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DR PEPPER SNAPPLE GROUP, INC.
NOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS
(Continued)
90
DEFINED CONTRIBUTION PLANS
The Company sponsors the SIP, which is a qualified 401(k) Retirement Plan that covers substantially all U.S.-based employees
who meet certain eligibility requirements. This plan permits both pre-tax and after-tax contributions, which are subject to limitations
imposed by Internal Revenue Code (the "Code") regulations. The Company matches employees' contributions up to specified
levels.
The Company also sponsors the SSP, which is a non-qualified defined contribution plan for employees who are actively
enrolled in the SIP and whose after-tax contributions under the SIP are limited by the Code compensation limitations.
The Company's employer matching contributions to the SIP and SSP plans were approximately $16 million for the year ended
December 31, 2014 and $15 million for the years ended December 31, 2013 and 2012.
Additionally, current participants in the SIP and SSP are eligible for an enhanced defined contribution (the "EDC").
Contributions began accruing for plan participants after a one-year waiting period for participant entry into the plan, which vest
after three years of service with the Company. The Company made contributions of $16 million to the EDC for the plan years
ended December 31, 2014, 2013 and 2012.
15. Fair Value
Under U.S. GAAP, fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an
orderly transaction between market participants at the measurement date. U.S. GAAP provides a framework for measuring fair
value and establishes a three-level hierarchy for fair value measurements based upon the transparency of inputs to the valuation
of an asset or liability. The three-level hierarchy for disclosure of fair value measurements is as follows:
Level 1 - Quoted market prices in active markets for identical assets or liabilities.
Level 2 - Observable inputs such as quoted prices for similar assets or liabilities in active markets; quoted prices for
identical or similar assets or liabilities in markets that are not active; and model-derived valuations in which all significant
inputs and significant value drivers are observable in active markets.
Level 3 - Valuations with one or more unobservable significant inputs that reflect the reporting entity's own assumptions.
RECURRING FAIR VALUE MEASUREMENTS
The following tables present the fair value hierarchy for those assets and liabilities measured at fair value on a recurring basis
as of December 31, 2014 and 2013 (in millions):
Fair Value Measurements at December 31, 2014
Quoted Prices
in Active
Markets for
Identical
Assets
Significant
Other
Observable
Inputs
Significant
Unobservable
Inputs
Level 1 Level 2 Level 3
Interest rate contracts $ — $ 40 $ —
Marketable securities - trading 25 — —
Total assets $ 25 $ 40 $ —
Commodity contracts $ — $ 26 $ —
Interest rate contracts — 9 —
Total liabilities $ — $ 35 $ —