.7	)		79.5
Total	$	146.5	$	(17.0	)			$	(14.9	)	$	16.1		$	130.7
Other postretirement plans
Insurance Contracts	$	7.9	$	(.2	)	$	.2	$	(.4	)				$	7.5
International pension plans
Insurance Contracts	$	146.7				$	6.6	$	(12.7	)	$	10.7		$	151.3
Real Estate		31.1					9.5					2.2			42.8
Commingled Funds		58.1	$	.4					(12.3	)		4.0			50.2
Total	$	235.9	$	.4		$	16.1	$	(25.0	)	$	16.9		$	244.3

The following table sets forth a summary of changes in the fair value of the plans’ Level 3 assets for the year ended December 31, 2012.

(millions)		January 1, 2012		Realized gains (losses)		Purchases or acquisitions		Sales or dispositions			Currency and unrealized gains (losses) relating to instruments still held at December 31, 2012			December 31, 2012
U.S. plans
Pension plan
Real Estate	$	33.7	$	.3			$	(1.2	)	$	2.0		$	34.8
Private Equity		45.6		7.3	$	.3		(26.7	)		(5.7	)		20.8
Insurance Contracts		79.6		–		7.6		–			3.7			90.9
Total	$	158.9	$	7.6	$	7.9	$	(27.9	)	$	–		$	146.5
Other postretirement plans
Insurance Contracts	$	7.5	$	.4	$	.3	$	(.3	)				$	7.9
International pension plans
Insurance Contracts	$	145.5			$	5.5	$	(12.1	)	$	7.8		$	146.7
Real Estate		29.0				.4		–			1.7			31.1
Commingled Funds		10.5				41.7		(.2	)		6.1			58.1
Total	$	185.0			$	47.6	$	(12.3	)	$	15.6		$	235.9

Pension Plans

Funded Status of the Plan and Amounts Recognized in Consolidated Balance Sheet

Retirement plans’ funded status and amounts recognized in the company’s consolidated balance sheets at December 31, 2013 and 2012 follow:

	U.S. Plans						International Plans
December 31 (millions)	2013			2012			2013			2012
Change in projected benefit obligation
Benefit obligation at beginning of year	$	5,646.8		$	5,154.8		$	2,945.4		$	2,560.1
Service cost		–			–			10.4			8.6
Interest cost		220.4			252.9			106.6			113.1
Plan participants’ contributions		–			–			3.1			3.0
Plan amendment		–			–			(6.3	)		(13.2	)
Plan curtailment		–			–			–			(5.7	)
Actuarial (gain) loss		(355.9	)		585.2			(19.3	)		279.8
Benefits paid		(352.5	)		(346.1	)		(100.8	)		(100.2	)
Foreign currency translation adjustments		–			–			120.1			99.9
Benefit obligation at end of year	$	5,158.8		$	5,646.8		$	3,059.2		$	2,945.4
Change in plan assets
Fair value of plan assets at beginning of year	$	3,786.7		$	3,558.7		$	2,399.2		$	2,115.8
Actual return on plan assets		572.6			455.7			166.3			211.4
Employer contribution		41.2			118.4			106.0			83.1
Plan participants’ contributions		–			–			3.1			3.0
Benefits paid		(352.5	)		(346.1	)		(100.8	)		(100.2	)
Foreign currency translation adjustments		–			–			108.0			86.1
Fair value of plan assets at end of year	$	4,048.0		$	3,786.7		$	2,681.8		$	2,399.2
Funded status at end of year	$	(1,110.8	)	$	(1,860.1	)	$	(377.4	)	$	(546.2	)
Amounts recognized in the consolidated balance sheets consist of:
Prepaid postretirement assets	$	–		$	–		$	82.6		$	2.5
Other accrued liabilities		(6.9	)		(7.3	)		(.2	)		(.2	)
Long-term postretirement liabilities		(1,103.9	)		(1,852.8	)		(459.8	)		(548.5	)
Total funded status	$	(1,110.8	)	$	(1,860.1	)	$	(377.4	)	$	(546.2	)
Accumulated other comprehensive loss, net of tax
Net loss	$	2,425.9		$	3,201.9		$	817.7		$	856.9
Prior service cost (credit)	$	1.4		$	2.1		$	(16.0	)	$	(11.9	)
Accumulated benefit obligation	$	5,158.8		$	5,646.8		$	3,051.5		$	2,934.2

Components of Net Periodic Benefit (Income) Cost

Net periodic pension cost for 2013, 2012 and 2011 includes the following components:

	U.S. Plans									International Plans
Year ended December 31 (millions)	2013			2012			2011			2013			2012			2011
Service cost	$	–		$	–		$	–		$	10.4		$	8.6		$	10.7
Interest cost		220.4			252.9			264.0			106.6			113.1			126.4
Expected return on plan assets		(291.5	)		(285.7	)		(337.4	)		(141.9	)		(136.1	)		(135.3	)
Amortization of prior service cost		.7			.7			.7			(2.1	)		(.5	)		(.1	)
Recognized net actuarial loss		139.0			124.0			78.5			51.9			36.9			26.8
Curtailment gain		–			–			–			–			(5.7	)		–
Net periodic pension cost	$	68.6		$	91.9		$	5.8		$	24.9		$	16.3		$	28.5

Expected Future Benefit Payments

As of December 31, 2013, the following benefit payments, which reflect expected future service where applicable, are expected to be paid from the defined benefit pension plans:

Year ending December 31 (millions)	U.S.		Int’l.
2014	$	360.8	$	111.6
2015		362.2		110.4
2016		363.7		114.1
2017		365.5		118.0
2018		366.2		121.6
2019 - 2023		1,833.7		660.5

Pension Plans | Net Periodic Pension Cost

Schedule of Weighted-Average Assumptions

Weighted-average assumptions used to determine net periodic pension cost for the years ended December 31 were as follows:
Discount rate	4.01%	4.96%	5.68%	3.92%	4.65%	5.32%
Rate of compensation increase	N/A	N/A	N/A	2.06%	2.66%	2.93%
Expected long-term rate of return on assets	8.00%	8.00%	8.75%	6.40%	6.59%	6.57%

Pension Plans | Benefit Obligation

Schedule of Weighted-Average Assumptions

Weighted-average assumptions used to determine benefit obligations at December 31 were as follows:
Discount rate	5.02%	4.01%	4.96%	4.15%	3.92%	4.65%
Rate of compensation increase	N/A	N/A	N/A	2.08%	2.06%	2.66%

Other Postretirement Benefit Plans

Funded Status of the Plan and Amounts Recognized in Consolidated Balance Sheet

Other postretirement benefits A reconciliation of the benefit obligation, fair value of the plan assets and the funded status of the postretirement benefit plan at December 31, 2013 and 2012, follows:

December 31 (millions)	2013			2012
Change in accumulated benefit obligation
Benefit obligation at beginning of year	$	180.5		$	177.6
Service cost		.6			.5
Interest cost		7.9			8.7
Plan participants’ contributions		4.9			5.3
Actuarial loss (gain)		(11.5	)		10.0
Federal drug subsidy		1.8			2.9
Benefits paid		(23.2	)		(25.7	)
Foreign currency translation and other adjustments		(1.3	)		1.2
Benefit obligation at end of year	$	159.7		$	180.5
Change in plan assets
Fair value of plan assets at beginning of year	$	9.7		$	9.3
Actual return on plan assets		(.2	)		.4
Employer contributions		18.0			20.4
Plan participants’ contributions		4.9			5.3
Benefits paid		(23.2	)		(25.7	)
Fair value of plan assets at end of year	$	9.2		$	9.7
Funded status at end of year	$	(150.5	)	$	(170.8	)
Amounts recognized in the consolidated balance sheets consist of:
Prepaid postretirement assets	$	1.1		$	.8
Other accrued liabilities		(18.0	)		(19.3	)
Long-term postretirement liabilities		(133.6	)		(152.3	)
Total funded status	$	(150.5	)	$	(170.8	)
Accumulated other comprehensive loss, net of tax
Net loss	$	36.7		$	52.2
Prior service cost		3.0			4.8

Components of Net Periodic Benefit (Income) Cost

Net periodic postretirement benefit cost for 2013, 2012 and 2011, follows:

Year ended December 31 (millions)	2013			2012			2011
Service cost	$	.6		$	.5		$	.4
Interest cost		7.9			8.7			10.0
Expected return on assets		(.5	)		(.5	)		(.5	)
Amortization of prior service cost		1.8			1.8			1.8
Recognized net actuarial loss		4.5			3.2			4.2
Net periodic benefit cost	$	14.3		$	13.7		$	15.9

Expected Future Benefit Payments

As of December 31, 2013, the following benefits are expected to be paid to or from the company’s postretirement plan:

Year ending December 31 (millions)	Gross Medicare Part D Receipts		Gross Expected Payments
2014	$	1.9	$	22.9
2015		1.8		20.8
2016		1.7		20.0
2017		1.5		19.1
2018		1.4		18.1
2019 - 2023		3.5		57.5

Other Postretirement Benefit Plans | Net Periodic Postretirement Benefit Cost

Schedule of Weighted-Average Assumptions

Weighted-average assumptions used to determine net periodic postretirement benefit cost for the years ended December 31 were as follows:
Discount rate	5.15	%	5.84	%	6.42	%
Expected return on plan assets	6.75	%	6.75	%	6.75	%

Other Postretirement Benefit Plans | Benefit Obligation

Schedule of Weighted-Average Assumptions

Weighted-average assumptions used to determine benefit obligation at December 31 were as follows:
Discount rate	5.86	%	5.15	%	5.84	%