Summary of Accounting Policies (Tables)

12 Months Ended

Dec. 31, 2017

The following is a rollforward of activity in our redeemable noncontrolling interests for the years ending December 31, 2017, 2016 and 2015, respectively:


	2017			2016			2015
	(Millions)
Balance January 1	$	40		$	41		$	34
Net income attributable to redeemable noncontrolling interests		36			36			32
Other comprehensive income (loss)		3			(2	)		(1	)
Dividends declared		(37	)		(35	)		(24	)

Balance December 31	$	42		$	40		$	41

Inventories by Major Classification

At December 31, 2017 and 2016, inventory by major classification was as follows:


	2017		2016
	(Millions)
Finished goods	$	349	$	284
Work in process		268		245
Raw materials		178		137
Materials and supplies		74		64

	$869		$730

Changes in Net Carrying Amount of Goodwill

The changes in the net carrying amount of goodwill for the years ended December 31, 2017, 2016 and 2015 were as follows:


	Clean Air Segment			Ride Performance Segment			Aftermarket Segment			Total
	(Millions)
Balance at December 31, 2015	$	14		$	22		$	24		$	60

Translation Adjustment		(1	)		(2	)		—			(3	)

Balance at December 31, 2016		13			20			24			57

Translation Adjustment		2			—			1			3
Goodwill Impairment Charge		—			(7	)		(4	)		(11	)

Balance at December 31, 2017	$	15		$	13		$	21		$	49

Carrying Amount and Accumulated Amortization of Finite Useful Life Intangible Assets

The carrying amount and accumulated amortization of our finite useful life intangible assets were as follows:


	December 31, 2017					December 31, 2016
	Gross Carrying Value		Accumulated Amortization			Gross Carrying Value		Accumulated Amortization
	(Millions)					(Millions)
Customer contract	$	8	$	(5	)	$	8	$	(5	)
Patents		1		(1	)		1		(1	)
Technology rights		29		(23	)		29		(21	)
Other		15		(2	)		9		(1	)

Total	$	53	$	(31	)	$	47	$	(28	)

Property, Plant and Equipment

At December 31, 2017 and 2016, plant, property, and equipment, at cost, by major category were as follows:


	2017		2016
	(Millions)
Land, buildings, and improvements	$	635	$	568
Machinery and equipment		2,983		2,638
Other, including construction in progress		390		342

	$4,008		$3,548

The effects of adopting the new standard on our consolidated financial statements

The following tables summarize the effects of adopting the new standard on our consolidated financial statements:


	Year Ended December 31, 2017
	Previously Reported			Effect of Accounting Change			As Adjusted
	(Millions)
Consolidated Statement of Income
Cost of sales	$	7,812		$	(3	)	$	7,809
Selling, general, and administrative		648			(12	)		636
Other (income) expense		(1	)		15			14

	Year Ended December 31, 2016
	Previously Reported			Effect of Accounting Change			As Adjusted
	(Millions)
Consolidated Statement of Income
Cost of sales	$	7,123		$	(7	)	$	7,116
Selling, general, and administrative		589			(76	)		513
Other expense		—			83			83

	Year Ended December 31, 2015
	Previously Reported			Effect of Accounting Change			As Adjusted
	(Millions)
Consolidated Statement of Income
Cost of sales	$	6,828		$	(7	)	$	6,821
Selling, general, and administrative		491			(9	)		482
Other expense		1			16			17

The following tables summarize the effects of adopting ASU 2016-18 and ASU 2016-15 on our consolidated statements of cash flows for the years ended December 31, 2017, 2016 and 2015.


	Year Ended December 31, 2017
	Previously Reported			Effect of ASU 2016-18			Effect of ASU 2016-15			As Adjusted
	(Millions)
Consolidated Statement of Cash Flows
Decrease (increase) in receivables	$	31		$	—		$	(112	)	$	(81	)
Net cash provided by operating activities		629			—			(112	)		517

Change in restricted cash	$	(1	)	$	1		$	—		$	—
Proceeds from deferred purchase price of factored receivables		—			—			112			112
Net cash used by investing activities		(413	)		1			112			(300	)

Decrease in cash, cash equivalents and restricted cash	$	(32	)	$	1		$	—		$	(31	)
Cash, cash equivalents and restricted cash, January 1		347			2			—			349

Cash, cash equivalents and restricted cash, December 31	$	315		$	3		$	—		$	318

	Year Ended December 31, 2016
	Previously Reported			Effect of ASU 2016-18			Effect of ASU 2016-15			As Adjusted
	(Millions)
Consolidated Statement of Cash Flows
Increase in receivables	$	(215	)	$	—		$	(110	)	$	(325	)
Net cash provided by operating activities		484			—			(110	)		374

Change in restricted cash	$	(1	)	$	1		$	—		$	—
Proceeds from deferred purchase price of factored receivables		—			—			110			110
Net cash used by investing activities		(340	)		1			110			(229	)

Increase in cash, cash equivalents and restricted cash	$	60		$	1		$	—		$	61
Cash, cash equivalents and restricted cash, January 1		287			1			—			288

Cash, cash equivalents and restricted cash, December 31	$	347		$	2		$	—		$	349


	Year Ended December 31, 2015
	Previously Reported			Effect of ASU 2016-18			Effect of ASU 2016-15			As Adjusted
	(Millions)
Consolidated Statement of Cash Flows
Increase in receivables	$	(90	)	$	—		$	(113	)	$	(203	)
Net cash provided by operating activities		528			—			(113	)		415

Change in restricted cash	$	2		$	(2	)	$	—		$	—
Proceeds from deferred purchase price of factored receivables		—			—			113			113
Net cash used by investing activities		(303	)		(2	)		113			(192	)

Increase in cash, cash equivalents and restricted cash	$	5		$	(2	)	$	—		$	3
Cash, cash equivalents and restricted cash, January 1		282			3			—			285

Cash, cash equivalents and restricted cash, December 31	$	287		$	1		$	—		$	288