Impact of Adoption of New Standards

In the first quarter of 2018, we adopted the following ASUs: ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606); ASU No. 2017-07, Compensation - Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost; and ASU 2016-18 Statement of Cash Flows (Topic 230) Restricted Cash; and ASU 2018-02 Income Statement—Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income.

The impact to our unaudited Consolidated Financial Statements as a result of adopting these standards was as follows:

Condensed Consolidated Statement of Operations (Unaudited)



	Three months ended March 31, 2017
(Dollars in millions)	Reported			Impact of New Standards			Restated
Sales of products		$18,512			$855			$19,367
Sales of services	2,464			130			2,594
Total revenues	20,976			985			21,961

Cost of products	(15,363		)	(699		)	(16,062		)
Cost of services	(1,888		)	(110		)	(1,998		)
Boeing Capital interest expense	(13		)				(13		)
Total costs and expenses	(17,264		)	(809		)	(18,073		)
	3,712			176			3,888
Income from operating investments, net	81						81
General and administrative expense	(933		)	4			(929		)
Research and development expense, net	(838		)	2			(836		)
Gain on dispositions, net	2						2
Earnings from operations	2,024			182			2,206
Other income, net	22			4			26
Interest and debt expense	(87		)				(87		)
Earnings before income taxes	1,959			186			2,145
Income tax expense	(508		)	(58		)	(566		)
Net earnings		$1,451			$128			$1,579

Basic earnings per share		$2.36			$0.21			$2.57

Diluted earnings per share		$2.34			$0.20			$2.54

Condensed Consolidated Statement of Financial Position



(Dollars in millions)	December 31, 2017
Assets	Reported			Impact of New Standards			Restated
Cash and cash equivalents		$8,813						$8,813
Short-term and other investments	1,179						1,179
Accounts receivable, net	10,516				($7,622	)	2,894
Unbilled receivables, net				8,194			8,194
Current portion of customer financing, net	309						309
Inventories	44,344			17,044			61,388
Other current assets				2,417			2,417
Total current assets	65,161			20,033			85,194
Customer financing, net	2,740			16			2,756
Property, plant and equipment, net	12,672						12,672
Goodwill	5,559						5,559
Acquired intangible assets, net	2,573						2,573
Deferred income taxes	341			(20		)	321
Investments	1,260						1,260
Other assets, net of accumulated amortization	2,027						2,027
Total assets		$92,333			$20,029			$112,362
Liabilities and equity
Accounts payable		$12,202						$12,202
Accrued liabilities	15,292				($2,223	)	13,069
Advances and billings in excess of related costs	27,440			(27,440		)
Advances and progress billings				48,042			48,042
Short-term debt and current portion of long-term debt	1,335						1,335
Total current liabilities	56,269			18,379			74,648
Deferred income taxes	1,839			349			2,188
Accrued retiree health care	5,545						5,545
Accrued pension plan liability, net	16,471						16,471
Other long-term liabilities	2,015						2,015
Long-term debt	9,782						9,782
Shareholders’ equity:
Common stock	5,061						5,061
Additional paid-in capital	6,804						6,804
Treasury stock, at cost	(43,454		)				(43,454		)
Retained earnings	45,320			4,298			49,618
Accumulated other comprehensive loss	(13,376		)	(2,997		)	(16,373		)
Total shareholders’ equity	355			1,301			1,656
Noncontrolling interests	57						57
Total equity	412			1,301			1,713
Total liabilities and equity		$92,333			$20,029			$112,362

Condensed Consolidated Statement of Cash Flows (Unaudited)



(Dollars in millions)	Three months ended March 31, 2017
	Reported			Impact of New Standards			Restated
Cash flows - operating activities:
Net earnings		$1,451			$128			$1,579
Adjustments to reconcile net earnings to net cash provided by operating activities:
Non-cash items -
Share-based plans expense	50						50
Depreciation and amortization	471			(3		)	468
Investment/asset impairment charges, net	23						23
Customer financing valuation expense	7						7
Gain on dispositions, net	(2		)				(2		)
Other charges and credits, net	52			6			58
Changes in assets and liabilities -
Accounts receivable	(769		)	505			(264		)
Unbilled receivables				(568		)	(568		)
Advances and progress billings				1,375			1,375
Inventories	(31		)	(1,460		)	(1,491		)
Other current assets				(117		)	(117		)
Accounts payable	616						616
Accrued liabilities	(613		)	331			(282		)
Advances and billings in excess of related costs	249			(249		)
Income taxes receivable, payable and deferred	495			57			552
Other long-term liabilities	(72		)				(72		)
Pension and other postretirement plans	10						10
Customer financing, net	232			(1		)	231
Other	(75		)				(75		)
Net cash provided by operating activities	2,094			4			2,098
Cash flows - investing activities:
Property, plant and equipment additions	(466		)				(466		)
Property, plant and equipment reductions	9						9
Contributions to investments	(605		)				(605		)
Proceeds from investments	803						803
Other	(3		)	2			(1		)
Net cash used by investing activities	(262		)	2			(260		)
Cash flows - financing activities:
New borrowings	872						872
Debt repayments	(34		)				(34		)
Stock options exercised	174						174
Employee taxes on certain share-based payment arrangements	(107		)				(107		)
Common shares repurchased	(2,500		)				(2,500		)
Dividends paid	(868		)				(868		)
Net cash used by financing activities	(2,463		)				(2,463		)
Effect of exchange rate changes on cash & cash equivalents, including restricted	20						20
Net (decrease)/increase in cash & cash equivalents, including restricted	(611		)	6			(605		)
Cash & cash equivalents, including restricted*, at beginning of year	8,801			68			8,869
Cash & cash equivalents, including restricted*, at end of period		$8,190			$74		8,264
Less restricted cash & cash equivalents, included in Investments							74
Cash and cash equivalents at end of period								$8,190

* Reported balance excludes restricted amounts

Condensed Consolidated Statements of Equity (Unaudited)



	Boeing shareholders
(Dollars in millions)	Common Stock		Additional Paid-In Capital		Treasury Stock			Retained Earnings		Accumulated Other Comprehensive Loss			Non- controlling Interests		Total
Balance at January 1, 2017, as reported		$5,061		$4,762		($36,097	)		$40,714		($13,623	)		$60		$877
Cumulative Impact of Topic 606 at 1/1/2016								901							901
Impact of Topic 606 on 2016 earnings								139							139
Balance at January 1, 2017, as restated		$5,061		$4,762		($36,097	)		$41,754		($13,623	)		$60		$1,917



	Boeing shareholders
(Dollars in millions)	Common Stock		Additional Paid-In Capital		Treasury Stock			Retained Earnings		Accumulated Other Comprehensive Loss			Non- controlling Interests		Total
Balance at December 31, 2017, as reported		$5,061		$6,804		($43,454	)		$45,320		($13,376	)		$57		$412
Cumulative Impact of Topic 606 at 1/1/2016								901							901
Impact of Topic 606 on 2016 earnings								139							139
Impact of Topic 606 on 2017 earnings								261							261
Total impact of ASC 606 through December 31, 2017								1,301							1,301
Impact of ASU 2018-02								2,997		(2,997		)
Balance at December 31, 2017, as restated		$5,061		$6,804		($43,454	)		$49,618		($16,373	)		$57		$1,713