McKesson 2013 Annual Report Download - page 90

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84
McKESSON CORPORATION
FINANCIAL NOTES (Continued)
The net periodic expense for our pension plans is as follows:
Years Ended March 31,
(In millions) 2013 2012 2011
Service cost - benefits earned during the year $ 7 $ 7 $ 6
Interest cost on projected benefit obligation 28 31 31
Expected return on assets (28) (31) (29)
Amortization of unrecognized actuarial loss, prior service costs and net
transitional obligation 32 27 28
Net periodic pension expense $ 39 $ 34 $ 36
The projected unit credit method is utilized in measuring net periodic pension expense over the employees' service life
for the U.S. pension plans. Unrecognized actuarial losses exceeding 10% of the greater of the projected benefit obligation or
the market value of assets are amortized straight-line over the average remaining future service periods.
Information regarding the changes in benefit obligations and plan assets for our pension plans is as follows:
Years Ended March 31,
(In millions) 2013 2012
Change in benefit obligations
Benefit obligation at beginning of period $ 670 $ 625
Service cost 7 7
Interest cost 28 31
Actuarial loss 73 42
Benefit payments (35) (34)
Foreign exchange impact and other (7) (1)
Benefit obligation at end of period (1) $ 736 $ 670
Change in plan assets
Fair value of plan assets at beginning of period $ 410 $ 416
Actual return on plan assets 31 12
Employer and participant contributions 25 17
Benefits paid (35) (34)
Foreign exchange impact and other (6) (1)
Fair value of plan assets at end of period $ 425 $ 410
Funded status at end of period $ (311) $ (260)
Amounts recognized on the balance sheet
Current liabilities $(3) $ (13)
Long-term liabilities (308) (247)
Total $(311) $ (260)
(1) The benefit obligation is the projected benefit obligation.