Ameriprise 2013 Annual Report Download - page 181

The following table provides the amounts recognized in the Consolidated Balance Sheets, which equal the funded status of
the Company’s pension plans:
December 31,
2013 2012
(in millions)
Benefit liability $ (136) $ (214)
Benefit asset 48
Net amount recognized $ (132) $ (206)
The Company complies with the minimum funding requirements in all countries.
The amounts recognized in accumulated other comprehensive income, net of tax, as of December 31, 2013 but not
recognized as components of net periodic benefit cost included an unrecognized actuarial loss of $55 million and an
unrecognized prior service credit of $3 million. The estimated amounts that will be amortized from accumulated other
comprehensive income, net of tax, into net periodic benefit cost in 2014 include a prior service credit of $1 million.
The accumulated benefit obligation for all pension plans as of December 31, 2013 and 2012 was $605 million and
$576 million, respectively. The accumulated benefit obligation and fair value of plan assets for pension plans with
accumulated benefit obligations that exceeded the fair value of plan assets were as follows:
December 31,
2013 2012
(in millions)
Accumulated benefit obligation $ 514 $ 503
Fair value of plan assets 418 333
The projected benefit obligation and fair value of plan assets for pension plans with projected benefit obligations that
exceeded the fair value of plan assets were as follows:
December 31,
2013 2012
(in millions)
Projected benefit obligation $ 554 $ 547
Fair value of plan assets 418 333
The weighted average assumptions used to determine benefit obligations for pension plans were as follows:
2013 2012
Discount rates 4.06% 3.45%
Rates of increase in compensation levels 4.38 4.36
The weighted average assumptions used to determine net periodic benefit cost for pension plans were as follows:
2013 2012 2011
Discount rates 3.45% 4.15% 4.75%
Rates of increase in compensation levels 4.36 4.27 4.25
Expected long-term rates of return on assets 7.62 7.69 8.00
In developing the expected long-term rate of return on assets, management evaluated input from an external consulting
firm, including their projection of asset class return expectations and long-term inflation assumptions. The Company also
considered historical returns on the plans’ assets. Discount rates are based on yields available on high-quality corporate
bonds that would generate cash flows necessary to pay the benefits when due.
The Company’s pension plans’ assets are invested in an aggregate diversified portfolio to minimize the impact of any
adverse or unexpected results from a security class on the entire portfolio. Diversification is interpreted to include
diversification by asset type, performance and risk characteristics and number of investments. When appropriate and
consistent with the objectives of the plans, derivative instruments may be used to mitigate risk or provide further
diversification, subject to the investment policies of the plans. Asset classes and ranges considered appropriate for
investment of the plans’ assets are determined by each plan’s investment committee. The target allocations are 70%
equity securities, 20% debt securities and 10% all other types of investments, except for the assets in pooled pension
funds which are 55% equity securities and 45% debt securities. Actual allocations will generally be within 5% of these
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