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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