INCOME TAXES (Tables)

12 Months Ended

Jun. 30, 2017

Income Tax Disclosure [Abstract]

Provisions for income taxes

The provisions for current and deferred income taxes are summarized as follows:

	2017		2016			2015
	(In millions)
Current:
United States	$	117	$	(36	)	$	114
International	9		6			1
State and local	6		(11		)	8
	132		(41		)	123
Deferred:
United States	126		279			(21		)
International	1		(3		)	8
State and local	8		38			(1		)
	135		314			(14		)
	$	267	$	273		$	109

Total Income tax provision summary

The total income tax provision is summarized as follows:

	2017			2016			2015
	(In millions)
Continuing operations	$	267		$	273		$	109
Discontinued operations	(110		)	(12		)	34
Total income tax provision	$	157		$	261		$	143

Components of deferred income tax assets (liabilities)

The components of deferred income tax assets (liabilities) were as follows:

	June 30, 2017			July 1, 2016
	(In millions)
Deferred tax assets:
Inventory valuations	$	31		$	32
Accruals	292			271
Deferred revenue	16			23
Domestic tax loss and credit carryforwards	60			43
International tax loss and credit carryforwards	35			32
Share-based compensation	31			29
Capital loss carryforwards	133			212
Long-term debt	13			16
Pension and other post-employment benefits	509			849
Unrealized loss on interest rate hedges	10			11
Unrecognized tax benefits	7			14
Other	(17		)	(8		)
Total deferred tax assets	1,120			1,524
Less: valuation allowance (1)	(183		)	(271		)
Total deferred tax assets, net of valuation allowance	937			1,253
Deferred tax liabilities:
Property, plant and equipment	(51		)	(66		)
Unbilled receivables	(5		)	(31		)
Acquired intangibles	(459		)	(559		)
Unremitted earnings of foreign subsidiaries	(47		)	(52		)
Total deferred tax liabilities	(562		)	(708		)
Total deferred tax assets, net of valuation allowance	$	375		$	545
(1) The valuation allowance has been established to offset certain domestic and foreign deferred tax assets due to uncertainty regarding our ability to realize them in the future.

Reconciliation of the United States statutory income tax rate to our effective income tax rate

A reconciliation of the United States statutory income tax rate to our effective income tax rate follows:

	2017		2016		2015
U.S. statutory income tax rate	35.0	%	35.0	%	35.0	%
State taxes	1.0		1.8		0.6
International income	(1.3	)	(1.2	)	(3.2	)
Nondeductible goodwill	—		0.9		2.2
Research and development tax credit	(2.0	)	(2.3	)	(2.1	)
Change in valuation allowance	(0.2	)	(2.6	)	—
U.S. production activity benefit	(0.5	)	(0.4	)	(3.8	)
Adoption of stock-based compensation ASU	(2.6	)	—		—
Cash repatriation	—		—		1.7
Settlement of tax audits	—		(0.3	)	(2.1	)
Other items	0.1		—		(0.8	)
Effective income tax rate	29.5	%	30.9	%	27.5	%

Reconciliation of the beginning and ending amounts of unrecognized tax benefits

A reconciliation of the beginning and ending amounts of unrecognized tax benefits is as follows:

	2017			2016			2015
	(In millions)
Balance at beginning of fiscal year	$	63		$	124		$	72
Additions based on tax positions taken during current fiscal year	52			7			5
Additions based on tax positions taken during prior fiscal years	—			9			5
Additions for tax positions related to acquired entities	—			—			68
Decreases based on tax positions taken during prior fiscal years	(25		)	(73		)	(8		)
Decreases from lapse in statutes of limitations	—			(1		)	(1		)
Decreases from settlements	—			(3		)	(17		)
Balance at end of fiscal year	$	90		$	63		$	124