Intel 2014 Annual Report Download - page 90

INTEL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
The U.S. Intel Minimum Pension Plan benefit is determined by a participant’s years of service and final average compensation as
defined by the plan document. The plan generates a minimum pension benefit if the participants’ U.S. Intel Minimum Pension
Plan benefit exceeds the annuitized value of their U.S. Intel Retirement Contribution Plan benefit. If participant balances in the
U.S. Intel Retirement Contribution Plan do not grow sufficiently, the projected benefit obligation of the U.S. Intel Minimum Pension
Plan could increase significantly. Consistent with applicable law, assets of the U.S. Intel Minimum Pension Plan are held in trust,
solely for the benefit of plan participants, and are not available for general corporate purposes.
Non-U.S. Pension Benefits. We also provide defined-benefit pension plans in certain other countries, most significantly Germany,
Ireland, and Israel. Consistent with the requirements of local law, we deposit funds for certain plans with insurance companies,
with third-party trustees, or into government-managed accounts, and/or accrue for the unfunded portion of the obligation. The
Ireland pension plan and one of our Germany pension plans were closed to employees hired on or after June 20, 2012 and
January 1, 2014, respectively.
U.S. Postretirement Medical Benefits. Upon retirement, eligible U.S. employees who were hired prior to January 1, 2014 are
credited with a defined dollar amount, based on years of service, into a U.S. Sheltered Employee Retirement Medical Account
(SERMA). These credits can be used to pay all or a portion of the cost to purchase coverage in the retiree’s choice of medical
plan. If the available credits are not sufficient to pay the entire cost of the coverage, the remaining cost is the retiree’s
responsibility. Employees hired on or after January 1, 2014 are not eligible to earn a SERMA benefit.
Funding Policy. Our practice is to fund the various pension plans and the U.S. postretirement medical benefits plan in amounts
sufficient to meet the minimum requirements of applicable local laws and regulations. Additional funding may be provided as
deemed appropriate. Depending on the design of the plan, local customs, and market circumstances, the liabilities of a plan may
exceed qualified plan assets.
Benefit Obligation and Plan Assets
The changes in the projected benefit obligations and plan assets for the plans described above were as follows:
U.S. Pension Benefits
Non-U.S. Pension
Benefits
U.S. Postretirement
Medical Benefits
(In Millions) 2014 2013 2014 2013 2014 2013
Beginning projected benefit obligation ......... $ 1,137 $ 1,742 $ 1,695 $ 1,412 $ 509 $ 484
Service cost ................................ 88 119 104 78 26 27
Interest cost ................................ 49 67 66 60 23 20
Actuarial (gain) loss .......................... 760 (746) 767 121 10 (56)
Currency exchange rate changes ............... ——(254) 46 ——
Plan curtailments ............................ (1,083) —————
Other ..................................... (59) (45) 45 (22) (22) 34
Ending projected benefit obligation ............ $ 892 $ 1,137 $ 2,423 $ 1,695 $ 546 $ 509
U.S. Pension Benefits
Non-U.S. Pension
Benefits
U.S. Postretirement
Medical Benefits
(In Millions) 2014 2013 2014 2013 2014 2013
Beginning fair value of plan assets ............ $ 649 $ 684 $ 1,005 $ 838 $ 395 $ 191
Actual return on plan assets ................... 30 10 80 81 33 49
Employer contributions ....................... ——73 65 —162
Currency exchange rate changes ............... ——(114) 26 ——
Other ..................................... (56) (45) (27) (5) (1) (7)
Ending fair value of plan assets ............... $ 623 $ 649 $ 1,017 $ 1,005 $ 427 $ 395
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