
6.	EQUITY

Reconciliation of Balances

The following is a reconciliation of the beginning and ending balances of equity attributable to our stockholders, equity attributable to noncontrolling interests, and total equity (in millions):



	Nine Months Ended September 30,
	2016									2015
	Valero Stockholders’ Equity			Non- controlling Interests (a)			Total Equity			Valero Stockholders’ Equity			Non- controlling Interests (a)			Total Equity
Balance as of beginning of period	$	20,527		$	827		$	21,354		$	20,677		$	567		$	21,244
Net income	1,922			79			2,001			3,692			14			3,706
Dividends	(840		)	—			(840		)	(608		)	—			(608		)
Stock-based compensation expense	33			—			33			27			—			27
Tax deduction in excess of stock-based compensation expense	—			—			—			33			—			33
Transactions in connection with stock-based compensation plans:
Stock issuances	4			—			4			29			—			29
Stock purchases	(43		)	—			(43		)	(136		)	—			(136		)
Stock purchases under purchase program	(1,120		)	—			(1,120		)	(1,965		)	—			(1,965		)
Issuance of Valero Energy Partners LP common units	—			6			6			—			—			—
Contributions from noncontrolling interests	—			—			—			—			5			5
Distributions to noncontrolling interests	—			(54		)	(54		)	—			(39		)	(39		)
Transfers from noncontrolling interests, net of tax (b)	43			(68		)	(25		)	—			—			—
Other comprehensive income (loss)	(187		)	1			(186		)	(428		)	—			(428		)
Balance as of end of period	$	20,339		$	791		$	21,130		$	21,321		$	547		$	21,868

^{___________________________}


(a)	The noncontrolling interests relate to third-party ownership interests in VIEs for which we are the primary beneficiary and therefore consolidate. See Note 9 for information about our consolidated VIEs.

(b)

“Transfers from noncontrolling interests, net of tax” reflects an adjustment to reallocate VLP equity activity between our ownership interest in VLP and that of the noncontrolling interests. This reallocation occurred due to the expiration of the subordination period on August 10, 2016 and as a result of a change in ownership interest resulting from VLP’s issuances of equity following that date. During the subordination period, we held certain common units in VLP that were subordinate to other common units held by us and VLP’s public unitholders. Upon expiration of the subordination period, all unitholders have equal ownership rights.

Share Activity

Activity in the number of shares of common stock and treasury stock was as follows (in millions):



	Nine Months Ended September 30,
	2016			2015
	Common Stock	Treasury Stock		Common Stock	Treasury Stock
Balance as of beginning of period	673	(200	)	673	(159	)
Transactions in connection with stock-based compensation plans:
Stock issuances	—	1		—	3
Stock purchases	—	(1	)	—	(2	)
Stock purchases under purchase program	—	(20	)	—	(32	)
Balance as of end of period	673	(220	)	673	(190	)

Treasury Stock

We purchase shares of our common stock as authorized under our common stock purchase program and to meet our obligations under employee stock-based compensation plans.

On September 21, 2016, our board of directors authorized our purchase of up to an additional $2.5 billion of our outstanding common stock with no expiration date.

Common Stock Dividends

On November 2, 2016, our board of directors declared a quarterly cash dividend of $0.60 per common share payable on December 15, 2016 to holders of record at the close of business on November 22, 2016.

Income Tax Effects Related to Components of Other Comprehensive Loss

The tax effects allocated to each component of other comprehensive loss were as follows (in millions):



	Three Months Ended September 30,
	2016									2015
	Before- Tax Amount			Tax Expense (Benefit)			Net Amount			Before- Tax Amount			Tax Expense (Benefit)			Net Amount
Foreign currency translation adjustment	$	(117	)	$	—		$	(117	)	$	(270	)	$	—		$	(270	)
Pension and other postretirement benefits:
Amounts reclassified into income related to:
Prior service credit	(9		)	(3		)	(6		)	(10		)	(3		)	(7		)
Net actuarial loss	12			4			8			16			5			11
Settlement	(3		)	—			(3		)	—			—			—
Net gain (loss) on pension and other postretirement benefits	—			1			(1		)	6			2			4
Other comprehensive loss	$	(117	)	$	1		$	(118	)	$	(264	)	$	2		$	(266	)



	Nine Months Ended September 30,
	2016									2015
	Before- Tax Amount			Tax Expense (Benefit)			Net Amount			Before- Tax Amount			Tax Expense (Benefit)			Net Amount
Foreign currency translation adjustment	$	(197	)	$	—		$	(197	)	$	(439	)	$	—		$	(439	)
Pension and other postretirement benefits:
Miscellaneous gain arising during the period	—			(8		)	8			—			—			—
Amounts reclassified into income related to:
Prior service credit	(27		)	(10		)	(17		)	(30		)	(10		)	(20		)
Net actuarial loss	36			13			23			47			16			31
Settlement	(3		)	—			(3		)	—			—			—
Net gain on pension and other postretirement benefits	6			(5		)	11			17			6			11
Other comprehensive loss	$	(191	)	$	(5	)	$	(186	)	$	(422	)	$	6		$	(428	)

Accumulated Other Comprehensive Loss

Changes in accumulated other comprehensive loss by component, net of tax, were as follows (in millions):



	Foreign Currency Translation Adjustment			Defined Benefit Plans Items			Total
Balance as of December 31, 2015	$	(605	)	$	(328	)	$	(933	)
Other comprehensive income (loss) before reclassifications	(198		)	8			(190		)
Amounts reclassified from accumulated other comprehensive loss	—			3			3
Net other comprehensive income (loss)	(198		)	11			(187		)
Balance as of September 30, 2016	$	(803	)	$	(317	)	$	(1,120	)



	Foreign Currency Translation Adjustment			Defined Benefit Plans Items			Total
Balance as of December 31, 2014	$	1		$	(368	)	$	(367	)
Other comprehensive loss before reclassifications	(439		)	—			(439		)
Amounts reclassified from accumulated other comprehensive loss	—			11			11
Net other comprehensive income (loss)	(439		)	11			(428		)
Balance as of September 30, 2015	$	(438	)	$	(357	)	$	(795	)