Berkshire Hathaway 2014 Annual Report Download - page 83

Notes to Consolidated Financial Statements (Continued)
(21) Pension plans (Continued)
A reconciliation of the pre-tax accumulated other comprehensive income (loss) related to defined benefit pension plans for
each of the two years ending December 31, 2014 follows (in millions).
2014 2013
Balance at beginning of year ............................................................... $ 86 $(2,516)
Amount included in net periodic pension expense ........................................... 55 167
Gains (losses) current period and other ................................................... (1,755) 2,435
Balance at end of year .................................................................... $(1,614) $ 86
Several of our subsidiaries also sponsor defined contribution retirement plans, such as 401(k) or profit sharing plans.
Employee contributions to the plans are subject to regulatory limitations and the specific plan provisions. Several of the plans
provide that the subsidiary match these contributions up to levels specified in the plans and provide for additional discretionary
contributions as determined by management. Employer contributions expensed with respect to these plans were $737 million,
$690 million and $637 million for the years ending December 31, 2014, 2013 and 2012, respectively.
(22) Contingencies and Commitments
We are parties in a variety of legal actions arising out of the normal course of business. In particular, such legal actions
affect our insurance and reinsurance businesses. Such litigation generally seeks to establish liability directly through insurance
contracts or indirectly through reinsurance contracts issued by Berkshire subsidiaries. Plaintiffs occasionally seek punitive or
exemplary damages. We do not believe that such normal and routine litigation will have a material effect on our financial
condition or results of operations. Berkshire and certain of its subsidiaries are also involved in other kinds of legal actions, some
of which assert or may assert claims or seek to impose fines and penalties. We believe that any liability that may arise as a result
of other pending legal actions will not have a material effect on our consolidated financial condition or results of operations.
We lease certain manufacturing, warehouse, retail and office facilities as well as certain equipment. Rent expense for all
operating leases was $1,484 million in 2014, $1,396 million in 2013 and $1,401 million in 2012. Future minimum rental
payments or operating leases having initial or remaining non-cancellable terms in excess of one year are as follows. Amounts
are in millions.
2015 2016 2017 2018 2019
After
2019 Total
$1,279 $1,159 $1,001 $847 $751 $3,605 $8,642
Our subsidiaries regularly make commitments in the ordinary course of business to purchase goods and services used in
their businesses. The most significant of these commitments relate to our railroad, utilities and energy and fractional aircraft
ownership businesses. As of December 31, 2014, future purchase commitments under such arrangements are expected to be
paid as follows: $14.6 billion in 2015, $4.9 billion in 2016, $4.2 billion in 2017, $3.6 billion in 2018, $3.0 billion in 2019 and
$13.7 billion after 2019.
Pursuant to the terms of shareholder agreements with noncontrolling shareholders in our less than wholly-owned
subsidiaries, we may be obligated to acquire their equity ownership interests. If we had acquired all outstanding noncontrolling
interests as of December 31, 2014, we estimate the cost would have been approximately $4.2 billion. However, the timing and
the amount of any such future payments that might be required are contingent on future actions of the noncontrolling owners.
During 2012 and 2013, we acquired substantially all of the outstanding common stock of Marmon that was held by
noncontrolling shareholders for aggregate consideration of approximately $1.4 billion in 2012 and approximately $1.47 billion
in 2013, of which $1.2 billion was paid in March 2014. On April 29, 2013, we acquired all of the common stock of IMC
International Metalworking Companies B.V. held by the noncontrolling shareholders for $2.05 billion. These transactions were
accounted for as acquisitions of noncontrolling interests. The differences between the consideration paid and the carrying
amounts of these noncontrolling interests were recorded as reductions in Berkshire’s shareholders’ equity and aggregated
approximately $1.8 billion in 2013 and $700 million in 2012.
On October 1, 2014, Berkshire and Van Tuyl Group entered into a definitive agreement pursuant to which Berkshire will
acquire a controlling interest in the Van Tuyl Group, the nation’s largest privately-owned auto dealership group and fifth largest
among all U.S. auto dealership groups, as well as 100% of related insurance and real estate businesses. The auto dealership
group consists of 78 dealers, with locations in 10 states. The transaction is expected to be completed in the first quarter of 2015
and is subject to obtaining approvals from the major auto manufacturers as well as certain customary closing conditions,
including various regulatory approvals.
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