XML 41 R20.htm IDEA: XBRL DOCUMENT v3.22.4
Employee Benefit Plans
 12 Months Ended
Dec. 31, 2022
Employee Benefit Plans [Abstract]  
Employee Benefit Plans
13.
 
EMPLOYEE BENEFIT PLANS
Defined Benefit Pension Plans.
The
 
Company
 
maintains
 
both
 
qualified
 
and
 
non-qualified
 
defined
 
benefit
 
pension
 
plans
 
for
 
its
 
U.S.
 
employees
employed prior to April
 
1, 2010.
 
Generally,
 
the Company computes
 
the benefits based on
 
average earnings
 
over
a
 
period
 
prescribed
 
by
 
the
 
plans
 
and
 
credited
 
length
 
of
 
service.
 
The
 
Company’s
 
non-qualified
 
defined
 
benefit
pension plan provided
 
compensating pension benefits
 
for participants whose
 
benefits have been curtailed
 
under
the
 
qualified
 
plan
 
due
 
to
 
Internal
 
Revenue
 
Code
 
limitations.
 
Effective
 
January 1,
 
2018,
 
participants
 
of
 
the
Company’s non-qualified defined
 
benefit pension plan may no longer accrue additional
 
service benefits.
Although
 
not
 
required
 
to
 
make
 
contributions
 
under
 
IRS
 
regulations,
 
the
 
following
 
table
 
summarizes
 
the
Company’s contributions
 
to the defined benefit pension plans for the periods
 
indicated:
Years Ended December 31,
(Dollars in millions)
2022
2021
2020
Company contributions
$
6
$
4
$
7
The following table summarizes the
 
Company’s pension expense
 
for the periods indicated:
Years Ended December 31,
(Dollars in millions)
2022
2021
2020
Pension expense
$
(2)
$
3
$
8
The
 
following
 
table
 
summarizes
 
the
 
status
 
of
 
these
 
defined
 
benefit
 
plans
 
for
 
U.S.
 
employees
 
for
 
the
 
periods
indicated:
Years Ended December 31,
(Dollars in millions)
2022
2021
Change in projected benefit obligation:
Benefit obligation at beginning of year
$
403
$
404
Service cost
9
11
Interest cost
10
8
Actuarial (gain)/loss
(115)
(9)
Curtailment
-
-
Benefits paid
(15)
(12)
Projected benefit obligation at end of year
291
403
Change in plan assets:
Fair value of plan assets at beginning of year
377
354
Actual return on plan assets
(83)
31
Actual contributions during the year
6
4
Administrative expenses paid
-
-
Benefits paid
(15)
(12)
Fair value of plan assets at end of year
285
377
Funded status at end of year
$
(6)
$
(25)
(Some amounts may not reconcile due
 
to rounding.)
Amounts recognized in the consolidated
 
balance sheets for the periods indicated:
At December 31,
(Dollars in millions)
2022
2021
Other assets (due beyond one year)
$
1
$
-
Other liabilities (due within one year)
(1)
(1)
Other liabilities (due beyond one year)
(6)
(24)
Net amount recognized in the consolidated balance sheets
$
(6)
$
(25)
(Some amounts may not reconcile due to rounding.)
Amounts not yet reflected in
 
net periodic benefit cost and included in accumulated
 
other comprehensive income
(loss) for the periods indicated:
At December 31,
(Dollars in millions)
2022
2021
Accumulated income (loss)
$
(56)
$
(68)
Accumulated other comprehensive income (loss)
$
(56)
$
(68)
(Some amounts may not reconcile due to rounding.)
Other changes in other comprehensive income (loss)
 
for the periods indicated are as
 
follows:
Years Ended December 31,
(Dollars in millions)
2022
2021
Other comprehensive income (loss) at December 31, prior year
$
(68)
$
(92)
Net gain (loss) arising during period
7
15
Recognition of amortizations in net periodic benefit cost:
Actuarial loss
4
9
Curtailment loss recognized
-
-
Other comprehensive income (loss) at December 31, current year
$
(56)
$
(68)
(Some amounts may not reconcile due to rounding.)
Net periodic benefit cost for U.S.
 
employees included the following components
 
for the periods indicated:
Years Ended December 31,
(Dollars in millions)
2022
2021
2020
Service cost
$
9
$
11
$
10
Interest cost
10
8
10
Expected return on assets
(25)
(24)
(21)
Amortization of actuarial loss from earlier periods
4
8
9
Settlement
1
-
1
Net periodic benefit cost
$
(2)
$
3
$
8
Other changes recognized in other comprehensive income (loss):
Other comprehensive income (loss) attributable to change from prior year
(12)
(24)
Total recognized in net periodic benefit cost and other
comprehensive income (loss)
$
(14)
$
(21)
(Some amounts may not reconcile due to rounding.)
The weighted
 
average
 
discount rates
 
used to determine
 
net periodic
 
benefit cost
 
for 2022,
 
2021 and 2020
 
were
2.86
%,
2.55
% and
3.28
%, respectively.
 
The rate
 
of
 
compensation
 
increase
 
used
 
to
 
determine
 
the
 
net
 
periodic
benefit cost for
 
2022, 2021 and 2020
 
was
4.00
%.
 
The expected long-term
 
rate of return
 
on plan assets for
 
2022,
2021 and 2020 was
6.75
%,
7.00
% and
7.00
% respectively.
 
The
 
weighted
 
average
 
discount
 
rates
 
used
 
to
 
determine
 
the
 
actuarial
 
present
 
value
 
of
 
the
 
projected
 
benefit
obligation for 2022, 2021 and 2020 were
5.25
%,
2.86
% and
2.55
%, respectively.
 
The following table summarizes the
 
accumulated benefit obligation for
 
the periods indicated:
At December 31,
(Dollars in millions)
2022
2021
Qualified Plan
$
258
$
339
Non-qualified Plan
6
12
Total
$
264
$
352
(Some amounts may not reconcile due to rounding.)
The following
 
table displays
 
the plans
 
with projected
 
benefit obligations
 
in excess
 
of plan
 
assets for
 
the periods
indicated:
At December 31,
(Dollars in millions)
2022
2021
Qualified Plan
Projected benefit obligation
$
284
$
390
Fair value of plan assets
285
377
Non-qualified Plan
Projected benefit obligation
$
6
$
12
Fair value of plan assets
-
-
The
 
following
 
table
 
displays
 
the
 
plans
 
with
 
accumulated
 
benefit
 
obligations
 
in
 
excess
 
of
 
plan
 
assets
 
for
 
the
periods indicated:
At December 31,
(Dollars in millions)
2022
2021
Qualified Plan
Accumulated benefit obligation
$
-
$
-
Fair value of plan assets
-
-
Non-qualified Plan
Accumulated benefit obligation
$
6
$
12
Fair value of plan assets
-
-
The following table displays
 
the expected benefit payments in
 
the periods indicated:
(Dollars in millions)
2023
$
13
2024
14
2025
14
2026
15
2027
17
Next 5 years
100
Plan assets
 
consist of
 
shares in
 
investment
 
trusts with
74
%,
24
%,
1
% and
1
% of the
 
underlying assets
 
consisting
of
 
equity
 
securities,
 
fixed
 
maturities,
 
limited
 
partnerships
 
and
 
cash,
 
respectively.
 
The
 
Company
 
manages
 
the
qualified
 
plan
 
investments
 
for
 
U.S.
 
employees.
 
The
 
assets
 
in
 
the
 
plan
 
consist
 
of
 
debt
 
and
 
equity
 
mutual
funds.
 
Due to the long term nature
 
of the plan, the target
 
asset allocation has historically
 
been
70
% equities and
30
% bonds.
 
The following
 
tables present
 
the fair
 
value measurement
 
levels for
 
the qualified
 
plan assets
 
at fair
 
value for
 
the
periods indicated:
Fair Value Measurement Using:
Quoted Prices
in Active
Significant
Markets for
Other
Significant
Identical
Observable
Unobservable
Assets
Inputs
Inputs
(Dollars in millions)
December 31, 2022
(Level 1)
(Level 2)
(Level 3)
Assets:
Short-term investments, which approximates fair value (a)
$
4
$
4
$
-
$
-
Mutual funds, fair value
Fixed income (b)
68
68
-
-
Equities (c)
211
211
-
-
Total
$
283
$
283
$
-
$
-
(Some amounts may not reconcile due to rounding.)
This category includes high quality, short-term
 
money market instruments, which are issued and payable in
 
U.S. dollars.
(b)
This category includes fixed income funds, which invest in
 
investment grade securities of corporations, governments
 
and government agencies with approximately
70
% in U.S.
securities and
30
% in international securities.
(c)
This category includes funds, which invest in small, mid and multi-cap equity securities
 
including common stocks, securities convertible into common stock
 
and securities with
common stock characteristics, such as rights and warrants, with
 
approximately
50
% in U.S. equities and
50
% in international equities.
Fair Value Measurement Using:
Quoted Prices
in Active
Significant
Markets for
Other
Significant
Identical
Observable
Unobservable
Assets
Inputs
Inputs
(Dollars in millions)
December 31, 2021
(Level 1)
(Level 2)
(Level 3)
Assets:
Short-term investments, which approximates fair value (a)
$
3
$
3
$
-
$
-
Mutual funds, fair value
Fixed income (b)
85
85
-
-
Equities (c)
287
287
-
-
Total
$
375
$
375
$
-
$
-
(Some amounts may not reconcile due to rounding.)
This category includes high quality, short-term
 
money market instruments, which are issued and payable in
 
U.S. dollars.
(b)
This category includes fixed income funds, which invest in
 
investment grade securities of corporations, governments
 
and government agencies with approximately
70
% in U.S.
securities and
30
% in international securities.
(c)
This category includes funds, which invest in small, mid and multi-cap equity securities
 
including common stocks, securities convertible into common stock
 
and securities with
common stock characteristics, such as rights and warrants, with
 
approximately
50
% in U.S. equities and
50
% in international equities.
In addition, $
1.5
 
million and $
2.6
 
million of investments
 
which were recorded
 
as part of the
 
qualified plan assets
at
 
December 31,
 
2022
 
and
 
2021,
 
respectively,
 
are
 
not
 
included
 
within
 
the
 
fair
 
value
 
hierarchy
 
tables
 
as
 
the
assets are valued using the NAV
 
practical expedient guidance within ASU
 
2015-07.
No
 
contributions
 
were made
 
to the
 
qualified pension
 
benefit plan
 
for the
 
years
 
ended December 31,
 
2022 and
2021.
Defined Contribution Plans.
The
 
Company
 
also
 
maintains
 
both
 
qualified
 
and
 
non-qualified
 
defined
 
contribution
 
plans
 
(“Savings
 
Plan”
 
and
“Non-Qualified Savings
 
Plan”,
 
respectively) covering
 
U.S. employees.
 
Under the plans,
 
the Company
 
contributes
up
 
to
 
a
 
maximum
3
%
 
of
 
the
 
participants’
 
compensation
 
based
 
on
 
the
 
contribution
 
percentage
 
of
 
the
employee.
 
The Non-Qualified
 
Savings
 
Plan provides
 
compensating
 
savings
 
plan benefits
 
for participants
 
whose
benefits
 
have
 
been
 
curtailed
 
under
 
the
 
Savings
 
Plan
 
due
 
to
 
Internal
 
Revenue
 
Code
 
limitations.
 
In
 
addition,
effective
 
for new
 
hires (and
 
rehires) on
 
or after
 
April 1, 2010,
 
the Company
 
will contribute
 
between
3
% and
8
%
of
 
an
 
employee’s
 
earnings
 
for
 
each
 
payroll
 
period
 
based
 
on
 
the
 
employee’s
 
age.
 
These
 
contributions
 
will
 
be
100
%
 
vested
 
after
 
three
 
years.
 
The
 
Company
 
incurred
 
expenses
 
related
 
to
 
these
 
plans
 
of
 
$
18
 
million,
 
$
15
million and $
14
 
million for the years ended December 31,
 
2022, 2021 and 2020, respectively.
In
 
addition,
 
the
 
Company
 
maintains
 
several
 
defined
 
contribution
 
pension
 
plans
 
covering
 
non-U.S.
employees.
 
Each
 
international
 
office
 
maintains
 
a
 
separate
 
plan
 
for
 
the
 
non-U.S.
 
employees
 
working
 
in
 
that
location.
 
The Company contributes
 
various amounts based
 
on salary,
 
age and/or years
 
of service.
 
In the current
year,
 
the contributions
 
as a
 
percentage
 
of salary
 
for
 
the international
 
offices
 
ranged
 
from
4.3
% to
39.5
%.
 
The
contributions
 
are
 
generally
 
used
 
to
 
purchase
 
pension
 
benefits
 
from
 
local
 
insurance
 
providers.
 
The
 
Company
incurred expenses
 
related to
 
these plans
 
of $
4
 
million, $
3
 
million and
 
$
3
 
million for
 
the years
 
ended December
31, 2022, 2021 and 2020, respectively.
Post-Retirement Plan.
The Company
 
sponsors a
 
Retiree Health
 
Plan for
 
employees employed
 
prior to
 
April 1, 2010.
 
This plan
 
provides
healthcare
 
benefits
 
for
 
eligible
 
retired
 
employees
 
(and
 
their
 
eligible
 
dependents),
 
who
 
have
 
elected
coverage.
 
The Company
 
anticipates that
 
most covered
 
employees will
 
become eligible for
 
these benefits
 
if they
retire
 
while
 
working
 
for
 
the
 
Company.
 
The
 
cost
 
of
 
these
 
benefits
 
is
 
shared
 
with
 
the
 
retiree.
 
The
 
Company
accrues the
 
post-retirement
 
benefit expense
 
during the
 
period of
 
the employee’s
 
service.
 
A medical
 
cost trend
rate
 
of
7.00
% in
 
2022 was
 
assumed to
 
decrease gradually
 
to
4.75
% in
 
2030 and
 
then remain
 
at that
 
level.
 
The
Company
 
incurred
 
expenses
 
of
 
$
1
 
million,
 
$
1
 
million
 
and
 
$
1
 
million
 
for
 
the
 
years
 
ended
 
December
 
31,
 
2022,
2021 and 2020, respectively.
The following table summarizes the
 
status of this plan for the periods indicated:
At December 31,
(Dollars in millions)
2022
2021
Change in projected benefit obligation:
Benefit obligation at beginning of year
$
31
$
35
Service cost
1
1
Interest cost
1
1
Amendments
-
-
Actuarial (gain)/loss
(10)
(6)
Benefits paid
-
-
Benefit obligation at end of year
21
31
Change in plan assets:
Fair value of plan assets at beginning of year
-
-
Employer contributions
-
-
Benefits paid
-
-
Fair value of plan assets at end of year
-
-
Funded status at end of year
$
(21)
$
(31)
Amounts recognized in the consolidated
 
balance sheets for the periods indicated:
At December 31,
(Dollars in millions)
2022
2021
Other liabilities (due within one year)
$
(1)
$
(1)
Other liabilities (due beyond one year)
(21)
(30)
Net amount recognized in the consolidated balance sheets
$
(21)
$
(31)
(Some amounts may not reconcile due to rounding.)
Amounts not yet reflected in
 
net periodic benefit cost and included in accumulated
 
other comprehensive income
(loss) for the periods indicated:
At December 31,
(Dollars in millions)
2022
2021
Accumulated income (loss)
$
13
$
2
Accumulated prior service credit (cost)
1
2
Accumulated other comprehensive income (loss)
$
14
$
4
Other changes in other comprehensive income (loss)
 
for the periods indicated are as
 
follows:
Years Ended December 31,
(Dollars in millions)
2022
2021
Other comprehensive income (loss) at December 31, prior year
$
4
$
(2)
Net gain (loss) arising during period
10
6
Prior Service credit (cost) arising during period
-
-
Recognition of amortizations in net periodic benefit cost:
Actuarial loss (gain)
-
-
Prior service cost
-
(1)
Other comprehensive income (loss) at December 31, current year
$
14
$
4
Net periodic benefit cost included the following
 
components for the periods indicated:
Years Ended December 31,
(Dollars in millions)
2022
2021
2020
Service cost
$
1
$
1
$
1
Interest cost
1
1
1
Prior service credit recognition
-
(1)
(1)
Net gain recognition
-
-
-
Net periodic cost
$
1
$
1
$
1
Other changes recognized in other comprehensive income (loss):
Other comprehensive gain (loss) attributable to change from prior year
(10)
(5)
Total recognized in net periodic benefit cost and
other comprehensive income (loss)
$
(9)
$
(4)
(Some amounts may not reconcile due to rounding.)
The weighted
 
average
 
discount rates
 
used to determine
 
net periodic
 
benefit cost
 
for 2022,
 
2021 and 2020
 
were
2.86
%,
2.55
% and
3.28
%, respectively.
The
 
weighted
 
average
 
discount
 
rates
 
used
 
to
 
determine
 
the
 
actuarial
 
present
 
value
 
of
 
the
 
projected
 
benefit
obligation at year end 2022, 2021 and 2020 were
5.25
%,
2.86
% and
2.55
%, respectively.
The following table displays
 
the expected benefit payments
 
in the years indicated:
(Dollars in millions)
2023
$
1
2024
1
2025
1
2026
1
2027
1
Next 5 years
7