XML 31 R17.htm IDEA: XBRL DOCUMENT
v3.23.3

Benefit Plans | 12 Months Ended
--- | ---
Sep. 30, 2023
Retirement Benefits [Abstract] |
Benefit Plans | Benefit Plans The Company has defined benefit pension plans covering certain employees in the United States and in certain international locations. Postretirement healthcare and life insurance benefits provided to qualifying domestic retirees as well as other postretirement benefit plans in international countries are not material. The measurement date used for the Company’s employee benefit plans is September 30. In August 2023, the Company announced that effective September 30, 2024, it would freeze the U.S. Plan, and plan participants, which include legacy Bard U.S. pension plan participants as further discussed below, no longer will accrue benefits under the plan subsequent to this date. Both the legacy BD U.S. pension and legacy Bard U.S. pension plans had already been frozen to prevent new participants effective January 1, 2018 and January 1, 2011, respectively. In fiscal year 2022, the transfer of employees to Embecta in connection with the spin-off triggered remeasurements of some of the Company’s benefit plans. The BD U.S. pension plan was also remeasured upon the merging of this plan with the legacy Bard U.S. pension plan effective January 1, 2022. These remeasurements did not materially impact the Company’s benefit obligation and resulted in adjustments to Accumulated other comprehensive loss. Generally, all components of the Company’s net periodic pension and postretirement benefit costs, aside from service cost, are recorded to Other expense, net on its consolidated statements of income. Certain amounts for termination benefits, curtailments and settlements related to the spin-off of Embecta, were recorded in Income from Discontinued Operations, Net of Tax and were not material. Net pension cost for the years ended September 30 included the following components:
| Pension Plans
(Millions of dollars) | 2023 |  | 2022 |  | 2021
Service cost | $ | 91 |  |  | $ | 134 |  |  | $ | 150 |
Interest cost | 129 |  |  | 77 |  |  | 71 |
Expected return on plan assets | (141) |  |  | (187) |  |  | (174) |
Amortization of prior service credit | (7) |  |  | (15) |  |  | (16) |
Amortization of loss | 58 |  |  | 61 |  |  | 97 |
Curtailments/settlement loss | 44 |  |  | 73 |  |  | 9 |
Net pension cost | $ | 174 |  |  | $ | 143 |  |  | $ | 137 |
Net pension cost included in the preceding table that is attributable to international plans | $ | 25 |  |  | $ | 20 |  |  | $ | 41 |
The amounts provided above for amortization of prior service credit and amortization of loss represent the reclassifications of prior service credits and net actuarial losses that were recognized in Accumulated other comprehensive income (loss) in prior periods. The Company recognizes pension settlements when payments from the plan exceed the sum of service and interest cost components of net periodic pension cost associated with the plan for the fiscal year. The settlement losses recorded in 2023 and 2022 included lump sum benefit payments primarily associated with the Company’s U.S. pension plan. A curtailment gain was recognized in 2023 related the freeze of the U.S. pension plan and a curtailment loss was recognized in 2021 related to a freeze of a pension plan in Europe. The change in benefit obligation, change in fair value of pension plan assets, funded status and amounts recognized in the Consolidated Balance Sheets for these plans were as follows:
| Pension Plans
(Millions of dollars) | 2023 |  | 2022
Change in benefit obligation: |  |  |
Beginning obligation | $ | 2,634 |  |  | $ | 3,889 |
Service cost | 91 |  |  | 134 |
Interest cost | 129 |  |  | 77 |
Plan amendments | — |  |  | 1 |
Benefits paid | (67) |  |  | (64) |
Impact of Embecta spin-off | — |  |  | (7) |
Actuarial gain | (24) |  |  | (1,007) |
Curtailments/settlements | (214) |  |  | (246) |
Other, includes translation | 68 |  |  | (143) |
Benefit obligation at September 30 | $ | 2,617 |  |  | $ | 2,634 |
Change in fair value of plan assets: |  |  |
Beginning fair value | $ | 2,242 |  |  | $ | 3,222 |
Actual return on plan assets | 33 |  |  | (740) |
Employer contribution | 62 |  |  | 198 |
Benefits paid | (67) |  |  | (64) |
Impact of Embecta spin-off | — |  |  | (6) |
Settlements | (200) |  |  | (241) |
Other, includes translation | 59 |  |  | (127) |
Plan assets at September 30 | $ | 2,129 |  |  | $ | 2,242 |
Funded Status at September 30: |  |  |
Unfunded benefit obligation | $ | (488) |  |  | $ | (392) |
Amounts recognized in the Consolidated Balance Sheets at September 30: |  |  |
Other Assets | $ | 81 |  |  | $ | 70 |
Salaries, wages and related items | (15) |  |  | (15) |
Long-term Employee Benefit Obligations | (554) |  |  | (447) |
Net amount recognized | $ | (488) |  |  | $ | (392) |
Amounts recognized in Accumulated other comprehensive income (loss) before income taxes at September 30: |  |  |
Prior service credit | $ | 3 |  |  | $ | 24 |
Net actuarial loss | (689) |  |  | (728) |
Net amount recognized | $ | (686) |  |  | $ | (704) |
International pension plan assets at fair value included in the preceding table were $748 million and $705 million at September 30, 2023 and 2022, respectively. The international pension plan projected benefit obligations were $833 million and $772 million at September 30, 2023 and 2022, respectively. The benefit obligation associated with postretirement healthcare and life insurance plans provided to qualifying domestic retirees, which was largely recorded to Long-Term Employee Benefit Obligations, was $92 million and $101 million at September 30, 2023 and 2022, respectively. Pension plans with accumulated benefit obligations in excess of plan assets and plans with projected benefit obligations in excess of plan assets consist of the following at September 30:
| Accumulated Benefit Obligation Exceeds the Fair Value of Plan Assets |  | Projected Benefit Obligation Exceeds the Fair Value of Plan Assets
(Millions of dollars) | 2023 |  | 2022 |  | 2023 |  | 2022
Projected benefit obligation | $ | 2,140 |  |  | $ | 2,104 |  |  | $ | 2,159 |  |  | $ | 2,182 |
Accumulated benefit obligation | $ | 2,088 |  |  | $ | 2,059 |  |  |  |  |
Fair value of plan assets | $ | 1,575 |  |  | $ | 1,644 |  |  | $ | 1,591 |  |  | $ | 1,720 |
The weighted average assumptions used in determining pension plan information were as follows:
| 2023 |  | 2022 |  | 2021
Net Cost |  |  |  |  |
Discount rate: |  |  |  |  |
U.S. plans (a) | 5.62 | % |  | 2.89 | % |  | 2.80 | %
International plans | 4.26 |  |  | 1.75 |  |  | 1.44 |
Expected return on plan assets: |  |  |  |  |
U.S. plans | 7.25 |  |  | 6.25 |  |  | 6.25 |
International plans | 5.02 |  |  | 4.84 |  |  | 4.92 |
Rate of compensation increase: |  |  |  |  |
U.S. plans | 4.51 |  |  | 4.31 |  |  | 4.30 |
International plans | 2.86 |  |  | 2.63 |  |  | 2.20 |
Cash balance plan interest crediting rate: |  |  |  |  |
U.S. plans | 4.00 |  |  | 4.00 |  |  | 4.00 |
International plans | 1.98 |  |  | 2.02 |  |  | 1.95 |
Benefit Obligation |  |  |  |  |
Discount rate: |  |  |  |  |
U.S. plans | 6.01 |  |  | 5.62 |  |  | 2.89 |
International plans | 4.62 |  |  | 4.26 |  |  | 1.75 |
Rate of compensation increase: |  |  |  |  |
U.S. plans | 4.00 |  |  | 4.51 |  |  | 4.31 |
International plans | 2.86 |  |  | 2.86 |  |  | 2.63 |
Cash balance plan interest crediting rate: |  |  |  |  |
U.S. plans | 4.00 |  |  | 4.00 |  |  | 4.00 |
International plans | 2.21 |  |  | 1.98 |  |  | 2.02 |
(a)The Company calculated the service and interest components utilizing an approach that discounts the individual expected cash flows using the applicable spot rates derived from the yield curve over the projected cash flow period. Expected Rate of Return on Plan Assets The expected rate of return on plan assets is based upon expectations of long-term average rates of return to be achieved by the underlying investment portfolios. In establishing this assumption, the Company considers many factors, including historical assumptions compared with actual results; benchmark data; expected returns on various plan asset classes, as well as current and expected asset allocations. Expected Funding The Company’s funding policy for its defined benefit pension plans is to contribute amounts sufficient to meet legal funding requirements, plus any additional amounts that may be appropriate considering the funded status of the plans, tax consequences, the cash flow generated by the Company and other factors. The Company made a discretionary contribution to its BD U.S. pension plan of $150 million in October 2023. The Company did not make any required contributions in 2023 and does not anticipate any significant required contributions to its pension plans in fiscal year 2024. Expected benefit payments are as follows:
(Millions of dollars) | Pension Plans
2024 | $ | 208 |
2025 | 203 |
2026 | 214 |
2027 | 204 |
2028 | 208 |
2029-2033 | 1,061 |
Expected benefit payments associated with postretirement healthcare plans are immaterial to the Company's consolidated financial results. Investments The Company’s primary objective is to achieve returns sufficient to meet future benefit obligations. It seeks to generate above market returns by investing in more volatile asset classes such as equities while at the same time controlling risk through diversification in non-correlated asset classes and through allocations to more stable asset classes like fixed income. U.S. Plans The Company’s U.S. pension plans comprise 65% of total benefit plan investments, based on September 30, 2023 market values, and have a target asset mix of 45% fixed income, 21% diversifying investments and 34% equities. This mix was established based on an analysis of projected benefit payments and estimates of long-term returns, volatilities and correlations for various asset classes. The asset allocations to diversifying investments include high-yield bonds, hedge funds, real estate, infrastructure, leveraged loans and emerging markets bonds. The actual portfolio investment mix may, from time to time, deviate from the established target mix due to various factors such as normal market fluctuations, the reliance on estimates in connection with the determination of allocations and normal portfolio activity such as additions and withdrawals. Rebalancing of the asset portfolio on a quarterly basis is required to address any allocations that deviate from the established target allocations in excess of defined allowable ranges. The target allocations are subject to periodic review, including a review of the asset portfolio’s performance, by the named fiduciary of the plans. Any tactical deviations from the established asset mix require the approval of the named fiduciary. The U.S. plans may enter into both exchange traded and non-exchange traded derivative transactions in order to manage interest rate exposure, volatility, term structure of interest rates, and sector and currency exposures within the fixed income portfolios. The Company has established minimum credit quality standards for counterparties in such transactions. The following table provides the fair value measurements of U.S. plan assets, as well as the measurement techniques and inputs utilized to measure fair value of these assets, at September 30, 2023 and 2022. The categorization of fund investments is based upon the categorization of these funds’ underlying assets.
|  |  |  |  |  |  |  |  | Basis of fair value measurement (See Note 1)
(Millions of dollars) | Total U.S. Plan Asset Balances |  | Investments Measured at Net Asset Value (a) |  | Level 1 |  | Level 2 |  | Level 3
| 2023 |  | 2022 |  | 2023 |  | 2022 |  | 2023 |  | 2022 |  | 2023 |  | 2022 |  | 2023 |  | 2022
Fixed Income: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Corporate bonds | $ | 443 |  |  | $ | 492 |  |  | $ | — |  |  | $ | — |  |  | $ | 260 |  |  | $ | 258 |  |  | $ | 182 |  |  | $ | 234 |  |  | $ | — |  |  | $ | — |
Government and agency-U.S. | 53 |  |  | 69 |  |  | — |  |  | — |  |  | 43 |  |  | 53 |  |  | 10 |  |  | 16 |  |  | — |  |  | — |
Government and agency-Foreign | 17 |  |  | 22 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 17 |  |  | 22 |  |  | — |  |  | — |
Other fixed income | 46 |  |  | 52 |  |  | — |  |  | — |  |  | 24 |  |  | 26 |  |  | 22 |  |  | 26 |  |  | — |  |  | — |
Equity securities | 469 |  |  | 469 |  |  | 59 |  |  | 62 |  |  | 410 |  |  | 406 |  |  | — |  |  | — |  |  | — |  |  | — |
Cash and cash equivalents | 202 |  |  | 243 |  |  | — |  |  | — |  |  | 202 |  |  | 243 |  |  | — |  |  | — |  |  | — |  |  | — |
Other | 151 |  |  | 191 |  |  | 79 |  |  | 110 |  |  | 72 |  |  | 81 |  |  | — |  |  | — |  |  | — |  |  | — |
Fair value of plan assets | $ | 1,382 |  |  | $ | 1,537 |  |  | $ | 138 |  |  | $ | 172 |  |  | $ | 1,012 |  |  | $ | 1,068 |  |  | $ | 231 |  |  | $ | 297 |  |  | $ | — |  |  | $ | — |
(a)As per applicable disclosure requirements, certain investments that were measured at net asset value per share or its equivalent have not been categorized within the fair value hierarchy. Values of such assets are based on the corroborated net asset value provided by the fund administrator. Fixed Income Securities U.S. pension plan assets categorized above as fixed income securities include fund investments comprised of corporate and government and agency investments. Investments in corporate bonds are diversified across industry and sector and consist of investment-grade, as well as high-yield debt instruments. U.S. government investments consist of obligations of the U.S. Treasury, other U.S. government agencies, state governments and local municipalities. Assets categorized as foreign government and agency debt securities included investments in developed and emerging markets. The values of fixed income investments classified within Level 1 are based on the closing price reported on the major market on which the investments are traded. A portion of the fixed income instruments classified within Level 2 are valued based upon estimated prices from independent vendors’ pricing models and these prices are derived from market observable sources including: benchmark yields, reported trades, broker/dealer quotes, issuer spreads, benchmark securities, bids, offers and other market-related data. Equity Securities U.S. pension plan assets categorized as equity securities consist of fund investments in publicly-traded U.S. and non-U.S. equity securities. In order to achieve appropriate diversification, these portfolios are invested across market sectors, investment styles, capitalization weights and geographic regions. The values of equity securities classified within Level 1 are based on the closing price reported on the major market on which the investments are traded or have a readily determinable fair value based on published prices obtained from fund managers which represent the price at which the instruments can be redeemed at period end. The U.S. pension plan has no future funding commitments associated with these investments and has the right to redeem them upon one day’s notice, at any time and without restriction. Cash and Cash Equivalents A portion of the U.S. plans’ assets consists of investments in cash and cash equivalents, primarily to accommodate liquidity requirements relating to trade settlement and benefit payment activity, and the values of these assets are based upon quoted market prices. Other Securities Other U.S. pension plan assets include fund investments comprised of hedge funds. The values of such instruments classified within Level 1 are based on the closing price reported on the major market on which the investments are traded. International Plans International plan assets comprise 35% of the Company’s total benefit plan assets, based on market value at September 30, 2023. Such plans have local independent fiduciary committees, with responsibility for development and oversight of investment policy, including asset allocation decisions. In making such decisions, consideration is given to local regulations, investment practices and funding rules. The following table provides the fair value measurements of international plan assets, as well as the measurement techniques and inputs utilized to measure fair value of these assets, at September 30, 2023 and 2022.
|  |  |  |  |  |  |  |  | Basis of fair value measurement (See Note 1)
(Millions of dollars) | Total International Plan Asset Balances |  |  |  | Level 1 |  | Level 2 |  | Level 3 (a)
| 2023 |  | 2022 |  |  |  |  |  | 2023 |  | 2022 |  | 2023 |  | 2022 |  | 2023 |  | 2022
Fixed Income: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Corporate bonds | $ | 122 |  |  | $ | 33 |  |  |  |  |  |  | $ | 100 |  |  | $ | 19 |  |  | $ | 10 |  |  | $ | 14 |  |  | $ | 12 |  |  | $ | — |
Government and agency-U.S. | 9 |  |  | 10 |  |  |  |  |  |  | 8 |  |  | 8 |  |  | 2 |  |  | 2 |  |  | — |  |  | — |
Government and agency-Foreign | 197 |  |  | 180 |  |  |  |  |  |  | 165 |  |  | 167 |  |  | 26 |  |  | 13 |  |  | 6 |  |  | — |
Other fixed income | 43 |  |  | 76 |  |  |  |  |  |  | 34 |  |  | 68 |  |  | 9 |  |  | 8 |  |  | — |  |  | — |
Equity securities | 173 |  |  | 190 |  |  |  |  |  |  | 147 |  |  | 190 |  |  | 1 |  |  | — |  |  | 25 |  |  | — |
Cash and cash equivalents | 10 |  |  | 7 |  |  |  |  |  |  | 8 |  |  | 7 |  |  | — |  |  | — |  |  | 2 |  |  | — |
Real estate | 36 |  |  | 35 |  |  |  |  |  |  | 1 |  |  | 1 |  |  | 26 |  |  | 24 |  |  | 9 |  |  | 10 |
Insurance contracts | 103 |  |  | 96 |  |  |  |  |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 103 |  |  | 96 |
Other | 55 |  |  | 76 |  |  |  |  |  |  | 35 |  |  | 48 |  |  | 1 |  |  | 7 |  |  | 19 |  |  | 21 |
Fair value of plan assets | $ | 748 |  |  | $ | 705 |  |  |  |  |  |  | $ | 499 |  |  | $ | 508 |  |  | $ | 74 |  |  | $ | 68 |  |  | $ | 175 |  |  | $ | 128 |
(a)Changes in the fair value of international pension assets measured using Level 3 inputs for the years ended September 30, 2023 and 2022 were immaterial. Fixed Income Securities Fixed income investments held by international pension plans include corporate, U.S. government and non-U.S. government securities. The values of fixed income securities classified within Level 1 are based on the closing price reported on the major market on which the investments are traded. Values of investments classified within Level 2 are based upon estimated prices from independent vendors’ pricing models and these prices are derived from market observable sources. Equity Securities Equity securities included in the international plan assets consist of publicly-traded U.S. and non-U.S. equity securities. The values of equity securities classified within Level 1 are based on the closing price reported on the major market on which the investments are traded or have a readily determinable fair value based on published prices obtained from fund managers which represent the price at which the instruments can be redeemed at period end. The international plans holding these securities have no future funding commitments associated with these investments and has the right to redeem them upon one day’s notice, at any time and without restriction. Other Securities The international plans hold a portion of assets in cash and cash equivalents, in order to accommodate liquidity requirements and the values are based upon quoted market prices. Real estate investments consist of investments in funds holding an interest in real properties and the corresponding values represent the estimated fair value based on the fair value of the underlying investment value or cost, adjusted for any accumulated earnings or losses. The values of insurance contracts approximately represent cash surrender value. Other investments include fund investments for which values are based upon either quoted market prices or market observable sources. Defined Contribution Plans The cost of voluntary defined contribution plans which provide for a Company match or contribution was $156 million in 2023, $178 million in 2022 and $153 million in 2021.

X
- References No definition available. + Details
Name: | us-gaap_CompensationAndRetirementDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for retirement benefits. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 715 -SubTopic 70 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Publisher FASB -URI https://asc.fasb.org//1943274/2147480794/715-70-50-1 Reference 2: http://www.xbrl.org/2003/role/exampleRef -Topic 715 -SubTopic 20 -Name Accounting Standards Codification -Section 55 -Paragraph 17 -Publisher FASB -URI https://asc.fasb.org//1943274/2147480482/715-20-55-17 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 715 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (d)(iv)(03) -Publisher FASB -URI https://asc.fasb.org//1943274/2147480506/715-20-50-1 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 715 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (d)(i) -Publisher FASB -URI https://asc.fasb.org//1943274/2147480506/715-20-50-1 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 715 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (q) -Publisher FASB -URI https://asc.fasb.org//1943274/2147480506/715-20-50-1 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 715 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (l) -Publisher FASB -URI https://asc.fasb.org//1943274/2147480506/715-20-50-1 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 715 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//715/tableOfContent Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 715 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (d)(iii) -Publisher FASB -URI https://asc.fasb.org//1943274/2147480506/715-20-50-1 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 715 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (o) -Publisher FASB -URI https://asc.fasb.org//1943274/2147480506/715-20-50-1 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Topic 715 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (p) -Publisher FASB -URI https://asc.fasb.org//1943274/2147480506/715-20-50-1 Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Topic 715 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (r)(1) -Publisher FASB -URI https://asc.fasb.org//1943274/2147480506/715-20-50-1 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Topic 715 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (r)(2) -Publisher FASB -URI https://asc.fasb.org//1943274/2147480506/715-20-50-1 Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Topic 715 -SubTopic 20 -Name Accounting Standards Codification -Section S99 -Paragraph 2 -Publisher FASB -URI https://asc.fasb.org//1943274/2147480126/715-20-S99-2 Reference 14: http://www.xbrl.org/2003/role/disclosureRef -Topic 715 -SubTopic 60 -Name Accounting Standards Codification -Section 50 -Paragraph 3 -Subparagraph (c) -Publisher FASB -URI https://asc.fasb.org//1943274/2147480266/715-60-50-3 + Details
Name: | us-gaap_PensionAndOtherPostretirementBenefitsDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration