UNITED TECHNOLOGIES CORP /DE/ | 2013 | FY | 3


(dollars in millions)
Quoted Prices in
Active Markets
For Identical Assets
(Level 1)

 
Significant
Observable Inputs
(Level 2)

 
Significant
Unobservable Inputs
(Level 3)

 
Total

Asset Category:
 
 
 
 
 
 
 
Public Equities
 
 
 
 
 
 
 
Global Equities
$
6,840

 
$
1

 
$

 
$
6,841

Global Equity Commingled Funds 1

 
4,881

 

 
4,881

Enhanced Global Equities 2
261

 
2,241

 
500

 
3,002

Private Equities 3

 

 
1,339

 
1,339

Fixed Income Securities

 

 

 
 
Governments
424

 
1,307

 

 
1,731

Corporate Bonds

 
8,461

 
296

 
8,757

Structured Products 4

 
80

 

 
80

Real Estate 5

 
13

 
1,800

 
1,813

Other 6

 
2,110

 

 
2,110

Cash & Cash Equivalents 7
2

 
207

 

 
209

Subtotal
$
7,527

 
$
19,301

 
$
3,935

 
30,763

Other Assets & Liabilities 8
 
 
 
 
 
 
592

Total at December 31, 2013
 
 
 
 
 
 
$
31,355

Public Equities
 
 
 
 
 
 
 
Global Equities
$
6,413

 
$

 
$

 
$
6,413

Global Equity Commingled Funds 1

 
4,114

 

 
4,114

Enhanced Global Equities 2
169

 
1,959

 
447

 
2,575

Private Equities 3

 

 
1,202

 
1,202

Fixed Income Securities

 

 

 
 
Governments
1,003

 
1,421

 

 
2,424

Corporate Bonds

 
7,699

 
276

 
7,975

Structured Products 4

 
21

 

 
21

Real Estate 5

 
19

 
1,785

 
1,804

Other 6

 
2,182

 

 
2,182

Cash & Cash Equivalents 7
1

 
364

 

 
365

Subtotal
$
7,586

 
$
17,779

 
$
3,710

 
29,075

Other Assets & Liabilities 8
 
 
 
 
 
 
853

Total at December 31, 2012
 
 
 
 
 
 
$
29,928

(dollars in millions)
  
Net actuarial loss
$
430

Prior service credit
(9
)
 
$
421

(dollars in millions)
2013
 
2012
 
2011
Other Postretirement Benefits:
 
 
 
 
 
Service cost
$
3

 
$
3

 
$
3

Interest cost
38

 
37

 
39

Expected return on plan assets

 

 
(1
)
Amortization of prior service credit
(10
)
 
(4
)
 
(2
)
Recognized actuarial net gain
(4
)
 
(6
)
 
(8
)
Net settlement and curtailment gain

 
(2
)
 
(8
)
Net periodic other postretirement benefit cost
$
27

 
$
28

 
$
23

(dollars in millions)
2013
 
2012
Change in Benefit Obligation:
 
 
 
Beginning balance
$
1,106

 
$
784

Service cost
3

 
3

Interest cost
38

 
37

Actuarial (gain) loss
(62
)
 
45

Total benefits paid
(119
)
 
(107
)
Business combinations

 
328

Other
21

 
16

Ending balance
$
987

 
$
1,106

 
 
 
 
Change in Plan Assets:
 
 
 
Beginning balance
$

 
$

Actual return on plan assets

 

Employer contributions
95

 
85

Benefits paid from plan assets
(119
)
 
(107
)
Other
24

 
22

Ending balance
$

 
$

 
 
 
 
Funded Status:
 
 
 
Fair value of plan assets
$

 
$

Benefit obligations
(987
)
 
(1,106
)
Funded status of plan
$
(987
)
 
$
(1,106
)
 
 
 
 
Amounts Recognized in the Consolidated Balance Sheet Consist of:
 
 
 
Current liability
$
(86
)
 
$
(91
)
Noncurrent liability
(901
)
 
(1,015
)
Net amount recognized
$
(987
)
 
$
(1,106
)
 
 
 
 
Amounts Recognized in Accumulated Other Comprehensive Loss Consist of:
 
 
 
Net actuarial gain
$
(124
)
 
$
(65
)
Prior service credit
(1
)
 
(11
)
Net amount recognized
$
(125
)
 
$
(76
)
(dollars in millions)
2013
 
2012
Projected benefit obligation
$
22,142

 
$
32,278

Accumulated benefit obligation
21,475

 
31,147

Fair value of plan assets
19,884

 
25,889

(dollars in millions)
Enhanced
Global
Equities

 
Private
Equities

 
Corporate
Bonds

 
Real
Estate

 
Total

Balance, December 31, 2011
$
239

 
$
1,159

 
$
110

 
$
1,364

 
$
2,872

Plan assets acquired
63

 

 

 
79

 
142

Realized gains
1

 
174

 
3

 
6

 
184

Unrealized (losses) gains relating to instruments still held in the reporting period
31

 
(14
)
 
51

 
115

 
183

Purchases, sales, and settlements, net
113

 
(117
)
 
112

 
221

 
329

Balance, December 31, 2012
447

 
1,202

 
276

 
1,785

 
3,710

Realized gains

 
195

 

 
20

 
215

Unrealized (losses) gains relating to instruments still held in the reporting period
50

 
(9
)
 
2

 
102

 
145

Purchases, sales, and settlements, net
3

 
(49
)
 
18

 
(107
)
 
(135
)
Balance, December 31, 2013
$
500

 
$
1,339

 
$
296

 
$
1,800

 
$
3,935

(dollars in millions)
2013
 
2012
Change in Benefit Obligation:
 
 
 
Beginning balance
$
35,708

 
$
27,167

Service cost
569

 
500

Interest cost
1,373

 
1,331

Actuarial (gain) loss
(3,027
)
 
2,855

Total benefits paid
(1,601
)
 
(1,357
)
Net settlement and curtailment gain
(53
)
 
(90
)
Plan amendments
224

 
(195
)
Business combinations

 
5,235

Other
(167
)
 
262

Ending balance
$
33,026

 
$
35,708

 
 
 
 
Change in Plan Assets:
 
 
 
Beginning balance
$
29,928

 
$
23,542

Actual return on plan assets
3,019

 
3,306

Employer contributions
236

 
516

Benefits paid from plan assets
(1,601
)
 
(1,357
)
Business combinations

 
3,800

Other
(227
)
 
121

Ending balance
$
31,355

 
$
29,928

 
 
 
 
Funded Status:
 
 
 
Fair value of plan assets
$
31,355

 
$
29,928

Benefit obligations
(33,026
)
 
(35,708
)
Funded status of plan
$
(1,671
)
 
$
(5,780
)
 
 
 
 
Amounts Recognized in the Consolidated Balance Sheet Consist of:
 
 
 
Noncurrent assets
$
768

 
$
643

Current liability
(74
)
 
(105
)
Noncurrent liability
(2,365
)
 
(6,318
)
Net amount recognized
$
(1,671
)
 
$
(5,780
)
 
 
 
 
Amounts Recognized in Accumulated Other Comprehensive Loss Consist of:
 
 
 
Net actuarial loss
$
5,261

 
$
10,215

Prior service credit
(37
)
 
(322
)
Net amount recognized
$
5,224

 
$
9,893

(dollars in millions)
  
Current year actuarial gain
$
(62
)
Current year prior service credit
(1
)
Amortization of prior service credit
10

Amortization of actuarial net gain
4

Net settlements and curtailments

Total recognized in other comprehensive loss
$
(49
)
Net recognized in net periodic other postretirement benefit cost and other comprehensive loss
$
22

 
 
Benefit Obligation
 
Net Cost
  
 
2013
 
2012
 
2013
 
2012
 
2011
Discount rate
 
4.7
%
 
4.0
%
 
4.0
%
 
4.6
%
 
5.4
%
Salary scale
 
4.2
%
 
4.2
%
 
4.2
%
 
4.3
%
 
4.4
%
Expected return on plan assets
 

 

 
7.7
%
 
7.7
%
 
7.9
%
 
2013 One-Percentage-Point
(dollars in millions)
Increase

 
Decrease

Effect on total service and interest cost
$
3

 
$
(2
)
Effect on postretirement benefit obligation
69

 
(59
)
(dollars in millions)
2013
 
2012
 
2011
Pension Benefits:
 
 
 
 
 
Service cost
$
569

 
$
500

 
$
444

Interest cost
1,373

 
1,331

 
1,298

Expected return on plan assets
(2,107
)
 
(1,944
)
 
(1,834
)
Amortization of prior service credits
(34
)
 
(24
)
 
(12
)
Amortization of unrecognized net transition obligation

 
1

 
1

Recognized actuarial net loss
954

 
722

 
462

Net settlement and curtailment loss
1

 
77

 
16

Net periodic pension cost - employer
$
756

 
$
663

 
$
375

 
Benefit Obligation
 
Net Cost
  
2013
 
2012
 
2013
 
2012
 
2011
Discount rate
4.4
%
 
3.6
%
 
3.6
%
 
4.2
%
 
4.9
%
Expected return on plan assets

 

 

 

 
5.0
%
 
2013
 
2012
Health care cost trend rate assumed for next year
7.5
%
 
8.0
%
Rate that the cost trend rate gradually declines to
5.0
%
 
5.0
%
Year that the rate reaches the rate it is assumed to remain at
2019

 
2019

(dollars in millions)
  
Current year actuarial gain
$
(3,925
)
Amortization of actuarial loss
(954
)
Current year prior service cost
226

Amortization of prior service credit
34

Other
(50
)
Total recognized in other comprehensive loss
$
(4,669
)
Net recognized in net periodic pension cost and other comprehensive loss
$
(3,913
)

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