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Equity Activity
3 Months Ended
Mar. 31, 2018
Equity Activity  
Equity Activity

8. Equity Activity:

 

Reclassifications and Taxes Related to Items of Other Comprehensive Income

 

(Dollars in millions)

 

Before Tax

 

Tax (Expense)/

 

Net of Tax

 

For the three months ended March 31, 2018:

 

Amount

 

Benefit

 

Amount

 

Other comprehensive income/(loss):

 

 

 

 

 

 

 

Foreign currency translation adjustments

 

$

(167

)

$

51

 

$

(115

)

Net changes related to available-for-sale securities:

 

 

 

 

 

 

 

Unrealized gains/(losses) arising during the period

 

$

(2

)

$

1

 

$

(2

)

Reclassification of (gains)/losses to other (income) and expense

 

0

 

0

 

0

 

 

 

 

 

 

 

 

 

Total net changes related to available-for-sale securities

 

$

(3

)

$

1

 

$

(2

)

 

 

 

 

 

 

 

 

 

 

 

Unrealized gains/(losses) on cash flow hedges:

 

 

 

 

 

 

 

Unrealized gains/(losses) arising during the period

 

$

61

 

$

(9

)

$

51

 

Reclassification of (gains)/losses to:

 

 

 

 

 

 

 

Cost of sales

 

17

 

(5

)

12

 

Cost of services

 

(19

)

5

 

(14

)

SG&A expense

 

18

 

(5

)

13

 

Other (income) and expense

 

(104

)

26

 

(78

)

Interest expense

 

34

 

(8

)

25

 

 

 

 

 

 

 

 

 

Total unrealized gains/(losses) on cash flow hedges

 

$

7

 

$

3

 

$

10

 

 

 

 

 

 

 

 

 

 

 

 

Retirement-related benefit plans(1):

 

 

 

 

 

 

 

Prior service costs/(credits)

 

$

(1

)

$

0

 

$

(1

)

Net (losses)/gains arising during the period

 

2

 

(1

)

1

 

Curtailments and settlements

 

0

 

0

 

0

 

Amortization of prior service (credits)/costs

 

(19

)

5

 

(14

)

Amortization of net (gains)/losses

 

753

 

(203

)

550

 

 

 

 

 

 

 

 

 

Total retirement-related benefit plans

 

$

735

 

$

(199

)

$

537

 

 

 

 

 

 

 

 

 

 

 

 

Other comprehensive income/(loss)

 

$

573

 

$

(143

)

$

430

 

 

 

 

 

 

 

 

 

 

 

 

 

(1)

These AOCI components are included in the computation of net periodic pension cost. (See note 9, “Retirement-Related Benefits,” for additional information.)

 

Reclassifications and Taxes Related to Items of Other Comprehensive Income

 

(Dollars in millions)

 

Before Tax

 

Tax (Expense)/

 

Net of Tax

 

For the three months ended March 31, 2017:

 

Amount

 

Benefit

 

Amount

 

Other comprehensive income/(loss):

 

 

 

 

 

 

 

Foreign currency translation adjustments

 

$

161

 

$

108

 

$

270

 

Net changes related to available-for-sale securities:

 

 

 

 

 

 

 

Unrealized gains/(losses) arising during the period

 

$

(1

)

$

0

 

$

(1

)

Reclassification of (gains)/losses to other (income) and expense

 

1

 

0

 

1

 

 

 

 

 

 

 

 

 

Total net changes related to available-for-sale securities

 

$

0

 

$

0

 

$

0

 

 

 

 

 

 

 

 

 

 

 

 

Unrealized gains/(losses) on cash flow hedges:

 

 

 

 

 

 

 

Unrealized gains/(losses) arising during the period

 

$

(33

)

$

8

 

$

(25

)

Reclassification of (gains)/losses to:

 

 

 

 

 

 

 

Cost of sales

 

(11

)

3

 

(8

)

Cost of services

 

(8

)

3

 

(5

)

SG&A expense

 

(20

)

5

 

(15

)

Other (income) and expense

 

(65

)

25

 

(40

)

Interest expense

 

7

 

(3

)

5

 

 

 

 

 

 

 

 

 

Total unrealized gains/(losses) on cash flow hedges

 

$

(130

)

$

41

 

$

(89

)

 

 

 

 

 

 

 

 

 

 

 

Retirement-related benefit plans(1):

 

 

 

 

 

 

 

Prior service costs/(credits)

 

$

0

 

$

0

 

$

0

 

Net (losses)/gains arising during the period

 

61

 

(20

)

41

 

Curtailments and settlements

 

(1

)

0

 

(1

)

Amortization of prior service (credits)/costs

 

(21

)

7

 

(15

)

Amortization of net (gains)/losses

 

710

 

(229

)

481

 

 

 

 

 

 

 

 

 

Total retirement-related benefit plans

 

$

748

 

$

(241

)

$

507

 

 

 

 

 

 

 

 

 

 

 

 

Other comprehensive income/(loss)

 

$

779

 

$

(92

)

$

688

 

 

 

 

 

 

 

 

 

 

 

 

 

(1)

These AOCI components are included in the computation of net periodic pension cost. (See note 9, “Retirement-Related Benefits,” for additional information.)

 

Accumulated Other Comprehensive Income/(Loss) (net of tax)

 

 

 

 

 

 

 

Net Change

 

Net Unrealized

 

 

 

 

 

Net Unrealized

 

Foreign

 

Retirement-

 

Gains/(Losses)

 

Accumulated

 

 

 

Gains/(Losses)

 

Currency

 

Related

 

on Available-

 

Other

 

 

 

on Cash Flow

 

Translation

 

Benefit

 

For-Sale

 

Comprehensive

 

(Dollars in millions)

 

Hedges

 

Adjustments*

 

Plans

 

Securities

 

Income/(Loss)

 

January 1, 2018

 

$

35

 

$

(2,834

)

$

(23,796

)

$

3

 

$

(26,592

)

Cumulative effect of a change in accounting principle **

 

5

 

46

 

(2,471

)

(2

)

(2,422

)

 

 

 

 

 

 

 

 

 

 

 

 

Other comprehensive income before reclassifications

 

51

 

(115

)

0

 

(2

)

(65

)

Amount reclassified from accumulated other comprehensive income

 

(41

)

0

 

537

 

0

 

495

 

 

 

 

 

 

 

 

 

 

 

 

 

Total change for the period

 

10

 

(115

)

537

 

(2

)

430

 

 

 

 

 

 

 

 

 

 

 

 

 

March 31, 2018

 

$

50

 

$

(2,903

)

$

(25,730

)

$

(1

)

$

(28,583

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

*Foreign currency translation adjustments are presented gross except for any associated hedges which are presented net of tax.

**Reflects the adoption of the FASB guidance on stranded tax effects, hedging and financial instruments. Refer to note 2, “Accounting Changes”.

 

 

 

 

 

 

 

Net Change

 

Net Unrealized

 

 

 

 

 

Net Unrealized

 

Foreign

 

Retirement-

 

Gains/(Losses)

 

Accumulated

 

 

 

Gains/(Losses)

 

Currency

 

Related

 

on Available-

 

Other

 

 

 

on Cash Flow

 

Translation

 

Benefit

 

For-Sale

 

Comprehensive

 

(Dollars in millions)

 

Hedges

 

Adjustments*

 

Plans

 

Securities

 

Income/(Loss)

 

January 1, 2017

 

$

319

 

$

(3,603

)

$

(26,116

)

$

2

 

$

(29,398

)

Other comprehensive income before reclassifications

 

(25

)

270

 

40

 

(1

)

284

 

Amount reclassified from accumulated other comprehensive income

 

(64

)

0

 

466

 

1

 

404

 

 

 

 

 

 

 

 

 

 

 

 

 

Total change for the period

 

(89

)

270

 

507

 

0

 

688

 

 

 

 

 

 

 

 

 

 

 

 

 

March 31, 2017

 

$

230

 

$

(3,333

)

$

(25,609

)

$

2

 

$

(28,710

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

*Foreign currency translation adjustments are presented gross except for any associated hedges which are presented net of tax.