Shareowners' Equity and Noncontrolling Interest

6 Months Ended

Jun. 30, 2016

Stockholders' Equity Note [Abstract]

Shareowners' Equity and Noncontrolling Interest [Text Block]

Shareowners' Equity and Noncontrolling Interest

A summary of the changes in shareowners' equity and noncontrolling interest comprising total equity for the quarters and six months ended June 30, 2016 and 2015 is provided below:

	Quarter Ended June 30,
	2016									2015
(Dollars in millions)	Share-owners' Equity			Non-controlling Interest			Total Equity			Share-owners' Equity			Non-controlling Interest			Total Equity
Equity, beginning of period	$	28,353		$	1,550		$	29,903		$	28,650		$	1,517		$	30,167
Comprehensive income for the period:
Net income	1,373			99			1,472			1,542			110			1,652
Total other comprehensive (loss) income	(140		)	(2		)	(142		)	634			—			634
Total comprehensive income for the period	1,233			97			1,330			2,176			110			2,286
Common Stock issued under employee plans	93						93			112						112
Common Stock repurchased	(36		)				(36		)	—						—
Dividends on Common Stock	(526		)				(526		)	(543		)				(543		)
Dividends on ESOP Common Stock	(19		)				(19		)	(18		)				(18		)
Dividends attributable to noncontrolling interest				(90		)	(90		)				(61		)	(61		)
Purchase of subsidiary shares from noncontrolling interest	(6		)	—			(6		)	—			(4		)	(4		)
Acquisition of noncontrolling interest				—			—						1			1
Other	(2		)	1			(1		)	—			(2		)	(2		)
Equity, end of period	$	29,090		$	1,558		$	30,648		$	30,377		$	1,561		$	31,938

	Six Months Ended June 30,
	2016									2015
(Dollars in millions)	Share-owners' Equity			Non-controlling Interest			Total Equity			Share-owners' Equity			Non-controlling Interest			Total Equity
Equity, beginning of period	$	27,358		$	1,486		$	28,844		$	31,213		$	1,351		$	32,564
Comprehensive income for the period:
Net income	2,564			180			2,744			2,968			182			3,150
Total other comprehensive income (loss)	135			11			146			84			(40		)	44
Total comprehensive income for the period	2,699			191			2,890			3,052			142			3,194
Common Stock issued under employee plans	144						144			237						237
Common Stock repurchased	(36		)				(36		)	(3,000		)				(3,000		)
Dividends on Common Stock	(1,035		)				(1,035		)	(1,096		)				(1,096		)
Dividends on ESOP Common Stock	(37		)				(37		)	(37		)				(37		)
Dividends attributable to noncontrolling interest				(141		)	(141		)				(116		)	(116		)
(Purchase) sale of subsidiary shares from noncontrolling interest	(6		)	(1		)	(7		)	11			10			21
Acquisition of noncontrolling interest				34			34						173			173
Disposition of noncontrolling interest				—			—						(3		)	(3		)
Other	3			(11		)	(8		)	(3		)	4			1
Equity, end of period	$	29,090		$	1,558		$	30,648		$	30,377		$	1,561		$	31,938

On March 13, 2015, we entered into accelerated share repurchase (ASR) agreements to repurchase an aggregate of $2.65 billion of our common stock. Under the terms of the ASR agreements, we made the aggregate payments and received an initial delivery of 18.6 million shares of common stock, representing approximately 85% of the shares expected to be repurchased. On July 31, 2015, the shares associated with the remaining portion of the aggregate purchase were settled upon final delivery to us of approximately 4.2 million additional shares of common stock.

On November 11, 2015, we entered into ASR agreements to repurchase an aggregate of $6 billion of our common stock utilizing the net after-tax proceeds from the sale of Sikorsky. The ASR agreements provide for the repurchase of our common stock based on the average of the daily volume-weighted average prices of our common stock during the term of such ASR agreements, less a discount and subject to adjustments pursuant to the terms and conditions of the ASR agreements. Under the terms of the ASR agreements, we made the aggregate payments and received an initial delivery of approximately 51.9 million shares of our common stock, representing approximately 85% of the shares expected to be repurchased. The shares associated with the remaining portion of the aggregate purchase price are to be settled over six tranches. Upon settlement of each tranche, we may be entitled to receive additional shares of our common stock or, under certain limited circumstances, be required to deliver shares or make additional payments to the counterparties, at our election.

On January 19, 2016, the shares associated with the remaining portion of the first tranche of the aggregate purchase were settled upon final delivery to us of approximately 2.1 million shares of common stock. The final settlement of the transactions under the remaining five tranches is expected to occur in the third quarter of 2016.

A summary of the changes in each component of accumulated other comprehensive income (loss), net of tax for the quarters and six months ended June 30, 2016 and 2015 is provided below:

(Dollars in millions)	Foreign Currency Translation			Defined Benefit Pension and Post- retirement Plans			Unrealized Gains (Losses) on Available-for-Sale Securities			Unrealized Hedging (Losses) Gains			Accumulated Other Comprehensive (Loss) Income
Quarter Ended June 30, 2016
Balance at March 31, 2016	$	(2,411	)	$	(5,072	)	$	316		$	(177	)	$	(7,344	)
Other comprehensive (loss) income before reclassifications, net	(274		)	(8		)	19			26			(237		)
Amounts reclassified, pretax	—			128			(25		)	45			148
Tax (benefit) expense reclassified	—			(47		)	7			(11		)	(51		)
Balance at June 30, 2016	$	(2,685	)	$	(4,999	)	$	317		$	(117	)	$	(7,484	)
Six Months Ended June 30, 2016
Balance at December 31, 2015	$	(2,438	)	$	(5,135	)	$	293		$	(339	)	$	(7,619	)
Other comprehensive (loss) income before reclassifications, net	(248		)	(25		)	57			143			(73		)
Amounts reclassified, pretax	1			254			(52		)	107			310
Tax (benefit) expense reclassified	—			(93		)	19			(28		)	(102		)
Balance at June 30, 2016	$	(2,685	)	$	(4,999	)	$	317		$	(117	)	$	(7,484	)

(Dollars in millions)	Foreign Currency Translation			Defined Benefit Pension and Post- retirement Plans			Unrealized Gains (Losses) on Available-for-Sale Securities			Unrealized Hedging (Losses) Gains			Accumulated Other Comprehensive (Loss) Income
Quarter Ended June 30, 2015
Balance at March 31, 2015	$	(1,718	)	$	(5,537	)	$	344		$	(300	)	$	(7,211	)
Other comprehensive income (loss) before reclassifications, net	439			(4		)	4			49			488
Amounts reclassified, pretax	1			218			(26		)	43			236
Tax (benefit) expense reclassified	—			(82		)	8			(16		)	(90		)
Balance at June 30, 2015	$	(1,278	)	$	(5,405	)	$	330		$	(224	)	$	(6,577	)
Six Months Ended June 30, 2015
Balance at December 31, 2014	$	(1,051	)	$	(5,709	)	$	308		$	(209	)	$	(6,661	)
Other comprehensive (loss) income before reclassifications, net	(226		)	31			58			(83		)	(220		)
Amounts reclassified, pretax	(1		)	435			(54		)	100			480
Tax (benefit) expense reclassified	—			(162		)	18			(32		)	(176		)
Balance at June 30, 2015	$	(1,278	)	$	(5,405	)	$	330		$	(224	)	$	(6,577	)

Amounts reclassified that relate to our defined benefit pension and postretirement plans include amortization of prior service costs and transition obligations, and actuarial net losses recognized during each period presented. These costs are recorded as components of net periodic pension cost for each period presented (see Note 7 for additional details).

All noncontrolling interests with redemption features, such as put options, that are not solely within our control (redeemable noncontrolling interests) are reported in the mezzanine section of the Condensed Consolidated Balance Sheet, between liabilities and equity, at the greater of redemption value or initial carrying value. The increase in the value of redeemable noncontrolling interest in our Condensed Consolidated Balance Sheet as of June 30, 2016 is primarily related to the acquisition of a majority interest in an Italian heating products and services company by UTC Climate, Controls & Security during the quarter ended June 30, 2016.

Changes in noncontrolling interests that do not result in a change of control, and where there is a difference between fair value and carrying value, are accounted for as equity transactions. For both the quarter and six months ended June 30, 2016, the pro-forma impact on Net income attributable to common shareowners would have been a decrease of $6 million had the changes been recorded through net income. For the quarter ended June 30, 2015 there would have been no impact on Net income attributable to common shareowners, and for the six months ended June 30, 2015 the pro-forma impact on Net income attributable to common shareowners would have been an increase of $11 million had the changes been recorded through net income.