Chrysler 2015 Annual Report Download - page 204

204 2015 | ANNUAL REPORT
Consolidated
Financial Statements
Notes to the Consolidated
Financial Statements
During the year ended December 31, 2014, following the release of new standards by the Canadian Institute of
Actuaries, mortality assumptions used for our Canadian benefit plan valuations were updated to reflect recent trends
in the industry and the revised outlook for future generational mortality improvements. The change increased the
Group’s Canadian pension obligations by approximately €41 million. In addition, retirement rate assumptions used for
the Group’s U.S. benefit plan valuations were updated to reflect an ongoing trend towards delayed retirement for FCA
US employees. The change decreased the Group’s U.S. pension and other post-employment benefit obligations by
approximately €261 million and €40 million, respectively.
There were no significant plan amendments or curtailments to the Group’s pension plans for the years ended
December 31, 2015 and 2014. During the year ended December 31, 2013, FCA US amended its U.S. and Canadian
salaried defined benefit pension plans. The U.S. plans were amended in order to comply with U.S. regulations,
cease the accrual of future benefits effective December31, 2013, and enhance the retirement factors. The Canada
amendment ceased the accrual of future benefits effective December31, 2014, enhanced the retirement factors and
continued to consider future salary increases for the affected employees. An interim re-measurement was performed
for these plans, which resulted in a curtailment gain of €166 million recognized in Other income/(expenses) in the
Consolidated Income Statement. In addition, the Group recognized a €509 million reduction to its pension obligation,
a €7 million reduction to defined benefit plan assets and a corresponding €502 million increase in accumulated Other
comprehensive income/(loss) for the year ended December 31, 2013.
The fair value of plan assets by class was as follows:
At December 31, 2015 At December 31, 2014
Amount
ofwhichhavea
quotedmarket
priceinanactive
market Amount
ofwhichhavea
quotedmarket
priceinanactive
market
(€ million)
Cash and cash equivalents 589 512 713 614
U.S. equity securities 2,209 2,208 2,406 2,338
Non-U.S. equity securities 1,388 1,388 1,495 1,463
Commingled funds 2,025 164 2,009 186
Equity instruments 5,622 3,760 5,910 3,987
Government securities 2,610 852 2,948 780
Corporate bonds (including Convertible and high
yield bonds) 6,028 — 6,104 4
Other fixed income 928 7 892 7
Fixed income securities 9,566 859 9,944 791
Private equity funds 1,787 — 1,648 —
Commingled funds 137 117 5 5
Mutual funds 3 — 4 —
Real estate funds 1,502 — 1,395 —
Hedge funds 2,607 — 1,841 —
Investment funds 6,036 117 4,893 5
Insurance contracts and other 602 49 771 91
Total fair value of plan assets 22,415 5,297 22,231 5,488
Non-U.S. Equity securities are invested broadly in developed international and emerging markets. Debt instruments
are fixed income securities which are primarily comprised of long-term U.S. Treasury and global government bonds,
as well as U.S., developed international and emerging market companies’ debt securities diversified by sector,
geography and through a wide range of market capitalization. Commingled funds include common collective trust
funds, mutual funds and other investment entities. Private equity funds include those in limited partnerships that invest
primarily in operating companies that are not publicly traded on a stock exchange. Real estate investments include
those in limited partnerships that invest in various commercial and residential real estate projects both domestically
and internationally. Hedge fund investments include those seeking to maximize absolute return using a broad range of
strategies to enhance returns and provide additional diversification.