Lockheed Martin 2013 Annual Report Download - page 84

The accumulated benefit obligation (ABO) for all qualified defined benefit pension plans was $37.5 billion and
$40.4 billion at December 31, 2013 and 2012, of which $37.3 billion and $40.2 billion related to plans where the ABO was in
excess of plan assets. The ABO represents benefits accrued without assuming future compensation increases to plan
participants. Certain key information related to our qualified defined benefit pension plans as of December 31, 2013 and
2012 is as follows (in millions):
2013 2012
Plans where ABO was in excess of plan assets
Projected benefit obligation $41,984 $ 45,875
Less: fair value of plan assets 32,623 30,597
Unfunded status of plans (a) (9,361) (15,278)
Plans where ABO was less than plan assets
Projected benefit obligation 177 142
Less: fair value of plan assets 387 327
Funded status of plans (b) $ 210 $ 185
(a) Represent accrued pension liabilities, which are included on our Balance Sheets.
(b) Represent prepaid pension assets, which are included on our Balance Sheets in other noncurrent assets.
We also sponsor nonqualified defined benefit plans to provide benefits in excess of qualified plan limits. The aggregate
liabilities for these plans at both December 31, 2013 and 2012 were $1.0 billion, which also represent the plans’ unfunded status.
We have set aside certain assets totaling $373 million and $270 million as of December 31, 2013 and 2012 in a separate trust
which we expect to be used to pay obligations under our nonqualified defined benefit plans. In accordance with GAAP, those
assets may not be used to offset the amount of the benefit obligation similar to the postretirement benefit plans in the table
above. The unrecognized net actuarial losses at December 31, 2013 and 2012 were $480 million and $544 million, and the
unrecognized prior service costs were not material. The expense associated with these plans totaled $108 million in 2013,
$107 million in 2012, and $104 million in 2011. We also sponsor a small number of other postemployment plans and foreign
benefit plans. The aggregate liability for the other postemployment plans was $108 million and $109 million as of
December 31, 2013 and 2012. The expense for the other postemployment plans, as well as the liability and expense associated
with the foreign benefit plans, was not material to our results of operations, financial position, or cash flows. The actuarial
assumptions used to determine the benefit obligations and expense associated with our nonqualified defined benefit plans and
postemployment plans are similar to those assumptions used to determine the benefit obligations and expense related to our
qualified defined benefit pension plans and retiree medical and life insurance plans as described below.
The following table provides the amounts recognized in other comprehensive income (loss) related to postretirement
benefit plans, net of tax, for the years ended December 31, 2013, 2012, and 2011 (in millions):
Incurred but Not Yet
Recognized in Net
Periodic Benefit Cost
Recognition of
Previously
Deferred Amounts
2013 2012 2011 2013 2012 2011
Gains (losses) (Gains) losses
Actuarial gains and losses
Qualified defined benefit pension plans $2,751 $(2,933) $(2,793) $ 911 $721 $568
Retiree medical and life insurance plans 140 (104) 1 28 21 22
Other plans 46 (98) (56) 34 77 34
2,937 (3,135) (2,848) 973 819 624
Credit (cost) (Credit) cost
Prior service credit and cost
Qualified defined benefit pension plans (69) (73) (3) 53 47 53
Retiree medical and life insurance plans —4 (7) (11) (8) (11)
(69) (69) (10) 42 39 42
$2,868 $(3,204) $(2,858) $1,015 $858 $666
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