JP Morgan Chase 2009 Annual Report Download - page 188

Notes to consolidated financial statements
JPMorgan Chase & Co./2009 Annual Report 186
The following table presents the changes in benefit obligations and plan assets and funded status amounts reported on the Consolidated
Balance Sheets for the Firm’s U.S. and non-U.S. defined benefit pension and OPEB plans.
Defined benefit pension plans
As of or for the year ended December 31, U.S. Non-U.S.
OPEB plans(f)
(in millions) 2009 2008 2009 2008 2009 2008
Change in benefit obligation
Benefit obligation, beginning of year $ (7,796) $ (7,556) $ (2,007) $ (2,743) $ (1,095) $ (1,204)
Benefits earned during the year (313) (278) (30) (29) (3) (5)
Interest cost on benefit obligations (514) (488) (122) (142) (64) (74)
Plan amendments 384 — 1 — — —
Business combinations (4)(b) — — — (40)(b) (1)(b)
Employee contributions NA NA (3) (3) (64) (61)
Net gain/(loss) (408) (147) (287) 214 101 99
Benefits paid 674 673 95 105 160 154
Expected Medicare Part D subsidy receipts NA NA NA NA (9) (10)
Curtailments — — 1 — (7) (6)
Settlements — — 4 — — —
Special termination benefits — — (1) (3) — —
Foreign exchange impact and other — — (187) 594 (4) 13
Benefit obligation, end of year
$ (7,977) $ (7,796) $ (2,536) $ (2,007) $ (1,025) $ (1,095)
Change in plan assets
Fair value of plan assets, beginning of year $ 6,948 $ 9,960 $ 2,008 $ 2,933 $ 1,126 $ 1,406
Actual return on plan assets 1,145 (2,377) 218 (298) 172 (246)
Firm contributions 2,799 38 115 88 2 3
Employee contributions — — 3 3 — —
Benefits paid (674) (673) (95) (105) (31) (37)
Settlements — — (4) — — —
Foreign exchange impact and other — — 187 (613) — —
Fair value of plan assets, end of year
$ 10,218(c)(d) $ 6,948(c) $ 2,432(d) $ 2,008 $ 1,269 $ 1,126
Funded/(unfunded) status(a) $ 2,241(e) $ (848)(e) $ (104) $ 1 $ 244 $ 31
Accumulated benefit obligation, end of year $ (7,964) $ (7,413) $ (2,510) $ (1,977) NA NA
(a) Represents overfunded plans with an aggregate balance of $3.0 billion and $122 million at December 31, 2009 and 2008, respectively, and underfunded plans with an
aggregate balance of $623 million and $938 million at December 31, 2009 and 2008, respectively.
(b) Represents change resulting from the Washington Mutual plan in 2009 and the Bear Stearns plan in 2008.
(c) At December 31, 2009 and 2008, approximately $332 million and $313 million, respectively, of U.S. plan assets included participation rights under participating
annuity contracts.
(d) At December 31, 2009, includes accrued receivables of $82 million and $8 million for U.S. plans and non-U.S. plans, respectively, and accrued liabilities of $265 million
and $30 million for U.S. plans and non-U.S. plans, respectively, which are not measured at fair value.
(e) Does not include any amounts attributable to the Washington Mutual Qualified Pension plan in 2009 and the Washington Mutual Pension and OPEB plans in 2008. The
disposition of those plans was not determinable.
(f) Includes an unfunded accumulated postretirement benefit obligation of $29 million and $32 million at December 31, 2009 and 2008, respectively, for the U.K. plan.
Gains and losses
For the Firm’s defined benefit pension plans, fair value is used to
determine the expected return on plan assets. For the Firm’s OPEB
plans, a calculated value that recognizes changes in fair value over
a five-year period is used to determine the expected return on plan
assets. Amortization of net gains and losses is included in annual
net periodic benefit cost if, as of the beginning of the year, the net
gain or loss exceeds 10% of the greater of the projected benefit
obligation or the fair value of the plan assets. Any excess, as well
as prior service costs, are amortized over the average future service
period of defined benefit pension plan participants, which for the
U.S. defined benefit pension plan is currently nine years. For OPEB
plans, any excess net gains and losses also are amortized over the
average future service period, which is currently five years; how-
ever, prior service costs are amortized over the average years of
service remaining to full eligibility age, which is currently four years.
The following table presents pretax pension and OPEB amounts recorded in AOCI.
Defined benefit pension plans
December 31, U.S. Non-U.S. OPEB plans
(in millions) 2009 2008 2009 2008 2009 2008
Net gain/(loss) $ (3,039) $ (3,493) $ (666) $ (492) $ (171) $ (349)
Prior service credit/(cost) 364 (26) 3 2 22 40
Accumulated other comprehensive income/
(loss), pretax, end of year
$ (2,675) $ (3,519) $ (663) $ (490) $ (149) $ (309)