Intel 2012 Annual Report Download - page 87

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U.S. Postretirement Medical Plan Assets
In general, the investment strategy for U.S. postretirement medical benefits plan assets is to invest primarily in liquid
assets due to the level of expected future benefit payments. In 2012 we modified the investment strategy for plan assets
from investing solely in a money market account to investing in a tax-aware global equity portfolio, which is actively
managed by an external investment manager. The tax-aware global equity portfolio is comprised of a diversified mix of
equities in developed countries, including the U.S., and emerging markets throughout the world. The expected long-term
rate of return for the U.S. postretirement medical benefits plan assets is 7.7%. As of December 29, 2012, all of the U.S.
postretirement medical benefits plan assets were invested in exchange-traded equity securities and were measured at fair
value using Level 1 inputs.
Concentrations of Risk
We manage a variety of risks, including market, credit, and liquidity risks, across our plan assets through our investment
managers. We define a concentration of risk as an undiversified exposure to one of the aforementioned risks that
unnecessarily increases the exposure to a loss of plan assets. We monitor exposure to such risks in both the U.S. and
non-U.S. plans by monitoring the magnitude of the risk in each plan and diversifying our exposure to such risks across a
variety of instruments, markets, and counterparties. As of December 29, 2012, we did not have concentrations of risk in
any single entity, manager, counterparty, sector, industry, or country.
Funding Expectations
Under applicable law for the U.S. Intel Minimum Pension Plan and the U.S. postretirement medical benefits plan, we are
not required to make any contributions during 2013. Our expected required funding for the non-U.S. plans during 2013 is
approximately $63 million.
Estimated Future Benefit Payments
Estimated benefit payments over the next 10 fiscal years are as follows:
(In Millions)
U.S. Pension
Benefits
Non-U.S.
Pension
Benefits
U.S.
Postretirement
Medical
Benefits
2013..................................................................................................................
$ 41
$ 24
$ 18
2014..................................................................................................................
$ 48
$ 26
$ 19
2015..................................................................................................................
$ 61
$ 27
$ 23
2016..................................................................................................................
$ 76
$ 29
$ 22
2017..................................................................................................................
$ 90
$ 31
$ 22
2018–2022........................................................................................................
$ 799
$ 201
$ 121
Note 21: Commitments
A portion of our capital equipment and certain facilities are under operating leases that expire at various dates through
2028. Additionally, portions of our land are under leases that expire at various dates through 2062. Rental expense was
$214 million in 2012 ($178 million in 2011 and $124 million in 2010).
Minimum rental commitments under all non-cancelable leases with an initial term in excess of one year were as follows as
of December 29, 2012:
(In Millions)
2013 ...........................................................................................................................................
$ 206
2014 ...........................................................................................................................................
177
2015 ...........................................................................................................................................
138
2016 ...........................................................................................................................................
98
2017 ...........................................................................................................................................
80
2018 and thereafter ....................................................................................................................
210
Total...........................................................................................................................................
$ 909
Commitments for construction or purchase of property, plant and equipment totaled $4.6 billion as of December 29, 2012
($4.7 billion as of December 31, 2011), substantially all of which will be due within the next year. Other purchase