Variable Interest Entities

12 Months Ended

Dec. 31, 2022

Schedule of Variable Interest Entities [Abstract]

Variable Interest Entity Disclosure

NOTE 16: VARIABLE INTEREST ENTITIES

Pratt & Whitney holds a 61% program share interest in the International Aero Engines AG (IAE) collaboration with MTU Aero Engines AG (MTU) and Japanese Aero Engines Corporation (JAEC) and a 49.5% ownership interest in IAE. IAE’s business purpose is to coordinate the design, development, manufacturing and product support of the V2500 engine program through involvement with the collaborators. Additionally, Pratt & Whitney, JAEC and MTU are participants in the International Aero Engines, LLC (IAE LLC) collaboration, whose business purpose is to coordinate the design, development, manufacturing and product support for the PW1100G-JM engine for the Airbus A320neo family of aircraft. Pratt & Whitney holds a 59% program share interest and a 59% ownership interest in IAE LLC. IAE and IAE LLC retain limited equity with the primary economics of the programs passed to the participants. As such, we have determined that IAE and IAE LLC are variable interest entities with Pratt & Whitney as the primary beneficiary. IAE and IAE LLC have, therefore, been consolidated. The carrying amounts and classification of assets and liabilities for variable interest entities in our Consolidated Balance Sheet as of December 31, 2022 and 2021 are as follows:

(dollars in millions)	2022		2021
Current assets	$	7,609	$	7,081
Noncurrent assets	779		825
Total assets	$	8,388	$	7,906
Current liabilities	$	9,154	$	7,965
Noncurrent liabilities	19		54
Total liabilities	$	9,173	$	8,019