Sears 2014 Annual Report Download - page 92

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SEARS HOLDINGS CORPORATION
Notes to Consolidated Financial Statements—(Continued)
92
Postretirement Obligations
2014 2013
millions SHC
Domestic SHC
Domestic Sears
Canada Total
Change in accumulated postretirement benefit obligation:
Beginning balance. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 215 $ 247 $ 295 $ 542
Interest cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 8 12 20
Plan participants' contributions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28 31 — 31
Actuarial (gain) loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . —(15)(2)(17)
Benefits paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (47)(56)(15)(71)
Plan amendment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (48) — (46)(46)
Foreign currency exchange rate impact and other . . . . . . . . . . . . . . — — (28)(28)
Balance at the measurement date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 156 $ 215 $ 216 $ 431
Change in plan assets at fair value:
Beginning of year balance. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ — $ — $ 45 $ 45
Actual return on plan assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — 1 1
Company contributions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 25 1 26
Plan participants' contributions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28 31 — 31
Benefits paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (47)(56)(15)(71)
Foreign currency exchange rate impact and other . . . . . . . . . . . . . . — — (12)(12)
Balance at the measurement date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ — $ — $ 20 $ 20
Funded status . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $(156) $ (215) $ (196) $ (411)
The current portion of our liability for postretirement obligations is $15 million, which we expect to pay
during fiscal 2015.
Weighted-average assumptions used to determine plan obligations were as follows:
2014 2013 2012
SHC
Domestic SHC
Domestic Sears
Canada SHC
Domestic Sears
Canada
Pension benefits:
Discount Rate. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.70% 4.60% 4.20% 4.25% 4.20%
Rate of compensation increases . . . . . . . . . . . . . . . N/A N/A 3.50% N/A 3.50%
Postretirement benefits:
Discount Rate. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.30% 4.00% 4.20% 3.55% 4.20%
Rate of compensation increases . . . . . . . . . . . . . . . N/A N/A 3.50% N/A 3.50%
The decrease in the discount rate in 2014 resulted in an increase in the 2014 year-end pension obligation of
approximately $500 million.