Prior-Period Financial Statements (Tables)

9 Months Ended

Oct. 01, 2017

Accounting Changes and Error Corrections [Abstract]

CONSOLIDATED STATEMENT OF EARNINGS (UNAUDITED)



	Three Months Ended			Effect of the Adoption of					Three Months Ended
	October 2, 2016			ASC			ASU		October 2, 2016
(Dollars in millions, except per-share amounts)	As Reported			Topic 606			2015-17		As Adjusted
Revenue:
Products	$	4,844		$	(95	)	$	—	$	4,749
Services	2,887			21			—		2,908
	7,731			(74		)	—		7,657
Operating costs and expenses:
Products	3,757			(7		)	—		3,750
Services	2,434			(13		)	—		2,421
G&A	471			—			—		471
	6,662			(20		)	—		6,642
Operating earnings	1,069			(54		)	—		1,015
Interest, net	(23		)	—			—		(23		)
Other, net	2			—			—		2
Earnings from continuing operations before income tax	1,048			(54		)	—		994
Provision for income tax, net	281			(18		)	—		263
Earnings from continuing operations	767			(36		)	—		731
Discontinued operations, net of tax benefit of $46	(84		)	—			—		(84		)
Net earnings	$	683		$	(36	)	$	—	$	647

Earnings per share
Basic:
Continuing operations	$	2.52		$	(0.12	)	$	—	$	2.40
Discontinued operations	(0.27		)	—			—		(0.27		)
Net earnings	$	2.25		$	(0.12	)	$	—	$	2.13
Diluted:
Continuing operations	$	2.48		$	(0.12	)	$	—	$	2.36
Discontinued operations	(0.27		)	—			—		(0.27		)
Net earnings	$	2.21		$	(0.12	)	$	—	$	2.09

CONSOLIDATED STATEMENT OF EARNINGS (UNAUDITED)



	Nine Months Ended			Effect of the Adoption of					Nine Months Ended
	October 2, 2016			ASC			ASU		October 2, 2016
(Dollars in millions, except per-share amounts)	As Reported			Topic 606			2015-17		As Adjusted
Revenue:
Products	$	14,556		$	(282	)	$	—	$	14,274
Services	8,564			69			—		8,633
	23,120			(213		)	—		22,907
Operating costs and expenses:
Products	11,287			(13		)	—		11,274
Services	7,224			26			—		7,250
G&A	1,417			—			—		1,417
	19,928			13			—		19,941
Operating earnings	3,192			(226		)	—		2,966
Interest, net	(68		)	—			—		(68		)
Other, net	13			—			—		13
Earnings from continuing operations before income tax	3,137			(226		)	—		2,911
Provision for income tax, net	882			(70		)	—		812
Earnings from continuing operations	2,255			(156		)	—		2,099
Discontinued operations, net of tax benefit of $46	(97		)	—			—		(97		)
Net earnings	$	2,158		$	(156	)	$	—	$	2,002

Earnings per share
Basic:
Continuing operations	$	7.38		$	(0.52	)	$	—	$	6.86
Discontinued operations	(0.31		)	—			—		(0.31		)
Net earnings	$	7.07		$	(0.52	)	$	—	$	6.55
Diluted:
Continuing operations	$	7.25		$	(0.51	)	$	—	$	6.74
Discontinued operations	(0.31		)	—			—		(0.31		)
Net earnings	$	6.94		$	(0.51	)	$	—	$	6.43

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED)



	Three Months Ended			Effect of the Adoption of					Three Months Ended
	October 2, 2016			ASC			ASU		October 2, 2016
(Dollars in millions)	As Reported			Topic 606			2015-17		As Adjusted
Net earnings	$	683		$	(36	)	$	—	$	647
Gains on cash flow hedges	102			—			—		102
Unrealized losses on securities	(1		)	—			—		(1		)
Foreign currency translation adjustments	(43		)	1			—		(42		)
Change in retirement plans’ funded status	65			—			—		65
Other comprehensive income, pretax	123			1			—		124
Provision for income tax, net	49			—			—		49
Other comprehensive income, net of tax	74			1			—		75
Comprehensive income	$	757		$	(35	)	$	—	$	722



	Nine Months Ended			Effect of the Adoption of					Nine Months Ended
	October 2, 2016			ASC			ASU		October 2, 2016
(Dollars in millions)	As Reported			Topic 606			2015-17		As Adjusted
Net earnings	$	2,158		$	(156	)	$	—	$	2,002
Gains on cash flow hedges	260			—			—		260
Unrealized losses on securities	(5		)	—			—		(5		)
Foreign currency translation adjustments	82			3			—		85
Change in retirement plans’ funded status	191			—			—		191
Other comprehensive income, pretax	528			3			—		531
Provision for income tax, net	133			—			—		133
Other comprehensive income, net of tax	395			3			—		398
Comprehensive income	$	2,553		$	(153	)	$	—	$	2,400

CONSOLIDATED BALANCE SHEET (UNAUDITED)



				Effect of the Adoption of
	December 31, 2016			ASC			ASU			December 31, 2016
(Dollars in millions)	As Reported			Topic 606			2015-17*			As Adjusted

ASSETS
Current assets:
Cash and equivalents	$	2,334		$	—		$	—		$	2,334
Accounts receivable	3,611			(212		)	—			3,399
Unbilled receivables	5,282			(1,070		)	—			4,212
Inventories	3,523			2,294			—			5,817
Other current assets	697			90			(15		)	772
Total current assets	15,447			1,102			(15		)	16,534
Noncurrent assets:
Property, plant and equipment, net	3,467			10			—			3,477
Intangible assets, net	678			—			—			678
Goodwill	11,445			—			—			11,445
Other assets	1,835			—			(797		)	1,038
Total noncurrent assets	17,425			10			(797		)	16,638
Total assets	$	32,872		$	1,112		$	(812	)	$	33,172

LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Short-term debt and current portion of long-term debt	$	900		$	—		$	—		$	900
Accounts payable	2,538			—			—			2,538
Customer advances and deposits	4,939			1,888			—			6,827
Other current liabilities	4,469			(361		)	(923		)	3,185
Total current liabilities	12,846			1,527			(923		)	13,450
Noncurrent liabilities:
Long-term debt	2,988			—			—			2,988
Other liabilities	6,062			260			111			6,433
Commitments and contingencies (see Note M)
Total noncurrent liabilities	9,050			260			111			9,421
Shareholders’ equity:
Common stock	482			—			—			482
Surplus	2,819			—			—			2,819
Retained earnings	25,227			(684		)	—			24,543
Treasury stock	(14,156		)	—			—			(14,156		)
Accumulated other comprehensive loss	(3,396		)	9			—			(3,387		)
Total shareholders’ equity	10,976			(675		)	—			10,301
Total liabilities and shareholders’ equity	$	32,872		$	1,112		$	(812	)	$	33,172

* The effect of the adoption of ASU 2015-17 includes the reclassification of current deferred tax assets and liabilities of $10 and $335, respectively, which represents the impact to current deferred taxes of adopting ASC Topic 606.

CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED)



	Nine Months Ended			Effect of the Adoption of					Nine Months Ended
	October 2, 2016			ASC			ASU		October 2, 2016
(Dollars in millions)	As Reported			Topic 606			2015-17		As Adjusted
Cash flows from operating activities - continuing operations:
Net earnings	$	2,158		$	(156	)	$	—	$	2,002
Adjustments to reconcile net earnings to net cash provided by operating activities:
Depreciation of property, plant and equipment	272			(2		)	—		270
Amortization of intangible assets	70			—			—		70
Equity-based compensation expense	76			—			—		76
Deferred income tax provision	218			(70		)	—		148
Discontinued operations, net of tax	97			—			—		97
(Increase) decrease in assets, net of effects of business acquisitions:
Accounts receivable	(52		)	73			—		21
Unbilled receivables	(957		)	50			—		(907		)
Inventories	(288		)	82			—		(206		)
Increase (decrease) in liabilities, net of effects of business acquisitions:
Accounts payable	305			—			—		305
Customer advances and deposits	(574		)	20			—		(554		)
Income taxes payable	(14		)	—			—		(14		)
Other, net	61			3			—		64
Net cash provided by operating activities	1,372			—			—		1,372
Cash flows from investing activities:
Capital expenditures	(244		)	—			—		(244		)
Business acquisitions, net of cash acquired	(56		)	—			—		(56		)
Other, net	18			—			—		18
Net cash used by investing activities	(282		)	—			—		(282		)
Cash flows from financing activities:
Purchases of common stock	(1,514		)	—			—		(1,514		)
Proceeds from fixed-rate notes	992			—			—		992
Dividends paid	(678		)	—			—		(678		)
Repayment of fixed-rate notes	(500		)	—			—		(500		)
Other, net	172			—			—		172
Net cash used by financing activities	(1,528		)	—			—		(1,528		)
Net cash used by discontinued operations	(44		)	—			—		(44		)
Net decrease in cash and equivalents	(482		)	—			—		(482		)
Cash and equivalents at beginning of period	2,785			—			—		2,785
Cash and equivalents at end of period	$	2,303		$	—		$	—	$	2,303

CONSOLIDATED STATEMENT OF SHAREHOLDERS’ EQUITY (UNAUDITED)



	Common Stock				Retained			Treasury			Accumulated Other Comprehensive			Total Shareholders’
(Dollars in millions)	Par		Surplus		Earnings			Stock			Loss			Equity
December 31, 2015 - as reported	$	482	$	2,730	$	23,204		$	(12,392	)	$	(3,286	)	$	10,738
Cumulative-effect adjustment of ASC Topic 606 on January 1, 2016	—		—		(301		)	—			3			(298		)
December 31, 2015 - as adjusted	482		2,730		22,903			(12,392		)	(3,283		)	10,440
Nine months ended October 2, 2016 - as reported	—		59		1,457			(1,332		)	395			579
Effect of the adoption of ASC Topic 606	—		—		(156		)	—			3			(153		)
Effect of the adoption of ASU 2015-17	—		—		—			—			—			—
October 2, 2016 - as adjusted	$	482	$	2,789	$	24,204		$	(13,724	)	$	(2,885	)	$	10,866