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ANNUAL
REPORT
TEXAS INSTRUMENTS26 • 2012 ANNUAL REPORT
Changes in the benefit obligations and plan assets for the defined benefit and retiree health care benefit plans were as follows:
U.S. Defined
Benefit U.S. Retiree
Health Care Non-U.S.
Defined Benefit
2012 2011 2012 2011 2012 2011
Change in plan benefit obligation:
Benefit obligation at beginning of year . . . . . . . . . . . . . . . . . . . . $ 959 $880 $521 $473 $2,748 $2,217
Service cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24 22 5 445 41
Interest cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44 46 25 25 75 69
Participant contributions . . . . . . . . . . . . . . . . . . . . . . . . . ——17 18 11
Benefits paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (45) (52) (47) (43) (83) (72)
Medicare subsidy . . . . . . . . . . . . . . . . . . . . . . . . . . . . ——54——
Actuarial (gain) loss . . . . . . . . . . . . . . . . . . . . . . . . . . . 116 61 (17) 19 222 91
Settlements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ————(533) (1)
Curtailments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1(2) (1) 4— (3)
Assumed with National acquisition . . . . . . . . . . . . . . . . . . . . —————301
Special termination benefit charges (credits) . . . . . . . . . . . . . . . (1) 4————
Plan amendments . . . . . . . . . . . . . . . . . . . . . . . . . . . . ——117 ——
Effects of exchange rate changes . . . . . . . . . . . . . . . . . . . . ————(61) 104
Benefit obligation at end of year (BO) . . . . . . . . . . . . . . . . . . . . $1,098 $959 $509 $521 $2,414 $2,748
Change in plan assets:
Fair value of plan assets at beginning of year . . . . . . . . . . . . . . . . $ 914 $833 $431 $404 $2,211 $1,835
Actual return on plan assets . . . . . . . . . . . . . . . . . . . . . . . 95 106 37 6207 53
Employer contributions (funding of qualified plans) . . . . . . . . . . . . 104 25 78 46 134 72
Employer contributions (payments for non-qualified plans) . . . . . . . . 32————
Participant contributions . . . . . . . . . . . . . . . . . . . . . . . . . ——17 18 11
Assumed with National acquisition . . . . . . . . . . . . . . . . . . . . —————235
Benefits paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (45) (52) (46) (43) (83) (72)
Settlements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ————(196) (1)
Effects of exchange rate changes . . . . . . . . . . . . . . . . . . . . ————(56) 88
Fair value of plan assets at end of year (FVPA) . . . . . . . . . . . . . . . . $1,071 $914 $517 $431 $2,218 $2,211
Funded status (FVPA – BO) at end of year . . . . . . . . . . . . . . . . . . $ (27) $ (45) $ 8 $ (90) $ (196) $ (537)
Amounts recognized on the balance sheet as of December 31, 2012, were as follows:
U.S. Defined
Benefit U.S. Retiree
Health Care
Non-U.S.
Defined
Benefit Total
Overfunded retirement plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 34 $ 12 $ 22 $ 68
Accrued expenses and other liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . (8) — (6) (14)
Underfunded retirement plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (53) (4) (212) (269)
Funded status (FVPA – BO) at end of year . . . . . . . . . . . . . . . . . . . . . . . . . $(27) $ 8 $(196) $(215)
Amounts recognized on the balance sheet as of December 31, 2011, were as follows:
U.S. Defined
Benefit U.S. Retiree
Health Care
Non-U.S.
Defined
Benefit Total
Overfunded retirement plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 11 $ — $ 29 $ 40
Accrued expenses and other liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . (2) — (9) (11)
Underfunded retirement plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (54) (90) (557) (701)
Funded status (FVPA – BO) at end of year . . . . . . . . . . . . . . . . . . . . . . . . . . $(45) $(90) $(537) $(672)
Contributions to the plans meet or exceed all minimum funding requirements. We expect to contribute about $100 million to our
retirement benefit plans in 2013. The amounts shown for underfunded U.S. defined benefit plans were for non-qualified pension plans.
Because contributions to those non-qualified plans are not tax deductible until the benefit is actually paid to the employee, we do not
fund them. As of December 31, 2012 and 2011, the unfunded benefit obligations of those non-qualified plans were $61 million and
$56 million, respectively.