Kodak 2006 Annual Report Download - page 107

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of employee elections to the Cash Balance Plus plan, the reductions in future pension expense will be almost entirely offset by the cost of matching
employee contributions to SIP. The impact of the Cash Balance Plus plan is shown as a plan amendment.
The Company also sponsors unfunded defined benefit plans for certain U.S. employees, primarily executives. The benefits of these plans are obtained
by applying KRIP provisions to all compensation, including amounts being deferred, and without regard to the legislated qualified plan maximums,
reduced by benefits under KRIP.
Most subsidiaries and branches operating outside the U.S. have defined benefit retirement plans covering substantially all employees. Contributions by
the Company for these plans are typically deposited under government or other fiduciary-type arrangements. Retirement benefits are generally based
on contractual agreements that provide for benefit formulas using years of service and/or compensation prior to retirement. The actuarial assumptions
used for these plans reflect the diverse economic environments within the various countries in which the Company operates.
The measurement date used to determine the pension obligation for all funded and unfunded U.S. and Non-U.S. defined benefit plans is December 31.
See Note 1, “Significant Accounting Policies” for information regarding the Company’s adoption of SFAS No. 158 as of December 31, 2006. SFAS No.
158 requires recognition of the overfunded or underfunded status of defined benefit plans as an asset or liability. Accordingly, the overfunded and
underfunded status of the Company’s defined benefit plans are recognized as assets and liabilities, respectively, in the Consolidated Statement of
Financial Position as of December 31, 2006. Information regarding the major funded and unfunded U.S. and Non-U.S. defined benefit plans follows:
2006 2005
(in millions) U.S. Non-U.S. U.S. Non-U.S.
Change in Benefit Obligation
Projected benefit obligation at January 1 $ 6,204 $ 3,784 $ 6,475 $ 3,652
Acquisitions/divestitures — — — 46
Service cost 92 35 116 41
Interest cost 325 180 346 167
Participant contributions — 16 — 14
Plan amendment — 2 — (1)
Benefit payments (394) (261) (740) (227)
Actuarial (gain) loss (190) (115) 92 463
Curtailments (53) (30) (85) (22)
Settlements (442) (20) — (62)
Special termination benefits 15 41 — 101
Currency adjustments — 435 — (388)
Projected benefit obligation at December 31 $ 5,557 $ 4,067 $ 6,204 $ 3,784
Change in Plan Assets
Fair value of plan assets at January 1 $ 6,593 $ 2,927 $ 6,480 $ 2,871
Acquisitions/divestitures — — 14 36
Actual return on plan assets 1,006 283 814 428
Employer contributions 57 131 25 156
Participant contributions — 16 — 14
Settlements (442) (13) — (60)
Benefit payments (394) (261) (740) (227)
Currency adjustments — 336 — (291)
Fair value of plan assets at December 31 $ 6,820 $ 3,419 $ 6,593 $ 2,927
Over (Under) Funded Status at December 31 $ 1,263 $ (648) $ 389 $ (857)
Unrecognized:
Net transition obligation — 9
Net actuarial loss 235 990
Prior service cost 4 43
Net amount recognized at December 31 $ 628 $ 185