Medtronic 2015 Annual Report Download - page 130

Medtronic plc
Notes to Consolidated Financial Statements (Continued)
The Company anticipates that it will make contributions of $79 million to its pension benefits in fiscal 2016. Based on the
guidelines under the U.S. Employee Retirement Income Security Act of 1974 and the various guidelines which govern the plans
outside the U.S., the majority of anticipated fiscal year 2015 contributions will be discretionary. The Company believes that,
along with pension assets, the returns on invested pension assets, and Company contributions, the Company will be able to meet
its pension and other post-retirement obligations in the future.
Retiree benefit payments, which reflect expected future service, are anticipated to be paid as follows:
(in millions)
U.S. Pension
Benefits
Non-U.S. Pension
Benefits
Fiscal Year Gross Payments Gross Payments
2016 $ 96 $ 160
2017 93 38
2018 103 40
2019 114 39
2020 125 41
2021 - 2025 792 239
Total $ 1,323 $ 557
Post-retirement Benefit Plans The net periodic benefit cost associated with the Company’s post-retirement benefit plans was
$14 million, $15 million, and $20 million in fiscal years 2015, 2014, and 2013, respectively. The Company’s projected benefit
obligation for all post-retirement benefit plans was $352 million and $327 million at April 24, 2015 and April 25, 2014,
respectively. The Company’s fair value of plan assets for all post-retirement benefit plans was $288 million and $267 million at
April 24, 2015 and April 25, 2014, respectively. The activity during fiscal 2015 and 2014 related to both the change in projected
benefit obligations and the fair value of plan assets was not material.
Defined Contribution Savings Plans The Company has defined contribution savings plans that cover substantially all U.S.
employees and certain non-U.S. employees. The general purpose of these plans is to provide additional financial security during
retirement by providing employees with an incentive to make regular savings. Company contributions to the plans are based on
employee contributions and Company performance and since fiscal year 2006, the entire match has been made in cash. Expense
under these plans was $188 million, $145 million, and $163 million in fiscal years 2015, 2014, and 2013, respectively.
Effective May 1, 2005, the Company froze participation in the existing defined benefit pension plan in the U.S. and
implemented two new plans including an additional defined benefit pension plan and a new defined contribution pension plan,
respectively: the Personal Pension Account (PPA) and the Personal Investment Account (PIA). Employees in the U.S. hired on
or after May 1, 2005 have the option to participate in either the PPA or the PIA. Participants in the PPA receive an annual
allocation of their salary and bonus on which they will receive an annual guaranteed rate of return which is based on the ten-
year Treasury bond rate. Participants in the PIA also receive an annual allocation of their salary and bonus; however, they are
allowed to determine how to invest their funds among identified fund alternatives. The cost associated with the PPA is included
in U.S. Pension Benefits in the tables presented earlier. The defined contribution cost associated with the PIA was
approximately $53 million, $50 million, and $50 million in fiscal years 2015, 2014, and 2013, respectively.
14. Leases
The Company leases office, manufacturing, and research facilities and warehouses, as well as transportation, data processing,
and other equipment under capital and operating leases. A substantial number of these leases contain options that allow the
Company to renew at the fair rental value on the date of renewal.
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