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POSTRETIREMENT BENEFIT PLANS
 9 Months Ended
Sep. 30, 2012
POSTRETIREMENT BENEFIT PLANS

NOTE 13

POSTRETIREMENT BENEFIT PLANS

The following tables provides the components of net periodic benefit cost for pension plans and other employee-related benefit plans for the three and nine month periods ended September 30, 2012 and 2011.

 

     2012     2011  
Three Months Ended September 30    Pension     Other
Benefits		     Total     Pension     Other
Benefits		     Total  

Net periodic benefit cost:

             

Service cost

    $ 1.5      $ 0.5      $ 2.0      $ 1.7      $ 0.5      $ 2.2   

Interest cost

      3.9        2.2        6.1        4.0        2.3        6.3   

Expected return on plan assets

      (4.7 )      (0.2 )      (4.9 )      (4.7 )      (0.1 )      (4.8 ) 

Amortization of prior service cost

      0.2        —        0.2        0.3        —        0.3   

Amortization of net actuarial loss

      1.6        1.1        2.7        0.9        0.6        1.5   
Net periodic benefit cost    $ 2.5      $ 3.6      $ 6.1      $ 2.2      $ 3.3      $ 5.5   

 

     2012     2011  
Nine Months Ended September 30    Pension     Other
Benefits		     Total     Pension     Other
Benefits		     Total  

Net periodic benefit cost:

             

Service cost

    $ 4.3      $ 1.6      $ 5.9      $ 5.0      $ 1.6      $ 6.6   

Interest cost

      11.6        6.7        18.3        12.0        7.0        19.0   

Expected return on plan assets

      (13.6 )      (0.4 )      (14.0 )      (14.0 )      (0.4 )      (14.4 ) 

Amortization of prior service cost (benefit)

      0.7        (0.1 )      0.6        0.9        (0.1 )      0.8   

Amortization of net actuarial loss

      4.7        3.1        7.8        2.6        1.9        4.5   
Net periodic benefit cost    $ 7.7      $ 10.9      $ 18.6      $ 6.5      $ 10.0      $ 16.5   

 

During the nine months ended September 30, 2012, we contributed $33.1 to our U.S. pension plans. We do not expect to make material contributions to our pension plans during the remainder of 2012.

In connection with the 2012 contributions, during the first quarter of 2012 we elected to remeasure the projected benefit obligations and plan assets for our U.S. pension plans. As a result of the remeasurement, the funded status of our U.S. pension plans improved by $41.2 and an after-tax adjustment of $8.8 was recorded to unrecognized actuarial loss included in other comprehensive income. At September 30, 2012, in the aggregate, ITT’s net postretirement liability was $294.9.

Third Quarter 2011 Plan Design Changes – Discontinued Operations

Prior to the Distribution, substantially all of ITT’s employees were covered under various defined benefit pension plans, defined contribution plans, or both, when they met the eligibility requirements of the plans. During the third quarter of 2011, the Compensation Committee of ITT’s Board of Directors amended the U.S. retirement programs to more closely align to industry practice. The most significant amendment was to ITT’s former U.S. Salaried Retirement Plan (U.S. SRP) which was transferred to Exelis at the Distribution Date. These amendments became effective on completion of the Distribution. The plan design changes eliminated future benefit accruals for a significant portion of employees who remained with ITT or who transferred to Xylem, accelerated vesting for certain plan participants as of the Distribution Date, and recognized future service for eligibility purposes for a defined period of time. Following the Distribution, employees remaining with ITT and new hires are eligible for an enhanced employer contribution to their 401(k).

As a result of the third quarter 2011 changes, ITT remeasured its projected benefit obligations and plan assets for certain U.S. and international pension plans, including the former U.S. SRP. These actions resulted in an unrecognized actuarial loss of $959.8 recorded within other comprehensive income and a curtailment loss of $4.9 including $3.6 presented within income from discontinued operations.