Johnson Controls 2014 Annual Report Download - page 91

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91
* During fiscal 2014, $203 million of cumulative foreign currency translation adjustments were recognized as part of the divestiture-
related losses recognized within discontinued operations as a result of the divestiture of the Automotive Experience Electronics
business.
** Refer to Note 10, "Derivative Instruments and Hedging Activities," of the notes to consolidated financial statements for
disclosure of the line items on the consolidated statements of income affected by reclassifications from AOCI into income related
to derivatives.
*** Refer to Note 11, "Fair Value Measurements," of the notes to consolidated financial statements for disclosure of the line item
on the consolidated statements of income affected by reclassifications from AOCI into income related to marketable common
stock.
**** Refer to Note 15, "Retirement Plans," of the notes to consolidated financial statements for disclosure of the components of
the Company's net periodic benefit costs associated with its defined benefit pension and postretirement plans. For the years ended
September 30, 2014 and 2012, the amount reclassified from AOCI into income for pension and postretirement plans were primarily
recorded in cost of sales on the consolidated statement of income. For the year ended September 30, 2013, the income reclassified
from AOCI to income for pension and postretirement plans was split approximately evenly between cost of sales and selling,
general and administrative expenses for the consolidated statement of income.
15. RETIREMENT PLANS
Pension Benefits
The Company has non-contributory defined benefit pension plans covering certain U.S. and non-U.S. employees. The benefits
provided are primarily based on years of service and average compensation or a monthly retirement benefit amount. Effective
January 1, 2006, certain of the Company’s U.S. pension plans were amended to prohibit new participants from entering the plans.
Effective September 30, 2009, active participants will continue to accrue benefits under the amended plans until December 31,
2014. Funding for U.S. pension plans equals or exceeds the minimum requirements of the Employee Retirement Income Security
Act of 1974. Funding for non-U.S. plans observes the local legal and regulatory limits. Also, the Company makes contributions
to union-trusteed pension funds for construction and service personnel.
For pension plans with accumulated benefit obligations (ABO) that exceed plan assets, the projected benefit obligation (PBO),
ABO and fair value of plan assets of those plans were $3,413 million, $3,363 million and $2,642 million, respectively, as of
September 30, 2014 and $3,069 million, $2,981 million and $2,392 million, respectively, as of September 30, 2013.
In fiscal 2014, total employer and employee contributions to the defined benefit pension plans were $164 million, of which $84
million were voluntary contributions made by the Company. The Company expects to contribute approximately $64 million in
cash to its defined benefit pension plans in fiscal 2015. Projected benefit payments from the plans as of September 30, 2014 are
estimated as follows (in millions):
2015 $ 224
2016 226
2017 229
2018 232
2019 240
2020-2024 1,276
Postretirement Benefits
The Company provides certain health care and life insurance benefits for eligible retirees and their dependents primarily in the
U.S. and Canada. Most non-U.S. employees are covered by government sponsored programs, and the cost to the Company is not
significant.
Eligibility for coverage is based on meeting certain years of service and retirement age qualifications. These benefits may be
subject to deductibles, co-payment provisions and other limitations, and the Company has reserved the right to modify these
benefits. Effective January 31, 1994, the Company modified certain salaried plans to place a limit on the Company’s cost of future
annual retiree medical benefits at no more than 150% of the 1993 cost.
The health care cost trend assumption does not have a significant effect on the amounts reported.