XML 57 R44.htm IDEA: XBRL DOCUMENT v3.8.0.1
Revenue Recognition Revenue Recognition (Details) - USD ($)
3 Months Ended 12 Months Ended
Mar. 31, 2018
Mar. 31, 2017
Dec. 31, 2017
Jan. 01, 2018
Inventories and contracts in progress, net $ 8,938,000,000   $ 9,881,000,000  
Accounts receivable, net 11,699,000,000   12,595,000,000  
Other assets, current 1,448,000,000   1,397,000,000  
Future income tax benefits 1,763,000,000   1,723,000,000  
Intangible assets, net 15,995,000,000   15,883,000,000  
Other assets 7,136,000,000   5,988,000,000  
Accrued liabilities 7,951,000,000   12,316,000,000  
Other long-term liabilities 13,405,000,000   12,952,000,000  
Retained earnings 55,533,000,000   55,242,000,000  
Contract with Customer, Asset, Net, Current 2,989,000,000   0  
Contract with Customer, Liability, Current 5,727,000,000   0  
Service Sales 4,984,000,000 $ 4,178,000,000    
Product Sales 10,258,000,000 9,637,000,000    
Total net sales 15,242,000,000 13,815,000,000    
Cost of products sold 8,016,000,000 7,311,000,000    
Cost of services sold 3,264,000,000 2,825,000,000    
Research and development 554,000,000 586,000,000    
Selling, general and administrative 1,711,000,000 1,537,000,000    
Total costs and expenses 13,545,000,000 12,259,000,000    
Other income, net 231,000,000 588,000,000    
Operating profit 1,928,000,000 2,144,000,000    
Non-service pension cost (benefit) (191,000,000) (123,000,000)    
Interest expense, net 229,000,000 213,000,000    
Income from continuing operations before income taxes 1,890,000,000 2,054,000,000    
Income tax expense 522,000,000 586,000,000    
Net Income from continuing operations 1,368,000,000 1,468,000,000    
Less: Noncontrolling interest in subsidiaries' earnings from continuing operations 71,000,000 82,000,000    
Net income attributable to common shareowners 1,297,000,000 $ 1,386,000,000    
Revenue, Remaining Performance Obligation $ 99,800,000,000      
Revenue, Remaining Performance Obligations, to be recognized within 24 months 40.00%      
Capitalized Contract Cost, Gross       $ 700,000,000
Inventory Costs in Excess of Average Cost Per Unit $ 0   438,000,000  
Previously Recognized Customer Funding to Contract Liability       850,000,000
Contract with Customer, Asset, Reclassified to Receivable $ (7,031,000,000)      
Revenue Recognition, Policy [Policy Text Block]
Note 2: Revenue Recognition
ASU 2014-09 and its related amendments (collectively, the New Revenue Standard) are effective for reporting periods beginning after December 15, 2017, and interim periods therein. We adopted the New Revenue Standard effective January 1, 2018 and elected the modified retrospective approach. The results for periods before 2018 were not adjusted for the new standard and the cumulative effect of the change in accounting was recognized through retained earnings at the date of adoption.
Revenue Recognition Accounting Policy Summary. We account for revenue in accordance with Accounting Standards Codification (ASC) Topic 606: Revenue from Contracts with Customers. Under Topic 606, a performance obligation is a promise in a contract with a customer to transfer a distinct good or service to the customer. Some of our contracts with customers contain a single performance obligation, while other contracts contain multiple performance obligations most commonly when contracts span multiple phases of the product life-cycle such as development, production, maintenance and support. A contract's transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied. When there are multiple performance obligations within a contract, we allocate the transaction price to each performance obligation based on its standalone selling price.
We consider the contractual consideration payable by the customer and assess variable consideration that may affect the total transaction price, including contractual discounts, contract incentive payments, estimates of award fees, and other sources of variable consideration, when determining the transaction price of each contract. We include variable consideration in estimated transaction price when there is a basis to reasonably estimate the amount. These estimates are based on historical experience, anticipated performance and our best judgment at the time. We consider whether our contracts provide customers with significant financing. Generally, our contracts do not contain significant financing.
Point in time revenue recognition. Timing of the satisfaction of performance obligations varies across our businesses due to our diverse product and service mix, customer base, and contractual terms. Performance obligations are satisfied as of a point in time for heating, ventilating, air-conditioning and refrigeration systems, certain alarm and fire detection and suppression systems, and certain aerospace components and engines components. Revenue is recognized when control of the product transfers to the customer, generally upon product shipment.
Over-time revenue recognition. Performance obligations are satisfied over-time if the customer receives the benefits as we perform work, if the customer controls the asset as it is being produced, or if the product being produced for the customer has no alternative use and we have a contractual right to payment. Revenue is recognized for our construction-type and certain production-type contracts on an over-time basis. We recognize revenue on an over-time basis on certain long-term aerospace aftermarket contracts and aftermarket service work; development, fixed price, and other cost reimbursement contracts in our aerospace businesses; and elevator and escalator sales, installation, service, modernization and other construction contracts in our commercial businesses. Commercial businesses service revenue is primarily recognized on a straight-line basis over the contract period. For construction and installation contracts within our commercial businesses and aerospace performance obligations satisfied over time, revenue is recognized using costs incurred to date relative to total estimated costs at completion to measure progress. Incurred costs represent work performed, which correspond with and best depict transfer of control to the customer. Contract costs include labor, materials, and subcontractors' costs, or other direct costs, and where applicable on government and commercial contracts, indirect costs.
For certain of our long-term aftermarket contracts, revenue is recognized over the contract period. In the commercial businesses, revenue is primarily recognized on a straight-line basis over the contract period. In the aerospace businesses, we generally account for such contracts as a series of daily obligations to stand ready to provide product maintenance and aftermarket services. Revenues are primarily recognized in proportion to cost as sufficient historical evidence indicates that the cost of performing services under the contract are incurred on an other than straight-line basis. Aerospace contract modifications are routine, and contracts are often modified to account for changes in contract specifications or requirements. Contract modifications that are for goods or services that are not distinct are accounted for as part of the existing contract.
We incur costs for engineering and development of aerospace products directly related to existing or anticipated contracts with customers. Such costs generate or enhance our ability to satisfy our performance obligations under these contracts. We capitalize these costs as contract fulfillment costs to the extent the costs are recoverable from the associated contract margin and subsequently amortize the costs as the original equipment (OEM) products are delivered to the customer. In instances where intellectual property does not transfer to the customer, we defer the customer funding of OEM product engineering and development and recognize revenue when the OEM products are delivered to the customer. Costs to obtain contracts are not material.
Loss provisions on OEM contracts are recognized to the extent that estimated contract costs exceed the estimated consideration from the products contemplated under the contractual arrangement. For new commitments, we generally record loss provisions at the earlier of contract announcement or contract signing except for certain contracts under which losses are recorded upon receipt of the purchase order that obligates us to perform. For existing commitments, anticipated losses on contractual arrangements are recognized in the period in which losses become evident. Products contemplated under contractual arrangements include firm quantities of product sold under contract and, in the large commercial engine and wheels and brakes businesses, future highly probable sales of replacement parts required by regulation that are expected to be sold subsequently for incorporation into the original equipment. In the large commercial engine and wheels and brakes businesses, when the combined original equipment and aftermarket arrangement for each individual sales campaign are profitable, we record original equipment product losses, as applicable, at the time of delivery.
We review our cost estimates on significant contracts on a quarterly basis, and for others, no less frequently than annually or when circumstances change and warrant a modification to a previous estimate. We record changes in contract estimates using the cumulative catch-up method.
     
Contract Asset and Liability [Abstract]        
Contract with Customer, Asset, Net, Current $ 2,989,000,000   0  
Contract with Customer, Asset, Net, Noncurrent 1,088,000,000      
Contract with Customer, Asset, Net 4,077,000,000      
Contract with Customer, Liability, Current 5,727,000,000   0  
Contract with Customer, Liability, Noncurrent 4,881,000,000      
Contract with Customer, Liability 10,608,000,000      
Contract with Customer, Net (6,531,000,000)     6,365,000,000
Contract with Customer, Liability, Revenue Recognized 5,676,000,000   $ 1,207,000,000  
Calculated under Revenue Guidance in Effect before Topic 606 [Member]        
Inventories and contracts in progress, net 10,788,000,000      
Accounts receivable, net 13,105,000,000      
Other assets, current 1,456,000,000      
Future income tax benefits 1,741,000,000      
Intangible assets, net 16,064,000,000      
Other assets 6,222,000,000      
Accrued liabilities 13,547,000,000      
Other long-term liabilities 12,472,000,000      
Retained earnings 56,005,000,000      
Contract with Customer, Asset, Net, Current 0      
Contract with Customer, Liability, Current 0      
Service Sales 4,853,000,000      
Product Sales 10,167,000,000      
Total net sales 15,020,000,000      
Cost of products sold 7,886,000,000      
Cost of services sold 3,168,000,000      
Research and development 574,000,000      
Selling, general and administrative 1,710,000,000      
Total costs and expenses 13,338,000,000      
Other income, net 232,000,000      
Operating profit 1,914,000,000      
Non-service pension cost (benefit) (191,000,000)      
Interest expense, net 229,000,000      
Income from continuing operations before income taxes 1,876,000,000      
Income tax expense 518,000,000      
Net Income from continuing operations 1,358,000,000      
Less: Noncontrolling interest in subsidiaries' earnings from continuing operations 69,000,000      
Net income attributable to common shareowners 1,289,000,000      
Contract Asset and Liability [Abstract]        
Contract with Customer, Asset, Net, Current 0      
Contract with Customer, Liability, Current 0      
Accounting Standards Update 2014-09 [Member]        
Inventories and contracts in progress, net (1,850,000,000)      
Accounts receivable, net (1,406,000,000)      
Other assets, current (8,000,000)      
Future income tax benefits 22,000,000      
Intangible assets, net (69,000,000)      
Other assets 914,000,000      
Accrued liabilities (5,596,000,000)      
Other long-term liabilities 933,000,000      
Retained earnings (472,000,000)     480,000,000
Contract with Customer, Asset, Net, Current 2,989,000,000      
Contract with Customer, Liability, Current 5,727,000,000      
Service Sales 131,000,000      
Product Sales 91,000,000      
Total net sales 222,000,000      
Cost of products sold 130,000,000      
Cost of services sold 96,000,000      
Research and development (20,000,000)      
Selling, general and administrative 1,000,000      
Total costs and expenses 207,000,000      
Other income, net (1,000,000)      
Operating profit 14,000,000      
Non-service pension cost (benefit) 0      
Interest expense, net 0      
Income from continuing operations before income taxes 14,000,000      
Income tax expense 4,000,000      
Net Income from continuing operations 10,000,000      
Less: Noncontrolling interest in subsidiaries' earnings from continuing operations 2,000,000      
Net income attributable to common shareowners 8,000,000      
Inventory Costs in Excess of Average Cost Per Unit       438,000,000
Satisfied Portion of the Performance Obligation of CIP       $ 220,000,000
Contract Asset and Liability [Abstract]        
Contract with Customer, Asset, Net, Current 2,989,000,000      
Contract with Customer, Liability, Current $ 5,727,000,000