Avis 2014 Annual Report Download - page 103

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F-36
Defined Benefit Pension Plans
The Company sponsors non-contributory defined benefit pension plans in the United States covering
certain eligible employees and sponsors contributory and non-contributory defined benefit pension plans in
certain foreign subsidiaries with some plans offering participation in the plans at the employees’ option. The
most material of the non-U.S. defined benefit pension plans is operated in the United Kingdom. Under these
plans, benefits are based on an employee’s years of credited service and a percentage of final average
compensation. However, the majority of such plans are closed to new employees and are no longer
accruing benefits. There is an unfunded defined benefit pension plan for employees in Germany, which is
closed to new employees, and a statutorily determined unfunded defined benefit termination plan for
employees in Italy.
The funded status of the defined benefit pension plans is recognized on the Consolidated Balance Sheets
and the gains or losses and prior service costs or credits that arise during the period, but are not recognized
as components of net periodic benefit cost, are recognized as a component of accumulated other
comprehensive income (loss), net of tax.
The components of net periodic benefit cost consisted of the following:
Year Ended December 31,
2014 2013 2012
Service cost $ 5 $ 5 $ 5
Interest cost 29 26 27
Expected return on plan assets (32) (28) (25)
Amortization of unrecognized amounts 3 15 14
Net periodic benefit cost $ 5 $ 18 $ 21
The estimated amount that will be amortized from accumulated other comprehensive income (loss) into net
periodic benefit cost in 2015 is $6 million, which consists of $5 million for net actuarial loss and $1 million for
prior service cost.
The Company uses a measurement date of December 31 for its pension plans. The funded status of the
pension plans were as follows:
As of December 31,
Change in Benefit Obligation 2014 2013
Benefit obligation at end of prior year $ 670 $ 670
Service cost 55
Interest cost 29 26
Plan amendments (1) 1
Actuarial (gain) loss 72 (19)
Currency translation adjustment (34) 8
Net benefits paid (25) (21)
Benefit obligation at end of current year $ 716 $ 670
Change in Plan Assets
Fair value of assets at end of prior year $ 517 $ 465
Actual return on plan assets 56 52
Employer contributions 26 17
Currency translation adjustment (21) 4
Net benefits paid (25) (21)
Fair value of assets at end of current year $ 553 $ 517