Income Taxes (Tables)

12 Months Ended

Sep. 30, 2016

Income Tax Disclosure [Abstract]

Income Before Income Taxes

Income from continuing operations before income taxes and equity in net earnings of affiliated companies was as follows:

	Years ended September 30
	2016			2015			2014
	(Dollars in millions)
Income from continuing operations:
Domestic	$	(26	)	$	(439	)	$	50
Foreign		220			62			258
Total	$	194		$	(377	)	$	308

Provision (Benefit) for Income Taxes

Tax provision (benefit) for income taxes consisted of the following:

	Years ended September 30
	2016			2015			2014
	(Dollars in millions)
U.S. federal and state:
Current	$	7		$	(7	)	$	(4	)
Deferred		(33	)		(74	)		(4	)
Total		(26	)		(81	)		(8	)
Foreign:
Current		62			48			86
Deferred		(2	)		(12	)		14
Total		60			36			100
Total U.S. and foreign	$	34		$	(45	)	$	92

Reconciliation Using U.S. Statutory Rate

The provision (benefit) for income taxes differed from the provision for income taxes as calculated using the U.S. statutory rate as follows:

	Years ended September 30
	2016			2015			2014
	(Dollars in millions)
Computed tax expense at the federal statutory rate	$	68		$	(132	)	$	108
Foreign income:
Impact of taxation at different rates, repatriation and    other		(37	)		(24	)		(29	)
Impact of increase (decrease) in valuation allowance on deferred taxes		7			(7	)		20
Impact of foreign losses for which a current tax benefit is    not available		—			9			7
Impact of non-deductible net currency losses		2			(1	)		—
U.S. and state benefits from research and experimentation    activities		(2	)		(2	)		—
Tax settlements		1			(7	)		(7	)
Benefit from prior currency loss		(3	)		—			—
Impact of goodwill impairment charge		—			123			—
Nontaxable gain on existing equity investment		—			—			(10	)
Permanent differences, net		—			—			3
State taxes, net of federal effect		(2	)		(4	)		—
Total	$	34		$	(45	)	$	92

Components of Deferred Income Taxes

Significant components of deferred income taxes were as follows:

	September 30
	2016			2015
	(Dollars in millions)
Deferred tax assets:
Deferred expenses	$	25		$	38
Intangible assets		45			32
Inventory		13			9
Other		4			3
Pension and other benefits		83			72
Net operating loss carry-forwards		144			145
Foreign tax credit carry-forwards		63			42
R&D credit carry-forwards		35			31
Other business credit carry-forwards		41			40
Subtotal		453			412
Valuation allowance		(177	)		(161	)
Total deferred tax assets	$	276		$	251

	September 30
	2016			2015
	(Dollars in millions)
Deferred tax liabilities:
Property, plant and equipment	$	(101	)	$	(116	)
Total deferred tax liabilities	$	(101	)	$	(116	)

Expiration Dates of Carryforwards

The following table provides detail surrounding the expiration dates of these carryforwards:

	NOLs		Credits
	(Dollars in millions)
Expiration periods
2017 to 2023	$	350	$	78
2024 and thereafter		134		45
Indefinite carry-forwards		276		21
Total	$	760	$	144

Reconciliation of Unrecognized Tax Benefits

A reconciliation of the beginning and ending amount of unrecognized tax benefits for fiscal years 2016, 2015 and 2014 is as follows:

	Years ended September 30
	2016			2015			2014
	(Dollars in millions)
Balance at beginning of the year	$	30		$	41		$	50
Additions based on tax provisions related to the current    year		2			1			1
Additions for tax positions of prior years		5			—			—
Reductions of tax provisions of prior years		(3	)		(1	)		(1	)
Reductions related to settlements		—			(9	)		(5	)
Reductions from lapse of statute of limitations		(4	)		(2	)		(4	)
Balance at end of the year	$	30		$	30		$	41