Share-Based Compensation (Tables)

12 Months Ended

Sep. 30, 2019

Share-based Payment Arrangement [Abstract]

Compensation Cost Relating to Share-Based Payments

The amounts and location of compensation cost relating to share-based payments included in the consolidated statements of income is as follows:

(Millions of dollars)	2019		2018		2017
Cost of products sold	$	37	$	36	$	30
Selling and administrative expense	145		136		113
Research and development expense	32		29		24
Acquisitions and other restructurings	50		130		10
	$	265	$	332	$	177
Tax benefit associated with share-based compensation costs recognized	$	62	$	79	$	61

Assumptions for Estimation of Fair Values of Stock Appreciation Rights Granted During Reporting Periods

The fair value was estimated on the date of grant using a lattice-based binomial option valuation model that uses the following weighted-average assumptions:

	2019	2018	2017
Risk-free interest rate	3.05%	2.32%	2.33%
Expected volatility	18.0%	19.0%	20.0%
Expected dividend yield	1.27%	1.33%	1.71%
Expected life	7.2 years	7.4 years	7.5 years
Fair value derived	$51.86	$46.10	$33.81

Summary of SARs Outstanding

A summary of SARs outstanding as of September 30, 2019 and changes during the year then ended is as follows:

	SARs (in thousands)		Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (Years)	Aggregate Intrinsic Value (Millions of dollars)
Balance at October 1	7,986		$	125.73
Granted	859		242.10
Exercised	(1,779	)	102.14
Forfeited, canceled or expired	(168	)	186.18
Balance at September 30	6,899		$	144.84	5.70	$	746
Vested and expected to vest at September 30	6,692		$	142.87	5.62	$	737
Exercisable at September 30	4,833		$	117.65	4.69	$	654

Schedule Of Share Based Compensation, Summary of Stock Appreciation Rights Exercised

A summary of SARs exercised 2019, 2018 and 2017 is as follows:

(Millions of dollars)	2019		2018		2017
Total intrinsic value of SARs exercised	$	260	$	333	$	148
Tax benefit realized from SAR exercises	$	62	$	90	$	53
Total fair value of SARs vested	$	66	$	107	$	30

Summary of Performance-Based Restricted Stock Units Outstanding

A summary of restricted stock units outstanding as of September 30, 2019 and changes during the year then ended is as follows:

	Performance-Based					Time-Vested
	Stock Units (in thousands)			Weighted Average Grant Date Fair Value		Stock Units (in thousands)		Weighted Average Grant Date Fair Value
Balance at October 1	1,032			$	190.57	2,765		$	194.92
Granted	381			237.55		755		235.50
Distributed	(142	)		153.73		(906	)	189.06
Forfeited or canceled	(316	)		182.50		(546	)	201.85
Balance at September 30	955		(a)	$	221.73	2,068		$	210.48
Expected to vest at September 30	306		(b)	$	218.06	1,964		$	209.67

(a) Based on 200% of target payout.

(b) Net of expected forfeited units and units in excess of the expected performance payout of 65 thousand and 585 thousand shares, respectively.

Schedule Of Share Based Compensation, Restricted Stock Units, Grant Date Fair Value of Units Granted

The weighted average grant date fair value of restricted stock units granted during the years 2019, 2018 and 2017 are as follows:

	Performance-Based						Time-Vested
	2019		2018		2017		2019		2018		2017
Weighted average grant date fair value of units granted	$	237.55	$	251.75	$	174.92	$	235.50	$	216.06	$	165.96

Schedule of Share-based Compensation, Restricted Stock and Restricted Stock Units Activity

The total fair value of stock units vested during 2019, 2018 and 2017 was as follows:

	Performance-Based						Time-Vested
(Millions of dollars)	2019		2018		2017		2019		2018		2017
Total fair value of units vested	$	33	$	31	$	32	$	254	$	362	$	139