A) What types of retirement and pension plans does JNJ sponsor? B) What are the key assumptions

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Question:

A) What types of retirement and pension plans does JNJ sponsor?

B) What are the key assumptions related to these plans?

C) What is JNJ’s PBO at the end of fiscal year 2016?

D) Is JNJ’s defined benefit pension plan overfunded or underfunded at the end of fiscal year 2016? By what amount?

E) If JNJ increased the life expectancy of retirees in 2016, describe the potential impact on: the PBO, the funded status, pension expense, and other comprehensive income.

F) Comment on the trend of the rate of increase in compensation levels. What impact would this have on the PBO?

G) What is the amount of the pension expense for JNJ for 2016?

H) What is ending balance of pension-related accumulated other comprehensive income for 2015 and 2016?

I) Consider the two components of pension-related AOCI in 2016. Estimate the amount of amortization you would expect to see in 2017. Assume an amortization period of 8 years where applicable.

J) Refer to the table detailing “Amounts Recognized in Net Periodic Benefit Cost and Other Comprehensive Income”. Provide a reconciliation between the 2015 and 2016 balances of AOCI.

K) In your opinion, is JNJ’s pension fund in a good position?

Use Johnson & Johnson’s 10-K (CIK identifier 0000200406, accessible on the SEC’s website:https://www.sec.gov/edgar/searchedgar/companysearch.html) to answer the questions above (**FY2016 = the fiscal year ending 1/1/2017 **)