Sears 2013 Annual Report Download - page 91

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SEARS HOLDINGS CORPORATION
Notes to Consolidated Financial Statements—(Continued)
91
terminated vested participants, representing approximately $2.0 billion of the Company's total qualified pension plan
liabilities. Eligible participants had until November 19, 2012 to make their election. The Company made payments
of approximately $1.5 billion to employees who made the election in December 2012 and funded the payments from
existing pension plan assets. In connection with this transaction, the Company incurred a non-cash charge to
operations of approximately $452 million pre-tax in the fourth quarter of 2012 as a result of the requirement to
expense the unrealized actuarial losses. The charge had no effect on equity because the unrealized actuarial losses
are already recognized in accumulated other comprehensive income/(loss). Accordingly, the effect on retained
earnings was offset by a corresponding reduction in accumulated other comprehensive loss.
Fair Value of Pension and Postretirement Benefit Plan Assets
The following table presents our plan assets using the fair value hierarchy at February 1, 2014 and February 2,
2013:
Investment Assets at Fair Value at
SHC Domestic February 1, 2014
millions Total Level 1 Level 2 Level 3
Cash equivalents and short-term investments. . . . . . . . . . . . . . . . . $ 274 $ — $ 274 $ —
Equity securities:
U.S. companies. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,026 1,026 — —
International companies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 163 163 — —
Fixed income securities:
Corporate bonds and notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,888 — 1,888 —
Sears Holdings Corporation senior secured notes . . . . . . . . . . . . 99 — 99 —
Mortgage-backed and asset-backed . . . . . . . . . . . . . . . . . . . . . . . 3 — 3 —
Ventures and partnerships. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 — — 6
Total investment assets at fair value . . . . . . . . . . . . . . . . . . . . . . . . $ 3,459 $1,189 $ 2,264 $ 6
Cash. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Accounts receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
Accounts payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (29)
Net assets available for plan benefits . . . . . . . . . . . . . . . . . . . . . . . $ 3,490