Shareowners' Equity and Noncontrolling Interest

A summary of the changes in shareowners' equity and noncontrolling interest comprising total equity for the quarter and nine months ended September 30, 2018 and 2017 is provided below:



	Quarter Ended September 30,
	2018									2017
(dollars in millions)	Share-owners' Equity			Non-controlling Interest			Total Equity			Share-owners' Equity			Non-controlling Interest			Total Equity
Equity, beginning of period	$	31,364		$	1,982		$	33,346		$	28,442		$	1,713		$	30,155
Comprehensive income (loss) for the period:
Net income	1,238			111			1,349			1,330			104			1,434
Total other comprehensive (loss) income	(39		)	(19		)	(58		)	637			40			677
Total comprehensive income for the period	1,199			92			1,291			1,967			144			2,111
Common Stock issued under employee plans	125			—			125			86			—			86
Common Stock repurchased	(23		)	—			(23		)	(60		)	—			(60		)
Dividends on Common Stock	(536		)	—			(536		)	(533		)	—			(533		)
Dividends on ESOP Common Stock	(18		)	—			(18		)	(19		)	—			(19		)
Dividends attributable to noncontrolling interest	—			(73		)	(73		)	—			(105		)	(105		)
Capital contributions	—			138			138			—			54			54
Sale of subsidiary shares from noncontrolling interest, net	—			—			—			5			9			14
Acquisition of noncontrolling interest	—			—			—			—			14			14
Redeemable noncontrolling interest fair value adjustment	(6		)	—			(6		)	(4		)	—			(4		)
Other	1			5			6			(3		)	(19		)	(22		)
Equity, end of period	$	32,106		$	2,144		$	34,250		$	29,881		$	1,810		$	31,691



	Nine Months Ended September 30,
	2018									2017
(dollars in millions)	Share-owners' Equity			Non-controlling Interest			Total Equity			Share-owners' Equity			Non-controlling Interest			Total Equity
Equity, beginning of period	$	29,610		$	1,811		$	31,421		$	27,579		$	1,590		$	29,169
Comprehensive income (loss) for the period:
Net income	4,583			273			4,856			4,155			279			4,434
Total other comprehensive (loss) income	(198		)	(24		)	(222		)	1,007			83			1,090
Total comprehensive income for the period	4,385			249			4,634			5,162			362			5,524
Common Stock issued under employee plans	306			—			306			256			—			256
Common Stock repurchased	(75		)	—			(75		)	(1,430		)	—			(1,430		)
Dividends on Common Stock	(1,606		)	—			(1,606		)	(1,541		)	—			(1,541		)
Dividends on ESOP Common Stock	(53		)	—			(53		)	(54		)	—			(54		)
Dividends attributable to noncontrolling interest	—			(212		)	(212		)	—			(217		)	(217		)
Capital contributions	—			300			300			—			97			97
(Purchase) sale of subsidiary shares from noncontrolling interest, net	(1		)	(1		)	(2		)	4			4			8
Acquisition of noncontrolling interest	—			—			—			—			14			14
Disposition of noncontrolling interest	—			(8		)	(8		)	—			—			—
Redeemable noncontrolling interest fair value adjustment	(8		)	—			(8		)	(99		)	—			(99		)
New Revenue Standard adoption impact	(480		)	—			(480		)	—			—			—
Other	28			5			33			4			(40		)	(36		)
Equity, end of period	$	32,106		$	2,144		$	34,250		$	29,881		$	1,810		$	31,691

A summary of the changes in each component of Accumulated other comprehensive (loss) income, net of tax for the quarter and nine months ended September 30, 2018 and 2017 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 September 30, 2018
Balance at June 30, 2018	$	(3,085	)	$	(4,499	)	$	—		$	(100	)	$	(7,684	)
Other comprehensive (loss) income before reclassifications, net	(166		)	(17		)	—			95			(88		)
Amounts reclassified, pre-tax	—			86			—			2			88
Tax expense (benefit)	4			(15		)	—			(28		)	(39		)
Balance at September 30, 2018	$	(3,247	)	$	(4,445	)	$	—		$	(31	)	$	(7,723	)

Nine Months Ended September 30, 2018
Balance at December 31, 2017	$	(2,950	)	$	(4,652	)	$	5		$	72		$	(7,525	)
Other comprehensive (loss) income before reclassifications, net	(354		)	9			—			(105		)	(450		)
Amounts reclassified, pre-tax	(3		)	262			—			(26		)	233
Tax expense (benefit)	60			(64		)	—			28			24
ASU 2016-01 adoption impact	—			—			(5		)	—			(5		)
Balance at September 30, 2018	$	(3,247	)	$	(4,445	)	$	—		$	(31	)	$	(7,723	)



(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 September 30, 2017
Balance at June 30, 2017	$	(3,128	)	$	(4,882	)	$	100		$	(54	)	$	(7,964	)
Other comprehensive income (loss) before reclassifications, net	474			(37		)	12			232			681
Amounts reclassified, pre-tax	(3		)	132			(138		)	(24		)	(33		)
Tax (benefit) expense reclassified	—			(66		)	50			5			(11		)
Balance at September 30, 2017	$	(2,657	)	$	(4,853	)	$	24		$	159		$	(7,327	)

Nine Months Ended September 30, 2017
Balance at December 31, 2016	$	(3,480	)	$	(5,045	)	$	353		$	(162	)	$	(8,334	)
Other comprehensive income (loss) before reclassifications, net	826			(39		)	11			332			1,130
Amounts reclassified, pre-tax	(3		)	395			(545		)	(14		)	(167		)
Tax (benefit) expense reclassified	—			(164		)	205			3			44
Balance at September 30, 2017	$	(2,657	)	$	(4,853	)	$	24		$	159		$	(7,327	)

In January 2016, the FASB issued ASU 2016-01, Financial Instruments - Overall: Recognition and Measurement of Financial Assets and Financial Liabilities. This ASU modifies how entities measure equity investments and present changes in the fair value of financial liabilities. Upon adoption, investments that do not result in consolidation and are not accounted for under the equity method generally must be carried at fair value, with changes in fair value recognized in net income. We had approximately $5 million of unrealized gains on these securities recorded in Accumulated other comprehensive loss in our Consolidated Balance Sheet as of December 31, 2017. We adopted this standard effective January 1, 2018, with these amounts recorded directly to retained earnings as of that date.

Amounts reclassified that relate to our defined benefit pension and postretirement plans include the amortization of prior service costs 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).

Amounts reclassified that relate to unrealized gains (losses) on available-for-sale securities, pre-tax includes approximately $500 million of previously unrealized gains reclassified to other income as a result of sales of significant investments in available-for-sale securities in the nine months ended September 30, 2017, including UTC Climate, Controls & Security's sale of investments in Watsco, Inc.

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.