Kodak 2000 Annual Report Download - page 56

Note 13: Nonpension Postre t i rement Benefits
The Company provides healthcare, dental and life insurance
benefits to U.S . eligible re t i rees and eligible survivors of re t i re e s .
In general, these benefits are provided to U.S. re t i rees that are
c o v e red by the Company’s KRIP plan. These benefits are funded
f rom the general assets of the Company as they are incurre d .
C e rtain non-U.S. subsidiaries offer healthcare benefits; however,
the cost of such benefits is insignificant to the Company.
Changes in the Company’s benefit obligation and funded
status are as follows:
(in millions) 2 0 0 0 1 9 9 9
Net benefit obligation at
beginning of year $2 , 3 0 7 $2 , 2 8 0
S e rvice cost 1 2 1 3
I n t e rest cost 1 6 9 1 5 2
Plan participants’ contributions 33
Plan amendments 6 2 ( 3 3 )
Actuarial loss 2 2 9 7 0
C u rt a i l m e n t s 1( 1 3 )
Benefit payments ( 1 8 1 ) ( 1 6 5 )
Net benefit obligation
at end of year $2 , 6 0 2 $2 , 3 0 7
Funded status at end of year $( 2 , 6 0 2 ) $( 2 , 3 0 7 )
U n a m o rtized net loss 7 0 0 4 9 1
U n a m o rtized plan amendments ( 5 1 0 ) ( 6 4 6 )
Net amount recognized and
re c o rded at end of year $( 2 , 4 1 2 ) $( 2 , 4 6 2 )
The weighted-average assumptions used to compute postre t i re-
ment benefit amounts were as follows:
2 0 0 0 1 9 9 9
Discount rate 7 . 5 % 7 . 5 %
S a l a ry increase rate 4 . 3 % 4 . 3 %
H e a l t h c a re cost tre n d( a ) 8 . 0 % 8 . 5 %
( a )d e c reasing to 5.0% by 2007
(in millions) 2 0 0 0 1 9 9 9 1 9 9 8
Components of net
p o s t re t i rement
benefit cost
S e rvice cost $1 2 $1 3 $ 1 9
I n t e rest cost 1 6 9 1 5 2 1 6 1
A m o rtization of:
Prior service cost ( 6 7 ) ( 6 8 ) ( 7 0 )
Actuarial loss 1 8 81 6
1 3 2 1 0 5 1 2 6
C u rt a i l m e n t s ( 6 ) ( 9 0 ) ( 1 0 3 )
Total net postre t i rement
benefit cost $1 2 6 $1 5 $ 2 3
The Company re c o rded a $6 million and $71 million gain in 2000
and 1999, re s p e c t i v e l y, as a result of the reduction in employees
in those years from the 1997 re s t ructuring program. Additionally,
the Company re c o rded a $15 million curtailment gain in 1999 as
a result of the sale of the Office Imaging business, which was
included in the gain on the sale, and a $4 million curtailment gain
as part of the investment in the joint venture with NexPre s s .
The Company will no longer fund healthcare and dental ben-
efits for employees who elected to participate in the Company’s
Cash Balance Plus plan, effective January 1, 2000. This change
is not expected to have a material impact on the Company’s future
p o s t re t i rement benefit cost.