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66 CVS Health
Notes to Consolidated Financial Statements
Shares held in trust The Company maintains grantor trusts, which held approximately 1 million shares of its
common stock at December 31, 2015 and 2014, respectively. These shares are designated for use under various
employee compensation plans. Since the Company holds these shares, they are excluded from the computation of
basic and diluted shares outstanding.
Accumulated other comprehensive income Accumulated other comprehensive income (loss) consists of changes
in the net actuarial gains and losses associated with pension and other postretirement benefit plans, losses on
derivatives from cash flow hedges executed in previous years associated with the issuance of long-term debt, and
foreign currency translation adjustments. The amount included in accumulated other comprehensive loss related to
the Company’s pension and postretirement plans was $305 million pre-tax ($186 million after-tax) as of December 31,
2015 and $234 million pre-tax ($143 million after-tax) as of December 31, 2014. The net impact on cash flow hedges
totaled $14 million pre-tax ($7 million after-tax) and $16 million pre-tax ($9 million after-tax) as of December 31, 2015
and 2014, respectively. Cumulative foreign currency translation adjustments at December 31, 2015 and 2014 were
$165 million and $65 million, respectively.
Changes in accumulated other comprehensive income (loss) by component are shown below:
YEAR ENDED DECEMBER 31, 2015 (1)
Pension
Losses on and Other
Foreign Cash Flow Postretirement
IN MILLIONS Currency Hedges Benefits Total
Balance, December 31, 2014 $ (65) $ (9) $ (143) $ (217)
Other comprehensive income (loss) before
reclassifications (100) — (56) (156)
Amounts reclassified from accumulated
other comprehensive income (2) — 2 13 15
Net other comprehensive income (loss) (100) 2 (43) (141)
Balance, December 31, 2015
$ (165)
$ (7)
$ (186)
$ (358)
YEAR ENDED DECEMBER 31, 2014 (1)
Pension
Losses on and Other
Foreign Cash Flow Postretirement
IN MILLIONS Currency Hedges Benefits Total
Balance, December 31, 2013 $ (30) $ (13) $ (106) $ (149)
Other comprehensive income (loss) before
reclassifications (35) — — (35)
Amounts reclassified from accumulated
other comprehensive income (2) — 4 (37) (33)
Net other comprehensive income (loss) (35) 4 (37) (68)
Balance, December 31, 2014 $ (65) $ (9) $ (143) $ (217)
(1) All amounts are net of tax.
(2) The amounts reclassified from accumulated other comprehensive income for cash flow hedges are recorded within interest expense, net on the
consolidated statement of income. The amounts reclassified from accumulated other comprehensive income for pension and other postretirement
benefits are included in operating expenses on the consolidated statement of income.
Stock-based compensation Stock-based compensation is measured at the grant date based on the fair value of
the award and is recognized as expense over the applicable requisite service period of the stock award (generally 3
to 5 years) using the straight-line method.