POSTRETIREMENT BENEFIT PLANS (Tables)

9 Months Ended

Sep. 26, 2021

Schedule of Pretax Net Periodic Benefit Cost

Our pretax FAS expense (income) related to our qualified defined benefit pension plans and retiree medical and life insurance plans consisted of the following (in millions):



	Quarters Ended				Nine Months Ended
	September 26, 2021		September 27, 2020		September 26, 2021		September 27, 2020
Qualified defined benefit pension plans
Operating:
Service cost	$	26	$	25	$	80	$	76
Non-operating:
Interest cost	302		385		923		1,154
Expected return on plan assets	(517)		(566)		(1,655)		(1,698)
Recognized net actuarial losses	210		213		714		637
Amortization of prior service credits	(88)		(86)		(262)		(257)
Pension settlement charge	1,665		—		1,665		—
Non-service FAS pension expense (income)	1,572		(54)		1,385		(164)
Total FAS pension expense (income)	$	1,598	$	(29)	$	1,465	$	(88)
Retiree medical and life insurance plans
Operating:
Service cost	$	3	$	3	$	10	$	10
Non-operating:
Interest cost	13		18		39		53
Expected return on plan assets	(35)		(32)		(105)		(96)
Recognized net actuarial gains	—		(1)		—		(3)
Amortization of prior service costs	9		10		27		29
Non-service FAS retiree medical and life (income)	(13)		(5)		(39)		(17)
Total FAS retiree medical and life (income)	$	(10)	$	(2)	$	(29)	$	(7)

Reconciliation of Benefit Obligations, Plan Assets and Unfunded or Funded Status

The following table provides a reconciliation of the benefit obligations, plan assets and net unfunded status related to all of our qualified defined benefit pension plans, inclusive of the plans affected by the interim remeasurement and plans that were not, for the nine months ended September 26, 2021 (in millions):



Change in benefit obligation
Beginning balance at December 31, 2020	$	51,352
Service cost	80
Interest cost	923
Benefits paid	(1,611)
Settlements(a)	(4,885)
Change in benefit obligation due to remeasurement(b)	(1,253)



Ending balance at September 26, 2021	$	44,606
Change in plan assets
Beginning balance at December 31, 2020	$	38,481
Expected return on plan assets(c)	1,655
Incremental return on plan assets recognized in remeasurement(c)	1,618
Benefits paid	(1,611)
Settlements(a)	(4,885)
Company contributions	—


Ending balance at September 26, 2021	$	35,258
Net Unfunded status of the plans(d)	$	(9,348)

(a)Represents the transfer of gross defined benefit pension obligations and related plan assets to an insurance company pursuant to the group annuity contracts purchased on August 3, 2021.

(b)Primarily reflects an increase in the discount rate from 2.50% at December 31, 2020 to 2.75% at the remeasurement date.

(c)The expected return on plan assets represents approximately 4.00% for the period January 1, 2021 through August 3, 2021 (the proportional effect, or approximately seven twelfths, of our previously expected 7.00% annual long-term rate of return on plan assets assumption). The incremental return on plan assets recognized in remeasurement represents the difference between our actual return on plan assets of approximately 8.00% and our expected return of approximately 4.00% for the period January 1, 2021 through August 3, 2021.

(d)For plans where the benefit obligation is in excess of plan assets, we report the net obligation (which was $9,351 million as of September 26, 2021) as part of accrued pension liabilities on our consolidated balance sheet. Conversely, for plans where the assets exceed the benefit obligation, we include the net asset (which was $3 million as of September 26, 2021) as part of other noncurrent assets on our consolidated balance sheet. The net unfunded status of the plans of $9,348 million in the table above represents the net total of these two amounts.