Berkshire Hathaway 2015 Annual Report Download - page 71

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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, 2015 follows (in millions).
2015 2014
Balance at beginning of year ............................................................... $(1,617) $ 86
Amount included in net periodic pension expense ........................................... 129 58
Gains (losses) current period and other ................................................... 295 (1,761)
Balance at end of year .................................................................... $(1,193) $(1,617)
Several of our subsidiaries also sponsor defined contribution retirement plans, such as 401(k) or profit sharing plans.
Employee contributions are subject to regulatory limitations and the specific plan provisions. Several plans provide for
employer matching contributions up to levels specified in the plans and provide for additional discretionary contributions as
determined by management. Employer contributions expensed with respect to our defined contribution plans were $739 million,
$737 million and $690 million for the years ending December 31, 2015, 2014 and 2013, respectively.
(22) Contingencies and Commitments
We are parties in a variety of legal actions that routinely arise out of the normal course of business, including legal actions
seeking 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 $1,516 million in 2015, $1,484 million in 2014 and $1,396 million in 2013. 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.
2016 2017 2018 2019 2020
After
2020 Total
$1,347 $1,187 $1,012 $884 $796 $3,512 $8,738
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 relate to our railroad, utilities and energy businesses and our fractional aircraft
ownership business. As of December 31, 2015, future purchase commitments under such arrangements are expected to be paid
as follows: $12.2 billion in 2016, $4.8 billion in 2017, $3.8 billion in 2018, $3.1 billion in 2019, $2.3 billion in 2020 and $13.4
billion after 2020.
On August 8, 2015, Berkshire entered into a definitive agreement with Precision Castparts Corp. (“PCC”) to acquire all
outstanding PCC shares of common stock for $235 per share in cash. Following the receipt of shareholder approval and all
required regulatory approvals, the acquisition was completed on January 29, 2016. The aggregate consideration paid was
approximately $32.7 billion, which included the value of PCC shares already owned by Berkshire on August 8, 2015. We
funded the acquisition with a combination of existing cash balances and from the proceeds from a short-term credit facility.
PCC is a worldwide, diversified manufacturer of complex metal components and products. It serves the aerospace, power
and general industrial markets. PCC is a market leader in manufacturing complex structural investment castings and forged
components for aerospace markets, machined airframe components and highly engineered critical fasteners for aerospace
applications, and in manufacturing airfoil castings for the aerospace and industrial gas turbine markets. PCC also is a leading
producer of titanium and nickel superalloy melted and mill products for the aerospace, chemical processing, oil and gas and
pollution control industries, and manufactures extruded seamless pipe, fittings and forgings for power generation and oil and gas
applications.
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