Mondelez 2014 Annual Report Download - page 94

Table of Contents
Postemployment Benefit Plans
Obligations:
Our postemployment plans are primarily not funded. The changes in and the amount of the accrued benefit obligation at
December 31, 2014 and 2013 were:
The accrued benefit obligation was determined using a weighted-average discount rate of 5.6% in 2014 and 6.2% in 2013, an
assumed weighted-average ultimate annual turnover rate of 0.3% in 2014 and 2013, assumed compensation cost increases of
4.0% in 2014 and 2013 and assumed benefits as defined in the respective plans.
Postemployment costs arising from actions that offer employees benefits in excess of those specified in the respective plans are
charged to expense when incurred.
Components of Net Postemployment Costs:
Net postemployment costs consisted of the following:
As of December 31, 2014, the estimated net gain for the postemployment benefit plans that we expected to amortize from
accumulated other comprehensive earnings / (losses) into net postemployment costs during 2015 was insignificant.
Note 11. Commitments and Contingencies
Legal Proceedings:
We routinely are involved in legal proceedings, claims and governmental inspections or investigations (“Legal Matters”) arising in
the ordinary course of our business.
A compliant and ethical corporate culture, which includes adhering to laws and industry regulations in all jurisdictions in which we
do business, is integral to our success. Accordingly, after we acquired Cadbury in February 2010 we began reviewing and
adjusting, as needed, Cadbury’s operations in light of applicable standards as well as our policies and practices. We initially
focused on such high priority areas as food safety, the Foreign Corrupt Practices Act (“FCPA”) and antitrust. Based upon Cadbury’
s
pre-acquisition policies and compliance programs and our post-acquisition reviews, our preliminary findings indicated that
Cadbury’s overall state of compliance was sound. Nonetheless, through our reviews, we determined that in certain jurisdictions,
including India, there appeared to be facts and circumstances warranting further investigation. We are continuing our investigations
in certain jurisdictions, including in India, and we continue to cooperate with governmental authorities.
91
2014
2013
(in millions)
Accrued benefit obligation at January 1
$
103
$
100
Service cost
9
8
Interest cost
6
5
Benefits paid
(17
)
(21
)
Assumption changes
2
(2
)
Actuarial losses
(9
)
13
Accrued benefit obligation at December 31
$
94
$
103
For the Years Ended December 31,
2014
2013
2012
(in millions)
Service cost
$
9
$
8
$
12
Interest cost
6
5
8
Amortization of net (gains) / losses
–
(
1
)
(3
)
Other – (
1
)
3
Net postemployment costs related to
discontinued operations –
– (
5
)
Net postemployment costs included in
continuing operations
$
15
$
11
$
15