10-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

Annual report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the year endedDecember 31, 2017

Commission file number 000-54863

EATON CORPORATION plc

(Exact name of registrant as specified in its charter)

Ireland	98-1059235
(State or other jurisdiction of incorporation or organization)	(IRS Employer Identification Number)
Eaton House, 30 Pembroke Road, Dublin 4, Ireland	D04 Y0C2
(Address of principal executive offices)	(Zip code)

		+353 1637 2900
		(Registrant's telephone number, including area code)
	Securities registered pursuant to Section 12(b) of the Act:
Title of each class			Name of each exchange on which registered
Ordinary Shares ($0.01 par value)			The New York Stock Exchange

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes þ No o

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes o No þ

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes þ No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes þ No o

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§229.405 of this chapter) is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer," “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer þ	Accelerated filer o	Non-accelerated filer o
Smaller reporting company o	Emerging growth company o	(Do not check if a smaller reporting company)

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange

Act. o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes o No þ

The aggregate market value of Ordinary Shares held by non-affiliates of the registrant as of June 30, 2017 was $34.6 billion.

As of January 31, 2018, there were 440.2 million Ordinary Shares outstanding.

Documents Incorporated By Reference

Portions of the Proxy Statement for the 2018 annual shareholders meeting are incorporated by reference into Part III.

TABLE OF CONTENTS
Part I		2
Item 1.	Business	2
Item 1A.	Risk Factors	3
Item 1B.	Unresolved Staff Comments	5
Item 2.	Properties	5
Item 3.	Legal Proceedings	5
Item 4.	Mine Safety Disclosures	5
Part II		6
Item 5.	Market for the Registrant's Ordinary Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	6
Item 6.	Selected Financial Data	6
Item 7.	Management's Discussion and Analysis of Financial Condition and Results of Operations	6
Item 7A.	Quantitative and Qualitative Disclosures about Market Risk	7
Item 8.	Financial Statements and Supplementary Data	7
Item 9.	Change in and Disagreements with Accountants on Accounting and Financial Disclosure	7
Item 9A.	Controls and Procedures	7
Item 9B.	Other Information	7
Part III		8
Item 10.	Directors, Executive Officers and Corporate Governance	8
Item 11.	Executive Compensation	9
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	9
Item 13.	Certain Relationships and Related Transactions, and Director Independence	9
Item 14.	Principal Accounting Fees and Services	10
Part IV		10
Item 15.	Exhibits, Financial Statement Schedules	10
Item 16.	Form 10-K Summary	14
SIGNATURES		15

Part I

Item 1. Business.

Eaton Corporation plc (Eaton or the Company) is a power management company with 2017 net sales of $20.4 billion. The Company provides energy-efficient solutions that help its customers effectively manage electrical, hydraulic and mechanical power more efficiently, safely and sustainably. Eaton has approximately 96,000 employees in 59 countries and sells products to customers in more than 175 countries.

Eaton electronically files or furnishes reports pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (Exchange Act) to the United States Securities and Exchange Commission (SEC), including annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and proxy and information statements, as well as any amendments to those reports. As soon as reasonably practicable, these reports are available free of charge through the Company's website at www.eaton.com. These filings are also accessible on the SEC's website at www.sec.gov.

Business Segment Information

Information by business segment and geographic region regarding principal products, principal markets, methods of distribution, net sales, operating profit and assets is presented in Note 15 of the Notes to the Consolidated Financial Statements. Additional information regarding Eaton's segments and business is presented below.

Electrical Products and Electrical Systems and Services

Principal methods of competition in these segments are performance of products and systems, technology, customer service and support, and price. Eaton has a strong competitive position in these segments and, with respect to many products, is considered among the market leaders. In normal economic cycles, sales of these segments are historically lower in the first quarter and higher in the third and fourth quarters of a year. In 2017, 21% of these segments' sales were made to six large distributors of electrical products and electrical systems and services.

Hydraulics

Principal methods of competition in this segment are product performance, geographic coverage, service, and price. Eaton has a strong competitive position in this segment and, with respect to many products, is considered among the market leaders. Sales of this segment are historically higher in the first and second quarters and lower in the third and fourth quarters of the year. In 2017, 9% of this segment's sales were made to three large original equipment manufacturers or distributors of agricultural, construction, and industrial equipment and parts.

Aerospace

Principal methods of competition in this segment are total cost of ownership, product and system performance, quality, design engineering capabilities, and timely delivery. Eaton has a strong competitive position in this segment and, with respect to many products and platforms, is considered among the market leaders. In 2017, 29% of this segment's sales were made to three large original equipment manufacturers of aircraft.

Vehicle

Principal methods of competition in this segment are product performance, technology, global service, and price. Eaton has a strong competitive position in this segment and, with respect to many products, is considered among the market leaders. In 2017, 69% of this segment's sales were made to nine large original equipment manufacturers of vehicles and related components.

Information Concerning Eaton's Business in General

Raw Materials

Eaton's major requirements for raw materials include iron, steel, copper, nickel, aluminum, brass, tin, silver, lead, titanium, rubber, plastic, electronic components, chemicals and fluids. Materials are purchased in various forms, such as extrusions, castings, powder metal, metal sheets and strips, forging billets, bar stock, and plastic pellets. Raw materials, as well as parts and other components, are purchased from many suppliers. Under normal circumstances, the Company has no difficulty obtaining its raw materials. In 2017, Eaton maintained appropriate levels of inventory to prevent shortages and did not experience any availability constraints.

2

Patents and Trademarks

Eaton considers its intellectual property, including without limitation patents, trade names, domain names, trademarks, confidential information, and trade secrets to be of significant value to its business as a whole. The Company's products are manufactured, marketed and sold under a portfolio of patents, trademarks, licenses, and other forms of intellectual property, some of which expire or are allowed to lapse at various dates in the future. Eaton develops and acquires new intellectual property on an ongoing basis and considers all of its intellectual property to be valuable. Based on the broad scope of the Company's product lines, management believes that the loss or expiration of any single intellectual property right would not have a material effect on Eaton's consolidated financial statements or its business segments. The Company's policy is to file applications and obtain patents for the majority of its novel and innovative new products including product modifications and improvements.

Order Backlog

A significant portion of open orders placed with Eaton are by original equipment manufacturers or distributors. These open orders are not considered firm as they have been historically subject to releases by customers. In measuring backlog orders, only the amount of orders to which customers are firmly committed are included. Using this criterion, total backlog at December 31, 2017 and 2016 was approximately $4.8 billion and $4.0 billion, respectively. Backlog should not be relied upon as being indicative of results of operations for future periods.

Research and Development

Research and development expenses for new products and improvement of existing products in 2017, 2016 and 2015 were $584 million, $589 million, and $625 million, respectively. Over the past five years, the Company has invested approximately $3.1 billion in research and development.

Environmental Contingencies

Operations of the Company involve the use and disposal of certain substances regulated under environmental protection laws. Eaton continues to modify processes on an ongoing, regular basis in order to reduce the impact on the environment, including the reduction or elimination of certain chemicals used in, and wastes generated from, operations. Compliance with laws that have been enacted or adopted regulating the discharge of materials into the environment, or otherwise relating to the protection of the environment, are not expected to have a material adverse effect upon earnings or the competitive position of the Company. Eaton's estimated capital expenditures for environmental control facilities are not expected to be material for 2018 and 2019. Information regarding the Company's liabilities related to environmental matters is presented in Note 8 of the Notes to the Consolidated Financial Statements.

Item 1A. Risk Factors.

Among the risks that could materially adversely affect Eaton's businesses, financial condition or results of operations are the following:

Volatility of end markets that Eaton serves.

Eaton's segment revenues, operating results, and profitability have varied in the past and may vary from quarter to quarter in the future. Profitability can be negatively impacted by volatility in the end markets that Eaton serves. The Company has undertaken measures to reduce the impact of this volatility through diversification of the markets it serves and expansion of the geographic regions in which it operates. Future downturns in any of the markets could adversely affect revenues, operating results, and profitability.

Eaton's operating results depend in part on continued successful research,development, and marketing of new and/or improved products and services, andthere can be no assurance that Eaton will continue to successfully introducenew products and services.

The success of new and improved products and services depends on their initial and continued acceptance by Eaton's customers. The Company's businesses are affected, to varying degrees, by technological change and corresponding shifts in customer demand, which could result in unpredictable product transitions or shortened life cycles. Eaton may experience difficulties or delays in the research, development, production, or marketing of new products and services which may prevent Eaton from recouping or realizing a return on the investments required to bring new products and services to market.

3

Eaton's ability to attract, develop and retain executives and other qualified employees is crucial to the Company's results of operations and future growth.

Eaton depends on the continued services and performance of key executives, senior management, and skilled personnel, particularly professionals with experience in its industry and business. Eaton cannot be certain that any of these individuals will continue his or her employment with the Company. A lengthy period of time is required to hire and develop replacement personnel when skilled personnel depart. An inability to hire, develop, and retain a sufficient number of qualified employees could materially hinder the business by, for example, delaying Eaton's ability to bring new products to market or impairing the success of the Company's operations.

Eaton's operations depend on production facilities throughout the world, which subjects them to varying degrees of riskof disrupted production.

Eaton manages businesses with manufacturing facilities worldwide. The Company's manufacturing facilities and operations could be disrupted by a natural disaster, labor strike, war, political unrest, terrorist activity, economic upheaval, or public health concerns. Some of these conditions are more likely in certain geographic regions in which Eaton operates. Any such disruption could cause delays in shipments of products and the loss of sales and customers, and insurance proceeds may not adequately compensate for losses.

If Eaton is unable to protect its information technology infrastructure against service interruptions, data corruption, cyber-based attacks or network security breaches, operations could be disrupted or data confidentiality lost.

Eaton relies on information technology networks and systems, including the Internet, to process, transmit and store electronic information, and to manage or support a variety of business processes and activities, including procurement, manufacturing, distribution, invoicing and collection. These technology networks and systems may be susceptible to damage, disruptions or shutdowns due to failures during the process of upgrading or replacing software, databases or components; power outages; hardware failures; or computer viruses. In addition, security breaches could result in unauthorized disclosure of confidential information. If these information technology systems suffer severe damage, disruption, breach, or shutdown, and business continuity plans do not effectively resolve the issues in a timely manner, there could be a negative impact on operating results or the Company may suffer financial or reputational damage. Further, Cyber-based risks could also include attacks targeting the security, integrity and/or reliability of the hardware, software and information installed, stored or transmitted in our products, including after the purchase of those products and when they are incorporated into third party products, facilities or infrastructure. Such attacks could result in disruptions to third party systems, unauthorized release of confidential or otherwise protected information and corruption of data (our own or that of third parties). Further, to a significant extent, the security of our customers’ systems depends on how those systems are protected, configured, updated and monitored, all of which are typically outside our control.

Eaton's global operations subject it to economic risk as Eaton'sresults of operations may be adversely affected by changes in government legislation,regulations and policies and currency fluctuations.

Operating globally subjects Eaton to changes in government regulations and policies in a large number of jurisdictions around the world, including those related to tariffs and trade barriers, investments, property ownership rights, taxation, and exchange controls. Changes in the relative values of currencies occur from time to time and could affect Eaton's operating results. While the Company monitors exchange rate exposures and attempts to reduce these exposures through hedging activities, these risks could adversely affect operating results.

Further, existing free trade laws and regulations, such as the North American Free Trade Agreement, provide certain beneficial duties and tariffs for qualifying imports and exports, subject to compliance with the applicable classification and other requirements. Changes in laws or policies governing the terms of foreign trade, and in particular increased trade restrictions, tariffs or taxes on imports from countries where we manufacture products could have an impact on our business and financial results.

Eaton may be subject to risks relating to changes in its tax rates or exposure to additional income tax liabilities.

Eaton is subject to income taxes in many jurisdictions around the world. Income tax liabilities are subject to the allocation of income among various tax jurisdictions. The Company's effective tax rate could be affected by changes in the mix among earnings in countries with differing statutory tax rates, changes in the valuation allowance of deferred tax assets, or changes in tax laws. The amount of income taxes paid is subject to ongoing audits by tax authorities in the countries in which Eaton operates. If these audits result in assessments different from amounts reserved, future financial results may include unfavorable adjustments to the Company's tax liabilities.

4

Eaton uses a variety of raw materials and components in its businesses, andsignificant shortages, price increases, or supplier insolvencies could increaseoperating costs and adversely impact the competitive positions of Eaton'sproducts.

Eaton's major requirements for raw materials are described above in Item 1 “Raw Materials”. Significant shortages could affect the prices Eaton's businesses are charged and the competitive position of their products and services, all of which could adversely affect operating results.

Further, Eaton's suppliers of component parts may increase their prices in response to increases in costs of raw materials that they use to manufacture component parts. The Company may not be able to increase its prices commensurately with its increased costs, adversely affecting operating results.

Eaton may be unable to adequately protect its intellectual property rights,which could affect the Company's ability to compete.

Protecting Eaton's intellectual property rights is critical to its ability to compete and succeed. The Company owns a large number of patents and patent applications worldwide, as well as trademark and copyright registrations that are necessary, and contribute significantly, to the preservation of Eaton's competitive position in various markets. Although management believes that the loss or expiration of any single intellectual property right would not have a material effect on the results of operations or financial position of Eaton or its business segments, there can be no assurance that any one, or more, of these patents and other intellectual property will not be challenged, invalidated, or circumvented by third parties. Eaton enters into confidentiality and invention assignment agreements with the Company's employees, and into non-disclosure agreements with suppliers and appropriate customers, so as to limit access to and disclosure of proprietary information. These measures may not suffice to deter misappropriation or independent third party development of similar technologies.

Eaton is subject to litigation and environmental regulations that couldadversely impact Eaton's businesses.

At any given time, Eaton may be subject to litigation, the disposition of which may have a material adverse effect on the Company's businesses, financial condition or results of operations. Information regarding current legal proceedings is presented in Note 8 and Note 9 of the Notes to the Consolidated Financial Statements.

Item 1B. Unresolved Staff Comments.

None.

Item 2. Properties.

Eaton's principal executive offices are located at Eaton House, 30 Pembroke Road, Dublin 4, Ireland D04 Y0C2. The Company maintains manufacturing facilities at approximately 327 locations in 42 countries. The Company is a lessee under a number of operating leases for certain real properties and equipment, none of which is material to its operations. Management believes that the existing manufacturing facilities are adequate for its operations and that the facilities are maintained in good condition.

Item 3. Legal Proceedings.

Information regarding the Company's current legal proceedings is presented in Note 8 and Note 9 of the Notes to the Consolidated Financial Statements.

Item 4. Mine Safety Disclosures.

Not applicable.

Executive Officers of the Registrant

Information regarding executive officers of the Company is presented in Item 10 of this Form 10-K Report.

5

Part II

Item 5. Market for the Registrant's Ordinary Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.

The Company's ordinary shares are listed for trading on the New York Stock Exchange. At December 31, 2017, there were 13,089 holders of record of the Company's ordinary shares. Additionally, 20,138 current and former employees were shareholders through participation in the Eaton Savings Plan (ESP), Eaton Personal Investment Plan (EPIP), and the Eaton Puerto Rico Retirement Savings Plan.

Information regarding cash dividends paid, and the high and low market price per ordinary share, for each quarter in 2017 and 2016 is presented in “Quarterly Data” of this Form 10-K. Information regarding equity-based compensation plans required by Regulation S-K Item 201(d) is provided in Item 12 of this Form 10-K Report.

Irish Taxes Applicable to Dividends

Irish income tax may arise with respect to dividends paid on Eaton shares. Generally, shareholders who are not tax residents of Ireland and otherwise have no connection with Ireland other than his or her shareholding in Eaton, will not be subject to Irish income tax. However, in certain circumstances, Eaton will be required to deduct Irish dividend withholding tax (“IDWT”, currently at the rate of 20%) from dividends paid to its shareholders who are not Irish residents. In the majority of cases though, shareholders resident in the U.S. and certain other countries are exempt from IDWT. To establish exempt status, shareholders who qualify can complete certain Irish dividend withholding tax exemption forms or hold their shares in an account through the Depository Trust Company and have on file with their broker or qualifying agent a valid U.S. address on the record date of the dividend.  

Eaton shareholders who receive their dividends subject to Irish dividend withholding tax will generally have no further liability for Irish income tax on the dividends unless they are otherwise subject to Irish income tax.

Issuer's Purchases of Equity Securities

During the fourth quarter of 2017, 0.8 million ordinary shares were repurchased in the open market at a total cost of $61 million. These shares were repurchased under the program approved by the Board on February 24, 2016. A summary of the shares repurchased in the fourth quarter of 2017 follows:

Month	Total number of shares purchased	Average price paid per share		Total number of shares purchased as part of publicly announced plans or programs	Approximate dollar value of shares that may yet be purchased under the plans or programs (in millions)
October	—	$	—	—	$	1,064
November	781,958	$	78.77	781,958	$	1,002
December	—	$	—	—	$	1,002
Total	781,958	$	78.77	781,958

Item 6. Selected Financial Data.

Information regarding selected financial data is presented in the “Five-Year Consolidated Financial Summary” of this Form 10-K.

Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations.

Information required by this Item is presented in “Management's Discussion and Analysis of Financial Condition and Results of Operations” of this Form 10-K.

6

Item 7A. Quantitative and Qualitative Disclosures about Market Risk.

Information regarding market risk is presented in “Market Risk Disclosure” of this Form 10-K.

Item 8. Financial Statements and Supplementary Data.

The reports of the independent registered public accounting firm, consolidated financial statements, and notes to consolidated financial statements are presented in Item 15 of this Form 10-K.

Information regarding selected quarterly financial information for 2017 and 2016 is presented in “Quarterly Data” of this Form 10-K.

Item 9. Change in and Disagreements with Accountants on Accounting and Financial Disclosure.

None.

Item 9A. Controls and Procedures.

Evaluation of Disclosure Controls and Procedures - Pursuant to SEC Rule 13a-15, an evaluation was performed under the supervision and with the participation of Eaton's management, including Craig Arnold - Principal Executive Officer; and Richard H. Fearon - Principal Financial Officer, of the effectiveness of the design and operation of the Company's disclosure controls and procedures. Based on that evaluation, Eaton's management concluded that the Company's disclosure controls and procedures were effective as of December 31, 2017.

Disclosure controls and procedures are designed to ensure that information required to be disclosed in Company reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange Commission's rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in Company reports filed under the Exchange Act is accumulated and communicated to management, including the Company's Principal Executive Officer and Principal Financial Officer, to allow timely decisions regarding required disclosure.

Pursuant to Section 404 of the Sarbanes Oxley Act of 2002 and the rules and regulations adopted pursuant thereto, Eaton has included a report of management's assessment of the effectiveness of internal control over financial reporting, which is included in Item 15 of this Form 10-K.

“Report of Independent Registered Public Accounting Firm” relating to internal control over financial reporting as of December 31, 2017 is included in Item 15 of this Form 10-K.

During the fourth quarter of 2017, there was no change in Eaton's internal control over financial reporting that materially affected, or is reasonably likely to materially affect, internal control over financial reporting.

Item 9B. Other Information.

Disclosure Pursuant to Section 13(r) of the Exchange Act

Set forth below is a description of all matters reported by us pursuant to Section 219 of the Iran Threat Reduction and Syria Human Rights Act of 2012 and Section 13(r) of the Exchange Act. Concurrently with the filing of this Annual Report, we are filing a notice pursuant to Section 13(r) of the Exchange Act that such matters have been disclosed in this Annual Report.

During the fourth quarter, certain of our wholly-owned non-U.S. subsidiaries sold various electrical products to customers in Iran. We received total revenue of approximately 1,220,762 Euros and realized net profits of approximately 399,894 Euros from the sales (approximately $1,443,658 and $472,910 in whole U.S. dollars, respectively). One or more of our non-U.S. subsidiaries intend to continue doing business in Iran under General License H in compliance with U.S. economic sanctions and export control laws, though the Company has no assets or employees in Iran.

7

Part III

Item 10. Directors, Executive Officers and Corporate Governance.

Information required with respect to the directors of the Company is set forth under the caption “Election of Directors” in the Company's definitive Proxy Statement to be filed on or about March 16, 2018, and is incorporated by reference.

A listing of executive officers, their ages, positions and offices held over the past five years, as of February 1, 2018, follows:

Name	Age	Position (Date elected to position)
Craig Arnold	57	Chairman of Eaton Corporation plc (June 1, 2016 - present)
		Chief Executive Officer of Eaton Corporation (June 1, 2016 - present)
		Director of Eaton Corporation plc (September 1, 2015 - present)
		President and Chief Operating Officer of Eaton Corporation
		(September 1, 2015 - May 31, 2016)
		Vice Chairman and Chief Operating Officer - Industrial Sector of Eaton Corporation
		(February 1, 2009 - August 31, 2015)
Richard H. Fearon	61	Director of Eaton Corporation plc (September 1, 2015 - present)
		Vice Chairman and Chief Financial and Planning Officer of Eaton Corporation
		(April 24, 2002 - present)
Revathi Advaithi	50	Chief Operating Officer - Electrical Sector of Eaton Corporation
		(September 1, 2015 - present)
		President of Electrical Sector, Americas of Eaton Corporation
		(April 1, 2012 - August 31, 2015)
Uday Yadav	54	Chief Operating Officer - Industrial Sector of Eaton Corporation
		(September 1, 2015 - present)
		President of Aerospace Group of Eaton Corporation (August 1, 2012 - August 31, 2015)
Cynthia K. Brabander	56	Executive Vice President and Chief Human Resources Officer of Eaton Corporation
		(March 1, 2012 - present)
Heath B. Monesmith	47	Executive Vice President and General Counsel of Eaton Corporation
		(March 1, 2017 - present)
		Senior Vice President and Deputy General Counsel of Eaton Corporation
		(May 15, 2015 - March 1, 2017)
		Vice President and Chief Counsel - Litigation of Eaton Corporation
		(November 30, 2012 - May 15, 2015)
Thomas E. Moran	53	Senior Vice President and Secretary of Eaton Corporation plc (November 27, 2012 - present)
Ken D. Semelsberger	56	Senior Vice President and Controller of Eaton Corporation (November 1, 2013 - present)
		Senior Vice President, Finance and Planning - Industrial Sector of Eaton Corporation
		(February 1, 2009 - October 31, 2013)
Joao V. Faria	53	President - Vehicle Group of Eaton Corporation (May 1, 2017 - present)
		Vice President and General Manager, Latin America, Electrical Sector and
		President, Latin America (August 1, 2013 - April 30, 2017)
		President, Americas, Hydraulics Group (July 1, 2010 - July 31, 2013)

8

Curtis J. Hutchins	52	President - Hydraulics Group of Eaton Corporation (August 1, 2015 - present)
		President - Asia Pacific Region of Eaton Corporation (September 1, 2009 - July 31, 2015)
Nandakumar Cheruvatath	56	President - Aerospace Group of Eaton Corporation (September 1, 2015 - present)
		Executive Vice President, Eaton Business System (August 1, 2012 - August 31, 2015)
Richard M. Eubanks, Jr. (Mark)	45	President - Electrical Products Group of Eaton Corporation (September 1, 2015 - present)
		President, Eaton Lighting Division (February 1, 2010 - August 31, 2015)
William J. VanLandingham II	55	President - Electrical Systems and Services Group of Eaton Corporation
		(September 1, 2015 - present)
		President, Crouse-Hinds Business, Electrical Sector ( December 1, 2012 - August 31, 2015)

There are no family relationships among the officers listed, and there are no arrangements or understandings pursuant to which any of them were elected as officers. All officers hold office for one year and until their successors are elected and qualified, unless otherwise specified by the Board of Directors; provided, however, that any officer is subject to removal with or without cause, at any time, by a vote of a majority of the Board of Directors.

Information required with respect to compliance with Section 16(a) of the Exchange Act is set forth under the caption “Section 16(a) Beneficial Ownership Reporting” in the Company's definitive Proxy Statement to be filed on or about March 16, 2018, and is incorporated by reference.

The Company has adopted a Code of Ethics, which applies to the directors, officers and employees worldwide. This document is available on the Company's website at http://www.eaton.com.

There were no changes during the fourth quarter 2017 to the procedures by which security holders may recommend nominees to the Company's Board of Directors.

Information related to the Audit Committee, and members of the Committee who are financial experts, is set forth under the caption “Board Committees - Audit Committee” in the definitive Proxy Statement to be filed on or about March 16, 2018, and is incorporated by reference.

Item 11. Executive Compensation.

Information required with respect to executive compensation is set forth under the caption “Compensation Discussion and Analysis” in the Company's definitive Proxy Statement to be filed on or about March 16, 2018, and is incorporated by reference.

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.

Information required with respect to securities authorized for issuance under equity-based compensation plans is set forth under the caption “Equity Compensation Plans” in the Company's definitive Proxy Statement to be filed on or about March 16, 2018, and is incorporated by reference.

Information required with respect to security ownership of certain beneficial owners, is set forth under the caption “Share Ownership Tables” in the Company's definitive Proxy Statement to be filed on or about March 16, 2018, and is incorporated by reference.

Item 13. Certain Relationships and Related Transactions, and Director Independence.

Information required with respect to certain relationships and related transactions is set forth under the caption “Review of Related Person Transactions” in the Company's definitive Proxy Statement to be filed on or about March 16, 2018, and is incorporated by reference.

9

Information required with respect to director independence is set forth under the caption “Director Independence” in the Company's definitive Proxy Statement to be filed on or about March 16, 2018, and is incorporated by reference.

Item 14. Principal Accounting Fees and Services.

Information required with respect to principal accountant fees and services is set forth under the caption “Audit Committee Report” in the Company's definitive Proxy Statement to be filed on or about March 16, 2018, and is incorporated by reference.

Part IV

Item 15. Exhibits, Financial Statement Schedules.

(a) (1) The reports of the independent registered public accounting firm, consolidated financial statements and notes to consolidated financial statements are included in Item 8 above:

Reports of Independent Registered Public Accounting Firm

Consolidated Statements of Income - Years ended December 31, 2017, 2016 and 2015

Consolidated Statements of Comprehensive Income - Years ended December 31, 2017, 2016 and 2015

Consolidated Balance Sheets - December 31, 2017 and 2016

Consolidated Statements of Cash Flows - Years ended December 31, 2017, 2016 and 2015

Consolidated Statements of Shareholders' Equity - Years ended December 31, 2017, 2016 and 2015

Notes to Consolidated Financial Statements

(2) All other schedules for which provision is made in Regulation S-X of the SEC are not required under the related instructions or are inapplicable and, therefore, have been omitted.

(3) Exhibits incorporated by reference to or filed in conjunction with this form 10-K are listed below.

3 (i)	Certificate of Incorporation - Incorporated by reference to the Form S-8 filed November 30, 2012
3 (ii)	Amended and restated Memorandum and Articles of Incorporation - Incorporated by reference to the Form 8-K Report filed on May 1, 2017
4.1	Indenture dated as of November 20, 2012, among Turlock Corporation, the guarantors named therein and The Bank of New York Mellon Trust Company, N.A., as trustee (incorporated by reference to Exhibit 4.1 of Eaton Corporation plc's Form 8-K Current Report filed on November 26, 2012 (Commission File No. 333-182303))
4.2	Supplemental Indenture No. 1, dated as of November 30, 2012, among Eaton Corporation, the guarantors named therein and The Bank of New York Mellon Trust Company, N.A., as trustee (incorporated by reference to Exhibit 4.2 of the registrant's Form S-4 filed on September 6, 2013)
4.3	Supplemental Indenture No. 2, dated as of January 8, 2013, among Eaton Corporation, the guarantors named therein and The Bank of New York Mellon Trust Company, N.A., as trustee (incorporated by reference Exhibit 4.3 of the registrant's Form S-4 filed on September 6, 2013)
4.4	Supplemental Indenture No. 3, dated as of December 20, 2013, among Eaton Corporation, the guarantors named therein and The Bank of New York Mellon Trust Company, N.A., as trustee - Filed in conjunction with this Form 10-K Report *
4.5	Supplemental Indenture No. 4, dated as of December 20, 2017 and effective as of January 1, 2018, among Eaton Corporation, the guarantors named therein and The Bank of New York Mellon Trust Company, N.A., as trustee - Filed in conjunction with this Form 10-K Report *
4.6	Supplemental Indenture No. 5, dated as of February 16, 2018, among Eaton Corporation, the guarantors named therein and The Bank of New York Mellon Trust Company, N.A., as trustee - Filed in conjunction with this Form 10-K Report *
4.7	Pursuant to Regulation S-K Item 601(b)(4), Eaton agrees to furnish to the SEC, upon request, a copy of the instruments defining the rights of holders of its long-term debt other than those set forth in Exhibits (4.1 - 4.6) hereto

10

10	Material contracts
	(a)	Senior Executive Incentive Compensation Plan (effective February 27, 2013) - Incorporated by reference to the Form 10-K Report for the year ended December 31, 2012
	(b)	Deferred Incentive Compensation Plan II - Incorporated by reference to the Form 10-K Report for the year ended December 31, 2007
	(c)	First Amendment to Deferred Incentive Compensation Plan II - Incorporated by reference to the Form S-8 filed November 30, 2012
	(d)	Excess Benefits Plan II (2008 restatement) - Incorporated by reference to the Form 10-K Report for the year ended December 31, 2007
	(e)	First Amendment to Excess Benefits Plan II (2008 restatement) - Incorporated by reference to the Form 10-K Report for the year ended December 31, 2012
	(f)	Incentive Compensation Deferral Plan II - Incorporated by reference to the Form 10-K Report for the year ended December 31, 2007
	(g)	First Amendment to Incentive Compensation Deferral Plan II - Incorporated by reference to the Form S-8 filed November 30, 2012
	(h)	Limited Eaton Service Supplemental Retirement Income Plan II - Incorporated by reference to the Form 10-K Report for the year ended December 31, 2007
	(i)	First Amendment to Limited Eaton Service Supplemental Retirement Income Plan II - Incorporated by reference to the Form 10-K Report for the year ended December 31, 2012
	(j)	Supplemental Benefits Plan II (2008 restatement) - Incorporated by reference to the Form 10-K Report for the year ended December 31, 2007
	(k)	First Amendment to Supplemental Benefits Plan II (2008 restatement) - Incorporated by reference to the Form 10-K Report for the year ended December 31, 2012
	(l)	Form of Restricted Share Unit Agreement - Incorporated by reference to the Form 10-K Report for the year ended December 31, 2015
	(m)	Form of Restricted Share Award Agreement - Incorporated by reference to the Form 10-K Report for the year ended December 31, 2015
	(n)	Form of Restricted Share Agreement (Non-Employee Directors) - Incorporated by reference to the Form 8-K Report filed February 1, 2010
	(o)	Form of Directors' Restricted Share Unit Agreement - Incorporated by reference to the Form 10-K report for the year ended December 31, 2012
	(p)	Form of Stock Option Agreement for Executives - Incorporated by reference to the Form 10-K Report for the year ended December 31, 2015
	(q)	Form of Stock Option Agreement for Non-Employee Directors (2008) - Incorporated by reference to the Form 10-K Report for the year ended December 31, 2007
	(r)	Amended and Restated 2002 Stock Plan - Incorporated by reference to the Form S-8 filed November 30, 2012
	(s)	Amended and Restated 2004 Stock Plan - Incorporated by reference to the Form S-8 filed November 30, 2012
	(t)	Amended and Restated 2008 Stock Plan - Incorporated by reference to the Form S-8 filed November 30, 2012
	(u)	Second Amended and Restated 2009 Stock Plan - Incorporated by reference to Form S-8 filed November 30, 2012
	(v)	Amended and Restated 2012 Stock Plan - Incorporated by reference to the Form S-8 filed November 30, 2012
	(w)	Amendment to Amended and Restated 2012 Stock Plan - Incorporated by reference to the Form 10-K Report for the year ended December 31, 2012

11

(x)	First Amendment to 2005 Non-Employee Director Fee Deferral Plan - Incorporated by reference to the Form S-8 filed November 30, 2012
(y)	2013 Non-Employee Director Fee Deferral Plan - Incorporated by reference to the Form 10-K Report for the year ended December 31, 2012
(z)	2015 Stock Plan - Incorporated by reference to the Form S-8 filed on October 30, 2015
(aa)	Form of Change of Control Agreement entered into with officers of Eaton Corporation - Incorporated by reference to the Form 8-K Report filed on December 17, 2015
(bb)	Form of Indemnification Agreement entered into with directors - Incorporated by reference to the Form 10-K Report for the year ended December 31, 2012
(cc)	Form of Indemnification Agreement II entered into with directors - Incorporated by reference to the Form 10-K Report for the year ended December 31, 2012
(dd)	Amended and Restated Executive Strategic Incentive Plan (amended and restated February 27, 2013) - Incorporated by reference to the Form 10-K Report for the year ended December 31, 2012
(ee)	Executive Strategic Incentive Plan II (effective January 1, 2001) - Incorporated by reference to the Form 10-K Report for the year ended December 31, 2002
(ff)	Amended and Restated Supplemental Executive Strategic Incentive Plan (amended and restated February 27, 2013) - Incorporated by reference to the Form 10-K Report for the year ended December 31, 2012
(gg)	Deferred Incentive Compensation Plan (amended and restated effective November 1, 2007) - Incorporated by reference to the Form 10-K Report for the year ended December 31, 2009
(hh)	Excess Benefits Plan (amended and restated effective January 1, 1989) - Incorporated by reference to the Form 10-K Report for the year ended December 31, 2002
(ii)	Amendment to Excess Benefits Plan I - Incorporated by reference to the Form 10-K Report for the year ended December 31, 2012
(jj)	Supplemental Benefits Plan (amended and restated January 1, 1989) - Incorporated by reference to the Form 10-K Report for the year ended December 31, 2002
(kk)	Amendment to Supplemental Benefits Plan I - Incorporated by reference to the Form 10-K Report for the year ended December 31, 2012
(ll)	Eaton Corporation Board of Directors Policy on Incentive Compensation, Stock Options and Other Equity Grants upon the Restatement of Financial Results - Incorporated by reference to the Form 10-K Report for the year ended December 31, 2015
(mm)	Amended and Restated Grantor Trust Agreement for Non-Employee Directors’ Deferred Fees Plans - effective January 1, 2010 - Incorporated by reference to the Form 10-K Report for the year ended December 31, 2010
(nn)	Amended and Restated Grantor Trust Agreement for Employees’ Deferred Compensation Plans - effective January 1, 2010 - Incorporated by reference to the Form 10-K Report for the year ended December 31, 2010
(oo)	Eaton Savings Plan 2016 Restatement - Incorporated by reference to the Form 10-K Report for the year ended December 31, 2015
(pp)	Eaton Personal Investment Plan 2015 Restatement - Incorporated by reference to the Form 10-K Report for the year ended December 31, 2015
(qq)	Performance Share Award Agreement - Incorporated by reference to the Form 10-K Report for the year ended December 31, 2015
(rr)	Form of Indemnification Agreement entered into with officers of Eaton Corporation - Incorporated by reference to the Form 10-K Report for the year ended December 31, 2015
(ss)	Amendment to Limited Eaton Service Supplemental Retirement Income Plan I- Incorporated by reference to the Form 10-K Report for the year ended December 31, 2015
(tt)	First Amendment to Eaton Savings Plan - Incorporated by reference to the Form 10-K Report for the year ended December 31, 2016

12

	(uu)	Second Amendment to Eaton Savings Plan - Incorporated by reference to the Form 10-K Report for the year ended December 31, 2016
	(vv)	First Amendment to Eaton Personal Investment Plan - Incorporated by reference to the Form 10-K Report for the year ended December 31, 2016
	(ww)	Second Amendment to Eaton Personal Investment Plan - Incorporated by reference to the Form 10-K Report for the year ended December 31, 2016
	(xx)	Amendment to Eaton Corporation Excess Benefits Plan - Incorporated by reference to the Form 10-K Report for the year ended December 31, 2016
	(yy)	Amendment to Eaton Corporation Supplemental Benefits Plan - Incorporated by reference to the Form 10-K Report for the year ended December 31, 2016
	(zz)	Second Amendment to Eaton Corporation Excess Benefits Plan II - Incorporated by reference to the Form 10-K Report for the year ended December 31, 2016
	(aaa)	Second Amendment to Limited Eaton Service Supplemental Retirement Income Plan II - Incorporated by reference to the Form 10-K Report for the year ended December 31, 2016
	(bbb)	Second Amendment to Eaton Corporation Supplemental Benefits Plan II - Incorporated by reference to the Form 10-K Report for the year ended December 31, 2016
	(ccc)	2016 RSU Grant Agreement - Incorporated by reference to the Form 10-K Report for the year ended December 31, 2016
	(ddd)	2016 Performance Share Grant Agreement - Incorporated by reference to the Form 10-K Report for the year ended December 31, 2016
	(eee)	Special 2016 Performance Share Grant Agreement - Incorporated by reference to the Form 10-K Report for the year ended December 31, 2016
12		Ratio of Earnings to Fixed Charges - Filed in conjunction with this Form 10-K Report *
14		Code of Ethics - Incorporated by reference to the definitive Proxy Statement filed on March 14, 2008
18		Change in Accounting Principles - Filed in conjunction with this Form 10-K Report *
21		Subsidiaries of Eaton Corporation plc - Filed in conjunction with this Form 10-K Report *
23		Consent of Independent Registered Public Accounting Firm - Filed in conjunction with this Form 10-K Report *
24		Power of Attorney - Filed in conjunction with this Form 10-K Report *
31.1		Certification of Principal Executive Officer (Pursuant to the Sarbanes-Oxley Act of 2002, Section 302) - Filed in conjunction with this Form 10-K Report *
31.2		Certification of Principal Financial Officer (Pursuant to the Sarbanes-Oxley Act of 2002, Section 302) - Filed in conjunction with this Form 10-K Report *
32.1		Certification of Principal Executive Officer (Pursuant to the Sarbanes-Oxley Act of 2002, Section 906) - Filed in conjunction with this Form 10-K Report *
32.2		Certification of Principal Financial Officer (Pursuant to the Sarbanes-Oxley Act of 2002, Section 906) - Filed in conjunction with this Form 10-K Report *
101.INS		XBRL Instance Document *
101.SCH		XBRL Taxonomy Extension Schema Document *
101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document *
101.DEF		XBRL Taxonomy Extension Definition Linkbase Document *
101.LAB		XBRL Taxonomy Extension Label Linkbase Document *
101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document *

_______________________________

13

* Submitted electronically herewith.

Attached as Exhibit 101 to this report are the following formatted in XBRL (Extensible Business Reporting Language): (i) Consolidated Statements of Income for the years ended December 31, 2017, 2016 and 2015, (ii) Consolidated Statements of Comprehensive Income for the years ended December 31, 2017, 2016 and 2015 (iii) Consolidated Balance Sheets at December 31, 2017 and 2016, (iv) Consolidated Statements of Cash Flows for the years ended December 31, 2017, 2016 and 2015, (v) Consolidated Statements of Shareholders' Equity for the years ended December 31, 2017, 2016 and 2015 and (vi) Notes to Consolidated Financial Statements for the year ended December 31, 2017.

Item 16. Form 10-K Summary.

Not applicable.

14

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

			EATON CORPORATION plc
			Registrant
Date:	February 28, 2018	By:	/s/ Richard H. Fearon
			Richard H. Fearon
			(On behalf of the registrant and as Principal Financial Officer)

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the date indicated.

Date: February 28, 2018

Signature	Title
*		/s/ Richard H. Fearon
Craig Arnold	Chairman, Principal Executive Officer; Director	Richard H. Fearon	Principal Financial Officer, Director
/s/ Ken D. Semelsberger		*
Ken D. Semelsberger	Principal Accounting Officer	Todd M. Bluedorn	Director
*		*
Christopher M. Connor	Director	Michael J. Critelli	Director
*		*
Charles E. Golden	Director	Arthur E. Johnson	Director
*		/s/ Gregory R. Page
Deborah L. McCoy	Director	Gregory R. Page	Director
*		*
Sandra Pianalto	Director	Gerald B. Smith	Director
*
Dorothy C. Thompson	Director

*By	/s/ Richard H. Fearon
	Richard H. Fearon, Attorney-in-Fact for the officers and directors signing in the capacities indicated

15

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Shareholders and Board of Directors of Eaton Corporation plc

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of Eaton Corporation plc (“the Company”) as of December 31, 2017 and 2016, and the related consolidated statements of income, comprehensive income, shareholders’ equity and cash flows for each of the three years in the period ended December 31, 2017, and the related notes (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2017 and 2016, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2017, in conformity with U.S. generally accepted accounting principles.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, 2017, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) and our report dated February 28, 2018 expressed an unqualified opinion thereon.

Change in Accounting Principle

As discussed in Notes 1 and 14 to the consolidated financial statements, in 2017 the Company elected to change its method of accounting for certain inventories in the United States to the first-in, first-out (“FIFO”) method, while in prior years, these inventories were accounted for using the last-in, first-out (“LIFO”) method.

Basis for Opinion

These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

/s/ Ernst & Young LLP

We have served as the Company’s auditor since 1923.

Cleveland, Ohio

February 28, 2018

16

MANAGEMENT'S REPORT ON FINANCIAL STATEMENTS

We have prepared the accompanying consolidated financial statements and related information of Eaton Corporation plc ("Eaton") included herein for the three years ended December 31, 2017. The primary responsibility for the integrity of the financial information included in this annual report rests with management. The financial information included in this annual report has been prepared in accordance with accounting principles generally accepted in the United States based on our best estimates and judgments and giving due consideration to materiality. The opinion of Ernst & Young LLP, Eaton's independent registered public accounting firm, on those financial statements is included herein.

Eaton has high standards of ethical business practices supported by the Eaton Code of Ethics and corporate policies. Careful attention is given to selecting, training and developing personnel, to ensure that management's objectives of establishing and maintaining adequate internal controls and unbiased, uniform reporting standards are attained. Our policies and procedures provide reasonable assurance that operations are conducted in conformity with applicable laws and with the Company's commitment to a high standard of business conduct.

The Board of Directors pursues its responsibility for the quality of Eaton's financial reporting primarily through its Audit Committee, which is composed of five independent directors. The Audit Committee meets regularly with management, the internal auditors and the independent registered public accounting firm to ensure that they are meeting their responsibilities and to discuss matters concerning accounting, control, audits and financial reporting. The internal auditors and independent registered public accounting firm have full and free access to senior management and the Audit Committee.

/s/ Craig Arnold	/s/ Richard H. Fearon	/s/ Ken D. Semelsberger
Principal Executive Officer	Principal Financial Officer	Principal Accounting Officer
February 28, 2018

17

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Shareholders and Board of Directors of Eaton Corporation plc

Opinion on Internal Control over Financial Reporting

We have audited Eaton Corporation plc’s (“the Company”) internal control over financial reporting as of December 31, 2017, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria). In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2017, based on the COSO criteria.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of December 31, 2017 and 2016, and the related consolidated statements of income, comprehensive income, shareholders’ equity and cash flows for each of the three years in the period ended December 31, 2017 and the related notes and our report dated February 28, 2018 expressed an unqualified opinion thereon.

Basis for Opinion

The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Management’s Report on Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects.

Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

Definition and Limitations of Internal Control Over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

/s/ Ernst & Young LLP

Cleveland, Ohio

February 28, 2018

18

MANAGEMENT'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING

The management of Eaton Corporation plc ("Eaton") is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Exchange Act rules 13a-15(f)).

Under the supervision and with the participation of Eaton's management, including our principal executive officer and principal financial officer, we conducted an evaluation of the effectiveness of the Company's internal control over financial reporting as of December 31, 2017. In conducting this evaluation, we used the framework set forth by the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control - Integrated Framework (2013 Framework). Based on this evaluation under the framework referred to above, management concluded that the Company's internal control over financial reporting was effective as of December 31, 2017.

The independent registered public accounting firm Ernst & Young LLP has issued an audit report on the effectiveness of the Company's internal control over financial reporting as of December 31, 2017. This report is included herein.

/s/ Craig Arnold	/s/ Richard H. Fearon	/s/ Ken D. Semelsberger
Principal Executive Officer	Principal Financial Officer	Principal Accounting Officer
February 28, 2018

19

EATON CORPORATION plc

CONSOLIDATED STATEMENTS OF INCOME

	Year ended December 31
(In millions except for per share data)	2017			2016*			2015*
Net sales	$	20,404		$	19,747		$	20,855
Cost of products sold	13,756			13,409			14,304
Selling and administrative expense	3,565			3,505			3,596
Research and development expense	584			589			625
Interest expense - net	246			233			232
Gain on sale of business	1,077			—			—
Other income - net	(38		)	(107		)	(35		)
Income before income taxes	3,368			2,118			2,133
Income tax expense	382			199			159
Net income	2,986			1,919			1,974
Less net income for noncontrolling interests	(1		)	(3		)	(2		)
Net income attributable to Eaton ordinary shareholders	$	2,985		$	1,916		$	1,972
Net income per share attributable to Eaton ordinary shareholders
Diluted	$	6.68		$	4.20		$	4.22
Basic	6.71			4.21			4.23
Weighted-average number of ordinary shares outstanding
Diluted	447.0			456.5			467.1
Basic	444.5			455.0			465.5
Cash dividends declared per ordinary share	$	2.40		$	2.28		$	2.20

*Year ended December 31, 2016 and 2015 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

The accompanying notes are an integral part of the consolidated financial statements.

20

EATON CORPORATION plc

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

	Year ended December 31
(In millions)	2017			2016*			2015*
Net income	$	2,986		$	1,919		$	1,974
Less net income for noncontrolling interests	(1		)	(3		)	(2		)
Net income attributable to Eaton ordinary shareholders	2,985			1,916			1,972
Other comprehensive income (loss), net of tax
Currency translation and related hedging instruments	807			(570		)	(1,078		)
Pensions and other postretirement benefits	241			(6		)	111
Cash flow hedges	(4		)	(9		)	3
Other comprehensive income (loss) attributable to Eaton    ordinary shareholders	1,044			(585		)	(964		)
Total comprehensive income attributable to Eaton ordinary shareholders	$	4,029		$	1,331		$	1,008

*Year ended December 31, 2016 and 2015 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

The accompanying notes are an integral part of the consolidated financial statements.

21

EATON CORPORATION plc

CONSOLIDATED BALANCE SHEETS

	December 31
(In millions)	2017			2016*
Assets
Current assets
Cash	$	561		$	543
Short-term investments	534			203
Accounts receivable - net	3,943			3,560
Inventory	2,620			2,346
Prepaid expenses and other current assets	679			381
Total current assets	8,337			7,033
Property, plant and equipment
Land and buildings	2,491			2,369
Machinery and equipment	6,014			5,670
Gross property, plant and equipment	8,505			8,039
Accumulated depreciation	(5,003		)	(4,596		)
Net property, plant and equipment	3,502			3,443
Other noncurrent assets
Goodwill	13,568			13,201
Other intangible assets	5,265			5,514
Deferred income taxes	253			325
Other assets	1,698			960
Total assets	$	32,623		$	30,476
Liabilities and shareholders’ equity
Current liabilities
Short-term debt	$	6		$	14
Current portion of long-term debt	578			1,552
Accounts payable	2,166			1,718
Accrued compensation	453			379
Other current liabilities	1,872			1,822
Total current liabilities	5,075			5,485
Noncurrent liabilities
Long-term debt	7,167			6,711
Pension liabilities	1,226			1,659
Other postretirement benefits liabilities	362			368
Deferred income taxes	538			321
Other noncurrent liabilities	965			934
Total noncurrent liabilities	10,258			9,993
Shareholders’ equity
Ordinary shares (439.9 million outstanding in 2017 and 449.4 million in 2016)	4			5
Capital in excess of par value	11,987			11,845
Retained earnings	8,669			7,555
Accumulated other comprehensive loss	(3,404		)	(4,448		)
Shares held in trust	(3		)	(3		)
Total Eaton shareholders’ equity	17,253			14,954
Noncontrolling interests	37			44
Total equity	17,290			14,998
Total liabilities and equity	$	32,623		$	30,476

*December 31, 2016 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

The accompanying notes are an integral part of the consolidated financial statements.

22

EATON CORPORATION plc

CONSOLIDATED STATEMENTS OF CASH FLOWS

	Year ended December 31
(In millions)	2017			2016*			2015*
Operating activities
Net income	$	2,986		$	1,919		$	1,974
Adjustments to reconcile to net cash provided by operating activities
Depreciation and amortization	914			929			925
Deferred income taxes	(206		)	(83		)	(105		)
Pension and other postretirement benefits expense	208			235			323
Contributions to pension plans	(473		)	(262		)	(330		)
Contributions to other postretirement benefits plans	(20		)	(30		)	(31		)
Gain on sale of businesses	(843		)	—			—
Changes in working capital
Accounts receivable - net	(231		)	(170		)	5
Inventory	(202		)	34			(8		)
Accounts payable	388			—			(120		)
Accrued compensation	59			20			(28		)
Accrued income and other taxes	(4		)	30			(9		)
Other current assets	2			(21		)	7
Other current liabilities	(203		)	(44		)	(38		)
Other - net	291			13			(156		)
Net cash provided by operating activities	2,666			2,570			2,409
Investing activities
Capital expenditures for property, plant and equipment	(520		)	(497		)	(506		)
Proceeds from sale of business	607			—			1
Cash received from (paid for) acquisitions of businesses, net of cash acquired	—			1			(72		)
Sales (purchases) of short-term investments - net	(298		)	(40		)	37
Other - net	(6		)	7			(35		)
Net cash used in investing activities	(217		)	(529		)	(575		)
Financing activities
Proceeds from borrowings	1,000			631			425
Payments on borrowings	(1,554		)	(653		)	(1,027		)
Cash dividends paid	(1,068		)	(1,037		)	(1,026		)
Exercise of employee stock options	66			74			52
Repurchase of shares	(850		)	(730		)	(682		)
Employee taxes paid from shares withheld	(22		)	(18		)	(38		)
Other - net	(14		)	(5		)	(9		)
Net cash used in financing activities	(2,442		)	(1,738		)	(2,305		)
Effect of currency on cash	11			(28		)	(42		)
Total increase (decrease) in cash	18			275			(513		)
Cash at the beginning of the period	543			268			781
Cash at the end of the period	$	561		$	543		$	268

*Year ended December 31, 2016 and 2015 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

The accompanying notes are an integral part of the consolidated financial statements.

23

EATON CORPORATION plc

CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY

	Ordinary shares					Capital in excess of par value			Retained earnings*			Accumulated other comprehensive loss			Shares held in trust			Total Eaton shareholders' equity*			Noncontrolling interests			Total equity*
(In millions)	Shares		Dollars
Balance at January 1, 2015 (originally reported)	467.9		$	5		$	11,605		$	7,078		$	(2,899	)	$	(3	)	$	15,786		$	53		$	15,839
Inventory accounting method change*	—		—			—			70			—			—			70			—			70
Balance at January 1, 2015*	467.9		5			11,605			7,148			(2,899		)	(3		)	15,856			53			15,909
Net income*	—		—			—			1,972			—			—			1,972			2			1,974
Other comprehensive loss, net of tax												(964		)				(964		)	—			(964		)
Cash dividends paid	—		—			—			(1,026		)	—			—			(1,026		)	(9		)	(1,035		)
Issuance of shares under equity-based compensation plans - net (net of income tax benefit of $1)	2.2		—			99			(3		)	—			—			96			—			96
Changes in noncontrolling interest of consolidated subsidiaries - net	—		—			(3		)	—			—			—			(3		)	(1		)	(4		)
Repurchase of shares	(11.3	)	—			—			(682		)	—			—			(682		)	—			(682		)
Balance at December 31, 2015*	458.8		5			11,701			7,409			(3,863		)	(3		)	15,249			45			15,294
Net income*	—		—			—			1,916			—			—			1,916			3			1,919
Other comprehensive loss, net of tax												(585		)				(585		)	—			(585		)
Cash dividends paid	—		—			—			(1,037		)	—			—			(1,037		)	(2		)	(1,039		)
Issuance of shares under equity-based compensation plans - net (net of income tax benefit of $1)	2.4		—			144			(3		)	—			—			141			—			141
Changes in noncontrolling interest of consolidated subsidiaries - net	—		—			—			—			—			—			—			(2		)	(2		)
Repurchase of shares	(11.8	)	—			—			(730		)	—			—			(730		)	—			(730		)
Balance at December 31, 2016*	449.4		5			11,845			7,555			(4,448		)	(3		)	14,954			44			14,998
Cumulative-effect adjustment upon adoption of ASU 2016-09	—		—			—			48			—			—			48			—			48
Net income	—		—			—			2,985			—			—			2,985			1			2,986
Other comprehensive income, net of tax												1,044						1,044			—			1,044
Cash dividends paid	—		—			—			(1,068		)	—			—			(1,068		)	(5		)	(1,073		)
Issuance of shares under equity-based compensation plans	2.0		—			142			(2		)	—			—			140			—			140
Changes in noncontrolling interest of consolidated subsidiaries - net	—		—			—			—			—			—			—			(3		)	(3		)
Repurchase of shares	(11.5	)	(1		)	—			(849		)	—			—			(850		)	—			(850		)
Balance at December 31, 2017	439.9		$	4		$	11,987		$	8,669		$	(3,404	)	$	(3	)	$	17,253		$	37		$	17,290

*The balances at January 1, 2015 and the year ended December 31, 2015 and 2016 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

The accompanying notes are an integral part of the consolidated financial statements.

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EATON CORPORATION plc

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Amounts are in millions unless indicated otherwise (per share data assume dilution).

Note 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

General Information and Basis of Presentation

Eaton Corporation plc (Eaton or the Company) is a power management company with 2017 net sales of $20.4 billion. The Company provides energy-efficient solutions that help its customers effectively manage electrical, hydraulic and mechanical power more efficiently, safely and sustainably. Eaton has approximately 96,000 employees in 59 countries and sells products to customers in more than 175 countries.

The consolidated financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States. Preparation of the consolidated financial statements requires management to make estimates and assumptions that affect amounts reported in the consolidated financial statements and notes. Actual results could differ from these estimates. Management has evaluated subsequent events through the date the consolidated financial statements were filed with the Securities Exchange Commission.

The consolidated financial statements include the accounts of Eaton and all subsidiaries and other entities it controls. Intercompany transactions and balances have been eliminated. The equity method of accounting is used for investments in associate companies where the Company has significant influence and generally a 20% to 50% ownership interest. Equity investments are evaluated for impairment whenever events or circumstances indicate the book value of the investment exceeds fair value. An impairment would exist if there is an other-than-temporary decline in value. Eaton does not have off-balance sheet arrangements or financings with unconsolidated entities. In the ordinary course of business, the Company leases certain real properties and equipment, as described in Note 8.

Eaton's functional currency is United States Dollars (USD). The functional currency for most subsidiaries is their local currency. Financial statements for these subsidiaries are translated at year-end exchange rates as to assets and liabilities and weighted-average exchange rates as to revenues and expenses. The resulting translation adjustments are recognized in Accumulated other comprehensive loss.

During 2017, the Company adopted Accounting Standards Update 2016-09, Compensation-Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting, (ASU 2016-09). Upon adoption, the Company recorded deferred tax assets of $48 for all excess tax benefits that had not been previously recognized. This was accomplished through a cumulative-effect adjustment to retained earnings. ASU 2016-09 also requires that all excess tax benefits and deficiencies generated in the current and future periods be recorded as income tax benefit or expense in the reporting period in which they occur. These excess tax benefits and deficiencies, which were previously required to be presented as financing activities on the Company’s Consolidated Statements of Cash Flows, are now classified as operating activities prospectively. The Company also reclassified $22, $18, and $38 for 2017, 2016, and 2015, respectively, from operating activities to financing activities on the Company’s Consolidated Statements of Cash Flows for withholding payments made to taxing authorities from shares withheld from employees. The Company will continue to estimate forfeitures as part of recording equity-based compensation expense.

During the fourth quarter of 2017, the Company changed its method of accounting for certain inventory in the United States from the last-in, first-out (LIFO) method to the first-in, first-out (FIFO) method. All prior periods presented have been retrospectively adjusted to apply the new method of accounting. See Note 14 for more information on the change in inventory accounting method.

Certain prior year amounts have been reclassified to conform to the current year presentation.

Revenue Recognition

Sales of products are recognized when a sales agreement is in place, products have been shipped to unaffiliated customers and title has transferred in accordance with shipping terms, the selling price is fixed and determinable and collectability is reasonably assured, all significant related acts of performance have been completed, and no other significant uncertainties exist. Shipping and handling costs billed to customers are included in Net sales and the related costs in Cost of products sold. Although the majority of the sales agreements contain standard terms and conditions, there are agreements that contain multiple elements or non-standard terms and conditions. As a result, judgment is required to determine the appropriate accounting, including whether the deliverables specified in these agreements should be treated as separate units of accounting for recognition purposes, and, if so, how the sales price should be allocated among the elements and when to recognize sales for each element. For delivered elements, sales generally are recognized only when the delivered elements have standalone value and there are no uncertainties regarding customer acceptance. Sales for service contracts generally are recognized as the services are provided.

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Eaton records reductions to revenue for customer and distributor incentives, primarily comprised of rebates, at the time of the initial sale. Rebates are estimated based on sales terms, historical experience, trend analysis, and projected market conditions in the various markets served. The rebate programs offered vary across businesses due to the numerous markets Eaton serves, but the most common incentives relate to amounts paid or credited to customers for achieving defined volume levels.

Goodwill and Indefinite Life Intangible Assets

Goodwill is evaluated annually for impairment as of July 1 using either a quantitative or qualitative analysis. Goodwill is tested for impairment at the reporting unit level, which is equivalent to Eaton's operating segments and based on the net assets for each segment, including goodwill and intangible assets. Goodwill is assigned to each operating segment, as this represents the lowest level that constitutes a business and is the level at which management regularly reviews the operating results. The Company performs a quantitative analysis using a discounted cash flow model and other valuation techniques, but may elect to perform a qualitative analysis. Additionally, goodwill is evaluated for impairment whenever an event occurs or circumstances change that would indicate that it is more likely than not that the fair value of an operating segment is less than its carrying amount.

Goodwill impairment testing in 2017 was performed using qualitative analysis, which is performed by assessing certain trends and factors, including projected market outlook and growth rates, forecasted and actual sales and operating profit margins, discount rates, industry data, and other relevant qualitative factors. These trends and factors are compared to, and based on, the assumptions used in the most recent quantitative assessment performed in 2016. The results of the qualitative analysis did not indicate a need to perform a quantitative analysis.

Goodwill impairment testing for 2016 was performed using a quantitative analysis under which the fair value for each reporting unit was estimated using a discounted cash flow model, which considered forecasted cash flows discounted at an estimated weighted-average cost of capital. The forecasted cash flows were based on the Company's long-term operating plan and a terminal value was used to estimate the operating segment's cash flows beyond the period covered by the operating plan. The weighted-average cost of capital is an estimate of the overall after-tax rate of return required by equity and debt market holders of a business enterprise. These analyses require the exercise of significant judgments, including judgments about appropriate discount rates, perpetual growth rates and the timing of expected future cash flows of the respective reporting unit. Sensitivity analyses were performed around these assumptions in order to assess the reasonableness of the assumptions and the resulting estimated fair values.

Based on a qualitative analysis performed in 2017 and a quantitative analysis performed in 2016, the fair value of Eaton's reporting units continue to substantially exceed their respective carrying amounts.

Indefinite life intangible assets consist of certain trademarks. They are evaluated annually for impairment as of July 1 using either a quantitative or qualitative analysis to determine whether their fair values exceed their respective carrying amounts. Indefinite life intangible asset impairment testing for 2017 and 2016 was performed using a quantitative analysis. The Company determines the fair value of these assets using a royalty relief methodology similar to that employed when the associated assets were acquired, but using updated estimates of future sales, cash flows and profitability. Additionally, indefinite life intangible assets are evaluated for impairment whenever an event occurs or circumstances change that would indicate that it is more likely than not that the asset is impaired. For 2017 and 2016, the fair value of indefinite lived intangible assets exceeded the respective carrying value.

For additional information about goodwill and other intangible assets, see Note 5.

Other Long-Lived Assets

Depreciation and amortization for property, plant and equipment, and intangible assets subject to amortization, are generally computed by the straight-line method and included in Cost of products sold, Selling and administrative expense, and Research and development expense, as appropriate. Cost of buildings are depreciated generally over 40 years and machinery and equipment over 3 to 10 years. At December 31, 2017, the weighted-average amortization period for intangible assets subject to amortization was 17 years for patents and technology, primarily as a result of the long life of aircraft platforms; 17 years for customer relationships; and 17 years for certain trademarks. Software is generally amortized up to a life of 15 years.

Other long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate the carrying amount may not be recoverable. Upon indications of impairment, assets and liabilities are grouped at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. The asset group would be considered impaired when the estimated future net undiscounted cash flows generated by the asset group are less than its carrying value. Determining asset groups and underlying cash flows requires the use of significant judgment.

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Retirement Benefits Plans

For the principal pension plans in the United States, Canada, Puerto Rico and the United Kingdom, the Company uses a market-related value of plan assets to calculate the expected return on assets used to determine net periodic benefit costs. The market-related value of plan assets is a calculated value that recognizes changes in the fair value of plan assets over a five year period. All other plans use fair value of plan assets.

Net actuarial gains or losses are amortized to expense on a plan-by-plan basis when they exceed the accounting corridor. The Company’s corridors are set at either 8% or 10%, depending on the plan, of the greater of the plan assets or benefit obligations. Gains or losses outside of the corridor are subject to amortization over an average employee future service period that differs by plan, but is approximately 12 years on a weighted average basis. If most or all of the plan’s participants are no longer actively accruing benefits, the average life expectancy is used.

Warranty Accruals

Product warranty accruals are established at the time the related sale is recognized through a charge to Cost of products sold. Warranty accrual estimates are based primarily on historical warranty claim experience and specific customer contracts. Provisions for warranty accruals are comprised of basic warranties for products sold, as well as accruals for product recalls and other events when they are known and estimable. See Note 8 for additional information about warranty accruals.

Asset Retirement Obligations

A conditional asset retirement obligation is recognized at fair value when incurred if the fair value of the liability can be reasonably estimated. Uncertainty about the timing or method of settlement of a conditional asset retirement obligation would be considered in the measurement of the liability when sufficient information exists. Eaton believes that for substantially all of its asset retirement obligations, there is an indeterminate settlement date because the range of time over which the Company may settle the obligation is unknown or cannot be estimated. A liability for these obligations will be recognized when sufficient information is available to estimate fair value.

Income Taxes

Deferred income tax assets and liabilities are determined based on the difference between the financial statement and tax basis of the respective assets and liabilities, using enacted tax rates in effect for the year when the differences are expected to reverse. Deferred income tax assets are recognized for income tax loss carryforwards and income tax credit carryforwards. Judgment is required in determining and evaluating income tax provisions and valuation allowances for deferred income tax assets. Eaton recognizes the income tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by taxing authorities, based on the technical merits of the position. Eaton evaluates and adjusts these accruals based on changing facts and circumstances. Eaton recognizes interest and penalties related to unrecognized income tax benefits in the provision for income tax expense. Penalties on unrecognized income tax benefits have been accrued for jurisdictions where penalties are automatically applied to any deficiency, regardless of the merit of the position. For additional information about income taxes, see Note 9.

Equity-Based Compensation

Eaton recognizes equity-based compensation expense based on the grant date fair value of the award. Awards with service conditions or both service and market conditions are expensed over the period during which an employee is required to provide service in exchange for the award. Awards with both service and performance conditions are expensed over the period an employee is required to provide service based on the number of units for which achievement of the performance objective is probable. Participants awarded restricted stock units (RSUs) in 2015 and 2016, do not receive dividends; therefore, their fair value is determined by reducing the closing market price of the Company’s ordinary shares on the date of grant by the present value of the estimated dividends had they been paid. The fair value of RSUs awarded in 2017, restricted stock awards (RSAs) and performance stock units (PSUs) with performance conditions are determined based on the closing market price of the Company’s ordinary shares at the date of grant. The Company uses a Monte Carlo simulation to estimate the fair value of PSUs with market conditions, which incorporates assumptions regarding expected stock price volatility and the risk-free interest rate. Stock options are granted with an exercise price equal to the closing market price of Eaton ordinary shares on the date of grant. The fair value of stock options is determined using a Black-Scholes option-pricing model, which incorporates assumptions regarding the expected stock price volatility, the expected option life, the risk-free interest rate, and the expected dividend yield. See Note 11 for additional information about equity-based compensation.

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Derivative Financial Instruments and Hedging Activities

Eaton uses derivative financial instruments to manage the exposure to the volatility in raw material costs, currency, and interest rates on certain debt. These instruments are marked to fair value in the accompanying Consolidated Balance Sheets. Changes in the fair value of derivative assets or liabilities (i.e., gains or losses) are recognized depending upon the type of hedging relationship and whether an instrument has been designated as a hedge. For those instruments that qualify for hedge accounting, Eaton designates the hedging instrument, based upon the exposure being hedged, as a cash flow hedge, a fair value hedge, or a hedge of a net investment in a foreign operation. Changes in fair value of these instruments that do not qualify for hedge accounting are recognized immediately in net income. See Note 13 for additional information about hedges and derivative financial instruments.

Recently Issued Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update 2014-09, Revenue from Contracts with Customers (ASU 2014-09). This accounting standard supersedes all existing US GAAP revenue recognition guidance. Under ASU 2014-09, a company will recognize revenue when it transfers the control of promised goods or services to customers in an amount that reflects the consideration which the company expects to collect in exchange for those goods or services. ASU 2014-09 will require additional disclosures in the notes to the consolidated financial statements.

Eaton adopted the standard at the start of the first quarter of 2018 using the modified retrospective approach and recorded a cumulative effect adjustment to retained earnings based on the current terms and conditions for open contracts as of January 1, 2018. The adoption of the standard did not have a material impact on the Company’s Consolidated financial statements. While, certain revenue streams moved from point-in-time or multiple elements to over time because of the continuous transfer of control to customers, we do not expect these changes to be material. The Company implemented the appropriate changes to business processes and controls to support recognition and disclosure under the new standard, including the new qualitative and quantitative disclosures that will include information on the nature, amount, timing and significant judgments impacting revenue from contracts with customers.

In October 2016, the FASB issued Accounting Standards Update 2016-16, Intra-Entity Transfers of Assets Other Than Inventory (ASU 2016-16). This accounting standard requires companies to recognize the income tax effects of intercompany sales and transfers of assets other than inventory in the period in which the transfer occurs. The previous accounting standard required companies to defer the income tax effects of intercompany transfers of assets by recording a prepaid tax, until such assets were sold to an outside party or otherwise recognized. ASU 2016-16 is effective for annual and interim periods beginning after December 15, 2017. Upon adoption, ASU 2016-16 requires companies to write off any income tax amounts that had been deferred as prepaid taxes from past intercompany transactions, and record deferred tax balances for amounts that have not been recognized, through a cumulative-effect adjustment to retained earnings. The Company adopted ASU 2016-16 at the start of the first quarter of 2018 by recording a cumulative-effect adjustment of approximately $200 to reduce retained earnings.

In February 2016, the FASB issued Accounting Standards Update 2016-02, Leases (Topic 842), (ASU 2016-02). This accounting standard requires that a lessee recognize a lease asset and a lease liability on its balance sheet for all leases, including operating leases, with a term greater than 12 months. ASU 2016-02 will require additional disclosures in the notes to the consolidated financial statements and is effective for annual and interim reporting periods beginning after December 15, 2018. A project team has been formed to evaluate and implement the new standard. The project team is working to gather the data required to account for leases under the new standard, and validating the functionality of third-party lease accounting software. In addition, the Company is in the process of identifying and implementing the appropriate changes to business processes and controls to support recognition and disclosure under the new standard. Eaton plans to adopt the standard as of the first quarter of 2019. Eaton is evaluating the impact of ASU 2016-02 and an estimate of the impact to the consolidated financial statements cannot be made at this time.

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Note 2. SALE AND ACQUISITIONS OF BUSINESSES

Sale of heavy-duty and medium-duty commercial vehicle automated transmission business

On July 31, 2017, Eaton sold a 50% interest in its heavy-duty and medium-duty commercial vehicle automated transmission business for $600 in cash to Cummins, Inc. The new joint venture is named Eaton Cummins Automated Transmission Technologies (ECATT). The Company recognized a pre-tax gain of $1,077, of which $533 related to the pre-tax gain from the $600 proceeds from the sale and $544 related to the Company’s remaining 50% investment in the joint venture being remeasured to fair value. The after-tax gain was $843. The fair value is based on the price paid to Eaton for the 50% interest sold to Cummins, Inc. and further supported by a discounted cash flow model. Eaton accounts for its investment on the equity method of accounting.

Acquisition of Ephesus Lighting, Inc.

On October 28, 2015, Eaton acquired Ephesus Lighting, Inc. (Ephesus). Ephesus is a leader in LED lighting for stadiums and other high lumen outdoor and industrial applications. Its sales for the 12 months ended September 30, 2015 were $23. Ephesus is reported within the Electrical Products business segment.

Acquisition of UK Safety Technology Manufacturer Oxalis Group Ltd.

On January 12, 2015, Eaton acquired Oxalis Group Ltd. (Oxalis). Oxalis is a manufacturer of closed-circuit television camera stations, public address and general alarm systems and other electrical products for the hazardous area, marine and industrial communications markets. Its sales for the 12 months ended December 31, 2014 were $9. Oxalis is reported within the Electrical Systems and Services business segment.

Note 3. ACQUISITION INTEGRATION CHARGES

Eaton incurs integration charges related to acquired businesses. A summary of these charges follows:

	2017		2016		2015
Electrical Products	$	4	$	3	$	25
Electrical Systems and Services	—		1		15
Hydraulics	—		—		2
Total business segments	4		4		42
Corporate	—		—		5
Total acquisition integration charges before income taxes	4		4		47
Income taxes	2		1		16
Total after income taxes	$	2	$	3	$	31
Per ordinary share - diluted	$	—	$	0.01	$	0.07

Business segment acquisition integration charges in 2017 related to the integration of Ephesus. The charges associated with Ephesus were included in Selling and administrative expense. Business segment acquisition integration charges in 2016 related to the integration of Ephesus and Oxalis. The charges associated with Ephesus were included in Cost of products sold and Selling and administrative expense, while the charges associated with Oxalis were included in Cost of products sold. Business segment acquisition charges in 2015 related primarily to the integration of Cooper Industries plc, which was acquired in 2012. The charges in 2015 were included in Cost of products sold or Selling and administrative expense, as appropriate. In Business Segment Information, the charges reduced Operating profit of the related business segment.

The integration of Cooper included costs related to restructuring activities Eaton undertook in an effort to gain efficiencies in selling, marketing, traditional back-office functions and manufacturing and distribution. These actions resulted in charges of $20 during 2015, comprised of severance costs and other expense totaling $1 and $19, respectively, of which $14 were incurred in the Electrical Products segment, and $6 were incurred in the Electrical Systems and Services segment.

Corporate integration charges related primarily to the acquisition of Cooper. These charges were included in Selling and administrative expense. In Business Segment Information, the charges were included in Other corporate expense - net.

See Note 15 for additional information about business segments.

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Note 4. RESTRUCTURING CHARGES

During 2015, Eaton announced its commitment to undertake actions to reduce its cost structure in all business segments and at corporate. Restructuring charges incurred under this plan were $116, $211, and $129 in 2017, 2016, and 2015, respectively. The multi-year initiative concluded at the end of 2017.

A summary of restructuring charges by type follows:

	2017		2016		2015
Workforce reductions	$	57	$	177	$	112
Plant closings and other costs	59		34		17
Total	$	116	$	211	$	129

A summary of restructuring charges by segment follows:

	2017		2016		2015
Electrical Products	$	29	$	44	$	12
Electrical Systems & Services	16		49		29
Hydraulics	32		67		31
Aerospace	2		4		5
Vehicle	12		35		34
Corporate	25		12		18
Total	$	116	$	211	$	129

A summary of liabilities related to workforce reductions, plant closings and other associated costs announced in 2015 follows:

	Workforce reductions			Plant closing and other			Total
Balance at December 31, 2015	$	54		$	—		$	54
Liability recognized	177			34			211
Payments	(116		)	(13		)	(129		)
Other adjustments	(2		)	(20		)	(22		)
Balance at December 31, 2016	113			1			114
Liability recognized	57			59			116
Payments	(102		)	(39		)	(141		)
Other adjustments	(1		)	(16		)	(17		)
Balance at December 31, 2017	$	67		$	5		$	72

These charges were included in Cost of products sold, Selling and administrative expenses or Other income-net, as appropriate. In Business Segment Information, the charges reduced Operating profit of the related business segment. See Note 15 for additional information about business segments.

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Note 5. GOODWILL AND OTHER INTANGIBLE ASSETS

Changes in the carrying amount of goodwill by segment follow:

	Electrical Products			Electrical Systems and Services			Hydraulics			Aerospace			Vehicle			Total
December 31, 2015	$	6,642		$	4,279		$	1,259		$	956		$	343		$	13,479
Translation	(145		)	(76		)	(38		)	(18		)	(1		)	(278		)
December 31, 2016	6,497			4,203			1,221			938			342			13,201
Goodwill written off from sale of business	—			(3		)	—			—			(52		)	(55		)
Translation	262			111			36			9			4			422
December 31, 2017	$	6,759		$	4,311		$	1,257		$	947		$	294		$	13,568

A summary of other intangible assets follows:

	2017				2016
	Historical cost		Accumulated amortization		Historical cost		Accumulated amortization
Intangible assets not subject to amortization
Trademarks	$	1,654			$	1,637
Intangible assets subject to amortization
Customer relationships	$	3,586	$	1,475	$	3,456	$	1,199
Patents and technology	1,395		628		1,342		519
Trademarks	1,137		473		1,104		378
Other	99		30		97		26
Total intangible assets subject to amortization	$	6,217	$	2,606	$	5,999	$	2,122

Amortization expense related to intangible assets subject to amortization in 2017, and estimated amortization expense for each of the next five years, follows:

2017	$	383
2018	369
2019	362
2020	357
2021	346
2022	336

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Note 6. DEBT

A summary of long-term debt, including the current portion, follows:

	2017			2016
5.30% notes due 2017 ($150 converted to floating rate by interest rate swap)	$	—		$	250
6.10% debentures due 2017	—			289
1.50% senior notes due 2017 ($750 converted to floating rate by interest rate swap)	—			1,000
5.60% notes due 2018 ($415 converted to floating rate by interest rate swap)	450			450
4.215% Japanese yen notes due 2018	88			86
6.95% notes due 2019 ($300 converted to floating rate by interest rate swap)	300			300
3.875% debentures due 2020 ($150 converted to floating rate by interest rate swap)	239			239
3.47% notes due 2021 ($275 converted to floating rate by interest rate swap)	300			300
8.10% debentures due 2022 ($100 converted to floating rate by interest rate swap)	100			100
2.75% senior notes due 2022 ($1,400 converted to floating rate by interest rate swap)	1,600			1,600
3.68% notes due 2023 ($200 converted to floating rate by interest rate swap)	300			300
0.75% euro notes due 2024	659			580
6.50% debentures due 2025	145			145
3.10% senior notes due 2027	700			—
7.65% debentures due 2029 ($50 converted to floating rate by interest rate swap)	200			200
4.00% senior notes due 2032	700			700
5.45% debentures due 2034 ($25 converted to floating rate by interest rate swap)	136			136
5.80% notes due 2037	240			240
4.15% senior notes due 2042	1,000			1,000
3.92% senior notes due 2047	300			—
5.25% to 8.875% notes (maturities ranging from 2018 to 2035, including $50 converted to floating rate by interest rate swap)	239			239
Other	49			109
Total long-term debt	7,745			8,263
Less current portion of long-term debt	(578		)	(1,552		)
Long-term debt less current portion	$	7,167		$	6,711

Substantially all these long-term debt instruments are fully and unconditionally guaranteed on an unsubordinated, unsecured basis by Eaton and certain of its direct and indirect subsidiaries (the Senior Notes). Further, all of these long-term debt instruments except the 4.215% Japanese yen notes due 2018, the 3.875% debentures due 2020, the 3.47% notes due 2021, the 3.68% notes due 2023, and the 0.75% Euro notes due 2024 are registered by Eaton Corporation under the Securities Act of 1933, as amended (the Registered Senior Notes).

On November 17, 2017, Eaton refinanced a $500, four-year revolving credit facility with a $500, three-year revolving credit facility that will expire November 17, 2020 and also refinanced a $750, five-year revolving credit facility with a $750, five-year revolving credit facility that will expire November 17, 2022. Eaton also maintains a $750, five-year revolving credit facility that will expire October 14, 2021. These refinancings maintain long-term revolving credit facilities at a total of $2,000. The revolving credit facilities are used to support commercial paper borrowings and are fully and unconditionally guaranteed by Eaton and certain of its direct and indirect subsidiaries on an unsubordinated, unsecured basis. There were no borrowings outstanding under Eaton's revolving credit facilities at December 31, 2017 or 2016. The Company had available lines of credit of $741 from various banks primarily for the issuance of letters of credit, of which there was $297 outstanding at December 31, 2017. Borrowings outside the United States are generally denominated in local currencies.

The Company repaid the 5.30% notes on March 15, 2017 for $250, the 6.10% debentures on June 29, 2017 for $289 and the 1.50% senior notes on November 2, 2017 for $1,000. The Company repaid the 2.375% debentures on January 15, 2016, for $240.

Short-term debt was $6 all of which was outside the United States as of December 31, 2017.

32

On September 15, 2017, a subsidiary of Eaton issued senior notes (the 2017 Senior Notes) with a face amount of $1,000. The 2017 Senior Notes are comprised of two tranches of $700 and $300, which mature in 2027 and 2047, respectively, with interest payable semi-annually at a respective rate of 3.1% and 3.9%. The issuer received proceeds totaling $993 from the issuance, net of financing costs. The 2017 Senior Notes are fully and unconditionally guaranteed on an unsubordinated, unsecured basis by Eaton and certain of its direct and indirect subsidiaries. The 2017 Senior Notes contain customary optional redemption and par call provisions. The 2017 Senior Notes also contain a change of control provision which requires the Company to make an offer to purchase all or any part of the 2017 Senior Notes at a purchase price of 101% of the principal amount plus accrued and unpaid interest. The capitalized deferred financing fees are amortized in Interest expense-net over the respective terms of the 2017 Senior Notes. The 2017 Senior Notes are subject to customary non-financial covenants.

On September 20, 2016, a subsidiary of Eaton issued euro denominated notes (Euro Notes) with a face value of €550 ($615 based on the September 20, 2016 spot rate), in accordance with Regulation S promulgated under the Securities Act of 1933, as amended. The Euro Notes mature in 2024 with interest payable annually at a rate of 0.75%. The issuer received proceeds totaling €544 ($609 based on the September 20, 2016 spot rate) from the issuance, net of financing costs and discounts. The senior Euro Notes are fully and unconditionally guaranteed on an unsubordinated, unsecured basis by Eaton and certain of its direct and indirect subsidiaries. The Euro Notes contain an optional redemption provision by which the Company may make an offer to purchase all or any part of the Euro Notes prior to June 20, 2024 at a purchase price of the greater of (a) 100% of the principal amount of the respective Euro Notes being redeemed, or (b) the sum of the present values of the respective remaining scheduled payments of principal and interest, discounted to the redemption date on an annual basis at the benchmark Bund Rate plus 20 basis points. In each case, the redemption price will include any accrued and unpaid interest on the Euro Notes being redeemed. At any time on or after June 20, 2024, the Company may redeem the Euro Notes, in whole or in part, at a redemption price equal to 100% of the principal amount to be redeemed plus accrued and unpaid interest. The Euro Notes also contain a change of control provision which requires the Company to make an offer to purchase all or any part of the Euro Notes at a purchase price of 101% of the principal amount plus accrued and unpaid interest. The capitalized deferred financing fees and discounts are amortized in Interest expense - net over the respective terms of the Euro Notes. The Euro Notes are subject to customary non-financial covenants. 

Eaton is in compliance with each of its debt covenants for all periods presented.

Maturities of long-term debt for each of the next five years follow:

2018	$	578
2019	340
2020	241
2021	302
2022	1,701

Interest paid on debt follows:

2017	$	293
2016	266
2015	271

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Note 7. RETIREMENT BENEFITS PLANS

Eaton has defined benefits pension plans and other postretirement benefits plans.

Obligations and Funded Status

	United States pension liabilities						Non-United States pension liabilities						Other postretirement liabilities
	2017			2016			2017			2016			2017			2016
Funded status
Fair value of plan assets	$	3,585		$	2,969		$	1,727		$	1,478		$	55		$	74
Benefit obligations	(3,961		)	(3,771		)	(2,399		)	(2,314		)	(448		)	(473		)
Funded status	$	(376	)	$	(802	)	$	(672	)	$	(836	)	$	(393	)	$	(399	)
Amounts recognized in the Consolidated    Balance Sheets
Non-current assets	$	82		$	34		$	136		$	33		$	—		$	—
Current liabilities	(15		)	(24		)	(25		)	(22		)	(31		)	(31		)
Non-current liabilities	(443		)	(812		)	(783		)	(847		)	(362		)	(368		)
Total	$	(376	)	$	(802	)	$	(672	)	$	(836	)	$	(393	)	$	(399	)
Amounts recognized in Accumulated other    comprehensive loss (pretax)
Net actuarial loss	$	1,059		$	1,232		$	596		$	771		$	19		$	21
Prior service cost (credit)	4			3			8			8			(46		)	(60		)
Total	$	1,063		$	1,235		$	604		$	779		$	(27	)	$	(39	)

Change in Benefit Obligations

	United States pension liabilities						Non-United States pension liabilities						Other postretirement liabilities
	2017			2016			2017			2016			2017			2016
Balance at January 1	$	3,771		$	3,829		$	2,314		$	2,175		$	473		$	575
Service cost	96			111			71			63			3			4
Interest cost	123			125			55			62			14			17
Actuarial (gain) loss	271			52			(148		)	355			2			(72		)
Gross benefits paid	(301		)	(346		)	(97		)	(94		)	(74		)	(79		)
Currency translation	—			—			223			(245		)	3			1
Plan amendments	1			—			—			2			—			—
Other	—			—			(19		)	(4		)	27			27
Balance at December 31	$	3,961		$	3,771		$	2,399		$	2,314		$	448		$	473
Accumulated benefit obligation	$	3,802		$	3,620		$	2,283		$	2,189

34

Change in Plan Assets

	United States pension liabilities						Non-United States pension liabilities						Other postretirement liabilities
	2017			2016			2017			2016			2017			2016
Balance at January 1	$	2,969		$	2,934		$	1,478		$	1,472		$	74		$	93
Actual return on plan assets	543			221			131			212			8			3
Employer contributions	374			160			99			102			20			30
Gross benefits paid	(301		)	(346		)	(97		)	(94		)	(74		)	(79		)
Currency translation	—			—			135			(211		)	—			—
Other	—			—			(19		)	(3		)	27			27
Balance at December 31	$	3,585		$	2,969		$	1,727		$	1,478		$	55		$	74

The components of pension plans with an accumulated benefit obligation in excess of plan assets at December 31 follow:

	United States pension liabilities				Non-United States pension liabilities
	2017		2016		2017		2016
Projected benefit obligation	$	3,540	$	3,342	$	966	$	1,902
Accumulated benefit obligation	3,380		3,190		911		1,824
Fair value of plan assets	3,081		2,505		175		1,066

Changes in pension and other postretirement benefit liabilities recognized in Accumulated other comprehensive loss follow:

	United States pension liabilities						Non-United States pension liabilities						Other postretirement liabilities
	2017			2016			2017			2016			2017			2016
Balance at January 1	$	1,235		$	1,327		$	779		$	653		$	(39	)	$	21
Prior service cost arising during the year	1			—			—			2			—			—
Net loss (gain) arising during the year	(28		)	81			(185		)	235			(2		)	(69		)
Currency translation	—			—			66			(75		)	1			1
Less amounts included in expense during the year	(145		)	(173		)	(56		)	(36		)	13			8
Net change for the year	(172		)	(92		)	(175		)	126			12			(60		)
Balance at December 31	$	1,063		$	1,235		$	604		$	779		$	(27	)	$	(39	)

Benefits Expense

	United States pension benefit expense									Non-United States pension benefit expense									Other postretirement benefits expense
	2017			2016			2015			2017			2016			2015			2017			2016			2015
Service cost	$	96		$	111		$	123		$	71		$	63		$	71		$	3		$	4		$	6
Interest cost	123			125			156			55			62			72			14			17			24
Expected return on plan assets	(244		)	(250		)	(262		)	(94		)	(92		)	(99		)	(4		)	(6		)	(5		)
Amortization	83			92			119			51			33			40			(13		)	(9		)	2
	58			78			136			83			66			84			—			6			27
Settlements and special termination benefits	62			81			74			5			3			2			—			1			—
Total expense	$	120		$	159		$	210		$	88		$	69		$	86		$	—		$	7		$	27

35

The estimated pretax net amounts that will be recognized from Accumulated other comprehensive loss into net periodic benefit cost in 2018 follow:

	United States pension liabilities		Non-United States pension liabilities		Other postretirement liabilities
Actuarial loss	$	146	$	38	$	1
Prior service cost (credit)	1		1		(14		)
Total	$	147	$	39	$	(13	)

Retirement Benefits Plans Assumptions

In 2015, 2016 and 2017, for purposes of determining liabilities related to pension plans and other postretirement benefits plans in the United States, the Company used 2014 mortality tables and generational improvement scales that are based on MP-2015, MP-2016 and MP-2017, respectively.

In 2016, the Company adopted a change in the method it uses to estimate the service and interest cost components of net periodic benefit cost for its defined benefit pension and other postretirement benefit plans. Prior to 2016, for the vast majority of its plans, the service and interest cost components were estimated using a single weighted-average discount rate derived from the yield curve used to measure the benefit obligation at the beginning of the period. Beginning in 2016, the Company used a spot rate approach by applying the specific spot rates along the yield curve to the relevant projected cash flows in the estimation of the service and interest components of benefit cost, resulting in a more precise measurement. This change does not affect the measurement of total benefit obligations. The change was accounted for as a change in estimate and, accordingly, was accounted for prospectively starting in 2016. The reductions in service cost and interest cost for 2016 associated with this change in estimate were $3 and $42, respectively.

Pension Plans

	United States pension plans						Non-United States pension plans
	2017		2016		2015		2017		2016		2015
Assumptions used to determine benefit obligation at year-end
Discount rate	3.64	%	4.12	%	4.22	%	2.62	%	2.63	%	3.46	%
Rate of compensation increase	3.15	%	3.15	%	3.18	%	3.11	%	3.13	%	3.12	%
Assumptions used to determine expense
Discount rate used to determine benefit obligation	4.12	%	4.22	%	3.97	%	2.63	%	3.46	%	3.33	%
Discount rate used to determine service cost	4.31	%	4.35	%	3.97	%	3.38	%	4.13	%	3.33	%
Discount rate used to determine interest cost	3.40	%	3.42	%	3.97	%	2.34	%	3.07	%	3.33	%
Expected long-term return on plan assets	7.90	%	8.50	%	8.50	%	6.30	%	6.62	%	6.92	%
Rate of compensation increase	3.15	%	3.18	%	3.16	%	3.13	%	3.12	%	3.13	%

The expected long-term rate of return on pension assets was determined for each country and reflects long-term historical data taking into account each plan's target asset allocation. The expected long-term rates of return on pension assets for United States pension plans and Non-United States pension plans for 2018 are 7.52% and 6.40%, respectively. The discount rates were determined using appropriate bond data for each country.

36

Other Postretirement Benefits Plans

Substantially all of the obligation for other postretirement benefits plans relates to United States plans. Assumptions used to determine other postretirement benefits obligations and expense follow:

	Other postretirement benefits plans
	2017		2016		2015
Assumptions used to determine benefit obligation at year-end
Discount rate	3.55	%	3.96	%	4.04	%
Health care cost trend rate assumed for next year	8.25	%	7.35	%	7.10	%
Ultimate health care cost trend rate	4.75	%	4.75	%	4.75	%
Year ultimate health care cost trend rate is achieved	2027		2026		2025
Assumptions used to determine expense
Discount rate used to determine benefit obligation	3.96	%	4.04	%	3.79	%
Discount rate used to determine service cost	4.11	%	4.26	%	3.79	%
Discount rate used to determine interest cost	3.18	%	3.12	%	3.79	%
Initial health care cost trend rate	7.35	%	7.10	%	6.31	%
Ultimate health care cost trend rate	4.75	%	4.75	%	4.77	%
Year ultimate health care cost trend rate is achieved	2026		2025		2024

Assumed health care cost trend rates may have a significant effect on the amounts reported for the health care plans. A 1-percentage point change in the assumed health care cost trend rates would have the following effects:

	1% increase		1% decrease
Effect on total service and interest cost	$	1	$	(1	)
Effect on other postretirement liabilities	13		(12		)

Employer Contributions to Retirement Benefits Plans

Contributions to pension plans that Eaton expects to make in 2018, and made in 2017, 2016 and 2015, follow:

	2018		2017		2016		2015
United States plans	$	16	$	374	$	160	$	221
Non-United States plans	96		99		102		109
Total contributions	$	112	$	473	$	262	$	330

The following table provides the estimated pension and other postretirement benefit payments for each of the next five years, and the five years thereafter in the aggregate. For other postretirement benefits liabilities, the expected subsidy receipts related to the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 would reduce the gross payments listed below.

	Estimated United States pension payments		Estimated non-United States pension payments		Estimated other postretirement benefit payments
					Gross		Medicare prescription drug subsidy
2018	$	291	$	88	$	47	$	(2	)
2019	291		90		43		(2		)
2020	292		93		39		(2		)
2021	299		95		35		(1		)
2022	298		99		35		—
2023 - 2027	1,478		548		141		(2		)

37

Pension Plan Assets

Investment policies and strategies are developed on a country specific basis. The United States plans, representing 67% of worldwide pension assets, and the United Kingdom plans representing 26% of worldwide pension assets, are invested primarily for growth, as the majority of the assets are in plans with active participants and ongoing accruals. In general, the plans have their primary allocation to diversified global equities, primarily through index funds in the form of common collective and other trusts. The United States plans' target allocation is 28% United States equities, 28% non-United States equities, 9% real estate (primarily equity of real estate investment trusts), 31% debt securities and 4% other, including hedge funds, private equity and cash equivalents. The United Kingdom plans' target asset allocations are 61% equities and the remainder in debt securities, cash equivalents and real estate investments. The equity risk for the plans is managed through broad geographic diversification and diversification across industries and levels of market capitalization. The majority of debt allocations for these plans are longer duration government and corporate debt. The United States, United Kingdom and Canada pension plans are authorized to use derivatives to achieve more economically desired market exposures and to use futures, swaps and options to gain or hedge exposures.

Other Postretirement Benefits Plan Assets

The Voluntary Employee Benefit Association trust which holds U.S. other postretirement benefits plan assets has investment guidelines that include allocations to global equities and fixed income investments. The trust's 2017 target investment allocation is 43% diversified global equities and 57% fixed income securities held in a trust that invests primarily in exchange traded funds.

Fair Value Measurements

Financial instruments included in pension and other postretirement benefits plan assets are categorized into a fair value hierarchy of three levels, based on the degree of subjectivity inherent in the valuation methodology as follows:

Level 1 - Quoted prices (unadjusted) for identical assets in active markets.

Level 2 - Quoted prices for similar assets in active markets, and inputs that are observable for the asset, either directly or indirectly, for substantially the full term of the financial instrument.

Level 3 - Unobservable prices or inputs.

Certain investments that are measured at fair value using the net asset value per share practical expedient have not been categorized in the fair value hierarchy and are being presented in the tables to permit a reconciliation to total plan assets.

38

Pension Plans

A summary of the fair value of pension plan assets at December 31, 2017 and 2016, follows:

	Total		Quoted prices in active markets for identical assets (Level 1)		Other observable inputs (Level 2)		Unobservable inputs (Level 3)
2017
Common collective trusts
Non-United States equity and global equities	$	741	$	—	$	741	$	—
United States equity	86		—		86		—
Fixed income	478		—		478		—
Fixed income securities	709		—		709		—
United States treasuries	67		67		—		—
Bank loans	161		—		161		—
Real estate	239		220		—		19
Equity securities	139		139		—		—
Cash equivalents	86		51		35		—
Exchange traded funds	224		224		—		—
Other	81		—		8		73
Common collective and other trusts measured at net asset value	2,225
Hedge funds measured at net asset value	67
Money market funds measured at net asset value	9
Total pension plan assets	$	5,312	$	701	$	2,218	$	92

39

	Total		Quoted prices in active markets for identical assets (Level 1)		Other observable inputs (Level 2)		Unobservable inputs (Level 3)
2016
Common collective trusts
Non-United States equity and global equities	$	413	$	—	$	413	$	—
United States equity	94		—		94		—
Fixed income	422		—		422		—
Fixed income securities	359		—		359		—
United States treasuries	123		123		—		—
Bank loans	150		—		150		—
Real estate	201		195		—		6
Equity securities	104		104		—		—
Cash equivalents	276		21		255		—
Exchange traded funds	55		55		—		—
Other	109		—		14		95
Common collective and other trusts measured at net asset value	2,038
Hedge funds measured at net asset value	85
Money market funds measured at net asset value	18
Total pension plan assets	$	4,447	$	498	$	1,707	$	101

The fair value measurement of plan assets using significant unobservable inputs (Level 3) changed during 2016 and 2017 due to the following:

	Real estate			Other			Total
Balance at December 31, 2015	$	7		$	86		$	93
Actual return on plan assets:
Gains (losses) relating to assets still held at year-end	—			(6		)	(6		)
Purchases, sales, settlements - net	(1		)	15			14
Transfers into or out of Level 3	—			—			—
Balance at December 31, 2016	6			95			101
Actual return on plan assets:
Gains (losses) relating to assets still held at year-end	1			(5		)	(4		)
Purchases, sales, settlements - net	12			(17		)	(5		)
Transfers into or out of Level 3	—			—			—
Balance at December 31, 2017	$	19		$	73		$	92

40

Other Postretirement Benefits Plans

A summary of the fair value of other postretirement benefits plan assets at December 31, 2017 and 2016, follows:

	Total		Quoted prices in active markets for identical assets (Level 1)		Other observable inputs (Level 2)		Unobservable inputs (Level 3)
2017
Cash equivalents	$	7	$	7	$	—	$	—
Common collective and other trusts measured at net asset value	48
Total other postretirement benefits plan assets	$	55	$	7	$	—	$	—

	Total		Quoted prices in active markets for identical assets (Level 1)		Other observable inputs (Level 2)		Unobservable inputs (Level 3)
2016
Cash equivalents	$	8	$	8	$	—	$	—
Common collective and other trusts measured at net asset value	66
Total other postretirement benefits plan assets	$	74	$	8	$	—	$	—

Valuation Methodologies

Following is a description of the valuation methodologies used for pension and other postretirement benefits plan assets measured at fair value. There have been no changes in the methodologies used at December 31, 2017 and 2016.

Common collective and other trusts - Valued at the net unit value of units held by the trust at year end. The unit value is determined by the total value of fund assets divided by the total number of units of the fund owned. The equity investments in collective trusts are predominantly in index funds for which the underlying securities are actively traded in public markets based upon readily measurable prices. The investments in other trusts are predominantly in exchange traded funds for which the underlying securities are actively traded in public markets based upon readily measurable prices. Common collective and other trusts measured at fair value using the net asset value per share practical expedient have not been categorized in the fair value hierarchy and are being presented in the tables above to permit a reconciliation of the fair value hierarchy to the total plan assets.

Fixed income securities - These securities consist of publicly traded United States and non-United States fixed interest obligations (principally corporate and government bonds and debentures). The fair value of corporate and government debt securities is determined through third-party pricing models that consider various assumptions, including time value, yield curves, credit ratings, and current market prices. The Company verifies the results of trustees or custodians and evaluates the pricing classification of these securities by performing analyses using other third-party sources.

United States treasuries - Valued at the closing price of each security.

Bank loans - These securities consist of senior secured term loans of publicly traded and privately held United States and non-United States floating rate obligations (principally corporations of non-investment grade rating). The fair value is determined through third-party pricing models that primarily utilize dealer quoted current market prices. The Company verifies the results of trustees or custodians and evaluates the pricing classification of these securities by performing analyses using other third-party sources.

41

Equity securities - These securities consist of direct investments in the stock of publicly traded companies. Such investments are valued based on the closing price reported in an active market on which the individual securities are traded. As such, the direct investments are classified as Level 1.

Real estate - Consists of direct investments in the stock of publicly traded companies and investments in pooled funds that invest directly in real estate. The publicly traded companies are valued based on the closing price reported in an active market on which the individual securities are traded and as such are classified as Level 1. The pooled funds rely on appraisal based valuations and as such are classified as Level 3.

Cash equivalents - Primarily certificates of deposit, commercial paper, and repurchase agreements.

Exchange traded funds - Valued at the closing price of the exchange traded fund's shares.

Hedge funds - Consists of direct investments in hedge funds through limited partnership interests. Net asset values are based on the estimated fair value of the ownership interest in the investment as determined by the General Partner. The majority of the holdings of the hedge funds are in equity securities traded on public exchanges. The investment terms of the hedge funds allow capital to be redeemed quarterly given prior notice with certain limitations. Hedge funds measured at fair value using the net asset value per share practical expedient have not been categorized in the fair value hierarchy and are being presented in the tables above to permit a reconciliation of the fair value hierarchy to the total plan assets.

Money market funds - Money market funds measured at fair value using the net asset value per share practical expedient have not been categorized in the fair value hierarchy and are being presented in the tables above to permit a reconciliation of the fair value hierarchy to the total plan assets.

Other - Primarily insurance contracts for international plans and also futures contracts and over-the-counter options. These investments are valued based on the closing prices of future contracts or indices as available on Bloomberg or similar service, and private equity investments.

For additional information regarding fair value measurements, see Note 12.

Defined Contribution Plans

The Company has various defined contribution benefit plans, primarily consisting of the plans in the United States. The total contributions related to these plans are charged to expense and were as follows:

2017	$	114
2016	72
2015	137

42

Note 8. COMMITMENTS AND CONTINGENCIES

Legal Contingencies

Eaton is subject to a broad range of claims, administrative and legal proceedings such as lawsuits that relate to contractual allegations, tax audits, patent infringement, personal injuries, antitrust matters and employment-related matters. Eaton is also subject to asbestos claims from historic products which may have contained asbestos. Insurance may cover some of the costs associated with these claims and proceedings. Although it is not possible to predict with certainty the outcome or cost of these matters, the Company believes they will not have a material adverse effect on the consolidated financial statements. During the fourth quarter of 2016, the Company was able to resolve several insurance matters. In total, the income from insurance matters was $68.

In December 2011, Pepsi-Cola Metropolitan Bottling Company, Inc. (“Pepsi”) filed an action against (a) Cooper Industries, LLC, Cooper Industries, Ltd., Cooper Holdings, Ltd., Cooper US, Inc., and Cooper Industries plc (collectively, “Cooper”), (b) M&F Worldwide Corp., Mafco Worldwide Corp., Mafco Consolidated Group LLC, and PCT International Holdings, Inc. (collectively, “Mafco”), and (c) the Pneumo Abex Asbestos Claims Settlement Trust (the “Trust”) in Texas state court. Pepsi alleged that it was harmed by a 2011 settlement agreement (“2011 Settlement”) among Cooper, Mafco, and Pneumo Abex, LLC (“Pneumo,” which prior to the 2011 Settlement was a Mafco subsidiary), which settlement resolved litigation that Pneumo had previously brought against Cooper involving, among other things, a guaranty related to Pneumo’s friction products business. In November 2015, after a Texas court ruled that Pepsi's claims should be heard in arbitration, Pepsi filed a demand for arbitration against Cooper, Mafco, the Trust, and Pneumo. Pepsi subsequently dropped claims against all parties except Cooper. An arbitration under the auspices of the American Arbitration Association commenced in October 2017. Pepsi’s experts have opined, among other things, that the value contributed to the Trust for a release of the guaranty was approximately $440 below reasonably equivalent value, and that an inability of Pneumo to satisfy future liabilities may result in plaintiffs suing Pepsi under various theories. Cooper submitted various expert reports and, among other things, Cooper’s experts opine that Pepsi has no basis to seek any damages and that Cooper paid reasonably equivalent value for the release of its indemnity obligations under the guaranty. The arbitration proceedings closed in December 2017. The parties are awaiting the issuance of a decision. The Company believes that the claims of Pepsi are without merit, and that the ultimate resolution of this matter will not have a material impact on the Company’s consolidated financial statements.

In December 2010, a Brazilian court held that a judgment obtained by a Brazilian company, Raysul, against another Brazilian company, Saturnia, which was sold by Eaton in 2006, could be enforced against Eaton Ltda. The judgment was based on an alleged violation of an agency agreement between Raysul and Saturnia. At March 31, 2016, the Company had a total accrual of 100 Brazilian Reais related to this matter ($31 based on June 2016 exchange rates). In June 2016, Eaton signed a settlement agreement and resolved the matter, which did not have a material impact on the consolidated financial statements.

Environmental Contingencies

Eaton has established policies to ensure that its operations are conducted in keeping with good corporate citizenship and with a positive commitment to the protection of the natural and workplace environments. The Company's manufacturing facilities are required to be certified to ISO 14001, an international standard for environmental management systems. The Company routinely reviews EHS performance at each of its facilities and continuously strives to improve pollution prevention.

Eaton is involved in remedial response and voluntary environmental remediation at a number of sites, including certain of its currently-owned or formerly-owned plants. The Company has also been named a potentially responsible party under the United States federal Superfund law, or the state equivalents thereof, at a number of disposal sites. The Company became involved in these sites as a result of government action or in connection with business acquisitions. At the end of 2017, the Company was involved with a total of 118 sites worldwide, including the Superfund sites mentioned above, with none of these sites being individually significant to the Company.

Remediation activities, generally involving soil and/or groundwater contamination, include pre-cleanup activities such as fact finding and investigation, risk assessment, feasibility study, design and action planning, performance (where actions may range from monitoring, to removal of contaminants, to installation of longer-term remediation systems), and operation and maintenance of a remediation system. The extent of expected remediation activities and costs varies by site. A number of factors affect the cost of environmental remediation, including the number of parties involved at a particular site, the determination of the extent of contamination, the length of time the remediation may require, the complexity of environmental regulations, and the continuing advancement of remediation technology. Taking these factors into account, Eaton has estimated the costs of remediation, which will be paid over a period of years. The Company accrues an amount on an undiscounted basis, consistent with the estimates of these costs, when it is probable that a liability has been incurred. Actual results may differ from these estimates. At December 31, 2017 and 2016, the Company had an accrual totaling $120 and $124, respectively, for these costs.

43

Based upon Eaton's analysis and subject to the difficulty in estimating these future costs, the Company expects that any sum it may be required to pay in connection with environmental matters is not reasonably possible to exceed the recorded liability by an amount that would have a material effect on its financial position, results of operations or cash flows.

Warranty Accruals

A summary of the current and long-term warranty accruals follows:

	2017			2016			2015
Balance at January 1	$	180		$	195		$	213
Provision	163			117			104
Settled	(156		)	(130		)	(114		)
Other	1			(2		)	(8		)
Balance at December 31	$	188		$	180		$	195

Lease Commitments

Eaton leases certain real properties and equipment. A summary of minimum rental commitments at December 31, 2017 under noncancelable operating leases, which expire at various dates and in most cases contain renewal options, for each of the next five years and thereafter in the aggregate, follow:

2018	$	159
2019	119
2020	85
2021	63
2022	42
Thereafter	71
Total noncancelable lease commitments	$	539

A summary of rental expense follows:

2017	$	222
2016	220
2015	225

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Note 9. INCOME TAXES

Certain amounts below have been adjusted to reflect the retrospective application of the Company's change in inventory accounting methods, as described in Notes 1 and 14.

Eaton Corporation plc is domiciled in Ireland. Income (loss) before income taxes and income tax (benefit) expense are summarized below based on the geographic location of the operation to which such earnings and income taxes are attributable.

	Income (loss) before income taxes
	2017			2016			2015
Ireland	$	(1,090	)	$	(923	)	$	(608	)
Foreign	4,458			3,041			2,741
Total income before income taxes	$	3,368		$	2,118		$	2,133

	Income tax expense (benefit)
	2017			2016			2015
Current
Ireland	$	1		$	2		$	8
Foreign
United States	123			93			110
Non-United States	234			209			240
Total current income tax expense	358			304			358
Deferred
Ireland	—			2			1
Foreign
United States	82			(77		)	(76		)
Non-United States	(58		)	(30		)	(124		)
Total deferred income tax expense (benefit)	24			(105		)	(199		)
Total income tax expense	$	382		$	199		$	159

45

Reconciliations of income taxes from the Ireland national statutory rate of 25% to the consolidated effective income tax rate follow:

	2017		2016		2015
Income taxes at the applicable statutory rate	25.0	%	25.0	%	25.0	%
Ireland operations
Ireland tax on trading income	—	%	(0.3	)%	(0.4	)%
Nondeductible interest expense	8.2	%	11.5	%	7.9	%
Foreign operations
United States operations (earnings taxed at other than     the applicable statutory rate)	1.7	%	0.1	%	(0.6	)%
U.S. federal tax rate change	(7.5	)%	—	%	—	%
U.S. tax on foreign earnings	4.8	%	—	%	—	%
U.S. foreign tax credit	(3.9	)%	0.6	%	(0.8	)%
Credit for research activities	(0.5	)%	(0.8	)%	(0.8	)%
U.S. Other - net	3.2	%	2.5	%	5.4	%
Non-U.S. operations (earnings taxed at other than    the applicable statutory tax rate)	(22.9	)%	(26.8	)%	(25.1	)%
Non-U.S. operations - other items	0.4	%	0.9	%	(0.5	)%
Worldwide operations
Adjustments to tax liabilities	(1.8	)%	(2.5	)%	(1.4	)%
Adjustments to valuation allowances	4.6	%	(0.8	)%	(1.2	)%
Effective income tax expense rate	11.3	%	9.4	%	7.5	%

During 2017, income tax expense of $382 was recognized (an effective tax rate of 11.3%) compared to income tax expense of $199 for 2016 (an effective tax rate of 9.4%) and income tax expense of $159 for 2015 (an effective tax rate of 7.5%). The 2017 effective tax rate includes tax expense of $234 on the gain related to the sale of business discussed in Note 2 and a tax benefit of $62 related to the U.S. Tax Cuts and Jobs Act (TCJA) which is discussed in further detail below. Excluding the gain and related tax impact on the sale of business, and the impact of the TCJA, the effective tax rate for 2017 was expense of 9.2%. The decrease from 9.4% for 2016 compared to 9.2% for 2017 was due to the resolution of tax contingencies in various tax jurisdictions and the excess tax benefits recognized for employee share-based payments pursuant to the adoption of Accounting Standards Update 2016-09, Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting. The increase from 7.5% for 2015 compared to 9.4% for 2016 is primarily due to greater levels of income earned in higher tax jurisdictions, partially offset by net decreases in worldwide tax liabilities.

The U.S. Tax Cuts and Jobs Act was enacted on December 22, 2017. The TCJA reduces the U.S. federal corporate tax rate from 35% to 21% and requires a one-time transition tax on certain unremitted earnings of non-U.S. subsidiaries owned directly or indirectly by U.S. subsidiaries of the Company. For 2017, we have recorded a provisional tax benefit amount of $62 for the impact on our deferred tax balances and the one-time transition tax.

The Company remeasured certain deferred tax assets and liabilities based on the rates at which they are expected to reverse in the future, which is generally 21%. Additionally, given the significant changes included in the TCJA, the Company re-evaluated the realizability of certain deferred tax assets, including foreign tax credits and interest deferral, and determined that valuation allowances needed to be adjusted. The Company is still analyzing certain aspects of the TCJA, including interpretations by state and local tax authorities, and additional Treasury guidance may be issued which could potentially affect the measurement of these balances or give rise to new deferred tax amounts. The Company recorded a provisional $79 tax benefit for the remeasurement of deferred tax balances and related valuation allowances.

46

The one-time transition tax is based on post-1986 unremitted earnings and profits (E&P) of non-U.S. subsidiaries owned directly or indirectly by U.S. subsidiaries of the Company which have been previously deferred from U.S. income taxes. The amount of the transition tax also depends on the amount of E&P held in cash or other specified assets. The Company recorded a provisional tax expense of $17 for the transition tax. This amount may change when Treasury issues additional guidance and the Company finalizes the calculation of E&P, including the amounts held in cash or other specified assets, and finalizes the calculation of available foreign tax credits.

No provision has been made for income taxes on undistributed earnings of foreign subsidiaries of approximately $22.1 billion at December 31, 2017, since it is the Company's intention to indefinitely reinvest undistributed earnings of its foreign subsidiaries. It is not practicable to estimate the additional income taxes and applicable withholding taxes that would be payable on the remittance of such undistributed earnings.

The Company expects to deploy capital to those markets which offer particularly attractive growth opportunities. The cash that is permanently reinvested is typically used to expand operations either organically or through acquisitions. In addition, the Company expects that minimal to no Irish tax would apply to dividends paid to the Irish parent due to the impact of the Irish foreign tax credit system. The Company's public dividends and share repurchases are funded primarily from Non-U.S. operations.

Worldwide income tax payments, net of tax refunds, follow:

2017	$	288
2016	272
2015	302

Deferred Income Tax Assets and Liabilities

Components of noncurrent deferred income taxes follow:

	2017			2016
	Noncurrent assets and liabilities			Noncurrent assets and liabilities
Accruals and other adjustments
Employee benefits	$	430		$	761
Depreciation and amortization	(1,324		)	(1,823		)
Other accruals and adjustments	380			761
Ireland income tax loss carryforwards	1			1
Foreign income tax loss carryforwards	1,962			1,796
Foreign income tax credit carryforwards	404			277
Valuation allowance for income tax loss and income tax    credit carryforwards	(1,992		)	(1,728		)
Other valuation allowances	(146		)	(41		)
Total deferred income taxes	$	(285	)	$	4

At December 31, 2017, Eaton Corporation plc and certain Irish subsidiaries had tax loss carryforwards that are available to reduce future taxable income and tax liabilities. These carryforwards and their respective expiration dates are summarized below:

	2018 through 2022		2023 through 2027		2028 through 2032		2033 through 2037		Not subject to expiration		Valuation allowance
Ireland income tax loss carryforwards	$	—	$	—	$	—	$	—	$	8	$	—
Ireland deferred income tax assets for income tax loss carryforwards	—		—		—		—		1		(1		)

47

At December 31, 2017, the Company's foreign subsidiaries, including all U.S. and non-U.S. subsidiaries, had income tax loss carryforwards and income tax credit carryforwards that are available to reduce future taxable income or tax liabilities. These carryforwards and their respective expiration dates are summarized below:

	2018 through 2022		2023 through 2027		2028 through 2032		2033 through 2037		Not subject to expiration		Valuation allowance
Foreign income tax loss carryforwards	$	918	$	7,528	$	14	$	545	$	4,047	$	—
Foreign deferred income tax assets for income tax loss carryforwards	112		721		14		175		1,047		(1,830		)
Foreign deferred income tax assets for income tax loss carryforwards after ASU 2013-11	101		715		14		86		1,047		(1,830		)
Foreign income tax credit carryforwards	86		205		78		115		64		(161		)
Foreign income tax credit carryforwards after ASU 2013-11	82		168		27		94		33		(161		)

Recoverability of Deferred Income Tax Assets

Eaton is subject to the income tax laws in the jurisdictions in which it operates. In order to determine its income tax provision for financial statement purposes, Eaton must make significant estimates and judgments about its business operations in these jurisdictions. These estimates and judgments are also used in determining the deferred income tax assets and liabilities that have been recognized for differences between the financial statement and income tax basis of assets and liabilities, and income tax loss carryforwards and income tax credit carryforwards.

Management evaluates the realizability of deferred income tax assets for each of the jurisdictions in which it operates. If the Company experiences cumulative pretax income in a particular jurisdiction in the three-year period including the current and prior two years, management normally concludes that the deferred income tax assets will more likely than not be realizable and no valuation allowance is recognized, unless known or planned operating developments, or changes in tax laws, would lead management to conclude otherwise. However, if the Company experiences cumulative pretax losses in a particular jurisdiction in the three-year period including the current and prior two years, management then considers a series of factors in the determination of whether the deferred income tax assets can be realized. These factors include historical operating results, known or planned operating developments, the period of time over which certain temporary differences will reverse, consideration of the utilization of certain deferred income tax liabilities, tax law carryback capability in the particular country, prudent and feasible tax planning strategies, changes in tax laws, and estimates of future earnings and taxable income using the same assumptions as those used for the Company's goodwill and other impairment testing. After evaluation of these factors, if the deferred income tax assets are expected to be realized within the tax carryforward period allowed for that specific country, management would conclude that no valuation allowance would be required. To the extent that the deferred income tax assets exceed the amount that is expected to be realized within the tax carryforward period for a particular jurisdiction, management would establish a valuation allowance.

Applying the above methodology, valuation allowances have been established for certain deferred income tax assets to the extent they are not expected to be realized within the particular tax carryforward period.

Unrecognized Income Tax Benefits

A summary of gross unrecognized income tax benefits follows:

	2017			2016			2015
Balance at January 1	$	629		$	584		$	493
Increases and decreases as a result of positions taken during prior years
Transfers from valuation allowances	—			—			—
Other increases, including currency translation	10			21			34
Other decreases, including currency translation	(30		)	(24		)	(34		)
Balances related to acquired businesses	—			—			(1		)
Increases as a result of positions taken during the current year	162			90			109
Decreases relating to settlements with tax authorities	(10		)	(19		)	—
Decreases as a result of a lapse of the applicable statute of limitations	(26		)	(23		)	(17		)
Balance at December 31	$	735		$	629		$	584

48

Eaton's long-term policy has been to enter into tax planning strategies only if it is more likely than not that the benefit would be sustained upon audit. For example, the Company does not enter into any of the United States Internal Revenue Service (IRS) Listed Transactions as set forth in Treasury Regulation 1.6011-4.

If all unrecognized tax benefits were recognized, the net impact on the provision for income tax expense would be $652.

As of December 31, 2017 and 2016, Eaton had accrued approximately $80 and $94, respectively, for the payment of worldwide interest and penalties, which are not included in the table of unrecognized income tax benefits above. Eaton recognizes interest and penalties related to unrecognized income tax benefits in the provision for income tax expense. The Company has accrued penalties in jurisdictions primarily where they are automatically applied to any deficiency, regardless of the merit of the position.

As part of Eaton’s broader efforts to streamline operations, accelerate organic growth, and increase administrative efficiencies, the Company centralized certain activities and assets, which resulted in an increase in current income taxes payable, prepaid tax, and unrecognized tax benefits for 2017. These changes did not impact the Company’s 2017 effective tax rate.

The resolution of the majority of Eaton's unrecognized income tax benefits is dependent upon uncontrollable factors such as the prospect of retroactive regulations; new case law; and the willingness of the income tax authority to settle the issue, including the timing thereof. Therefore, for the majority of unrecognized income tax benefits, it is not reasonably possible to estimate the increase or decrease in the next 12 months. For each of the unrecognized income tax benefits where it is possible to estimate the increase or decrease in the balance within the next 12 months, the Company does not anticipate any significant change.

Eaton or its subsidiaries file income tax returns in Ireland and many countries around the world. With only few exceptions, Irish and non-United States subsidiaries of Eaton are no longer subject to examinations for years before 2007.

The United States Internal Revenue Service (“IRS”) has completed its examination of Eaton Corporation and Includible Subsidiaries’ (Eaton Corp.) United States income tax returns for 2005 through 2010 and has issued Statutory Notices of Deficiency (Notices) as discussed below. The statute of limitations on these tax years remains open until the matters are resolved. The IRS is currently examining tax years 2011 through 2013. The statute of limitations for tax years 2011 through 2013 is open until August 31, 2018. Tax years 2014 through 2016 are still subject to examination by the IRS.

Eaton is also under examination for the income tax filings in various states and localities of the United States. With only a few exceptions, Eaton Corp. is no longer subject to income tax examinations from states and localities within the United States for years before 2012. Income tax returns of states and localities within the United States will be reopened to the extent of United States federal income tax adjustments, if any, going back to 2005 when those audit years are finalized. Some states and localities may not limit their assessment to the United States federal adjustments, and may require the opening of the entire tax year. In addition, with only a few exceptions, BZ Holdings Inc. and Includible Subsidiaries (the former U.S. holding company for Cooper Industries) are no longer subject to United States state and local income tax examinations for years before 2012.

In 2011, the IRS issued a Notice for Eaton Corp. for the 2005 and 2006 tax years (the 2011 Notice). The 2011 Notice proposed assessments of $75 in additional taxes plus $52 in penalties related primarily to transfer pricing adjustments for products manufactured in the Company's facilities in Puerto Rico and the Dominican Republic and sold to affiliated companies located in the U.S.. Eaton Corp. has set its transfer prices for products sold between these affiliates at the same prices that Eaton Corp. sells such products to third parties as required by two successive Advance Pricing Agreements (APAs) Eaton Corp. entered into with the IRS that governed the 2005-2010 tax years. The Company has continued to apply the arms-length transfer pricing methodology for 2011 through the current reporting period. Immediately prior to the 2011 Notice being issued, the IRS sent a letter stating that it was retrospectively canceling the APAs. Eaton Corp. contested the proposed assessments in United States Tax Court. The case involved both whether the APAs should be enforced and, if not, the appropriate transfer pricing methodology. On July 26, 2017, the United States Tax Court issued a ruling in which it agreed with Eaton Corp. that the IRS must abide by the terms of the APAs for the tax years 2005-2006. The Tax Court’s ruling on the APAs did not have a material impact on Eaton’s consolidated financial statements.

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In 2014, Eaton Corp. received a Notice from the IRS for the 2007 through 2010 tax years (the 2014 Notice) proposing assessments of $190 in additional taxes plus $72 in penalties, net of agreed credits and deductions, which the company has also contested in Tax Court. The proposed assessments pertain primarily to the same transfer pricing issues and APA for which the Tax Court has issued its ruling during 2017 as noted above. The Company believes that the Tax Court’s ruling for tax years 2005-2006 will also be applicable to the 2007-2010 years. Following the issuance of the Tax Court’s ruling, Eaton and the IRS recognized that the ruling on the enforceability of the APAs did not address a secondary issue regarding the transfer pricing for a certain royalty paid from 2006-2010. Eaton Corp. reported a consistent royalty rate for 2006-2010. The IRS has agreed to the royalty rate as reported by Eaton Corp. in 2006. Although the IRS has not proposed an alternative rate, it has not agreed to apply the same royalty rate in the 2007-2010 years.  

The 2014 Notice also includes a separate proposed assessment involving the recognition of income for several of Eaton Corp.’s controlled foreign corporations. The Company believes that the proposed assessment is without merit. Eaton and the IRS have both moved for partial summary judgment on this issue. The Tax Court heard oral arguments on the motions in January 2018, following which the Court ordered further briefing.

During 2010, the Company received a tax assessment of $49 (translated at the December 31, 2017 exchange rate), plus interest and penalties, in Brazil for the tax years 2005 through 2008 that relates to the amortization of certain goodwill generated from the acquisition of third-party businesses and corporate reorganizations. The Company is contesting the assessment, which is under review at the administrative appeals level. During 2013, the Brazilian tax authorities began an audit of tax years 2009 through 2012. During 2014, the Company received a tax assessment of $37 (translated at the December 31, 2017 exchange rate), plus interest and penalties, for the 2009 through 2012 tax years (primarily relating to the same issues concerning the 2005 through 2008 tax years), which the Company is also contesting and is under review at the administrative appeals level. Multiple outside advisors have stated that Brazilian tax authorities are raising the issue for most clients with similar facts and that the matter is expected to require at least 10 years to resolve. The Company continues to believe that final resolution of the assessments will not have a material impact on its consolidated financial statements.

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Note 10. EATON SHAREHOLDERS' EQUITY

There are 750 million Eaton ordinary shares authorized ($0.01 par value per share), 439.9 million and 449.4 million of which were issued and outstanding at December 31, 2017 and 2016, respectively. Eaton's Memorandum and Articles of Association authorized 40 thousand deferred ordinary shares (€1.00 par value per share) and 10 thousand preferred A shares ($1.00 par value per share), all of which were issued and outstanding at December 31, 2017 and 2016, and 10 million serial preferred shares ($0.01 par value per share), none of which is outstanding at December 31, 2017 and 2016. At December 31, 2017, there were 13,089 holders of record of Eaton ordinary shares. Additionally, 20,138 current and former employees were shareholders through participation in the Eaton Savings Plan, Eaton Personal Investment Plan, or the Eaton Puerto Rico Retirement Savings Plan.

On October 22, 2013, Eaton's Board of Directors adopted a share repurchase program (the 2013 Program). Under the 2013 Program, the ordinary shares were expected to be repurchased over time, depending on market conditions, the market price of ordinary shares, capital levels, and other considerations. During 2016 and 2015, 1.5 million and 11.3 million ordinary shares were repurchased under the 2013 Program in the open market at a total cost of $82 and $682, respectively. On February 24, 2016, the Board of Directors approved a new share repurchase program for share repurchases up to $2,500 of ordinary shares (2016 Program). Under the 2016 Program, the ordinary shares are expected to be repurchased over time, depending on market conditions, the market price of ordinary shares, capital levels, and other considerations. During 2017 and 2016, 11.5 million and 10.3 million shares, respectively, were purchased on the open market under the 2016 Program for a total cost of $850 and $648, respectively.

Eaton has deferral plans that permit certain employees and directors to defer a portion of their compensation. A trust contains $11 and $13 of ordinary shares and marketable securities at December 31, 2017 and 2016, respectively, to fund a portion of these liabilities. The marketable securities were included in Other assets and the ordinary shares were included in Shareholders' equity at historical cost.

On February 28, 2018, Eaton's Board of Directors declared a quarterly dividend of $0.66 per ordinary share, a 10% increase over the dividend paid in the fourth quarter of 2017. The dividend is payable on March 23, 2018, to shareholders of record at the close of business on March 12, 2018.

Comprehensive Income (Loss)

Comprehensive income (loss) consists primarily of net income, currency translation and related hedging instruments, changes in unrecognized costs of pension and other postretirement benefits, and changes in the effective portion of open derivative contracts designated as cash flow hedges. The following table summarizes the pre-tax and after-tax amounts recognized in Comprehensive income (loss):

	2017						2016						2015
	Pre-tax			After-tax			Pre-tax			After-tax			Pre-tax			After-tax
Currency translation and related hedging instruments	$	800		$	807		$	(562	)	$	(570	)	$	(1,080	)	$	(1,078	)
Pensions and other postretirement benefits
Prior service credit (cost) arising during the year	(1		)	—			(2		)	(2		)	1			1
Net gain (loss) arising during the year	215			169			(247		)	(197		)	(123		)	(89		)
Currency translation	(67		)	(53		)	74			62			62			46
Other	—			(5		)	—			(2		)	—			(3		)
Amortization of actuarial loss and prior service cost    reclassified to earnings	188			130			201			133			237			156
	335			241			26			(6		)	177			111
Cash flow hedges
Gain (loss) on derivatives designated as cash flow hedges	(24		)	(15		)	(21		)	(14		)	20			13
Changes in cash flow hedges reclassified to earnings	17			11			8			5			(16		)	(10		)
Cash flow hedges, net of reclassification adjustments	(7		)	(4		)	(13		)	(9		)	4			3
Other comprehensive income (loss) attributable to Eaton ordinary shareholders	$	1,128		$	1,044		$	(549	)	$	(585	)	$	(899	)	$	(964	)

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The changes in Accumulated other comprehensive loss follow:

	Currency translation and related hedging instruments			Pensions and other postretirement benefits			Cash flow hedges			Total
Balance at December 31, 2016	$	(3,062	)	$	(1,380	)	$	(6	)	$	(4,448	)
Other comprehensive income (loss) before     reclassifications	807			111			(15		)	903
Amounts reclassified from Accumulated other    comprehensive loss (income)	—			130			11			141
Net current-period Other comprehensive    income (loss)	807			241			(4		)	1,044
Balance at December 31, 2017	$	(2,255	)	$	(1,139	)	$	(10	)	$	(3,404	)

The reclassifications out of Accumulated other comprehensive loss follow:

	December 31, 2017			Consolidated Statements of Income classification
Amortization of defined benefit pension and other    postretirement benefits items
Actuarial loss and prior service cost	$	(188	)	1
Tax benefit	58
Total, net of tax	(130		)
Gains and (losses) on cash flow hedges
Currency exchange contracts	(17		)	Cost of products sold
Tax benefit	6
Total, net of tax	(11		)
Total reclassifications for the period	$	(141	)

¹ These components of Accumulated other comprehensive loss are included in the computation of net periodic benefit cost. See Note 7 for additional information about defined benefit pension and other postretirement benefits items.

Net Income Per Share Attributable to Eaton Ordinary Shareholders

A summary of the calculation of net income per share attributable to Eaton ordinary shareholders follows:

(Shares in millions)	2017		2016*		2015*
Net income attributable to Eaton ordinary shareholders	$	2,985	$	1,916	$	1,972
Weighted-average number of ordinary shares outstanding - diluted	447.0		456.5		467.1
Less dilutive effect of equity-based compensation	2.5		1.5		1.6
Weighted-average number of ordinary shares outstanding - basic	444.5		455.0		465.5
Net income per share attributable to Eaton ordinary shareholders
Diluted	$	6.68	$	4.20	$	4.22
Basic	6.71		4.21		4.23

*Certain amounts have been adjusted to reflect the retrospective application of the Company's change in inventory accounting method, as described in Notes 1 and 14.

In 2017, 2016, and 2015, 0.4 million, 1.7 million, and 1.6 million stock options, respectively, were excluded from the calculation of diluted net income per share attributable to Eaton ordinary shareholders because the exercise price of the options exceeded the average market price of the ordinary shares during the period and their effect, accordingly, would have been antidilutive.

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Note 11. EQUITY-BASED COMPENSATION

Restricted Stock Units and Awards

Restricted stock units (RSUs) and restricted stock awards (RSAs) have been issued to certain employees and directors. Participants awarded RSUs in 2015 and 2016 do not receive dividends; therefore, the fair value is determined by reducing the closing market price of the Company’s ordinary shares on the date of grant by the present value of the estimated dividends had they been paid. The fair value of RSUs awarded in 2017 and RSAs are determined based on the closing market price of the Company’s ordinary shares at the date of grant. The RSUs entitle the holder to receive one ordinary share for each RSU upon vesting, generally over three years. RSAs are issued and outstanding at the time of grant, but remain subject to forfeiture until vested, generally over three or four years. A summary of the RSU and RSA activity for 2017 follows:

(Restricted stock units and awards in millions)	Number of restricted stock units and awards		Weighted-average fair value per unit and award
Non-vested at January 1	2.6		$	57.87
Granted	0.9		72.09
Vested	(0.9	)	61.80
Forfeited	(0.2	)	61.66
Non-vested at December 31	2.4		$	62.24

Information related to RSUs and RSAs follows:

	2017		2016		2015
Pretax expense for RSUs and RSAs	$	66	$	65	$	68
After-tax expense for RSUs and RSAs	43		42		44
Fair value of vested RSUs and RSAs	73		71		110

As of December 31, 2017, total compensation expense not yet recognized related to non-vested RSUs and RSAs was $79, and the weighted-average period in which the expense is expected to be recognized is 2.3 years. Excess tax benefit for RSUs and RSAs totaled $2 for 2017. There was no excess tax benefit for RSUs and RSAs in 2016 and 2015.

Performance Share Units

In February 2017 and 2016, the Compensation and Organization Committee of the Board of Directors approved the grant of performance share units (PSUs) to certain employees that vest based on the satisfaction of a three-year service period and total shareholder return relative to that of a group of peers. Awards earned at the end of the three-year vesting period range from 0% to 200% of the targeted number of PSUs granted based on the ranking of total shareholder return of the Company, assuming reinvestment of all dividends, relative to a defined peer group of companies. Equity-based compensation expense for these PSUs is recognized over the period during which an employee is required to provide service in exchange for the award. Upon vesting, dividends that have accumulated during the vesting period are paid on earned awards.

The Company uses a Monte Carlo simulation to estimate the fair value of PSUs with market conditions. The principal assumptions utilized in valuing these PSUs include the expected stock price volatility (based on the most recent 3-year period as of the grant date) and the risk-free interest rate (an estimate based on the yield of United States Treasury zero coupon bonds with a 3-year maturity as of the grant date). A summary of the assumptions used in determining fair value of these PSUs follows:

	2017			2016
Expected volatility	24		%	24		%
Risk-free interest rate	1.46		%	0.88		%
Weighted-average fair value of PSUs granted	$	80.07		$	76.41

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A summary of the 2017 activity for these PSUs follows:

(Performance share units in millions)	Number of performance share units		Weighted-average fair value per unit
Non-vested at January 1	0.5		$	76.41
Granted1	0.4		80.07
Vested	—		—
Forfeited	(0.1	)	77.90
Non-vested at December 31	0.8		$	77.97

¹ Performance shares granted assuming the Company will perform at target relative to peers.

In February 2015 and 2016, performance share units were granted to certain employees that entitles the holder to receive one ordinary share for each PSU that vest based on the satisfaction of a three-year service period and the achievement of certain performance metrics over that same period. Upon vesting, PSU holders receive dividends that accumulate during the vesting period. The fair value of these PSUs is determined based on the closing market price of the Company's ordinary shares at the date of grant. Equity-based compensation expense is recognized over the period an employee is required to provide service based on the number of PSUs for which achievement of the performance objectives is probable. A summary of the 2017 activity for these PSUs follows:

(Performance share units in millions)	Number of performance share units		Weighted-average fair value per unit
Non-vested at January 1	0.7		$	68.23
Granted	—		—
Vested	(0.1	)	71.72
Forfeited	(0.5	)	71.72
Non-vested at December 31	0.1		$	56.55

Information related to PSUs follows:

	2017		2016		2015
Pretax expense for PSUs	$	22	$	13	$	2
After-tax expense for PSUs	13		8		1

As of December 31, 2017, total compensation expense not yet recognized related to non-vested PSUs was $30 and the weighted average period in which the expense is to be recognized is 1.6 years. There was no excess tax benefit for PSUs in 2017, 2016 and 2015.

Stock Options

Under various plans, stock options have been granted to certain employees and directors to purchase ordinary shares at prices equal to fair market value on the date of grant. Substantially all of these options vest ratably during the three-year period following the date of grant and expire 10 years from the date of grant. Compensation expense is recognized for stock options based on the fair value of the options at the date of grant and amortized on a straight-line basis over the period the employee or director is required to provide service.

54

The Company uses a Black-Scholes option pricing model to estimate the fair value of stock options. The principal assumptions utilized in valuing stock options include the expected stock price volatility (based on the most recent historical period equal to the expected life of the option); the expected option life (an estimate based on historical experience); the expected dividend yield; and the risk-free interest rate (an estimate based on the yield of United States Treasury zero coupon with a maturity equal to the expected life of the option). A summary of the assumptions used in determining the fair value of stock options follows:

	2017			2016			2015
Expected volatility	27		%	27		%	29		%
Expected option life in years	6.6			5.5			5.5
Expected dividend yield	2.8		%	2.5		%	2.6		%
Risk-free interest rate	1.8 to 2.1%			1.2 to 1.5%			1.6 to 1.5%
Weighted-average fair value of stock options granted	$	15.11		$	11.80		$	15.25

A summary of stock option activity follows:

(Options in millions)	Weighted-average exercise price per option		Options		Weighted-average remaining contractual life in years	Aggregate intrinsic value
Outstanding at January 1, 2017	$	56.75	5.5
Granted	71.89		0.7
Exercised	46.31		(1.5	)
Forfeited and canceled	59.23		(0.1	)
Outstanding at December 31, 2017	$	62.43	4.6		6.3	$	77.3
Exercisable at December 31, 2017	$	61.06	2.9		5.1	$	52.1
Reserved for future grants at December 31, 2017			15.0

The aggregate intrinsic value in the table above represents the total excess of the $79.01 closing price of Eaton ordinary shares on the last trading day of 2017 over the exercise price of the stock option, multiplied by the related number of options outstanding and exercisable. The aggregate intrinsic value is not recognized for financial accounting purposes and the value changes based on the daily changes in the fair market value of the Company's ordinary shares.

Information related to stock options follows:

	2017		2016		2015
Pretax expense for stock options	$	11	$	14	$	12
After-tax expense for stock options	8		9		8
Proceeds from stock options exercised	66		74		52
Income tax benefit related to stock options exercised
Tax benefit classified in operating activities in the Consolidated    Statements of Cash Flows	13		5		4
Excess tax benefit classified in financing activities in the    Consolidated Statements of Cash Flows	—		1		1
Intrinsic value of stock options exercised	41		42		44
Total fair value of stock options vested	$	11	$	14	$	12
Stock options exercised, in millions of options	1.5		1.9		1.4

As of December 31, 2017, total compensation expense not yet recognized related to non-vested stock options was $8.8, and the weighted-average period in which the expense is expected to be recognized is 1.7 years.

55

Note 12. FAIR VALUE MEASUREMENTS

Fair value is measured based on an exit price, representing the amount that would be received to sell an asset or paid to satisfy a liability in an orderly transaction between market participants. Fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions, a fair value hierarchy is established, which categorizes the inputs used in measuring fair value as follows: (Level 1) observable inputs such as quoted prices in active markets; (Level 2) inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and (Level 3) unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.

A summary of financial instruments recognized at fair value, and the fair value measurements used, follows:

	Total			Quoted prices in active markets for identical assets (Level 1)		Other observable inputs (Level 2)			Unobservable inputs (Level 3)
2017
Cash	$	561		$	561	$	—		$	—
Short-term investments	534			534		—			—
Net derivative contracts	36			—		36			—
2016
Cash	$	543		$	543	$	—		$	—
Short-term investments	203			203		—			—
Net derivative contracts	(3		)	—		(3		)	—

Eaton values its financial instruments using an industry standard market approach, in which prices and other relevant information is generated by market transactions involving identical or comparable assets or liabilities. No financial instruments were measured using unobservable inputs.

Other Fair Value Measurements

Long-term debt and the current portion of long-term debt had a carrying value of $7,745 and fair value of $8,048 at December 31, 2017 compared to $8,263 and $8,477, respectively, at December 31, 2016. The fair value of Eaton's debt instruments was estimated using prevailing market interest rates on debt with similar creditworthiness, terms and maturities and is considered a Level 2 fair value measurement.

As discussed in Note 2, on July 31, 2017 Eaton sold a 50% interest in its heavy-duty and medium-duty commercial vehicle automated transmission business to Cummins, Inc. Eaton's remaining 50% interest was remeasured to a fair value of $600 on July 31, 2017 using a discounted cash flow model which is considered a Level 3 fair value measurement. The model includes estimates of future cash flows, future growth rates, terminal value amounts, and the applicable weighted-average cost of capital used to discount those estimated cash flows. Eaton will account for its investment on the equity method of accounting.

Short-Term Investments

Eaton invests excess cash generated from operations in short-term marketable investments. For those investments classified as “available-for-sale”, Eaton marks these investments to fair value with the offset recognized in Accumulated other comprehensive loss. A summary of the carrying value of short-term investments follows:

	2017		2016
Time deposits, certificates of deposit and demand deposits with banks	$	435	$	149
Money market investments	99		54
Total short-term investments	$	534	$	203

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Note 13. DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES

In the normal course of business, Eaton is exposed to certain risks related to fluctuations in interest rates, currency exchange rates and commodity prices. The Company uses various derivative and non-derivative financial instruments, primarily interest rate swaps, currency forward exchange contracts, currency swaps and, to a lesser extent, commodity contracts, to manage risks from these market fluctuations. The instruments used by Eaton are straightforward, non-leveraged instruments. The counterparties to these instruments are financial institutions with strong credit ratings. Eaton maintains control over the size of positions entered into with any one counterparty and regularly monitors the credit rating of these institutions. Such instruments are not purchased and sold for trading purposes.

Derivative financial instruments are accounted for at fair value and recognized as assets or liabilities in the Consolidated Balance Sheets. Accounting for the gain or loss resulting from the change in the fair value of the derivative financial instrument depends on whether it has been designated, and is effective, as part of a hedging relationship and, if so, as to the nature of the hedging activity. Eaton formally documents all relationships between derivative financial instruments accounted for as designated hedges and the hedged item, as well as its risk-management objective and strategy for undertaking the hedge transaction. This process includes linking derivative financial instruments to a recognized asset or liability, specific firm commitment, forecasted transaction, or net investment in a foreign operation. These financial instruments can be designated as:

• Hedges of the change in the fair value of a recognized fixed-rate asset or liability, or the firm commitment to acquire such an asset or liability (a fair value hedge); for these hedges, the gain or loss from the derivative financial instrument, as well as the offsetting loss or gain on the hedged item attributable to the hedged risk, are recognized in income during the period of change in fair value.

• Hedges of the variable cash flows of a recognized variable-rate asset or liability, or the forecasted acquisition of such an asset or liability (a cash flow hedge); for these hedges, the effective portion of the gain or loss from the derivative financial instrument is recognized in Accumulated other comprehensive loss and reclassified to income in the same period when the gain or loss on the hedged item is included in income.

• Hedges of the currency exposure related to a net investment in a foreign operation (a net investment hedge); for these hedges, the effective portion of the gain or loss from the derivative financial instrument is recognized in Accumulated other comprehensive loss and reclassified to income in the same period when the gain or loss related to the net investment in the foreign operation is included in income.

The gain or loss from a derivative financial instrument designated as a hedge that is effective is classified in the same line of the Consolidated Statements of Income as the offsetting loss or gain on the hedged item. The change in fair value of a derivative financial instrument that is not effective as a hedge is immediately recognized in income. The cash flows resulting from these financial instruments are classified in operating activities on the Consolidated Statements of Cash Flows.

For derivatives that are not designated as a hedge, any gain or loss is immediately recognized in income. The majority of derivatives used in this manner relate to risks resulting from assets or liabilities denominated in a foreign currency and certain commodity contracts that arise in the normal course of business. During 2017 and 2016, Eaton recognized gains of $2 and $7, respectively, associated with these commodity hedge contracts. Gains and losses associated with commodity hedge contracts are classified in Cost of products sold.

Eaton uses certain of its debt denominated in foreign currency to hedge portions of its net investments in foreign operations against foreign currency exposure (net investment hedges). Foreign currency denominated debt designated as non-derivative net investment hedging instruments on an after-tax basis was $88 and $86 at December 31, 2017 and 2016, respectively, and designated on a pre-tax basis was $652 and $572 at December 31, 2017 and 2016, respectively. See Note 6 for additional information about debt.

Interest Rate Risk

Eaton has entered into fixed-to-floating interest rate swaps to manage interest rate risk of certain long-term debt. These interest rate swaps are accounted for as fair value hedges of certain long-term debt. The maturity of the swap corresponds with the maturity of the debt instrument as noted in the table of long-term debt in Note 6. Eaton also entered into several forward starting floating-to-fixed interest rate swaps to manage interest rate risk in anticipation of debt that was refinanced in 2017.

57

A summary of interest rate swaps outstanding at December 31, 2017, follows:

Fixed-to-Floating Interest Rate Swaps

Notional amount		Fixed interest rate received	Floating interest rate paid	Basis for contracted floating interest rate paid
$	415	5.60%	4.59%	6 month LIBOR + 3.18%
300		6.95%	6.31%	3 month LIBOR + 5.07%
25		8.88%	5.24%	6 month LIBOR + 3.84%
150		3.88%	3.22%	1 month LIBOR + 2.12%
275		3.47%	2.84%	1 month LIBOR + 1.74%
100		8.10%	7.08%	1 month LIBOR + 5.90%
1,400		2.75%	1.66%	1 month LIBOR + 0.58%
200		3.68%	2.17%	1 month LIBOR + 1.07%
25		7.63%	3.87%	6 month LIBOR + 2.48%
50		7.65%	3.98%	6 month LIBOR + 2.57%
25		5.45%	1.68%	6 month LIBOR + 0.28%

Derivative Financial Statement Impacts

The fair value of derivative financial instruments recognized in the Consolidated Balance Sheets follows:

	Notional amount		Other  current assets		Other noncurrent assets		Other current liabilities		Other noncurrent liabilities		Type of hedge	Term
December 31, 2017
Derivatives designated as hedges
Fixed-to-floating interest rate swaps	$	2,965	$	1	$	41	$	—	$	17	Fair value	6 months to 17 years
Currency exchange contracts	924		7		7		22		2		Cash flow	1 to 36 months
Total			$	8	$	48	$	22	$	19
Derivatives not designated as hedges
Currency exchange contracts	$	3,719	$	39			$	19				1 to 12 months
Commodity contracts	13		1				—					1 to 12 months
Total			$	40			$	19

December 31, 2016
Derivatives designated as hedges
Fixed-to-floating interest rate swaps	$	3,765	$	1	$	65	$	—	$	8	Fair value	3 months to 18 years
Forward starting floating-to-fixed interest rate swaps	450		—		19		—		1		Cash flow	11 years
Currency exchange contracts	802		11		1		22		17		Cash flow	1 to 36 months
Total			$	12	$	85	$	22	$	26
Derivatives not designated as hedges
Currency exchange contracts	$	5,333	$	31			$	85				1 to 12 months
Commodity contracts	10		2				—					1 to 12 months
Total			$	33			$	85

The currency exchange contracts shown in the table above as derivatives not designated as hedges are primarily contracts entered into to manage currency volatility or exposure on intercompany sales and loans. While Eaton does not elect hedge accounting treatment for these derivatives, Eaton targets managing 100% of the intercompany balance sheet exposure to minimize the effect of currency volatility related to the movement of goods and services in the normal course of its operations. This activity represents the great majority of these currency exchange contracts.

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The impact of derivative instruments to the Consolidated Statements of Income and Comprehensive Income follow:

	Gain (loss) recognized in other comprehensive (loss) income						Location of gain (loss) reclassified from Accumulated other comprehensive loss	Gain (loss) reclassified from Accumulated other comprehensive loss
	2017			2016				2017			2016
Derivatives designated as cash flow hedges
Forward starting floating-to-fixed interest rate swaps	$	(15	)	$	18		Interest expense - net	$	—		$	—
Interest rate locks	(9		)	—			Interest expense - net	—			—
Currency exchange contracts	—			(39		)	Cost of products sold	(17		)	(8		)
Total	$	(24	)	$	(21	)		$	(17	)	$	(8	)

Amounts recognized in net income follow:

	2017			2016
Derivatives designated as fair value hedges
Fixed-to-floating interest rate swaps	$	(33	)	$	(36	)
Related long-term debt converted to floating interest    rates by interest rate swaps	33			36
	$	—		$	—

Gains and losses described above were recognized in Interest expense - net.

Note 14. ACCOUNTS RECEIVABLE AND INVENTORY

Accounts Receivable

Eaton performs ongoing credit evaluation of its customers and maintains sufficient allowances for potential credit losses. The Company evaluates the collectability of its accounts receivable based on the length of time the receivable is past due and any anticipated future write-off based on historic experience. Accounts receivable balances are written off against an allowance for doubtful accounts after a final determination of uncollectability has been made. Accounts receivable are net of an allowance for doubtful accounts of $57 and $50 at December 31, 2017 and 2016.

Inventory

Inventory is carried at lower of cost or net realizable value. During the fourth quarter of 2017, the Company changed its method of accounting for certain inventory in the United States from the LIFO method to the FIFO method. The FIFO method of accounting for inventory is preferable because it conforms the Company's entire inventory to a single method of accounting and improves comparability with the Company's peers. Cost components include raw materials, purchased components, direct labor, indirect labor, utilities, depreciation, inbound freight charges, purchasing and receiving costs, inspection costs, warehousing costs, and costs of the distribution network.

The components of inventory follow:

	2017		2016 As adjusted
Raw materials	$	953	$	879
Work-in-process	471		395
Finished goods	1,196		1,072
Total inventory	$	2,620	$	2,346

All prior periods presented in the financial statements have been retrospectively adjusted to apply the new method of FIFO accounting for certain U.S. inventory. The cumulative effect of this change on periods prior to those presented herein resulted in an increase in Retained earnings of $70 as of January 1, 2015. The Tax Cuts and Jobs Act ("TCJA"), which was signed into law on December 22, 2017, would have required $14 of additional tax expense to adjust the deferred tax asset related to the LIFO reserve to the new tax rate if inventories continued to be computed under the LIFO method. The change from the LIFO method to the FIFO method eliminated the need to record this $14 of additional tax expense.

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As a result of the retrospective application of this change in accounting method, the following financial statement line items within the accompanying financial statements were adjusted, as follows:

		December 31, 2017										December 31, 2016							December 31, 2015
(In millions except for per share data)		As computed under LIFO		As reported under FIFO		Effect of change						As originally reported		As adjusted		Effect of change			As originally reported		As adjusted		Effect of change
						TCJA			Other
Consolidated Statements of Income
	Cost of products sold	$	13,770	$	13,756	$	—		$	(14	)	$	13,400	$	13,409	$	9		$	14,292	$	14,304	$	12
	Income before income taxes	3,354		3,368		—			14			2,127		2,118		(9		)	2,145		2,133		(12		)
	Income tax expense	391		382		(14		)	5			202		199		(3		)	164		159		(5		)
	Net income	2,963		2,986		14			9			1,925		1,919		(6		)	1,981		1,974		(7		)
	Net income attributable to Eaton ordinary shareholders	$	2,962	$	2,985	$	14		$	9		$	1,922	$	1,916	$	(6	)	$	1,979	$	1,972	$	(7	)
Net income per ordinary share
	Diluted	$	6.63	$	6.68	$	0.03		$	0.02		$	4.21	$	4.20	$	(0.01	)	$	4.23	$	4.22	$	(0.01	)
	Basic	$	6.66	$	6.71	$	0.03		$	0.02		$	4.22	$	4.21	$	(0.01	)	$	4.25	$	4.23	$	(0.02	)
Consolidated Statements of Comprehensive Income
	Net income	$	2,963	$	2,986	$	14		$	9		$	1,925	$	1,919	$	(6	)	$	1,981	$	1,974	$	(7	)
	Net income attributable to Eaton ordinary shareholders	2,962		2,985		14			9			1,922		1,916		(6		)	1,979		1,972		(7		)
	Total comprehensive income attributable to Eaton ordinary shareholders	$	4,006	$	4,029	$	14		$	9		$	1,337	$	1,331	$	(6	)	$	1,015	$	1,008	$	(7	)

		December 31, 2017									December 31, 2016									December 31, 2015
(In millions except for per share data)		As computed under LIFO			As reported under FIFO			Effect of change			As originally reported			As adjusted			Effect of change			As originally reported			As adjusted			Effect of change
Consolidated Balance Sheets
	Inventory	$	2,514		$	2,620		$	106		$	2,254		$	2,346		$	92
	Deferred income taxes - noncurrent asset	253			253			—			360			325			(35		)
	Deferred income taxes - noncurrent liability	512			538			26			321			321			—
	Retained earnings	$	8,589		$	8,669		$	80		$	7,498		$	7,555		$	57
Consolidated Statements of Cash Flows
	Net income	$	2,963		$	2,986		$	23		$	1,925		$	1,919		$	(6	)	$	1,981		$	1,974		$	(7	)
	Deferred income taxes	(197		)	(206		)	(9		)	(80		)	(83		)	(3		)	(100		)	(105		)	(5		)
	Inventory	$	(188	)	$	(202	)	$	(14	)	$	25		$	34		$	9		$	(20	)	$	(8	)	$	12

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As a result of the retrospective application of this change in accounting principle, the following financial statement line items within the unaudited interim 2017 and 2016 quarterly condensed consolidated financial statements were adjusted, as follows:

	(unaudited)	Three months ended
		March 30, 2017							June 30, 2017							September 30, 2017
(In millions except for per share data)		As originally reported		As adjusted		Effect of change			As originally reported		As adjusted		Effect of change			As originally reported		As adjusted		Effect of change
Consolidated Statements of Income
	Cost of products sold	$	3,310	$	3,307	$	(3	)	$	3,450	$	3,448	$	(2	)	$	3,469	$	3,466	$	(3	)
	Income before income taxes	464		467		3			570		572		2			1,691		1,694		3
	Income tax expense	32		33		1			54		55		1			292		293		1
	Net income	432		434		2			516		517		1			1,399		1,401		2
	Net income attributable to Eaton ordinary shareholders	$	432	$	434	$	2		$	515	$	516	$	1		$	1,399	$	1,401	$	2
Net income per ordinary share
	Diluted	$	0.96	$	0.96	$	—		$	1.15	$	1.15	$	—		$	3.14	$	3.14	$	—
	Basic	$	0.96	$	0.97	$	0.01		$	1.15	$	1.16	$	0.01		$	3.16	$	3.16	$	—

	(unaudited)	Three months ended
		March 30, 2016							June 30, 2016							September 30, 2016
(In millions except for per share data)		As originally reported		As adjusted		Effect of change			As originally reported		As adjusted		Effect of change			As originally reported		As adjusted		Effect of change
Consolidated Statements of Income
	Cost of products sold	$	3,291	$	3,294	$	3		$	3,419	$	3,422	$	3		$	3,371	$	3,374	$	3
	Income before income taxes	442		439		(3		)	553		550		(3		)	573		570		(3		)
	Income tax expense	39		38		(1		)	61		60		(1		)	51		50		(1		)
	Net income	403		401		(2		)	492		490		(2		)	522		520		(2		)
	Net income attributable to Eaton ordinary shareholders	$	404	$	402	$	(2	)	$	491	$	489	$	(2	)	$	523	$	521	$	(2	)
Net income per ordinary share
	Diluted	$	0.88	$	0.87	$	(0.01	)	$	1.07	$	1.07	$	—		$	1.15	$	1.14	$	(0.01	)
	Basic	$	0.88	$	0.88	$	—		$	1.08	$	1.07	$	(0.01	)	$	1.15	$	1.15	$	—

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Note 15. BUSINESS SEGMENT AND GEOGRAPHIC REGION INFORMATION

Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated on a regular basis by the chief operating decision maker, or decision making group, in deciding how to allocate resources to an individual segment and in assessing performance. Eaton’s segments are as follows:

Electrical Products and Electrical Systems and Services

The Electrical Products segment consists of electrical components, industrial components, residential products, single phase power quality, emergency lighting, fire detection, wiring devices, structural support systems, circuit protection, and lighting products. The Electrical Systems and Services segment consists of power distribution and assemblies, three phase power quality, hazardous duty electrical equipment, intrinsically safe explosion-proof instrumentation, utility power distribution, power reliability equipment, and services. The principal markets for these segments are industrial, institutional, governmental, utility, commercial, residential and information technology. These products are used wherever there is a demand for electrical power in commercial buildings, data centers, residences, apartment and office buildings, hospitals, factories, utilities, and industrial and energy facilities. The segments share several common global customers, but a large number of customers are located regionally. Sales are made directly to original equipment manufacturers, utilities, and certain other end users, as well as through distributors, resellers, and manufacturers' representatives.

Hydraulics

The Hydraulics segment is a global leader in hydraulics components, systems and services for industrial and mobile equipment. Eaton offers a wide range of power products including pumps, motors and hydraulic power units; a broad range of controls and sensing products including valves, cylinders and electronic controls; a full range of fluid conveyance products including industrial and hydraulic hose, fittings, and assemblies, thermoplastic hose and tubing, couplings, connectors, and assembly equipment; filtration systems solutions; industrial drum and disc brakes; and golf grips. The principal markets for the Hydraulics segment include renewable energy, marine, agriculture, oil and gas, construction, mining, forestry, utility, material handling, truck and bus, machine tools, molding, primary metals, and power generation. Key manufacturing customers in these markets and other customers are located globally. Products are sold and serviced through a variety of channels.

Aerospace

The Aerospace segment is a leading global supplier of aerospace fuel, hydraulics, and pneumatic systems for commercial and military use. Products include hydraulic power generation systems for aerospace applications including pumps, motors, hydraulic power units, hose and fittings, electro-hydraulic pumps; controls and sensing products including valves, cylinders, electronic controls, electromechanical actuators, sensors, aircraft flap and slat systems and nose wheel steering systems; fluid conveyance products, including hose, thermoplastic tubing, fittings, adapters, couplings, sealing and ducting; and fuel systems including fuel pumps, sensors, valves, adapters and regulators. The principal markets for the Aerospace segment are manufacturers of commercial and military aircraft and related after-market customers. These manufacturers and other customers operate globally. Products are sold and serviced through a variety of channels.

Vehicle

The Vehicle segment is a leader in the design, manufacture, marketing, and supply of: drivetrain, powertrain systems and critical components that reduce emissions and improve fuel economy, stability, performance, and safety of cars, light trucks and commercial vehicles. Products include transmissions, clutches, hybrid power systems, superchargers, engine valves and valve actuation systems, cylinder heads, locking and limited slip differentials, transmission controls, fuel vapor components, fluid connectors and conveyance products for the global vehicle industry. The principal markets for the Vehicle segment are original equipment manufacturers and aftermarket customers of heavy-, medium-, and light-duty trucks, SUVs, CUVs, passenger cars and agricultural equipment.

Other Information

No single customer represented greater than 10% of net sales in 2017, 2016 or 2015, respectively.

The accounting policies of the business segments are generally the same as the policies described in Note 1, except that operating profit only reflects the service cost component related to pensions and other postretirement benefits. Intersegment sales and transfers are accounted for at the same prices as if the sales and transfers were made to third parties. These intersegment sales are eliminated in consolidation. Operating profit includes the operating profit from intersegment sales.

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For purposes of business segment performance measurement, the Company does not allocate items that are of a non-operating nature or are of a corporate or functional governance nature. Corporate expenses consist of transaction costs associated with the acquisition of certain businesses and corporate office expenses including compensation, benefits, occupancy, depreciation, and other administrative costs. Identifiable assets of the business segments exclude goodwill, other intangible assets, and general corporate assets, which principally consist of certain cash, short-term investments, deferred income taxes, certain accounts receivable, certain property, plant and equipment, and certain other assets.

Business Segment Information

	2017			2016			2015
Net sales
Electrical Products	$	7,193		$	6,957		$	6,976
Electrical Systems and Services	5,666			5,662			5,931
Hydraulics	2,468			2,222			2,459
Aerospace	1,744			1,753			1,807
Vehicle	3,333			3,153			3,682
Total net sales	$	20,404		$	19,747		$	20,855
Segment operating profit
Electrical Products	$	1,287		$	1,240		$	1,156
Electrical Systems and Services	770			711			776
Hydraulics	288			198			246
Aerospace	332			335			310
Vehicle	537			474			645
Total segment operating profit	3,214			2,958			3,133
Corporate
Amortization of intangible assets	(388		)	(392		)	(406		)
Interest expense - net	(246		)	(233		)	(232		)
Pension and other postretirement benefits expense	(45		)	(60		)	(130		)
Gain on sale of business	1,077			—			—
Other corporate expense - net*	(244		)	(155		)	(232		)
Income before income taxes*	3,368			2,118			2,133
Income tax expense*	382			199			159
Net income*	2,986			1,919			1,974
Less net income for noncontrolling interests	(1		)	(3		)	(2		)
Net income attributable to Eaton ordinary shareholders*	$	2,985		$	1,916		$	1,972

*Other corporate expense - net and Income tax expense in 2016 and 2015 have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14.

Business segment operating profit was reduced by acquisition integration charges as follows:

	2017		2016		2015
Electrical Products	$	4	$	3	$	25
Electrical Systems and Services	—		1		15
Hydraulics	—		—		2
Total	$	4	$	4	$	42

Corporate acquisition integration charges totaled $5 in 2015, and are included above in Other corporate expense - net. There was no corporate acquisition integration charges in 2017 and 2016. See Note 3 for additional information about acquisition integration charges.

63

	2017		2016		2015
Identifiable assets
Electrical Products	$	2,570	$	2,363	$	2,538
Electrical Systems and Services	2,141		2,222		2,285
Hydraulics	1,345		1,188		1,138
Aerospace	938		830		841
Vehicle	2,379		1,549		1,579
Total identifiable assets	9,373		8,152		8,381
Goodwill	13,568		13,201		13,479
Other intangible assets	5,265		5,514		6,014
Corporate*	4,417		3,609		3,185
Total assets*	$	32,623	$	30,476	$	31,059
*Corporate identifiable assets in 2016 and 2015 have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14.
Capital expenditures for property, plant and equipment
Electrical Products	$	134	$	134	$	137
Electrical Systems and Services	83		78		94
Hydraulics	96		92		61
Aerospace	37		28		33
Vehicle	141		142		119
Total	491		474		444
Corporate	29		23		62
Total expenditures for property, plant and equipment	$	520	$	497	$	506
Depreciation of property, plant and equipment
Electrical Products	$	143	$	141	$	137
Electrical Systems and Services	83		82		82
Hydraulics	61		64		67
Aerospace	26		27		28
Vehicle	109		109		113
Total	422		423		427
Corporate	54		63		52
Total depreciation of property, plant and equipment	$	476	$	486	$	479

64

Geographic Region Information

Net sales are measured based on the geographic destination of sales. Long-lived assets consist of property, plant and equipment - net.

	2017		2016		2015
Net sales
United States	$	11,222	$	10,937	$	11,396
Canada	942		898		969
Latin America	1,485		1,448		1,726
Europe	4,394		4,228		4,379
Asia Pacific	2,361		2,236		2,385
Total	$	20,404	$	19,747	$	20,855
Long-lived assets
United States	$	1,872	$	1,924	$	1,982
Canada	20		19		19
Latin America	290		281		243
Europe	769		681		734
Asia Pacific	551		538		587
Total	$	3,502	$	3,443	$	3,565

Note 16. CONDENSED CONSOLIDATING FINANCIAL STATEMENTS

The Registered Senior Notes issued by Eaton Corporation are registered under the Securities Act of 1933. Eaton and certain other of Eaton's 100% owned direct and indirect subsidiaries (the Guarantors) fully and unconditionally guaranteed (subject, in the case of the Guarantors, other than Eaton, to customary release provisions as described below), on a joint and several basis, the Registered Senior Notes. The following condensed consolidating financial statements are included so that separate financial statements of Eaton, Eaton Corporation and each of the Guarantors are not required to be filed with the Securities and Exchange Commission. The consolidating adjustments primarily relate to eliminations of investments in subsidiaries and intercompany balances and transactions. The condensed consolidating financial statements present investments in subsidiaries using the equity method of accounting. See Note 6 for additional information related to the Registered Senior Notes.

The guarantee of a Guarantor that is not a parent of the issuer will be automatically and unconditionally released and discharged in the event of any sale of the Guarantor or of all or substantially all of its assets, or in connection with the release or termination of the Guarantor as a guarantor under all other U.S. debt securities or U.S. syndicated credit facilities, subject to limitations set forth in the indenture. The guarantee of a Guarantor that is a direct or indirect parent of the issuer will only be automatically and unconditionally released and discharged in connection with the release or termination of such Guarantor as a guarantor under all other debt securities or syndicated credit facilities (in both cases, U.S. or otherwise), subject to limitations set forth in the indenture.

During 2017, 2016 and 2015, the Company undertook certain steps to restructure ownership of various subsidiaries. The transactions were entirely among wholly-owned subsidiaries under the common control of Eaton. This restructuring has been reflected as of the beginning of the earliest period presented below.

Additionally, certain amounts in 2016 and 2015 have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14.

65

CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME YEAR ENDED DECEMBER 31, 2017
	Eaton Corporation plc			Eaton Corporation			Guarantors			Other subsidiaries			Consolidating adjustments			Total
Net sales	$	—		$	6,659		$	6,563		$	12,599		$	(5,417	)	$	20,404
Cost of products sold	—			5,276			4,840			9,054			(5,414		)	13,756
Selling and administrative expense	136			1,172			759			1,498			—			3,565
Research and development expense	—			215			207			162			—			584
Interest expense (income) - net	—			245			21			(21		)	1			246
Gain on sale of business	—			560			—			517			—			1,077
Other expense (income) - net	79			9			(70		)	(56		)	—			(38		)
Equity in loss (earnings) of    subsidiaries, net of tax	(3,644		)	(1,139		)	(4,958		)	(4,665		)	14,406			—
Intercompany expense (income) - net	444			(561		)	1,197			(1,080		)	—			—
Income (loss) before income taxes	2,985			2,002			4,567			8,224			(14,410		)	3,368
Income tax expense (benefit)	—			499			(232		)	115			—			382
Net income (loss)	2,985			1,503			4,799			8,109			(14,410		)	2,986
Less net loss (income) for    noncontrolling interests	—			—			—			(3		)	2			(1		)
Net income (loss) attributable to    Eaton ordinary shareholders	$	2,985		$	1,503		$	4,799		$	8,106		$	(14,408	)	$	2,985
Other comprehensive income (loss)	1,044			41			1,064			2,192			(3,297		)	1,044
Total comprehensive income (loss) attributable to Eaton    ordinary shareholders	$	4,029		$	1,544		$	5,863		$	10,298		$	(17,705	)	$	4,029

66

CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME YEAR ENDED DECEMBER 31, 2016
	Eaton Corporation plc			Eaton Corporation			Guarantors			Other subsidiaries			Consolidating adjustments			Total
Net sales	$	—		$	6,447		$	6,351		$	11,961		$	(5,012	)	$	19,747
Cost of products sold	—			5,076			4,697			8,649			(5,013		)	13,409
Selling and administrative expense	140			1,153			760			1,452			—			3,505
Research and development expense	—			235			186			168			—			589
Interest expense (income) - net	—			233			17			(16		)	(1		)	233
Other expense (income) - net	(35		)	(48		)	43			(67		)	—			(107		)
Equity in loss (earnings) of    subsidiaries, net of tax	(2,433		)	(770		)	(3,266		)	(2,808		)	9,277			—
Intercompany expense (income) - net	412			(122		)	1,230			(1,520		)	—			—
Income (loss) before income taxes	1,916			690			2,684			6,103			(9,275		)	2,118
Income tax expense (benefit)	—			23			26			149			1			199
Net income (loss)	1,916			667			2,658			5,954			(9,276		)	1,919
Less net loss (income) for    noncontrolling interests	—			—			—			(5		)	2			(3		)
Net income (loss) attributable to    Eaton ordinary shareholders	$	1,916		$	667		$	2,658		$	5,949		$	(9,274	)	$	1,916
Other comprehensive income (loss)	(585		)	54			(566		)	(1,344		)	1,856			(585		)
Total comprehensive income (loss) attributable to Eaton    ordinary shareholders	$	1,331		$	721		$	2,092		$	4,605		$	(7,418	)	$	1,331

67

CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME YEAR ENDED DECEMBER 31, 2015
	Eaton Corporation plc			Eaton Corporation			Guarantors			Other subsidiaries			Consolidating adjustments			Total
Net sales	$	—		$	6,926		$	6,660		$	12,531		$	(5,262	)	$	20,855
Cost of products sold	—			5,518			5,041			8,978			(5,233		)	14,304
Selling and administrative expense	141			1,223			738			1,494			—			3,596
Research and development expense	—			266			197			162			—			625
Interest expense (income) - net	—			222			21			(13		)	2			232
Other expense (income) - net	—			—			24			(59		)	—			(35		)
Equity in loss (earnings) of    subsidiaries, net of tax	(2,449		)	(821		)	(3,221		)	(2,761		)	9,252			—
Intercompany expense (income) - net	336			(384		)	1,218			(1,170		)	—			—
Income (loss) before income taxes	1,972			902			2,642			5,900			(9,283		)	2,133
Income tax expense (benefit)	—			87			(69		)	152			(11		)	159
Net income (loss)	1,972			815			2,711			5,748			(9,272		)	1,974
Less net loss (income) for    noncontrolling interests	—			—			—			(3		)	1			(2		)
Net income (loss) attributable to    Eaton ordinary shareholders	$	1,972		$	815		$	2,711		$	5,745		$	(9,271	)	$	1,972
Other comprehensive income (loss)	(964		)	5			(951		)	(2,000		)	2,946			(964		)
Total comprehensive income (loss) attributable to Eaton    ordinary shareholders	$	1,008		$	820		$	1,760		$	3,745		$	(6,325	)	$	1,008

68

CONDENSED CONSOLIDATING BALANCE SHEETS DECEMBER 31, 2017
	Eaton Corporation plc		Eaton Corporation		Guarantors		Other subsidiaries		Consolidating adjustments			Total
Assets
Current assets
Cash	$	—	$	183	$	12	$	366	$	—		$	561
Short-term investments	—		—		—		534		—			534
Accounts receivable - net	—		482		1,317		2,144		—			3,943
Intercompany accounts receivable	8		2,865		5,146		2,741		(10,760		)	—
Inventory	—		473		692		1,537		(82		)	2,620
Prepaid expenses and other    current assets	—		229		145		277		28			679
Total current assets	8		4,232		7,312		7,599		(10,814		)	8,337
Property, plant and equipment - net	—		835		684		1,983		—			3,502
Other noncurrent assets
Goodwill	—		1,307		6,293		5,968		—			13,568
Other intangible assets	—		138		3,002		2,125		—			5,265
Deferred income taxes	—		356		—		221		(324		)	253
Investment in subsidiaries	15,045		15,439		87,919		39,527		(157,930		)	—
Intercompany loans receivable	3,122		7,104		2,735		61,225		(74,186		)	—
Other assets	—		748		163		787		—			1,698
Total assets	$	18,175	$	30,159	$	108,108	$	119,435	$	(243,254	)	$	32,623
Liabilities and shareholders’    equity
Current liabilities
Short-term debt	$	—	$	—	$	—	$	6	$	—		$	6
Current portion of long-term debt	—		542		35		1		—			578
Accounts payable	—		533		313		1,320		—			2,166
Intercompany accounts payable	4		4,920		4,405		1,431		(10,760		)	—
Accrued compensation	—		128		63		262		—			453
Other current liabilities	1		564		308		1,000		(1		)	1,872
Total current liabilities	5		6,687		5,124		4,020		(10,761		)	5,075
Noncurrent liabilities
Long-term debt	—		6,180		976		8		3			7,167
Pension liabilities	—		341		83		802		—			1,226
Other postretirement benefits    liabilities	—		192		94		76		—			362
Deferred income taxes	—		—		558		304		(324		)	538
Intercompany loans payable	917		3,718		68,405		1,146		(74,186		)	—
Other noncurrent liabilities	—		314		272		379		—			965
Total noncurrent liabilities	917		10,745		70,388		2,715		(74,507		)	10,258
Shareholders’ equity
Eaton shareholders’ equity	17,253		12,727		32,596		112,663		(157,986		)	17,253
Noncontrolling interests	—		—		—		37		—			37
Total equity	17,253		12,727		32,596		112,700		(157,986		)	17,290
Total liabilities and equity	$	18,175	$	30,159	$	108,108	$	119,435	$	(243,254	)	$	32,623

69

CONDENSED CONSOLIDATING BALANCE SHEETS DECEMBER 31, 2016
	Eaton Corporation plc		Eaton Corporation		Guarantors		Other subsidiaries		Consolidating adjustments			Total
Assets
Current assets
Cash	$	1	$	92	$	5	$	445	$	—		$	543
Short-term investments	—		—		—		203		—			203
Accounts receivable - net	—		536		1,049		1,975		—			3,560
Intercompany accounts receivable	5		953		4,239		3,382		(8,579		)	—
Inventory	—		443		638		1,344		(79		)	2,346
Prepaid expenses and other    current assets	—		77		42		237		25			381
Total current assets	6		2,101		5,973		7,586		(8,633		)	7,033
Property, plant and equipment - net	—		857		706		1,880		—			3,443
Other noncurrent assets
Goodwill	—		1,362		6,293		5,546		—			13,201
Other intangible assets	—		169		3,442		1,903		—			5,514
Deferred income taxes	—		864		15		218		(772		)	325
Investment in subsidiaries	32,852		20,200		92,766		44,345		(190,163		)	—
Intercompany loans receivable	—		7,609		2,061		56,938		(66,608		)	—
Other assets	—		490		134		336		—			960
Total assets	$	32,858	$	33,652	$	111,390	$	118,752	$	(266,176	)	$	30,476
Liabilities and shareholders’    equity
Current liabilities
Short-term debt	$	—	$	—	$	8	$	6	$	—		$	14
Current portion of long-term debt	—		1,250		296		6		—			1,552
Accounts payable	1		412		252		1,053		—			1,718
Intercompany accounts payable	281		3,332		3,130		1,836		(8,579		)	—
Accrued compensation	—		98		58		223		—			379
Other current liabilities	1		590		276		957		(2		)	1,822
Total current liabilities	283		5,682		4,020		4,081		(8,581		)	5,485
Noncurrent liabilities
Long-term debt	—		5,767		936		8		—			6,711
Pension liabilities	—		610		161		888		—			1,659
Other postretirement benefits    liabilities	—		198		99		71		—			368
Deferred income taxes	—		—		732		361		(772		)	321
Intercompany loans payable	17,621		3,768		44,788		431		(66,608		)	—
Other noncurrent liabilities	—		326		212		396		—			934
Total noncurrent liabilities	17,621		10,669		46,928		2,155		(67,380		)	9,993
Shareholders’ equity
Eaton shareholders’ equity	14,954		17,301		60,442		112,478		(190,221		)	14,954
Noncontrolling interests	—		—		—		38		6			44
Total equity	14,954		17,301		60,442		112,516		(190,215		)	14,998
Total liabilities and equity	$	32,858	$	33,652	$	111,390	$	118,752	$	(266,176	)	$	30,476

70

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS DECEMBER 31, 2017
	Eaton Corporation plc			Eaton Corporation			Guarantors			Other subsidiaries			Consolidating adjustments			Total
Net cash provided by (used in)    operating activities	$	258		$	(498	)	$	(30	)	$	4,545		$	(1,609	)	$	2,666
Investing activities
Capital expenditures for property,    plant and equipment	—			(90		)	(110		)	(320		)	—			(520		)
Cash received from sales (paid for    acquisitions) of affiliates	—			—			(92		)	92			—			—
Purchases of short-term investments - net	—			—			—			(298		)	—			(298		)
Investments in affiliates	(190		)	—			—			(90		)	280			—
Return of investments in affiliates	—			—			90			—			(90		)	—
Loans to affiliates	—			(444		)	—			(6,723		)	7,167			—
Repayments of loans from affiliates	—			303			46			3,817			(4,166		)	—
Proceeds from sale of business	—			338			—			269			—			607
Other - net	—			(45		)	9			30			—			(6		)
Net cash provided by (used in)     investing activities	(190		)	62			(57		)	(3,223		)	3,191			(217		)
Financing activities
Proceeds from borrowings	—			1,000			—			—			—			1,000
Payments on borrowings	—			(1,250		)	(297		)	(7		)	—			(1,554		)
Proceeds from borrowings from    affiliates	2,605			3,130			991			441			(7,167		)	—
Payments on borrowings from    affiliates	(822		)	(2,904		)	(353		)	(87		)	4,166			—
Capital contributions from affiliates	—			—			90			190			(280		)	—
Return of capital to affiliates	—			—			—			(90		)	90			—
Other intercompany financing    activities	—			573			469			(1,042		)	—			—
Cash dividends paid	(1,068		)	—			—			—			—			(1,068		)
Cash dividends paid to affiliates	—			—			(800		)	(809		)	1,609			—
Exercise of employee stock options	66			—			—			—			—			66
Repurchase of shares	(850		)	—			—			—			—			(850		)
Employee taxes paid from shares    withheld	—			(14		)	(5		)	(3		)	—			(22		)
Other - net	—			(8		)	(1		)	(5		)	—			(14		)
Net cash provided by (used in)    financing activities	(69		)	527			94			(1,412		)	(1,582		)	(2,442		)
Effect of currency on cash	—			—			—			11			—			11
Total increase (decrease) in cash	(1		)	91			7			(79		)	—			18
Cash at the beginning of the period	1			92			5			445			—			543
Cash at the end of the period	$	—		$	183		$	12		$	366		$	—		$	561

71

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS DECEMBER 31, 2016
	Eaton Corporation plc			Eaton Corporation			Guarantors			Other subsidiaries			Consolidating adjustments			Total
Net cash provided by (used in)    operating activities	$	(253	)	$	22		$	(232	)	$	3,033		$	—		$	2,570
Investing activities
Capital expenditures for property,    plant and equipment	—			(92		)	(114		)	(291		)	—			(497		)
Cash received from acquisitions of    businesses, net of cash acquired	—			—			1			—			—			1
Sales (purchases) of short-term investments - net	—			—			2			(42		)	—			(40		)
Investments in affiliates	(1,250		)	—			(120		)	(1,370		)	2,740			—
Return of investments in affiliates	—			—			47			—			(47		)	—
Loans to affiliates	—			(251		)	(655		)	(8,208		)	9,114			—
Repayments of loans from affiliates	—			1,293			—			5,951			(7,244		)	—
Other - net	—			(9		)	41			(25		)	—			7
Net cash provided by (used in)     investing activities	(1,250		)	941			(798		)	(3,985		)	4,563			(529		)
Financing activities
Proceeds from borrowings	—			21			610			—			—			631
Payments on borrowings	—			(408		)	(233		)	(12		)	—			(653		)
Proceeds from borrowings from    affiliates	3,843			4,045			1,120			106			(9,114		)	—
Payments on borrowings from    affiliates	(646		)	(4,712		)	(1,844		)	(42		)	7,244			—
Capital contribution from affiliates	—			—			1,370			1,370			(2,740		)	—
Return of capital to affiliates	—			—			—			(47		)	47			—
Other intercompany financing    activities	—			168			12			(180		)	—			—
Cash dividends paid	(1,037		)	—			—			—			—			(1,037		)
Exercise of employee stock options	74			—			—			—			—			74
Repurchase of shares	(730		)	—			—			—			—			(730		)
Employee taxes paid from shares    withheld	—			(12		)	(3		)	(3		)	—			(18		)
Other - net	—			1			(4		)	(2		)	—			(5		)
Net cash provided by (used in)    financing activities	1,504			(897		)	1,028			1,190			(4,563		)	(1,738		)
Effect of currency on cash	—			—			—			(28		)	—			(28		)
Total increase (decrease) in cash	1			66			(2		)	210			—			275
Cash at the beginning of the period	—			26			7			235			—			268
Cash at the end of the period	$	1		$	92		$	5		$	445		$	—		$	543

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CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS DECEMBER 31, 2015
	Eaton Corporation plc			Eaton Corporation			Guarantors			Other subsidiaries			Consolidating adjustments			Total
Net cash provided by (used in)    operating activities	$	(137	)	$	(195	)	$	(281	)	$	3,026		$	(4	)	$	2,409
Investing activities
Capital expenditures for property,    plant and equipment	—			(94		)	(146		)	(266		)	—			(506		)
Cash paid for acquisitions of    businesses, net of cash acquired	—			—			(36		)	(36		)	—			(72		)
Sales (purchases) of short-term    investments - net	—			—			(2		)	39			—			37
Investments in affiliates	(1,482		)	—			(1,176		)	(1,482		)	4,140			—
Loans to affiliates	—			(889		)	(39		)	(10,608		)	11,536			—
Repayments of loans from affiliates	—			342			359			7,493			(8,194		)	—
Proceeds from the sales of    businesses	—			—			—			1			—			1
Other - net	—			(50		)	47			(32		)	—			(35		)
Net cash provided by (used in)    investing activities	(1,482		)	(691		)	(993		)	(4,891		)	7,482			(575		)
Financing activities
Proceeds from borrowings	—			408			—			17			—			425
Payments on borrowings	—			(724		)	(301		)	(2		)	—			(1,027		)
Proceeds from borrowings from    affiliates	3,322			6,885			997			332			(11,536		)	—
Payments on borrowings from    affiliates	(48		)	(6,467		)	(1,282		)	(397		)	8,194			—
Capital contribution from affiliates	—			1,176			1,482			1,482			(4,140		)	—
Other intercompany financing    activities	—			(518		)	378			140			—			—
Cash dividends paid	(1,026		)	—			—			—			—			(1,026		)
Cash dividends paid to affiliates	—			—			—			(4		)	4			—
Exercise of employee stock options	52			—			—			—			—			52
Repurchase of shares	(682		)	—			—			—			—			(682		)
Employee taxes paid from shares    withheld	—			(26		)	(6		)	(6		)	—			(38		)
Other - net	—			1			—			(10		)	—			(9		)
Net cash provided by (used in)    financing activities	1,618			735			1,268			1,552			(7,478		)	(2,305		)
Effect of currency on cash	—			—			—			(42		)	—			(42		)
Total increase (decrease) in cash	(1		)	(151		)	(6		)	(355		)	—			(513		)
Cash at the beginning of the period	1			177			13			590			—			781
Cash at the end of the period	$	—		$	26		$	7		$	235		$	—		$	268

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

Amounts are in millions of dollars or shares unless indicated otherwise (per share data assume dilution).

COMPANY OVERVIEW

Eaton Corporation plc (Eaton or the Company) is a power management company with 2017 net sales of $20.4 billion. The Company provides energy-efficient solutions that help its customers effectively manage electrical, hydraulic and mechanical power more efficiently, safely and sustainably. Eaton has approximately 96,000 employees in 59 countries and sells products to customers in more than 175 countries.

Summary of Results of Operations

During 2017, the Company's results of operations returned to solid growth as global end markets expanded, particularly in the second half of 2017. During the year, the Company completed its multi-year restructuring program that reduced its cost structure, which expanded operating margins.

On July 31, 2017, Eaton sold a 50% interest in its heavy-duty and medium-duty commercial vehicle automated transmission business for $600 in cash to Cummins, Inc. The Company recognized a pre-tax gain of $1,077, of which $533 related to the pre-tax gain from the $600 proceeds from the sale and $544 related to the Company’s remaining 50% investment in the joint venture being remeasured to fair value. The after-tax gain was $843. Eaton accounts for its investment on the equity method of accounting.

The tax rate for 2017 includes a tax benefit of $62 related to the United States Tax Cuts and Jobs Act (“TCJA”), which was signed into law on December 22, 2017. The tax benefit of $62 related to the TCJA is comprised of a tax benefit of $79 for adjusting deferred tax assets and liabilities, offset by a tax expense of $17 for the taxation of unremitted earnings of non-U.S. subsidiaries owned directly or indirectly by U.S. subsidiaries of Eaton.

During 2016, the Company's results of operations were impacted by a decline in several of the Company's end markets. Further, the results of operations were negatively impacted by the strengthening in the value of the U.S. dollar. Despite the declining market conditions and unfavorable impact of currency translation, the Company generated solid operating margins and diluted net income per share.

During 2015, Eaton announced a multi-year restructuring initiative to reduce its cost structure and gain efficiencies in all business segments and at corporate in order to respond to declining market conditions. Restructuring charges in 2017, 2016 and 2015 were $116, $211 and $129, respectively. These charges were primarily comprised of severance costs. The initiative concluded at the end of 2017 and the projected annualized savings from these restructuring actions are expected to be $518, when fully realized in 2018.

Additional information related to acquisitions and divestitures of businesses, and restructuring activities is presented in Note 2, Note 3, and Note 4, respectively, of the Notes to the Consolidated Financial Statements.

A summary of Eaton’s Net sales, Net income attributable to Eaton ordinary shareholders, and Net income per share attributable to Eaton ordinary shareholders - diluted follows:

	2017		2016*		2015*
Net sales	$	20,404	$	19,747	$	20,855
Net income attributable to Eaton ordinary shareholders	2,985		1,916		1,972
Net income per share attributable to Eaton ordinary shareholders - diluted	$	6.68	$	4.20	$	4.22

* Years ended December 31, 2016 and 2015 amounts have been revised to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

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RESULTS OF OPERATIONS

Non-GAAP Financial Measures

The following discussion of Consolidated Financial Results and Business Segment Results of Operations includes certain non-GAAP financial measures. These financial measures include adjusted earnings, adjusted earnings per ordinary share, and operating profit before acquisition integration charges for each business segment as well as corporate, each of which differs from the most directly comparable measure calculated in accordance with generally accepted accounting principles (GAAP). A reconciliation of adjusted earnings and adjusted earnings per ordinary share to the most directly comparable GAAP measure is included in the table below. Operating profit before acquisition integration charges is reconciled in the discussion of the operating results of each business segment, and excludes acquisition integration expense related to integration of Ephesus Lighting, Inc. in 2017 and 2016, Oxalis Group Ltd. in 2016, and primarily Cooper Industries plc in 2015. Management believes that these financial measures are useful to investors because they exclude certain transactions, allowing investors to more easily compare Eaton’s financial performance period to period. Management uses this information in monitoring and evaluating the on-going performance of Eaton and each business segment. For additional information on acquisition integration charges, see Note 3 to the Consolidated Financial Statements.

Consolidated Financial Results

	2017			Change from 2016		2016*			Change from 2015		2015*
Net sales	$	20,404		3	%	$	19,747		(5	)%	$	20,855
Gross profit	6,648			5	%	6,338			(3	)%	6,551
Percent of net sales	32.6		%			32.1		%			31.4		%
Income before income taxes	3,368			59	%	2,118			(1	)%	2,133
Net income	2,986			56	%	1,919			(3	)%	1,974
Less net income for noncontrolling interests	(1		)			(3		)			(2		)
Net income attributable to Eaton ordinary shareholders	2,985			56	%	1,916			(3	)%	1,972
Excluding acquisition integration charges,    after-tax (Note 3)	2					3					31
Adjusted earnings	$	2,987		56	%	$	1,919		(4	)%	$	2,003
Net income per share attributable to Eaton ordinary shareholders - diluted	$	6.68		59	%	$	4.20		—	%	$	4.22
Excluding per share impact of acquisition integration charges, after-tax (Note 3)	—					0.01					0.07
Adjusted earnings per ordinary share	$	6.68		59	%	$	4.21		(2	)%	$	4.29

* Year ended December 31, 2016 and 2015 amounts have been revised to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

Net Sales

Net sales in 2017 increased by 3% compared to 2016 due to an increase of 3% in organic sales. The increase in organic sales in 2017 was primarily due to higher sales volumes in the Electrical Products, Hydraulics, and Vehicle business segments.Net sales in 2016 decreased by 5% compared to 2015 due to a decrease of 4% in organic sales and decrease of 1% from the impact of negative currency translation. The decrease in organic sales in 2016 was primarily due to weakening demand in several of the Company's end markets.

Gross Profit

Gross profit margin increased from 32.1% in 2016 to 32.6% in 2017. The increase in gross profit margin in 2017 was primarily due to higher sales volumes, savings from restructuring actions, and lower restructuring charges, partially offset by commodity inflation. Gross profit increased from 31.4% in 2015 to 32.1% in 2016. The increase in gross profit margin in 2016 was primarily due to savings from restructuring actions and other cost control measures, partially offset by lower sales volumes, unfavorable product mix, and higher restructuring charges.

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Income Taxes

During 2017, an income tax expense of $382 was recognized (an effective tax rate of 11.3%) compared to income tax expense of $199 in 2016 (an effective tax rate of 9.4%). The 2017 effective tax rate includes tax expense of $234 on the gain from the sale of the business discussed in Note 2, and a tax benefit of $62 related to the TCJA. Excluding the gain and related tax impact on the sale of business, and the impact of the TCJA, the tax rate for 2017 was expense of 9.2%. The decrease from 9.4% for the full year 2016 compared to 9.2% for the full year 2017 was due to the resolution of tax contingencies in various tax jurisdictions and the excess tax benefits recognized for employee share-based payments pursuant to the adoption of ASU 2016-09 as discussed in Note 1. During 2016, an income tax expense of $199 was recognized (an effective tax rate of 9.4%) compared to income tax expense of $159 in 2015 (an effective tax rate of 7.5%). The 2016 effective tax rate increased from 2015 primarily due to greater levels of income earned in higher tax jurisdictions, partially offset by net decreases in worldwide tax liabilities.

Net Income

Net income attributable to Eaton ordinary shareholders of $2,985 in 2017 increased 56% compared to $1,916 in 2016. Net income in 2017 included $843 from the gain on the sale of the business discussed in Note 2, and $62 of income from the new U.S. tax bill discussed in Note 9. Excluding these items, the increase in 2017 was primarily due to higher sales volumes, savings from restructuring actions, and lower restructuring charges, partially offset by commodity inflation. Net income attributable to Eaton ordinary shareholders of $1,916 in 2016 decreased 3% compared to Net income attributable to Eaton ordinary shareholders of $1,972 in 2015. The decrease in 2016 was primarily due to lower sales volumes, unfavorable product mix, and higher restructuring charges, partially offset by savings from restructuring actions, other cost control measures, a decrease in pension and other post benefits expense, and income from several insurance matters during 2016.

Net income per ordinary share in 2017 included $1.89 from the gain on the sale of business discussed in Note 2 and $0.14 income from the new U.S. tax bill discussed in Note 9. Net income per ordinary share increased by 59% to $6.68 in 2017 compared to $4.20 in 2016. The increase was due to higher Net income attributable to Eaton ordinary shareholders and the Company's share repurchases in 2017. Net income per ordinary share was broadly flat at $4.20 in 2016 compared to $4.22 in 2015 primarily due to a decrease in Net Income attributable to Eaton ordinary shareholders offset by the impact of the Company's share repurchases in 2016.

Adjusted Earnings

Adjusted earnings of $2,987 in 2017 increased 56% compared to Adjusted earnings of $1,919 in 2016. The increase was due to higher Net income attributable to Eaton ordinary shareholders. Adjusted earnings of $1,919 in 2016 decreased 4% compared to 2015 Adjusted earnings of $2,003. The decrease was due to lower Net income attributable to Eaton ordinary shareholders and lower acquisition integration charges.

Adjusted earnings per ordinary share increased by 59% to $6.68 in 2017 compared to $4.21 in 2016. The increase in Adjusted earnings per ordinary share in 2017 was due to higher Adjusted earnings and the Company's share repurchases in 2017. Adjusted earnings per ordinary share of $4.21 in 2016 decreased 2% from $4.29 in 2015. The decrease in Adjusted earnings per ordinary share in 2016 was due to lower Adjusted earnings, partially offset by the impact of the Company's share repurchases in 2016.

Business Segment Results of Operations

The following is a discussion of Net sales, operating profit and operating profit margin by business segment, which includes a discussion of operating profit and operating profit margin before acquisition integration charges. For additional information related to acquisition integration charges see Note 3 to the Consolidated Financial Statements.

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Electrical Products

	2017			Change from 2016		2016			Change from 2015		2015
Net sales	$	7,193		3	%	$	6,957		—	%	$	6,976
Operating profit	$	1,287		4	%	$	1,240		7	%	$	1,156
Operating margin	17.9		%			17.8		%			16.6		%
Acquisition integration charges	$	4				$	3				$	25
Before acquisition integration charges
Operating profit	$	1,291		4	%	$	1,243		5	%	$	1,181
Operating margin	17.9		%			17.9		%			16.9		%

Net sales increased 3% in 2017 compared to 2016 due to an increase of 3% in organic sales. Organic sales growth in 2017 was driven by growth in the Americas and Europe. Net sales were broadly flat in 2016 compared to 2015 due to an increase of 1% in organic sales, offset by a decrease of 1% from the impact of negative currency translation. By region, organic sales grew in 2016 in the Americas and Europe, while organic sales declined in Asia Pacific.

Operating margin increased from 17.8% in 2016 to 17.9% in 2017. The increase in operating margin in 2017 was primarily due to higher sales volumes, savings from restructuring actions, and lower restructuring charges, partially offset by commodity inflation and the impact from natural disasters in 2017. Operating margin increased from 16.6% in 2015 to 17.8% in 2016. The increase in operating margin in 2016 was primarily due to savings from restructuring actions, other cost control measures, and lower acquisition integration charges, partially offset by higher restructuring charges and unfavorable product mix.

Operating margin before acquisition integration charges was flat at 17.9% for 2016 and 2017. Operating margin before acquisition integration charges increased from 16.9% in 2015 to 17.9% in 2016. The increase in operating margin before acquisition integration charges in 2016 was primarily due to an increase in operating margin, partially offset by lower acquisition integration charges.

Electrical Systems and Services

	2017			Change from 2016		2016			Change from 2015		2015
Net sales	$	5,666		—	%	$	5,662		(5	)%	$	5,931
Operating profit	$	770		8	%	$	711		(8	)%	$	776
Operating margin	13.6		%			12.6		%			13.1		%
Acquisition integration charges	$	—				$	1				$	15
Before acquisition integration charges
Operating profit	$	770		8	%	$	712		(10	)%	$	791
Operating margin	13.6		%			12.6		%			13.3		%

Net sales were broadly flat in 2017 compared to 2016. Net sales decreased 5% in 2016 compared to 2015 due to a decrease of 3% in organic sales and a decrease of 2% from the impact of negative currency translation. The organic sales decline in 2016 was primarily due to weakness in oil and gas markets and large industrial projects, partially offset by growth in data centers and commercial construction markets.

Operating margin increased from 12.6% in 2016 to 13.6% in 2017. Operating margin increased in 2017 primarily due to savings from restructuring actions and lower restructuring charges, partially offset by commodity inflation. Operating margin decreased from 13.1% in 2015 to 12.6% in 2016. Operating margin decreased in 2016 primarily due to lower sales volumes, unfavorable product mix, and higher restructuring charges, partially offset by savings from restructuring actions and other cost control measures.

77

Operating margin before acquisition integration charges increased from 12.6% in 2016 to 13.6% in 2017. The increase in operating margin before acquisition integration charges was primarily due to an increase in operating margin. Operating margin before acquisition integration charges decreased from 13.3% in 2015 to 12.6% in 2016. The decrease in operating margin was primarily due to lower operating margins and lower acquisition integration charges.

Hydraulics

	2017			Change from 2016		2016			Change from 2015		2015
Net sales	$	2,468		11	%	$	2,222		(10	)%	$	2,459
Operating profit	$	288		45	%	$	198		(20	)%	$	246
Operating margin	11.7		%			8.9		%			10.0		%
Acquisition integration charges	$	—				$	—				$	2
Before acquisition integration charges
Operating profit	$	288		45	%	$	198		(20	)%	$	248
Operating margin	11.7		%			8.9		%			10.1		%

Net sales in 2017 increased 11% compared to 2016 due to an increase in organic sales of 12% and a decrease of 1% from the impact of negative currency translation. The increase in organic sales in 2017 was due to strength in global mobile equipment markets. Net sales in 2016 decreased 10% compared to 2015 due to a decrease in organic sales of 9% and a decrease of 1% from the impact of negative currency translation. The decrease in organic sales was due to weakness in both the mobile equipment and industrial markets.

Operating margin increased from 8.9% in 2016 to 11.7% in 2017. The increase in operating margin in 2017 was primarily due to higher sales volumes, lower restructuring charges, and savings from restructuring actions, partially offset by commodity inflation. Operating margin decreased from 10.0% in 2015 to 8.9% in 2016. The decrease in operating margin in 2016 was primarily due to lower sales volumes and higher restructuring costs, partially offset by savings from restructuring actions and other cost control measures.

Operating margin before acquisition integration charges decreased from 10.1% in 2015 to 8.9% in 2016. The decrease in operating margin before acquisition integration charges was primarily due to lower operating margins.

Aerospace

	2017			Change from 2016		2016			Change from 2015		2015
Net sales	$	1,744		—	%	$	1,753		(3	)%	$	1,807
Operating profit	$	332		(1	)%	$	335		8	%	$	310
Operating margin	19.0		%			19.1		%			17.2		%

Net sales were broadly flat in 2017 compared to 2016. Net sales in 2016 decreased 3% compared to 2015 due to a decrease of 2% from the impact of negative currency translation and a decrease in organic sales of 1%. The decrease in organic sales during 2016 was primarily due to a decrease in military OEM markets and lower cost reimbursements on certain engineering programs, partially offset by growth in commercial markets.

Operating margin decreased from 19.1% in 2016 to 19.0% in 2017. The decrease was primarily due to higher program development spending, partially offset by savings from restructuring actions. Operating margin increased from 17.2% in 2015 to 19.1% in 2016. The increase was primarily due to savings from restructuring actions, other cost control measures, and reduced program development spending.

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Vehicle

	2017			Change from 2016		2016			Change from 2015		2015
Net sales	$	3,333		6	%	$	3,153		(14	)%	$	3,682
Operating profit	$	537		13	%	$	474		(27	)%	$	645
Operating margin	16.1		%			15.0		%			17.5		%

Net sales increased 6% in 2017 compared to 2016 due to an increase in organic sales of 5% and an increase of 2% from the impact of positive currency translation, partially offset by a decrease of 1% from the sale of the business discussed Note 2. The increase in organic sales in 2017 was primarily due to growth in North America. Net sales decreased 14% in 2016 compared to 2015 due to a decrease in organic sales of 13% and a decrease of 1% from the impact of negative currency translation. The decrease in organic sales in 2016 was primarily due to the lower North American Class 8 truck market.

Operating margin increased from 15.0% in 2016 to 16.1% in 2017. The increase in operating margin in 2017 was primarily due to higher sales volumes, lower restructuring costs, and savings from restructuring actions, partially offset by commodity inflation and unfavorable product mix. Operating margin decreased from 17.5% in 2015 to 15.0% in 2016. The decrease in operating margin in 2016 was primarily due to lower sales volume and unfavorable product mix, partially offset by savings from restructuring actions and other cost control measures.

Corporate Expense (Income)

	2017			Change from 2016		2016*		Change from 2015		2015*
Amortization of intangible assets	$	388		(1	)%	$	392	(3	)%	$	406
Interest expense - net	246			6	%	233		—	%	232
Pension and other postretirement benefits expense	45			(25	)%	60		(54	)%	130
Gain on sale of a business	(1,077		)	NM		—		NM		—
Other corporate expense - net	244			57	%	155		(33	)%	232
Total corporate expense (income)	$	(154	)	(118	)%	$	840	(16	)%	$	1,000

* Year ended December 31, 2016 and 2015 amounts have been revised to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

Corporate results were income of $154 in 2017 compared to expense of $840 in 2016. The change in Total corporate expense (income) in 2017 was primarily due to the gain on the sale of the business discussed in Note 2, partially offset by an increase in other corporate expense. Total corporate expense decreased 16% in 2016 to $840 from $1,000 in 2015 primarily due to a decrease in pension and other postretirement benefits expense, and income from several insurance matters of $64 during the fourth quarter of 2016. The decrease in pension and other postretirement benefits expense resulted from a change to the spot rate approach for measuring service and interest costs, higher discount rates, and updated mortality tables.

79

LIQUIDITY, CAPITAL RESOURCES AND CHANGES IN FINANCIAL CONDITION

Financial Condition and Liquidity

Eaton’s objective is to finance its business through operating cash flow and an appropriate mix of equity and long-term and short-term debt. By diversifying its debt maturity structure, Eaton reduces liquidity risk. The Company maintains access to the commercial paper markets through a $2,000 commercial paper program. On November 17, 2017, Eaton refinanced a $500, four-year revolving credit facility with a $500, three-year revolving credit facility that will expire November 17, 2020 and also refinanced a $750, five-year revolving credit facility with a $750, five-year revolving credit facility that will expire November 17, 2022. Eaton also maintains a $750, five-year revolving credit facility that will expire October 14, 2021. These refinancings maintain long-term revolving credit facilities at a total of $2,000. The revolving credit facilities are used to support commercial paper borrowings and are fully and unconditionally guaranteed by Eaton and certain of its direct and indirect subsidiaries on an unsubordinated, unsecured basis. There were no borrowings outstanding under Eaton's revolving credit facilities at December 31, 2017 or 2016. The Company had available lines of credit of $741 from various banks primarily for the issuance of letters of credit, of which there was $297 outstanding at December 31, 2017. Over the course of a year, cash, short-term investments and short-term debt may fluctuate in order to manage global liquidity. Eaton believes it has the operating flexibility, cash flow, cash and short-term investment balances, and access to capital markets in excess of the liquidity necessary to meet future operating needs of the business as well as scheduled payments of long-term debt.

On September 15, 2017, a subsidiary of Eaton issued senior notes (the Notes) with a face amount of $1,000. The Notes are comprised of two tranches of $700 and $300 which mature in 2027 and 2047, respectively, with interest payable semi-annually at a respective rate of 3.1% and 3.9%. The issuer received proceeds totaling $993 from the issuance, net of financing costs.

On September 20, 2016, a subsidiary of Eaton issued Euro denominated notes (Euro Notes) with a face value of €550 ($615 based on the September 20, 2016 spot rate), in accordance with Regulation S promulgated under the Securities Act of 1933, as amended. The Euro Notes mature in 2024 with interest payable annually at a rate of 0.75%. After financing costs and discounts, the issuer received proceeds totaling €544 ($609 based on the September 20, 2016 spot rate) from the issuance.

For additional information on financing transactions and debt, see Note 6 to the Consolidated Financial Statements.

Eaton’s credit facilities and indentures governing certain long-term debt contain various covenants, the violation of which would limit or preclude the use of the credit facilities for future borrowings, or might accelerate the maturity of the related outstanding borrowings covered by the indentures. At Eaton’s present credit rating level, the most restrictive financial covenant provides that the ratio of secured debt (or lease payments due under a sale and leaseback transaction) to adjusted consolidated net worth (or consolidated net tangible assets, in each case as defined in the relevant credit agreement or indenture) may not exceed 10%. Eaton's actual ratios are substantially below the required threshold. In addition, Eaton is in compliance with each of its debt covenants for all periods presented.

Sources and Uses of Cash

Operating Cash Flow

Net cash provided by operating activities was $2,666 in 2017, an increase of $96 compared to $2,570 in 2016. The increase was driven by higher net income, and lower working capital balances compared to 2016, partially offset by higher pension contributions, including $350 of voluntary contributions to Eaton's U.S. qualified pension plans.

Net cash provided by operating activities was $2,570 in 2016, an increase of $161 compared to $2,409 in 2015. The increase was driven by lower pension contributions and lower working capital balances compared to 2015.

Investing Cash Flow

Net cash used in investing activities was $217 in 2017, a decrease in the use of cash of $312 compared to $529 in 2016. The decrease in 2017 was primarily driven by proceeds of $600 from the sale of the business discussed in Note 2, partially offset by purchases of short-term investments of $298 in 2017 compared to $40 in 2016. Capital expenditures were $520 in 2017 compared to $497 in 2016. Eaton expects approximately $575 in capital expenditures in 2018.

Net cash used in investing activities was $529 in 2016, a decrease in the use of cash of $46 compared to $575 in 2015. The decrease in 2016 was primarily driven by no business acquisitions completed in 2016 and lower capital expenditures in 2016 compared to 2015, partially offset by purchases of short-term investments of $40 in 2016 compared to sales $37 in 2015. Capital expenditures were $497 in 2016 compared to $506 in 2015.

80

Financing Cash Flow

Net cash used in financing activities was $2,442 in 2017, an increase in the use of cash of $704 compared to $1,738 in 2016. The increase in the use of cash was primarily due to higher payments on borrowings of $1,554 in 2017 compared to $653 in 2016 and higher share repurchases of $850 in 2017 compared to $730 in 2016, partially offset by higher proceeds from borrowings of $1,000 in 2017 compared to $631 in 2016.

Net cash used in financing activities was $1,738 in 2016, a decrease in use of cash of $567 compared to $2,305 in 2015. The decrease in the use of cash was primarily due to lower payments on borrowings of $653 in 2016 compared to $1,027 in 2015 and higher proceeds from borrowings of $631 in 2016 compared to $425 in 2015, partially offset by higher share repurchases of $730 in 2016 compared to $682 in 2015.

Credit Ratings

Eaton's debt has been assigned the following credit ratings:

Credit Rating Agency (long- /short-term rating)	Rating	Outlook
Standard & Poor's	A-/A-2	Negative outlook
Moody's	Baa1/P-2	Stable outlook
Fitch	BBB+/F2	Stable outlook

Defined Benefits Plans

Pension Plans

During 2017, the fair value of plan assets in the Company’s employee pension plans increased $865 to $5,312 at December 31, 2017. The increase in plan assets was primarily due to better than expected return on plan assets, the Company's contributions to the pension plans, and the impact of positive currency translation. At December 31, 2017, the net unfunded position of $1,048 in pension liabilities consisted of $279 in the U.S. qualified pension plans, $925 in plans that have no minimum funding requirements, and $62 in all other plans that require minimum funding, partially offset by $218 in plans that are overfunded.

Funding requirements are a major consideration in making contributions to Eaton’s pension plans. With respect to the Company’s pension plans worldwide, the Company intends to contribute annually not less than the minimum required by applicable law and regulations. In 2017, $473 was contributed to the pension plans. The Company anticipates making $112 of contributions to certain pension plans during 2018. The funded status of the Company’s pension plans at the end of 2018, and future contributions, will depend primarily on the actual return on assets during the year and the discount rate used to calculate certain benefits at the end of the year. Depending on these factors, and the resulting funded status of the pension plans, the level of future contributions could be materially higher or lower than in 2017.

Off-Balance Sheet Arrangements

Eaton does not have off-balance sheet arrangements or financings with unconsolidated entities or other persons. In the ordinary course of business, the Company leases certain real properties and equipment, as described in Note 8 to the Consolidated Financial Statements.

CRITICAL ACCOUNTING POLICIES

The preparation of financial statements in conformity with generally accepted accounting principles (GAAP) in the United States requires management to make certain estimates and assumptions that may involve the exercise of significant judgment. For any estimate or assumption used, there may be other reasonable estimates or assumptions that could have been used. However, based on facts and circumstances inherent in developing estimates and assumptions, management believes it is unlikely that applying other such estimates and assumptions would have caused materially different amounts to have been reported. Actual results may differ from these estimates.

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Revenue Recognition

Sales of products are recognized when a sales agreement is in place, products have been shipped to unaffiliated customers and title has transferred in accordance with shipping terms, the selling price is fixed and determinable and collectability is reasonably assured, all significant related acts of performance have been completed, and no other significant uncertainties exist. Shipping and handling costs billed to customers are included in Net sales and the related costs in Cost of products sold. Although the majority of the sales agreements contain standard terms and conditions, there are agreements that contain multiple elements or non-standard terms and conditions. As a result, judgment is required to determine the appropriate accounting, including whether the deliverables specified in these agreements should be treated as separate units of accounting for recognition purposes, and, if so, how the sales price should be allocated among the elements and when to recognize sales for each element. For delivered elements, sales generally are recognized only when the delivered elements have standalone value and there are no uncertainties regarding customer acceptance. Sales for service contracts generally are recognized as the services are provided.

Eaton records reductions to revenue for customer and distributor incentives, primarily comprised of rebates, at the time of the initial sale. Rebates are estimated based on sales terms, historical experience, trend analysis and projected market conditions in the various markets served. The rebate programs offered vary across businesses due to the numerous markets Eaton serves, but the most common incentives relate to amounts paid or credited to customers for achieving defined volume levels.

Impairment of Goodwill and Other Long-Lived Assets

Goodwill

Goodwill is evaluated annually for impairment as of July 1 using either a quantitative or qualitative analysis. Goodwill is tested for impairment at the reporting unit level, which is equivalent to Eaton's operating segments and based on the net assets for each segment, including goodwill and intangible assets. Goodwill is assigned to each operating segment, as this represents the lowest level that constitutes a business and is the level at which management regularly reviews the operating results. The Company performs a quantitative analysis using a discounted cash flow model and other valuation techniques, but may elect to perform a qualitative analysis.

Additionally, goodwill is evaluated for impairment whenever an event occurs or circumstances change that would indicate that it is more likely than not that the fair value of an operating segment is less than its carrying amount. Events or circumstances that may result in an impairment review include changes in macroeconomic conditions, industry and market considerations, cost factors, overall financial performance, other relevant entity-specific events, specific events affecting the reporting unit or sustained decrease in share price.

Goodwill impairment testing for 2017 was performed using a qualitative analysis, which is performed by assessing certain trends and factors that require significant judgment, including projected market outlook and growth rates, forecasted and actual sales and operating profit margins, discount rates, industry data, and other relevant qualitative factors. These trends and factors are compared to, and based on, the assumptions used in the most recent quantitative assessment. The results of these qualitative analyses did not indicate a need to perform a quantitative analysis.

Goodwill impairment testing for 2016 was performed using a quantitative analysis under which the fair value for each reporting unit was estimated using a discounted cash flow model, which considered forecasted cash flows discounted at an estimated weighted-average cost of capital. The forecasted cash flows were based on the Company's long-term operating plan and a terminal value was used to estimate the operating segment's cash flows beyond the period covered by the operating plan. The weighted-average cost of capital is an estimate of the overall after-tax rate of return required by equity and debt market holders of a business enterprise. These analyses require the exercise of significant judgments, including judgments about appropriate discount rates, perpetual growth rates and the timing of expected future cash flows of the respective reporting unit. Sensitivity analyses were performed in order to assess the reasonableness of the assumptions and the resulting estimated fair values.

Based on the qualitative analyses performed in 2017 and quantitative analysis performed in 2016, the fair values of Eaton's reporting units continue to substantially exceed their respective carrying amounts.

Indefinite Life Intangible Assets

Indefinite life intangible assets consist of certain trademarks. They are evaluated annually for impairment as of July 1 using either a quantitative or qualitative analysis to determine whether their fair values exceed their respective carrying amounts. Indefinite life intangible asset impairment testing for 2017 and 2016 was performed using a quantitative analysis. Determining the fair value of these assets requires significant judgment and the Company uses a royalty relief methodology similar to that employed when the associated assets were acquired, but using updated estimates of future sales, cash flows and profitability.

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Additionally, indefinite life intangible assets are evaluated for impairment whenever an event occurs or circumstances change that would indicate that it is more likely than not that the asset is impaired. Events or circumstances that may result in an impairment review include changes in industry and market considerations, cost factors, financial performance, and other relevant entity-specific events that could affect inputs used to determine the respective fair values of the indefinite-lived intangible assets.

For 2017 and 2016, the fair value of indefinite lived intangible assets exceeded the respective carrying value.

Other Long-Lived Assets

Other long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate the carrying amount may not be recoverable. Events or circumstances that may result in an impairment review include operations reporting losses, a significant adverse change in the use of an asset, the planned disposal or sale of the asset, a significant adverse change in the business climate or legal factors related to the asset, or a significant decrease in the estimated market value of an asset. Upon indications of impairment, assets and liabilities are grouped at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. The asset group would be considered impaired when the estimated future net undiscounted cash flows generated by the asset group are less than its carrying value. In instances where the carrying amount of the asset group exceeded the undiscounted cash flows, the fair value of the asset group would be determined and an impairment loss would be recognized based on the amount by which the carrying value of the asset group exceeds its fair value. Determining asset groups and underlying cash flows requires the use of significant judgment.

For additional information about goodwill and other intangible assets, see Note 5 to the Consolidated Financial Statements.

Recoverability of Deferred Income Tax Assets

Eaton is subject to the income tax laws in the jurisdictions in which it operates. In order to determine the income tax provision for financial statement purposes, Eaton must make significant estimates and judgments about its business operations in these jurisdictions. These estimates and judgments are also used in determining the deferred income tax assets and liabilities that have been recognized for differences between the financial statement and income tax basis of assets and liabilities, and income tax loss carryforwards and income tax credit carryforwards.

Management evaluates the realizability of deferred income tax assets for each jurisdiction in which it operates. If the Company experiences cumulative pretax income in a particular jurisdiction in a three-year period including the current and prior two years, management normally concludes that the deferred income tax assets will more likely than not be realizable and no valuation allowance is recognized, unless known or planned operating developments, or changes in tax laws, would lead management to conclude otherwise. However, if the Company experiences cumulative pretax losses in a particular jurisdiction in a three-year period including the current and prior two years, management then considers a series of factors in the determination of whether the deferred income tax assets can be realized. These factors include historical operating results, known or planned operating developments, the period of time over which certain temporary differences will reverse, consideration of the utilization of certain deferred income tax liabilities, tax law carryback capability in a particular country, prudent and feasible tax planning strategies, changes in tax laws, and estimates of future earnings and taxable income using the same assumptions as the Company’s goodwill and other impairment testing. After evaluation of these factors, if the deferred income tax assets are expected to be realized within the tax carryforward period allowed for that specific country, management would conclude that no valuation allowance would be required. To the extent that the deferred income tax assets exceed the amount that is expected to be realized within the tax carryforward period for a particular jurisdiction, management would establish a valuation allowance. For additional information about income taxes, see Note 9 to the Consolidated Financial Statements.

Pension and Other Postretirement Benefits Plans

The measurement of liabilities related to pension plans and other postretirement benefits plans is based on assumptions related to future events including interest rates, return on plan assets, rate of compensation increases, and health care cost trend rates. Actual plan asset performance will either reduce or increase losses included in accumulated other comprehensive loss, which ultimately affects net income.

The discount rate for United States plans was determined by discounting the expected future benefit payments using a theoretical zero-coupon spot yield curve derived from a universe of high-quality bonds as of the measurement date and solving for the single rate that generated the same benefit obligation. Only corporate bonds with a rating of Aa or higher by either Moody’s or Standard & Poor's were included. Callable bonds that are not make-whole bonds and certain other non-comparable bonds were eliminated. Finally, a subset of bonds was selected by grouping the universe of bonds by duration and retaining 50% of the bonds that had the highest yields.

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The discount rates for non-United States plans were determined by region and are based on high quality long-term corporate and government bonds. Consideration has been given to the duration of the liabilities in each plan when selecting the bonds to be used in determining the discount rate.

In 2016, the Company adopted a change in the method it uses to estimate the service and interest cost components of net periodic benefit cost for its defined benefit pension and other postretirement benefit plans. Prior to 2016, for the vast majority of its plans, the service and interest cost components were estimated using a single weighted-average discount rate derived from the yield curve used to measure the benefit obligation at the beginning of the period. Beginning in 2016, the Company used a spot rate approach by applying the specific spot rates along the yield curve to the relevant projected cash flows in the estimation of the service and interest components of benefit cost, resulting in a more precise measurement. This change does not affect the measurement of total benefit obligations. The change was accounted for as a change in estimate and, accordingly, was accounted for prospectively starting in 2016. The reductions in service cost and interest cost for 2016 associated with this change in estimate were $3 and $42, respectively.

Key assumptions used to calculate pension and other postretirement benefits expense are adjusted at each year-end. A 1-percentage point change in the assumed rate of return on pension plan assets is estimated to have approximately a $46 effect on pension expense. Likewise, a 1-percentage point change in the discount rate is estimated to have approximately a $69 effect on pension expense. A 1-percentage point change in the assumed rate of return on other postretirement benefits assets is estimated to have approximately a $1 effect on other postretirement benefits expense. A 1-percentage point change in the discount rate is estimated to have approximately a $3 effect on expense for other postretirement benefits plans.

Additional information related to changes in key assumptions used to recognize expense for other postretirement benefits plans is found in Note 7 to the Consolidated Financial Statements.

Environmental Contingencies

As a result of past operations, Eaton is involved in remedial response and voluntary environmental remediation at a number of sites, including certain of its currently-owned or formerly-owned plants. The Company has also been named a potentially responsible party under the United States federal Superfund law, or the state equivalents thereof, at a number of disposal sites.

A number of factors affect the cost of environmental remediation, including the number of parties involved at a particular site, the determination of the extent of contamination, the length of time the remediation may require, the complexity of environmental regulations, and the continuing advancement of remediation technology. Taking these factors into account, Eaton has estimated the costs of remediation, which will be paid over a period of years. The Company accrues an amount on an undiscounted basis, consistent with the estimates of these costs, when it is probable that a liability has been incurred. At December 31, 2017 and 2016, $120 and $124, respectively, was accrued for these costs.

Based upon Eaton's analysis and subject to the difficulty in estimating these future costs, the Company expects that any sum it may be required to pay in connection with environmental matters is not reasonably possible to exceed the recorded liability by an amount that would have a material effect on its financial position, results of operations or cash flows.

MARKET RISK DISCLOSURE

On a regular basis, Eaton monitors third-party depository institutions that hold its cash and short-term investments, primarily for safety of principal and secondarily for maximizing yield on those funds. The Company diversifies its cash and short-term investments among counterparties to minimize exposure to any one of these entities. Eaton also monitors the creditworthiness of its customers and suppliers to mitigate any adverse impact.

Eaton uses derivative instruments to manage exposure to volatility in raw material costs, currency, and interest rates on certain debt instruments. Derivative financial instruments used by the Company are straightforward and non-leveraged. The counterparties to these instruments are financial institutions with strong credit ratings. Eaton maintains control over the size of positions entered into with any one counterparty and regularly monitors the credit rating of these institutions. See Note 13 to the Consolidated Financial Statements for additional information about hedges and derivative financial instruments.

Eaton’s ability to access the commercial paper market, and the related cost of these borrowings, is based on the strength of its credit rating and overall market conditions. The Company has not experienced any material limitations in its ability to access these sources of liquidity. At December 31, 2017, Eaton had $2,000 of long-term revolving credit facilities with banks in support of its commercial paper program. It has no borrowings outstanding under these credit facilities.

Interest rate risk can be measured by calculating the short-term earnings impact that would result from adverse changes in interest rates. This exposure results from short-term debt, which includes commercial paper at a floating interest rate, long-term debt that has been swapped to floating rates, and money market investments that have not been swapped to fixed rates. Based upon the balances of investments and floating rate debt at year end 2017, a 100 basis-point increase in short-term interest rates would have increased the Company’s net, pretax interest expense by $30.

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Eaton also measures interest rate risk by estimating the net amount by which the fair value of the Company’s financial liabilities would change as a result of movements in interest rates. Based on Eaton’s best estimate for a hypothetical, 100 basis point decrease in interest rates at December 31, 2017, the market value of the Company’s debt and interest rate swap portfolio, in aggregate, would increase by $537.

The Company is exposed to currency risk associated with translating its functional currency financial statements into its reporting currency, which is the U.S. dollar. As a result, the Company is exposed to movements in the exchange rates of various currencies against the U.S. dollar. Eaton also monitors exposure to transactions denominated in currencies other than the functional currency of each country in which the Company operates, and regularly enters into forward contracts to mitigate that exposure. In the aggregate, Eaton’s portfolio of forward contracts related to such transactions was not material to its Consolidated Financial Statements.

CONTRACTUAL OBLIGATIONS

A summary of contractual obligations as of December 31, 2017 follows:

	2018			2019 to 2020			2021 to 2022			Thereafter			Total
Long-term debt, including current portion(1)	$	578		$	581		$	2,003		$	4,549		$	7,711
Interest expense related to long-term debt	284			497			453			1,965			3,199
Reduction of interest expense from interest rate swap agreements related to long-term debt	(19		)	(14		)	(12		)	(46		)	(91		)
Operating leases	159			204			105			71			539
Purchase obligations	958			93			9			4			1,064
Other obligations	155			9			8			23			195
Total	$	2,115		$	1,370		$	2,566		$	6,566		$	12,617
(1) Long-term debt excludes deferred gains and losses on derivatives related to debt, adjustments to fair market value, and premiums and discounts on long-term debentures.

Interest expense related to long-term debt is based on the fixed interest rate, or other applicable interest rate, related to the debt instrument. The reduction of interest expense due to interest rate swap agreements related to long-term debt is based on the difference in the fixed interest rate the Company receives from the swap, compared to the floating interest rate the Company pays on the swap. Purchase obligations are entered into with various vendors in the normal course of business. These amounts include commitments for purchases of raw materials, outstanding non-cancelable purchase orders, releases under blanket purchase orders, and commitments under ongoing service arrangements. Other long-term obligations principally include anticipated contributions of $112 to pension plans in 2018 and $45 of deferred compensation earned under various plans for which the participants have elected to receive disbursement at a later date.

The table above does not include future expected pension benefit payments or expected other postretirement benefits payments. Information related to the amounts of these future payments is described in Note 7 to the Consolidated Financial Statements. The table above also excludes the liability for unrecognized income tax benefits, since the Company cannot predict with reasonable certainty the timing of cash settlements with the respective taxing authorities. At December 31, 2017, the gross liability for unrecognized income tax benefits totaled $735 and interest and penalties were $80.

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FORWARD-LOOKING STATEMENTS

This Annual Report to Shareholders contains forward-looking statements concerning litigation and regulatory developments, expected pension or other post-retirement benefit payments, and rates of return and expected future liquidity. These statements may discuss goals, intentions and expectations as to future trends, plans, events, results of operations or financial condition, or state other information relating to Eaton, based on current beliefs of management as well as assumptions made by, and information currently available to, management. Forward-looking statements generally will be accompanied by words such as “anticipate,” “believe,” “could,” “estimate,” “expect,” “forecast,” “guidance,” “intend,” “may,” “possible,” “potential,” “predict,” “project” or other similar words, phrases or expressions. These statements should be used with caution and are subject to various risks and uncertainties, many of which are outside Eaton’s control. The following factors could cause actual results to differ materially from those in the forward-looking statements: unanticipated changes in the markets for the Company’s business segments; unanticipated downturns in business relationships with customers or their purchases from us; the availability of credit to customers and suppliers; competitive pressures on sales and pricing; unanticipated changes in the cost of material and other production costs, or unexpected costs that cannot be recouped in product pricing; the introduction of competing technologies; unexpected technical or marketing difficulties; unexpected claims, charges, litigation or dispute resolutions; strikes or other labor unrest; the impact of acquisitions and divestitures; unanticipated difficulties integrating acquisitions; new laws and governmental regulations; interest rate changes; tax rate changes or exposure to additional income tax liability; stock market and currency fluctuations; war, natural disasters, civil or political unrest or terrorism; and unanticipated deterioration of economic and financial conditions in the United States and around the world. Eaton does not assume any obligation to update these forward-looking statements.

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QUARTERLY DATA (unaudited)

	Quarter ended in 2017												Quarter ended in 2016
(In millions except for per share data)	Dec. 31			Sept. 30*			June 30*			Mar. 31*			Dec. 31*			Sept. 30*			June 30*			Mar. 31*
Net sales	$	5,213		$	5,211		$	5,132		$	4,848		$	4,867		$	4,987		$	5,080		$	4,813
Gross profit	1,678			1,745			1,684			1,541			1,548			1,613			1,658			1,519
Percent of net sales	32.2		%	33.5		%	32.8		%	31.8		%	31.8		%	32.3		%	32.6		%	31.6		%
Income before income taxes	635			1,694			572			467			559			570			550			439
Net income	634			1,401			517			434			508			520			490			401
Less net (income) loss for    noncontrolling interests	—			—			(1		)	—			(4		)	1			(1		)	1
Net income attributable to Eaton ordinary shareholders	$	634		$	1,401		$	516		$	434		$	504		$	521		$	489		$	402
Net income per share attributable to Eaton ordinary shareholders
Diluted	$	1.43		$	3.14		$	1.15		$	0.96		$	1.12		$	1.14		$	1.07		$	0.87
Basic	1.44			3.16			1.16			0.97			1.12			1.15			1.07			0.88
Cash dividends declared per    ordinary share	$	0.60		$	0.60		$	0.60		$	0.60		$	0.57		$	0.57		$	0.57		$	0.57
Market price per ordinary share
High	$	82.34		$	81.63		$	79.31		$	74.63		$	70.00		$	68.20		$	63.98		$	63.99
Low	74.90			69.82			73.42			66.60			59.07			58.28			54.30			46.19
Earnings per share for the four quarters in a year may not equal full year earnings per share.
Acquisition integration charges included in Income before income taxes are as follows:
	Quarter ended in 2017												Quarter ended in 2016
	Dec. 31			Sept. 30			June 30			Mar. 31			Dec. 31			Sept. 30			June 30			Mar. 31
Acquisition integration charges	$	1		$	1		$	1		$	1		$	1		$	1		$	1		$	1

*Certain amounts have been adjusted to reflect the retrospective application of the Company's change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

FIVE-YEAR CONSOLIDATED FINANCIAL SUMMARY (unaudited)

(In millions except for per share data)	2017			2016*			2015*			2014*			2013*
Net sales	$	20,404		$	19,747		$	20,855		$	22,552		$	22,046
Income before income taxes	3,368			2,118			2,133			1,762			1,870
Net income	2,986			1,919			1,974			1,804			1,864
Less net income for noncontrolling interests	(1		)	(3		)	(2		)	(10		)	(12		)
Net income attributable to Eaton ordinary shareholders	$	2,985		$	1,916		$	1,972		$	1,794		$	1,852
Net income per share attributable to Eaton ordinary shareholders
Diluted	$	6.68		$	4.20		$	4.22		$	3.76		$	3.88
Basic	6.71			4.21			4.23			3.78			3.91
Weighted-average number of ordinary shares outstanding
Diluted	447.0			456.5			467.1			476.8			476.7
Basic	444.5			455.0			465.5			474.1			473.5
Cash dividends declared    per ordinary share	$	2.40		$	2.28		$	2.20		$	1.96		$	1.68
Total assets	$	32,623		$	30,476		$	31,059		$	33,557		$	35,511
Long-term debt	7,167			6,711			7,746			7,982			8,920
Total debt	7,751			8,277			8,414			8,992			9,500
Eaton shareholders' equity	17,253			14,954			15,249			15,856			16,860
Eaton shareholders' equity    per ordinary share	$	39.22		$	33.28		$	33.24		$	33.89		$	35.49
Ordinary shares outstanding	439.9			449.4			458.8			467.9			475.1

*Certain amounts for the years 2013 through 2016 have been adjusted to reflect the retrospective application of the Company's change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

EX-4.4

Exhibit 4.4

THIRD SUPPLEMENTAL INDENTURE

Third Supplemental Indenture, dated as of December 20, 2013, (this “ThirdSupplemental Indenture”) among Eaton Corporation, an Ohio corporation (the “Company”), Cooper Industries Holdings (Ireland) Limited, an Irish unlimited company (the “NewGuarantor”) and The Bank of New York Mellon Trust Company, N.A., as trustee (the “Trustee”).

W I T N E S S E T H

WHEREAS, the Company (as successor to Turlock Corporation, an Ohio corporation), the Guarantors party thereto and the Trustee are parties to an indenture dated as of November 20, 2012 (the “Base Indenture”), as supplemented by a first supplemental indenture dated as of November 30, 2012 among the Company, the New Guarantors party thereto and the Trustee (the “First Supplemental Indenture”), and a second supplemental indenture dated as of January 8, 2013 among the Company, the New Guarantors party thereto and the Trustee (the “Second Supplemental Indenture”, and together with the Base Indenture and First Supplemental Indenture, the “Indenture”) as supplemented from time to time, providing for the issuance by the Company of $600,000,000 aggregate principal amount of 0.950% Senior Notes due 2015 (the “2015 Notes”), $1,000,000,000 aggregate principal amount of 1.500% Senior Notes due 2017 (the “2017 Notes”), $1,600,000,000 aggregate principal amounts of 2.750% Senior Notes due 2022 (the “2022 Notes”), $700,000,000 aggregate principal amount of 4.000% Senior Notes due 2032 (the “2032 Notes”) and $1,000,000,000 aggregate principal amount of 4.150% Senior Notes due 2042 (the “2042 Notes” and, together with the 2015 Notes, the 2017 Notes, the 2022 Notes and the 2032 Notes, the “Securities”);

WHEREAS, Section 1014 of the Indenture provides that under certain circumstances, a Subsidiary shall execute and deliver to the Trustee a supplemental indenture pursuant to which such Subsidiary shall irrevocably and unconditionally guarantee all of the Company’s obligations under the Notes and the Indenture on the terms and conditions set forth herein and under the Indenture (the “New Guarantee”); and

WHEREAS, pursuant to Section 903 of the Indenture, the Trustee is authorized to execute and deliver this Third Supplemental Indenture.

NOW THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt of which is hereby acknowledged, the parties mutually covenant and agree for the equal and ratable benefit of the Holders of the Securities as follows:

(1)Capitalized Terms. Capitalized terms used herein without definition shall have the meanings assigned to them in the Indenture.

(2)Agreement to be Bound. The New Guarantor hereby becomes a party to the Indenture as a Guarantor and as a Subsidiary Guarantor and as such will have all of the rights and be subject to all of the obligations and agreements of a Guarantor and a Subsidiary Guarantor under the Indenture.

(3)Guarantee. The New Guarantor agrees, on a joint and several basis with all the existing Guarantors, to fully, unconditionally and irrevocably Guarantee to each Holder of

1

Exhibit 4.4

the Securities and the Trustee the obligations of the Company pursuant to and as set forth in Article Seventeen of the Indenture.

(4)Release of Guarantee. The Guarantee of the New Guarantor shall be automatically and unconditionally released and discharged, upon:

(i)the consummation of any transaction permitted under the Indenture (including a sale, transfer, disposition or distribution of the New Guarantor to a Person that is not Parent or one of its Subsidiaries, or a dissolution) resulting in the New Guarantor ceasing to be a Subsidiary; or

(ii)the New Guarantor becoming an Excluded Person; provided that no such release will occur to the extent the New Guarantor remains an issuer or co-issuer of or borrower or guarantor under any U.S. debt securities or U.S. syndicated credit facilities.

(5)Severability. In case any provision of this Third Supplemental Indenture shall be invalid, illegal or unenforceable, the validity, legality, and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.

(6)Benefits Acknowledged. The New Guarantor acknowledges that it will receive direct and indirect benefits from the financing arrangements contemplated by the Indenture and that its guarantee and waivers (to the extent permitted by applicable law) pursuant to the New Guarantee are knowingly made in contemplation of such benefits.

(7)No Recourse Against Others. No director, officer, employee, incorporator or stockholder of the New Guarantor shall have any liability for any obligations of the Company or the Guarantors (including the New Guarantor) under the Securities, any Guarantees, the Indenture or this Third Supplemental Indenture or for any claim based on, in respect of, or by reason of, such obligations or their creation. Each Holder by accepting Securities waives and releases all such liability. The waiver and release are part of the consideration for issuance of the Securities.

(8)Trustee Disclaimer. The recitals contained in this Third Supplemental Indenture shall be taken as the statements of the Company and the New Guarantor and the Trustee assumes no responsibility for their correctness. The Trustee makes no representations as to the validity or sufficiency of this Third Supplemental Indenture. All rights, protections, privileges, indemnities and benefits granted or afforded to the Trustee under the Base Indenture shall be deemed incorporated herein by this reference and shall be deemed applicable to all actions taken, suffered or omitted by the Trustee under this Third Supplemental Indenture.

(9)Counterparts. This Third Supplemental Indenture may be executed in any number of counterparts, each of which shall be an original but all of which together shall constitute one instrument. Each counterparty may consist of a number of copies hereof, each signed by less than all, but together signed by all, of the parties hereto.

(10)Headings. The headings of the sections in this Third Supplemental Indenture are for convenience of reference only and shall not be deemed to alter or affect the meaning or interpretation of any provisions hereof.

[signature pages follow]

2

IN WITNESS WHEREOF, each of the undersigned has caused this Third Supplemental Indenture to be duly executed by its proper and duly authorized officer(s) as of the date set forth above.

EATON CORPORATION
By:	/s/ Trent M. Meyerhoefer
	Name: Trent M. Meyerhoefer
	Title: Senior Vice President - Treasury
By:	/s/ Lizbeth L. Wright
	Name: Lizbeth L. Wright
	Title: Assistant Secretary

[Signature Page to Third Supplemental Indenture to 2012 Indenture]

Signed and Delivered as a Deed For and on behalf of

COOPER INDUSTRIES HOLDINGS (IRELAND)

by its duly appointed attorney

EATON CORPORATION
By:	/s/ Thomas E. Moran
	Name: Thomas E. Moran
	Title: Director
	In the presence of:
	/s/ Celine Notin
	Name: Celine Notin
	Title: Witness

[Signature Page to Third Supplemental Indenture to 2012 Indenture]

THE BANK OF NEW YORK MELLON TRUST

COMPANY, N.A., as Trustee

By:	/s/ Melonee Young
	Name: Melonee Young
	Title: Vice President

[Signature Page to Third Supplemental Indenture to 2012 Indenture]

EX-4.5

Exhibit 4.5

Dated as of December 20, 2017
and effective as of January 1, 2018

EATON CORPORATION,

EATON INDUSTRIAL CORPORATION,

as the New Guarantor

and

THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A.,

as Trustee

______________________________________________

FOURTH SUPPLEMENTAL INDENTURE

to Indenture dated as of November 20, 2012 (as amended and

supplemented from time to time)

______________________________________________

FOURTH SUPPLEMENTAL INDENTURE, dated as of December 20, 2017 and effective as of January 1, 2018 (this "Fourth Supplemental Indenture") among Eaton Corporation, an Ohio corporation (the "Company"), Eaton Industrial Corporation, a Delaware corporation (the "New Guarantor") and The Bank of New York Mellon Trust Company, N.A., as trustee (the "Trustee").

W I T N E S S E T H

WHEREAS, the Company (as successor to Turlock Corporation, an Ohio corporation), the Guarantors party thereto and the Trustee are parties to an indenture dated as of November 20, 2012 (the "Base Indenture"), as supplemented by a first supplemental indenture dated as of November 30, 2012 among the Company, the new guarantors party thereto and the Trustee (the "First Supplemental Indenture"), a second supplemental indenture dated as of January 8, 2013 among the Company, the new guarantors party thereto and the Trustee (the "Second Supplemental Indenture"), and a third supplemental indenture dated as of December 20, 2013 among the Company, the new guarantor party thereto and the Trustee (the "Third Supplemental Indenture", and together with the Base Indenture, First Supplemental Indenture, Second Supplemental Indenture and Third Supplemental Indenture, the "Indenture"), providing for the issuance by the Company of $1,000,000,000 aggregate principal amount of 1.500% Senior Notes due 2017 (the "2017 Notes"), $1,600,000,000 aggregate principal amounts of 2.750% Senior Notes due 2022 (the "2022 Notes"), $700,000,000 aggregate principal amount of 4.000% Senior Notes due 2032 (the "2032 Notes") and $1,000,000,000 aggregate principal amount of 4.150% Senior Notes due 2042 (the "2042 Notes" and, together with the 2015 Notes, the 2017 Notes, the 2022 Notes and the 2032 Notes, the "Securities");

WHEREAS, Section 1014 of the Indenture provides that under certain circumstances, a Subsidiary shall execute and deliver to the Trustee a supplemental indenture pursuant to which such Subsidiary shall irrevocably and unconditionally guarantee all of the Company's obligations under the Securities and the Indenture on the terms and conditions set forth herein and under the Indenture (the "New Guarantee"); and

WHEREAS, pursuant to Section 903 of the Indenture, the Trustee is authorized to execute and deliver this Fourth Supplemental Indenture.

NOW THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt of which is hereby acknowledged, the parties mutually covenant and agree for the equal and ratable benefit of the Holders of the Securities as follows:

1.CAPITALIZED TERMS. CAPITALIZED TERMS USED HEREIN WITHOUT DEFINITION SHALL HAVE THE MEANINGS ASSIGNED TO THEM IN THE INDENTURE.

2.AGREEMENT TO BE BOUND. THE NEW GUARANTOR HEREBY BECOMES A PARTY TO THE INDENTURE AS A GUARANTOR AND AS A SUBSIDIARY GUARANTOR AND AS SUCH WILL HAVE ALL OF THE RIGHTS AND BE SUBJECT TO ALL OF THE OBLIGATIONS AND AGREEMENTS OF A GUARANTOR AND A SUBSIDIARY GUARANTOR UNDER THE INDENTURE.

3.GUARANTEE. THE NEW GUARANTOR AGREES, ON A JOINT AND SEVERAL BASIS WITH ALL THE EXISTING GUARANTORS, TO FULLY, UNCONDITIONALLY AND IRREVOCABLY GUARANTEE TO EACH HOLDER OF THE SECURITIES AND THE TRUSTEE THE OBLIGATIONS OF THE COMPANY PURSUANT TO AND AS SET FORTH IN ARTICLE SEVENTEEN OF THE INDENTURE.

4.RELEASE OF GUARANTEE. THE GUARANTEE OF THE NEW GUARANTOR SHALL BE AUTOMATICALLY AND UNCONDITIONALLY RELEASED AND DISCHARGED, UPON:

a. THE CONSUMMATION OF ANY TRANSACTION PERMITTED UNDER THE INDENTURE (INCLUDING A SALE, TRANSFER, DISPOSITION OR DISTRIBUTION OF THE NEW GUARANTOR TO A PERSON THAT IS NOT PARENT OR ONE OF ITS SUBSIDIARIES, OR A DISSOLUTION) RESULTING IN THE NEW GUARANTOR CEASING TO BE A SUBSIDIARY; OR

b. THE NEW GUARANTOR BECOMING AN EXCLUDED PERSON; PROVIDED THAT NO SUCH RELEASE WILL OCCUR TO THE EXTENT THE NEW GUARANTOR REMAINS AN ISSUER OR CO-ISSUER OF OR BORROWER OR GUARANTOR UNDER ANY U.S. DEBT SECURITIES OR U.S. SYNDICATED CREDIT FACILITIES.

5.SEVERABILITY. IN CASE ANY PROVISION OF THIS FOURTH SUPPLEMENTAL INDENTURE SHALL BE INVALID, ILLEGAL OR UNENFORCEABLE, THE VALIDITY, LEGALITY, AND ENFORCEABILITY OF THE REMAINING PROVISIONS SHALL NOT IN ANY WAY BE AFFECTED OR IMPAIRED THEREBY.

6.BENEFITS ACKNOWLEDGED. THE NEW GUARANTOR ACKNOWLEDGES THAT IT WILL RECEIVE DIRECT AND INDIRECT BENEFITS FROM THE FINANCING ARRANGEMENTS CONTEMPLATED BY THE INDENTURE AND THAT ITS GUARANTEE AND WAIVERS (TO THE EXTENT PERMITTED BY APPLICABLE LAW) PURSUANT TO THE NEW GUARANTEE ARE KNOWINGLY MADE IN CONTEMPLATION OF SUCH BENEFITS.

7.NO RECOURSE AGAINST OTHERS. NO DIRECTOR, OFFICER, EMPLOYEE, INCORPORATOR OR STOCKHOLDER OF THE NEW GUARANTOR SHALL HAVE ANY LIABILITY FOR ANY OBLIGATIONS OF THE COMPANY OR THE GUARANTORS (INCLUDING THE NEW GUARANTOR) UNDER THE SECURITIES, ANY GUARANTEES, THE INDENTURE OR THIS FOURTH SUPPLEMENTAL INDENTURE OR FOR ANY CLAIM BASED ON, IN RESPECT OF, OR BY REASON OF, SUCH OBLIGATIONS OR THEIR CREATION. EACH HOLDER BY ACCEPTING SECURITIES WAIVES AND RELEASES ALL SUCH LIABILITY. THE WAIVER AND RELEASE ARE PART OF THE CONSIDERATION FOR ISSUANCE OF THE SECURITIES.

8.TRUSTEE DISCLAIMER. THE RECITALS CONTAINED IN THIS FOURTH SUPPLEMENTAL INDENTURE SHALL BE TAKEN AS THE STATEMENTS OF THE COMPANY AND THE NEW GUARANTOR AND THE TRUSTEE ASSUMES NO RESPONSIBILITY FOR THEIR CORRECTNESS. THE TRUSTEE MAKES NO REPRESENTATIONS AS TO THE VALIDITY OR SUFFICIENCY OF THIS FOURTH SUPPLEMENTAL INDENTURE. ALL RIGHTS, PROTECTIONS, PRIVILEGES, INDEMNITIES AND BENEFITS GRANTED OR AFFORDED TO THE TRUSTEE UNDER THE BASE INDENTURE SHALL BE DEEMED INCORPORATED HEREIN BY THIS REFERENCE AND SHALL BE DEEMED APPLICABLE TO ALL ACTIONS TAKEN, SUFFERED OR OMITTED BY THE TRUSTEE UNDER THIS FOURTH SUPPLEMENTAL INDENTURE.

9.COUNTERPARTS. THIS FOURTH SUPPLEMENTAL INDENTURE MAY BE EXECUTED IN ANY NUMBER OF COUNTERPARTS, EACH OF WHICH SHALL BE AN ORIGINAL BUT ALL OF WHICH TOGETHER SHALL CONSTITUTE ONE INSTRUMENT. EACH COUNTERPARTY MAY CONSIST OF A NUMBER OF COPIES HEREOF, EACH SIGNED BY LESS THAN ALL, BUT TOGETHER SIGNED BY ALL, OF THE PARTIES HERETO.

10.HEADINGS. THE HEADINGS OF THE SECTIONS IN THIS FOURTH SUPPLEMENTAL INDENTURE ARE FOR CONVENIENCE OF REFERENCE ONLY AND SHALL NOT BE DEEMED TO ALTER OR AFFECT THE MEANING OR INTERPRETATION OF ANY PROVISIONS HEREOF.

11.GOVERNING LAW. THIS SUPPLEMENTAL INDENTURE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

[SIGNATURE PAGES FOLLOW]

IN WITNESS WHEREOF, each of the undersigned has caused this Fourth Supplemental Indenture to be duly executed by its proper and duly authorized officer(s) as of the date set forth above.

EATON CORPORATION
By:	/s/ Trent M. Meyerhoefer
	Name: Trent M. Meyerhoefer
	Title: Senior Vice President – Treasury
By:	/s/ Lizbeth L. Wright
	Name: Lizbeth L. Wright
	Title: Assistant Secretary

[Signature Page to Fourth Supplemental Indenture to 2012 Indenture]

EATON INDUSTRIAL CORPORATION
By:	/s/ Trent M. Meyerhoefer
	Name: Trent M. Meyerhoefer
	Title: Vice President and Treasurer

[Signature Page to Fourth Supplemental Indenture to 2012 Indenture]

THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A.,
as Trustee
By:	/s/ Richard Tarnas
	Name: Richard Tarnas
	Title: Vice President

[Signature Page to Fourth Supplemental Indenture to 2012 Indenture]

EX-4.6

Exhibit 4.6

Dated as of February 16, 2018

EATON CORPORATION

as Issuer

and

THE BANK OF NEW YORKMELLON TRUST COMPANY, N.A.,

as Trustee

_____________________________________________

FIFTH SUPPLEMENTAL INDENTURE

to Indenture dated as of November 20, 2012 (as amended and supplemented from time to time)

_____________________________________________

FIFTH SUPPLEMENTAL INDENTURE, dated as of February 16, 2018 (this "Supplemental Indenture") among Eaton Corporation, an Ohio corporation, as issuer (the "Company") and The Bank of New York Mellon Trust Company, N.A., as trustee (the "Trustee").

W I T N E S S E T H

WHEREAS, the Company (as successor to Turlock Corporation, an Ohio corporation) and the Trustee are parties to an indenture dated as of November 20, 2012 (the "Base Indenture"), as supplemented by a first supplemental indenture dated as of November 30, 2012 among the Company, the new guarantors party thereto and the Trustee (the "First Supplemental Indenture"), a second supplemental indenture dated as of January 8, 2013 among the Company, the new guarantors party thereto and the Trustee (the "Second Supplemental Indenture"), a third supplemental indenture dated as of December 20, 2013 among the Company, the new guarantor party thereto and the Trustee(the "Third Supplemental Indenture"), and a fourth supplemental indenture dated as of December 20, 2017 and effective as of January 1, 2018 (the "Fourth Supplemental Indenture", and together with the Base Indenture, First Supplemental Indenture, Second Supplemental Indenture and Third Supplemental Indenture, the "Indenture"), providing for the issuance by the Company of $1,600,000,000 aggregate principal amounts of 2.750% Senior Notes due 2022 (the "2022 Notes"), $700,000,000 aggregate principal amount of 4.000% Senior Notes due 2032 (the "2032 Notes") and $1,000,000,000 aggregate principal amount of 4.150% Senior Notes due 2042 (the "2042 Notes" and, together with the 2022 Notes and the 2032 Notes, the "Securities");

WHEREAS, Section 901(7) of the Indenture provides, among other things, that the Company and the Trustee may enter into one or more supplemental indentures to the Indenture without the consent of any holder of a Note that do not adversely affect the interests of the holders of the Notes in any material respect;

WHEREAS, the Company has determined that it is in its best interest to amend Section 801(3) of the Indenture to clarify that the conditions therein do not apply to certain consolidations or mergers with Parent or the Company as the surviving corporation; and

WHEREAS, pursuant to Section 903 of the Indenture, the Trustee is authorized to execute and deliver this Supplemental Indenture.

NOW THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt of which is hereby acknowledged, the parties mutually covenant and agree for the equal and ratable benefit of the Holders of the Securities as follows:

1.CAPITALIZED TERMS. CAPITALIZED TERMS USED HEREIN WITHOUT DEFINITION SHALL HAVE THE MEANINGS ASSIGNED TO THEM IN THE INDENTURE.

2.AMENDMENT. CLAUSE (3) OF SECTION 801 IS HEREBY AMENDED AND RESTATED IN ITS ENTIRETY AS FOLLOWS:

(3) THE COMPANY, PARENT OR SUCH PERSON HAS DELIVERED TO THE TRUSTEE AN OFFICERS' CERTIFICATE AND AN OPINION OF COUNSEL, EACH

1

STATING THAT SUCH CONDOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE AND ANY SUPPLEMENTAL INDENTURE COMPLY WITH THIS ARTICLE AND THAT ALL CONDITIONS PRECEDENT PROVIDED FOR IN THIS SECTION 801 RELATING TO SUCH TRANSACTION HAVE BEEN COMPLIED WITH; PROVIDED THAT, THIS CLAUSE (3) WILL NOT APPLY TO A CONSOLIDATION OR MERGER OF A SUBSIDIARY OF PARENT (OTHER THAN THE COMPANY) WITH OR INTO PARENT OR THE COMPANY, WITH PARENT OR THE COMPANY AS THE SURVIVING CORPORATION (AS THE CASE MAY BE).

3.SEVERABILITY. IN CASE ANY PROVISION OF THIS SUPPLEMENTAL INDENTURE SHALL BE INVALID, ILLEGAL OR UNENFORCEABLE, THE VALIDITY, LEGALITY, AND ENFORCEABILITY OF THE REMAINING PROVISIONS SHALL NOT IN ANY WAY BE AFFECTED OR IMPAIRED THEREBY.

4.TRUSTEE DISCLAIMER. THE RECITALS CONTAINED IN THIS SUPPLEMENTAL INDENTURE SHALL BE TAKEN AS THE STATEMENTS OF THE COMPANY AND THE TRUSTEE ASSUMES NO RESPONSIBILITY FOR THEIR CORRECTNESS. THE TRUSTEE MAKES NO REPRESENTATIONS AS TO THE VALIDITY OR SUFFICIENCY OF THIS SUPPLEMENTAL INDENTURE. ALL RIGHTS, PROTECTIONS, PRIVILEGES, INDEMNITIES AND BENEFITS GRANTED OR AFFORDED TO THE TRUSTEE UNDER THE BASE INDENTURE SHALL BE DEEMED INCORPORATED HEREIN BY THIS REFERENCE AND SHALL BE DEEMED APPLICABLE TO ALL ACTIONS TAKEN, SUFFERED OR OMITTED BY THE TRUSTEE UNDER THIS SUPPLEMENTAL INDENTURE.

5.COUNTERPARTS. THIS SUPPLEMENTAL INDENTURE MAY BE EXECUTED IN ANY NUMBER OF COUNTERPARTS, EACH OF WHICH SHALL BE AN ORIGINAL BUT ALL OF WHICH TOGETHER SHALL CONSTITUTE ONE INSTRUMENT. EACH COUNTERPARTY MAY CONSIST OF A NUMBER OF COPIES HEREOF, EACH SIGNED BY LESS THAN ALL, BUT TOGETHER SIGNED BY ALL, OF THE PARTIES HERETO.

6.HEADINGS. THE HEADINGS OF THE SECTIONS IN THIS SUPPLEMENTAL INDENTURE ARE FOR CONVENIENCE OF REFERENCE ONLY AND SHALL NOT BE DEEMED TO ALTER OR AFFECT THE MEANING OR INTERPRETATION OF ANY PROVISIONS HEREOF.

7.GOVERNING LAW. THIS SUPPLEMENTAL INDENTURE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

[SIGNATURE PAGES FOLLOW]

2

IN WITNESS WHEREOF, each of the undersigned has caused this Supplemental Indenture to be duly executed by its proper and duly authorized officer(s) as of the date set forth above.

EATON CORPORATION

By: /s/ Trent M. Meyerhoefer    Name: Trent M. Meyerhoefer
Title: Senior Vice President – Treasury

By: /s/ Lizbeth L. Wright    Name: Lizbeth L. WrightTitle: Assistant Secretary

[Signature Page to Fifth Supplemental Indenture to 2012 Indenture]

THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A.,as Trustee

By: /s/ R. Tarnas    Name: R. TarnasTitle: Vice President

[Signature Page to Fifth Supplemental Indenture to 2012 Indenture]

EX-12

Eaton Corporation plc

2017 Annual Report on Form 10-K

Item 15(b)

Exhibit 12

Ratio of Earnings to Fixed Charges

	Year ended December 31
(In millions)	2017			2016*			2015*			2014*			2013*
Income from continuing operations before income taxes and   noncontrolling interests in consolidated subsidiaries	$	3,368		$	2,118		$	2,133		$	1,762		$	1,870
Adjustments
(Income) loss of equity investees	(1		)	(14		)	(11		)	(6		)	2
Distributed income of equity investees	7			9			9			4			77
Interest expensed	273			240			237			250			290
Amortization of debt issue costs	7			7			8			9			10
Estimated portion of rent expense representing interest	74			73			75			81			80
Amortization of capitalized interest	11			12			10			14			13
Adjusted income from continuing operations before   income taxes	$	3,739		$	2,445		$	2,461		$	2,114		$	2,342
Fixed charges
Interest expensed	$	273		$	240		$	237		$	250		$	290
Interest capitalized	11			12			13			13			11
Amortization of debt issue costs	7			7			8			9			10
Estimated portion of rent expense representing interest	74			73			75			81			80
Total fixed charges	$	365		$	332		$	333		$	353		$	391
Ratio of earnings to fixed charges	10.24			7.36			7.39			5.99			5.99

*Certain amounts for the years 2013 through 2016 have been adjusted to reflect the retrospective application of the Company's change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

EX-18

Eaton Corporation plc

2017 Annual Report on Form 10-K

Item 15(b)

Exhibit 18

Change in Accounting Principles Preferability Letter

February 28, 2018

Board of Directors

Eaton Corporation plc

Eaton House

30 Pembroke Road

Dublin 4, Ireland

Ladies and Gentlemen:

Notes 1 and 14 to the consolidated financial statements of Eaton Corporation plc included in its Form 10-K for the year ended December 31, 2017 describe a change in the method of accounting for inventory valuation from the last-in, first-out (LIFO) method to the first-in, first-out (FIFO) method for certain inventory in the United States. There are no authoritative criteria for determining a “preferable” inventory method based on the particular circumstances; however, we conclude that such change in the method of accounting is to an acceptable alternative method which, based on your business judgment to make this change and for the stated reasons, is preferable in your circumstances.

Very truly yours,

 /s/ Ernst & Young LLP

Cleveland, Ohio

EX-21

Eaton Corporation plc

2017 Annual Report on Form 10-K

Item 15(b)

Exhibit 21

Subsidiaries of Eaton Corporation plc

Eaton is publicly held and has no parent corporation. Eaton’s subsidiaries as of December 31, 2017, and the state or country in which each was organized, are as follows:

Consolidated Subsidiaries (A)	Where Organized
Illumination Management Solutions, Inc.	California
Eaton Energy Solutions, Inc.	Colorado
Bussmann International Holdings, LLC	Delaware
Bussmann International, Inc.	Delaware
CBE Services, Inc.	Delaware
Cooper B-Line, Inc.	Delaware
Cooper Bussmann, LLC	Delaware
Cooper Crouse-Hinds MTL, Inc.	Delaware
Cooper Crouse-Hinds, LLC	Delaware
Cooper Electrical International, LLC	Delaware
Cooper Enterprises LLC	Delaware
Cooper Finance USA, Inc.	Delaware
Cooper Industries International, LLC	Delaware
Cooper Industries Middle East, LLC	Delaware
Cooper Industries Poland, LLC	Delaware
Cooper Industries Vietnam, LLC	Delaware
Cooper Industries, LLC	Delaware
Cooper Interconnect, Inc.	Delaware
Cooper Lighting, LLC	Delaware
Cooper Notification, Inc.	Delaware
Cooper Power Systems, LLC	Delaware
Cooper Technologies Company	Delaware
Eaton Aerospace LLC	Delaware
Eaton Automated Transmission Technologies Corporation	Delaware
Eaton Electric Holdings LLC	Delaware
Eaton Holding International LLC	Delaware
Eaton Hydraulics LLC	Delaware
Eaton Industrial Corporation	Delaware
Eaton Industries (Philippines), LLC	Delaware
Eaton Worldwide LLC	Delaware
EIC Holding GP I	Delaware
EIC Holding GP II	Delaware
EIC Holding GP III	Delaware
EIC Holding GP IV	Delaware
EIC Holding I LLC	Delaware
EIC Holding II LLC	Delaware
EIC Holding III LLC	Delaware
EIC Holding IV LLC	Delaware
EIC Holding V LLC	Delaware
EIC Holding VI LLC	Delaware
McGraw-Edison Development Corporation	Delaware
MTL Instruments LLC	Delaware

Consolidated Subsidiaries (A)	Where Organized
MTL Partners II, Inc.	Delaware
MTL Partners, Inc.	Delaware
Standard Automation & Control LP	Delaware
Wright Line Holding, Inc.	Delaware
Wright Line LLC	Delaware
Azonix Corporation	Massachusetts
Eaton Ann Arbor LLC	Michigan
Cannon Technologies, Inc.	Minnesota
Cooper Wheelock, Inc.	New Jersey
Cooper Wiring Devices, Inc.	New York
Chagrin Highlands III Limited	Ohio
Eaton Aeroquip LLC	Ohio
Eaton Corporation	Ohio
Eaton Holding II LLC	Ohio
Eaton Holding LLC	Ohio
Eaton Leasing Corporation	Ohio
Eaton US Holdings, Inc.	Ohio
Sure Power, Inc.	Oregon
Eaton Industries (Argentina) S.A.	Argentina
Cooper Electrical Australia Pty. Limited	Australia
Eaton Industries Pty. Ltd.	Australia
Elpro Technologies Pty. Limited	Australia
CTI-VIENNA Gesellschaft zur Prüfung elektrotechnischer Industrieprodukte GmbH	Austria
Eaton Holding (Austria) G.m.b.H.	Austria
Eaton Holding G.m.b.H.	Austria
Eaton Industries (Austria) G.m.b.H.	Austria
Eaton Holding SRL	Barbados
Eaton Electric SPRL	Belgium
Eaton Filtration BVBA	Belgium
Eaton Industries (Belgium) BVBA	Belgium
Cambridge International Insurance Company Ltd.	Bermuda
Cooper Bermuda Investments Ltd.	Bermuda
Cooper Finance Group Ltd.	Bermuda
Cooper Investment Group Ltd.	Bermuda
Eaton Industries Holdings Ltd.	Bermuda
Saturn Insurance Company Ltd.	Bermuda
Aeroquip do Brasil Ltda.	Brazil
Blinda Industria e Comercio Ltda.	Brazil
Bussmann do Brasil Ltda.	Brazil
Cooper Power Systems do Brasil Ltda.	Brazil
Eaton Ltda.	Brazil
Eaton Power Solution Ltda.	Brazil
Hernis Scan System do Brasil Comercio E Servicos LTDA	Brazil
Moeller Electric Ltda.	Brazil
Moeller Industria de electro-electronicos do Amazonas Ltda.	Brazil
Digital Lighting Holdings Limited	British Virgin Islands
Nittan BVI Co. Ltd.	British Virgin Islands
Phoenixtec International Corp.	British Virgin Islands
Senyuan International Investments Limited	British Virgin Islands

Consolidated Subsidiaries (A)	Where Organized
Silver Light International Limited	British Virgin Islands
Winner Hydraulics Ltd.	British Virgin Islands
Eaton Industries EOOD	Bulgaria
Aeroquip-Vickers Canada Inc.	Canada
Cooper Finance (Canada) L.P.	Canada
Cooper Industries (Canada) Inc.	Canada
Cooper Industries (Electrical) Inc.	Canada
Cyme International T & D Inc.	Canada
Eaton ETN Offshore Company	Canada
Eaton ETN Offshore II Company	Canada
Eaton Industries (Canada) Company	Canada
Aeroquip Financial Ltd.	Cayman Islands
Cutler-Hammer Electrical Company	Cayman Islands
Cutler-Hammer Industries Ltd.	Cayman Islands
Eaton Holding I Limited	Cayman Islands
Eaton Holding II Limited	Cayman Islands
Eaton Holding III Limited	Cayman Islands
Georgetown Financial Services Ltd.	Cayman Islands
Green Holding Company	Cayman Islands
Senyuan International Holdings Limited	Cayman Islands
Eaton Industries (Chile) S.p.A.	Chile
Beijing Internormen-Filter Ltd. Co.	China
Beijing Yoosung Shinhwa Automobile Parts Co., Ltd.	China
Cooper (China) Co., Ltd.	China
Cooper (Ningbo) Electric Co., Ltd.	China
Cooper Edison (Pingdingshan) Electronic Technologies Co., Ltd.	China
Cooper Electric (Changzhou) Co., Ltd.	China
Cooper Electronic Technologies (Shanghai) Co., Ltd.	China
Cooper Shanghai Power Capacitor Co., Ltd.	China
Cooper Xi'an Fusegear Co., Ltd.	China
Cooper Yuhua (Changzhou) Electric Equipment Manufacturing Co., Ltd.	China
Digital Lighting (Dong Guan) Co., Ltd.	China
Dongguan Cooper Electronics Co. Ltd.	China
Dongguan Wiring Devices Electronics Co., Ltd.	China
Eaton (China) Investments Co., Ltd.	China
Eaton Electrical Equipment Co Ltd	China
Eaton Electrical Ltd.	China
Eaton Filtration (Shanghai) Co. Ltd.	China
Eaton Fluid Power (Shanghai) Co., Ltd.	China
Eaton Fu Li An (Changzhou) Electronics Co., Ltd.	China
Eaton Hydraulics (Luzhou) Co., Ltd.	China
Eaton Hydraulics (Ningbo) Co., Ltd.	China
Eaton Hydraulics Systems (Jining) Co., Ltd.	China
Eaton Industrial Clutches and Brakes (Shanghai) Co., Ltd.	China
Eaton Industries (Jining) Co., Ltd	China
Eaton Industries (Shanghai) Co., Ltd	China
Eaton Industries (Wuxi) Co., Ltd.	China
Eaton Power Quality (Shanghai) Co., Ltd.	China
Eaton Senstar Automotive Fluid Connector (Shanghai) Co., Ltd.	China

Consolidated Subsidiaries (A)	Where Organized
Funke+Huster (Tianjin) Electronics Co. Ltd.	China
Guangzhou Nittan Valve Co. Ltd.	China
Kaicheng Funke+Huster (Tangshan) Mining Electrical Co. Ltd.	China
Lian Zheng Electronics (Shenzhen) Co., Ltd.	China
Moeller Electric (Shanghai) Co., Ltd.	China
Phoenixtec Electronics (Shenzhen) Co., Ltd.	China
Rizhao Yoosung Shinhwa Automobile Parts Co., Ltd.	China
Santak Electronic (Shenzhen) Co., Ltd.	China
UPE Electronics (Shenzhen) Co., Ltd.	China
Cooper Industries Colombia S.A.S.	Colombia
Eaton Industries (Colombia) S.A.S.	Colombia
Eaton Electrical S.A.	Costa Rica
Eaton Electric s.r.o.	Czech Republic
Eaton Elektrotechnika s.r.o.	Czech Republic
Eaton Industries s.r.o.	Czech Republic
Eaton Electric ApS	Denmark
Eaton Filtration (Denmark) ApS	Denmark
Cutler-Hammer, SRL	Dominican Republic
Eaton Industries (Egypt) LLC	Egypt
Eaton Power Quality OY (Finland)	Finland
Cooper Capri S.A.S.	France
Cooper Menvier France SARL	France
Cooper Securite S.A.S.	France
Eaton France Holding SAS	France
Eaton Industries (France) S.A.S.	France
Eaton Power Quality S.A.S.	France
Eaton S.A.S.	France
Eaton Technologies S.A.	France
Martek Power F SAS	France
MP Group SAS	France
MTL Instruments SARL	France
Sefelec SAS	France
Semelec SAS	France
CEAG Notlichtsysteme GmbH	Germany
Cooper Crouse-Hinds GmbH	Germany
Cooper Germany Holdings GmbH	Germany
Cooper Industries Finanzierungs-GbR	Germany
Cooper Industries Holdings GmbH	Germany
Eaton Electric G.m.b.H.	Germany
Eaton Electrical IP G.m.b.H. & Co. KG	Germany
Eaton Germany G.m.b.H.	Germany
Eaton GmbH & Co. KG	Germany
Eaton Holding SE & Co. KG	Germany
Eaton Industrial IP G.m.b.H. & Co. KG	Germany
Eaton Industries G.m.b.H.	Germany
Eaton Industries Holding G.m.b.H.	Germany
Eaton Production International G.m.b.H.	Germany
Eaton Protection Systems IP G.m.b.H. & Co. KG	Germany
Eaton Safety IP G.m.b.H. & Co. KG	Germany

Consolidated Subsidiaries (A)	Where Organized
Eaton SE	Germany
Eaton Technologies G.m.b.H.	Germany
Eaton Technologies IP G.m.b.H. & Co. KG	Germany
FHF Bergbautechnik GmbH & Co. KG	Germany
FHF Funke+Huster Fernsig GmbH	Germany
FHF New World GmbH	Germany
Funke+Huster GmbH	Germany
GeCma Components electronic GmbH	Germany
Hein Moeller Stiftung G.m.b.H.	Germany
Institute for International Product Safety G.m.b.H.	Germany
Martek Power GmbH	Germany
MTL Instruments GmbH	Germany
Sefelec GmbH	Germany
Cooper Univel S.A.	Greece
Digital Lighting Co., Limited	Hong Kong
Eaton Electric & Engineering Services Limited	Hong Kong
Eaton Enterprises Limited	Hong Kong
Eaton Power Quality Limited	Hong Kong
Martek Power Limited	Hong Kong
Riseson International Limited	Hong Kong
Santak Electronics Company Limited	Hong Kong
Scoremax Limited	Hong Kong
Silver Victory Hong Kong Limited	Hong Kong
Tai Ah Electrical Ltd.	Hong Kong
Vickers Systems Limited	Hong Kong
Cooper Bussmann Hungaria Kft.	Hungary
Eaton Enterprises (Hungary) Kft.	Hungary
Eaton Industries KFT	Hungary
Cooper India Private Limited	India
Eaton Fluid Power Limited	India
Eaton India Innovation Center LLP	India
Eaton Industrial Systems Private Limited	India
Eaton Management Services LLP	India
Eaton Power Quality Private Limited	India
Eaton Technologies Private Limited	India
Internormen Filters Private Limited	India
MTL Instruments Private Limited	India
PT Eaton Industries	Indonesia
PT. Fluid Sciences Batam	Indonesia
Abeiron III Unlimited Company	Ireland
Cooper Industries Trading Unlimited Company	Ireland
Cooper Industries Unlimited Company	Ireland
Eaton Capital Global Holdings Unlimited Company	Ireland
Eaton Capital Unlimited Co	Ireland
Eaton Industries (Ireland) Limited	Ireland
Eaton Intelligent Power Limited	Ireland
Tractech (Ireland) Limited	Ireland
TT (Ireland) Acquisition Limited	Ireland
Eaton Global Limited	Isle of Man

Consolidated Subsidiaries (A)	Where Organized
Eaton Global Holdings Limited	Isle of Man
Eaton Industries (Israel) Ltd.	Israel
Cooper Csa Srl	Italy
Eaton Filtration (Italy) S.r.l.	Italy
Eaton Fluid Power S.r.l.	Italy
Eaton Industries (Italy) S.r.l.	Italy
Eaton S.r.l.	Italy
Gitiesse S.r.l.	Italy
MTL Italia Srl	Italy
Cooper Industries Japan K.K.	Japan
Eaton Electric (Japan) Ltd.	Japan
Eaton Filtration Ltd.	Japan
Eaton Industries (Japan) Ltd.	Japan
Eaton Japan Co., Ltd.	Japan
Cooper Korea Ltd.	Korea
Eaton Industries (Korea) Limited	Korea
Eaton Electric S.I.A.	Latvia
Aeroquip-Vickers International S.a.r.L.	Luxembourg
Cooper International Holdings S.a.r.l	Luxembourg
Cooper Investment Group S a.r.l.	Luxembourg
Cooper Offshore Holdings S.a.r.l.	Luxembourg
Eaton Controls (Luxembourg) S.a.r.l.	Luxembourg
Eaton Finance S.a.r.l.	Luxembourg
Eaton Holding II S.a.r.l.	Luxembourg
Eaton Holding III S.a.r.l.	Luxembourg
Eaton Holding IV S.a.r.l.	Luxembourg
Eaton Holding IX S.a.r.l.	Luxembourg
Eaton Holding S.a.r.l.	Luxembourg
Eaton Holding V S.a.r.l.	Luxembourg
Eaton Holding VI S.a.r.l.	Luxembourg
Eaton Holding VIII S.a.r.l.	Luxembourg
Eaton Holding X S.a.r.l.	Luxembourg
Eaton Holding XII B.V./S.a.r.l.	Luxembourg
Eaton Industries (Luxembourg) B.V./S.a.r.l.	Luxembourg
Eaton Moeller S.a.r.l.	Luxembourg
Eaton Services S.a.r.L.	Luxembourg
Eaton Technologies (Luxembourg) S.a.r.l.	Luxembourg
Martek Power SA	Luxembourg
Cooper Industries Malaysia SDN BHD	Malaysia
Eaton Industries Sdn. Bhd.	Malaysia
ETN Asia International Limited	Mauritius
ETN Holding 1 Limited	Mauritius
ETN Holding 2 Limited	Mauritius
ETN Holding 3 Limited	Mauritius
Arrow-Hart, S. de R.L. de C.V.	Mexico
Bussmann, S. de R.L. de C.V.	Mexico
Componentes de Iluminacion, S. de R.L. de C.V.	Mexico
Cooper Crouse-Hinds, S. de R.L. de C.V.	Mexico
Cooper Lighting de Mexico, S. de R.L. de C.V.	Mexico

Consolidated Subsidiaries (A)	Where Organized
Cooper Mexico Distribucion, S. de R.L. de C.V.	Mexico
Cooper Wiring Devices de Mexico, S.A. de C.V.	Mexico
Cooper Wiring Devices Manufacturing, S. de R.L. de C.V.	Mexico
Eaton Controls, S. de R.L. de C.V.	Mexico
Eaton Enterprises, S. de R.L. de C.V.	Mexico
Eaton Industries, S. de R.L. de C.V.	Mexico
Eaton Solutions, S. de R.L. de C.V.	Mexico
Eaton Technologies, S. de R.L. de C.V.	Mexico
Eaton Trading Company, S. de R.L. de C.V.	Mexico
Eaton Truck Components, S. de R.L. de C.V.	Mexico
Electromanufacturas, S. de R.L. de C.V.	Mexico
Iluminacion Cooper de las Californias, S. de R.L. de C.V.	Mexico
Martek Power S.A. de C.V.	Mexico
Eaton Electric S.a.r.l.	Morocco
Eaton Industries (Morocco) LLC	Morocco
Cooper Crouse-Hinds B.V.	Netherlands
Cooper Industries Finance B.V.	Netherlands
Cooper Industries Global B.V.	Netherlands
Cooper Safety B.V.	Netherlands
Eaton B.V.	Netherlands
Eaton C.V.	Netherlands
Eaton Holding (Netherlands) B.V.	Netherlands
Eaton Holding I B.V.	Netherlands
Eaton Holding III B.V.	Netherlands
Eaton Holding Turlock B.V.	Netherlands
Eaton Holding V B.V.	Netherlands
Eaton Holding VI B.V.	Netherlands
Eaton Holding VII B.V.	Netherlands
Eaton Holding VIII B.V.	Netherlands
Eaton Industries (Netherlands) B.V.	Netherlands
Eaton International B.V.	Netherlands
Eaton Moeller B.V.	Netherlands
MTL Instruments B.V.	Netherlands
Scantronic Benelux BV	Netherlands
Turlock B.V.	Netherlands
Eaton Industries Company	New Zealand
Eaton International Industries Nigeria Limited	Nigeria
Cooper Crouse-Hinds AS	Norway
Eaton Electric AS	Norway
Hernis Scan Systems A/S	Norway
Norex AS	Norway
Eaton Industries Panama S.A.	Panama
Eaton Industries SAC	Peru
Eaton Automotive Components Spolka z o.o.	Poland
Eaton Automotive Spolka z o.o.	Poland
Eaton Automotive Systems Spolka z o.o.	Poland
Eaton Electric Spolka z.o.o.	Poland
Eaton Filtration (Poland) Sp. z o.o.	Poland
Eaton I Spolka z.o.o.	Poland

Consolidated Subsidiaries (A)	Where Organized
Eaton Truck Components Spolka z o.o.	Poland
Cooper Pretronica Lda.	Portugal
Eaton Madeira SGPS Lda.	Portugal
Cooper Industries Romania SRL	Romania
Eaton Electric S.r.l.	Romania
Eaton Electro Productie S.r.l.	Romania
Cooper Industries Russia LLC	Russia
Eaton LLC	Russia
Eaton II LP	Scotland
Eaton III LP	Scotland
Eaton Industries LP	Scotland
Eaton IV LP	Scotland
Eaton LP	Scotland
Eaton Manufacturing LP	Scotland
Eaton Electric d.o.o.	Serbia
Cooper Crouse-Hinds Pte. Ltd.	Singapore
Eaton Industries Pte. Ltd.	Singapore
Hernis Scan Systems - Asia Pte Ltd.	Singapore
Eaton Electric s.r.o.	Slovak Republic
Eaton Electric (South Africa) Pty Ltd.	South Africa
Eaton Hydraulics (Proprietary) Limited	South Africa
Eaton Truck Components (Proprietary) Ltd.	South Africa
Aeroquip Iberica S.L.	Spain
Cooper Crouse-Hinds, S.A.	Spain
Eaton Industries (Spain) S.L.	Spain
Productos Eaton Livia S.L.	Spain
Eaton Holec AB	Sweden
Eaton Power Quality AB	Sweden
Ultronics Nordic Sales AB	Sweden
Eaton Automation G.m.b.H	Switzerland
Eaton Automation Holding G.m.b.H.	Switzerland
Eaton Industries II G.m.b.H.	Switzerland
Eaton Industries Manufacturing G.m.b.H.	Switzerland
Eaton Manufacturing G.m.b.H.	Switzerland
Eaton Manufacturing II G.m.b.H.	Switzerland
Eaton Manufacturing III G.m.b.H.	Switzerland
Eaton Switzerland Holding I GmbH	Switzerland
Eaton Switzerland Holding II GmbH	Switzerland
Centralion Industrial Inc.	Taiwan
Eaton Phoenixtec MMPL Co. Ltd.	Taiwan
RTE Far East Corporation	Taiwan
Eaton Electric (Thailand) Ltd.	Thailand
Eaton Electric Company Ltd.	Thailand
Eaton Industries (Thailand) Ltd.	Thailand
Eaton Elektrik Ticaret Limited Sirketi	Turkey
Polimer Kaucuk Sanayi ve Pazarlama A.S.	Turkey
D.P. Eaton Electric	Ukraine
Cooper Crouse-Hinds (LLC)	United Arab Emirates
Cooper Industries FZE	United Arab Emirates

Consolidated Subsidiaries (A)	Where Organized
Eaton FZE	United Arab Emirates
Aeroquip (UK) Limited	United Kingdom
Aeroquip Limited	United Kingdom
Cooper Bussmann (U.K.) Limited	United Kingdom
Cooper Controls (Watford) Limited	United Kingdom
Cooper Controls Limited	United Kingdom
Cooper Crouse-Hinds (UK) Ltd.	United Kingdom
Cooper Industries Investments UK Limited	United Kingdom
Cooper Industries UK Subco Limited	United Kingdom
Cooper Security Limited	United Kingdom
Eaton Controls (UK) Limited	United Kingdom
Eaton Electric Limited	United Kingdom
Eaton Electrical Products Limited	United Kingdom
Eaton Electrical Systems Limited	United Kingdom
Eaton Holding (UK) II Limited	United Kingdom
Eaton Holding Limited	United Kingdom
Eaton Industries (England) Limited	United Kingdom
Eaton Industries (U.K.) Limited	United Kingdom
Eaton Limited	United Kingdom
Eaton MEDC Limited	United Kingdom
Eaton Safety Limited	United Kingdom
EX Innovations Limited	United Kingdom
Martek Power Limited (UK)	United Kingdom
Measurement Technology Limited	United Kingdom
Menvier Overseas Holdings Limited	United Kingdom
Ocean Technical Systems Limited	United Kingdom
Oxalis Group Limited	United Kingdom
Polaron Components Limited	United Kingdom
Scantronic Holdings Limited	United Kingdom
The MTL Instruments Group Limited	United Kingdom
Eaton Electrical, S.A.	Venezuela
(A) Other Eaton subsidiaries, many inactive, are not listed above. If considered in the aggregate, they would not be material.

EX-23

Eaton Corporation plc

2017 Annual Report on Form 10-K

Item 15(b)

Exhibit 23

Consent of Independent Registered Public Accounting Firm

We consent to the incorporation by reference in the following Registration Statements of our reports dated February 28, 2018, with respect to the consolidated financial statements of Eaton Corporation plc and the effectiveness of internal control over financial reporting of Eaton Corporation plc included in this Annual Report (Form 10-K) of Eaton Corporation plc for the year ended December 31, 2017:

Registration number	Description	Filing date
333-207689	Form S-8 Registration Statement-2015 Stock Plan	October 30, 2015
333-202308	Form S-3 Registration Statement	February 26, 2015
333-185206	Multiple plans - Form S-8 Registration Statement	November 30, 2012
	Amended and Restated 2012 Stock Plan
	Second Amended and Restated 2009 Stock Plan
	Amended and Restated 2008 Stock Plan
	Amended and Restated 2004 Stock Plan
	Amended and Restated 2002 Stock Plan
	Amended and Restated 1998 Stock Plan
	Amended and Restated 1995 Stock Plan
	Eaton Incentive Compensation Deferral Plan II
	Eaton Corporation Deferred Incentive Compensation Plan II
	2005 Non-Employee Director Fee Deferral Plan
	Eaton Savings Plan
	Eaton Personal Investment Plan
	Eaton Puerto Rico Retirement Savings Plan
	Cooper Retirement Savings and Stock Ownership Plan

/s/ Ernst & Young LLP

Cleveland, Ohio

February 28, 2018

EX-24

Eaton Corporation plc

2017 Annual Report on Form 10-K

Item 15(b)

Exhibit 24

Power of Attorney

KNOW ALL MEN BY THESE PRESENTS: That each person whose name is signed below has made, constituted and appointed, and by this instrument does make, constitute and appoint Richard H. Fearon, Ken D. Semelsberger or James P. Even his or her true and lawful attorney and agent, for him or her and in his or her name, place and stead to execute and subscribe, as attorney-in-fact, his or her signature as Director or Officer or both, as the case may be, of Eaton Corporation plc, to its Annual Report on Form 10-K for the year ended December 31, 2017 pursuant to the Securities Exchange Act of 1934, and to any and all amendments to that Annual Report, hereby giving and granting unto each such attorney-in-fact full power and authority to do and perform every act and thing whatsoever necessary to be done in the premises, including to file the Annual Report on Form 10-K with the Securities and Exchange Commission, as fully as he or she might or could do if personally present, hereby ratifying and confirming all that each such attorney-in-fact shall lawfully do or cause to be done by virtue hereof.

This Power of Attorney shall not apply to any Annual Report on Form 10-K or amendment thereto filed after December 31, 2018.

IN WITNESS WHEREOF, this Power of Attorney has been signed at Cleveland, Ohio, U.S.A. this 28th day of February, 2018.

/s/ Craig Arnold	/s/ Richard H. Fearon
Craig Arnold, Chairman; Principal Executive Officer; Director	Richard H. Fearon, Principal Financial Officer; Director
	/s/ Todd M. Bluedorn
Ken D. Semelsberger, Principal Accounting Officer	Todd M. Bluedorn, Director
/s/ Christopher M. Connor	/s/ Michael J. Critelli
Christopher M. Connor, Director	Michael J. Critelli, Director
/s/ Charles E. Golden	/s/ Arthur E. Johnson
Charles E. Golden, Director	Arthur E. Johnson, Director
/s/ Deborah L. McCoy
Deborah L. McCoy, Director	Gregory R. Page, Director
/s/ Sandra Pianalto	/s/ Gerald B. Smith
Sandra Pianalto, Director	Gerald B. Smith, Director
/s/ Dorothy C. Thompson
Dorothy C. Thompson, Director

EX-31.1

Eaton Corporation plc

2017 Annual Report on Form 10-K

Item 15(b)

Exhibit 31.1

Certification

I, Craig Arnold, certify that:

1. I have reviewed this annual report on Form 10-K of Eaton Corporation plc;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:	February 28, 2018	/s/ Craig Arnold
		Craig Arnold
		Principal Executive Officer

EX-31.2

Eaton Corporation plc

2017 Annual Report on Form 10-K

Item 15(b)

Exhibit 31.2

Certification

I, Richard H. Fearon, certify that:

1. I have reviewed this annual report on Form 10-K of Eaton Corporation plc;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:	February 28, 2018	/s/ Richard H. Fearon
		Richard H. Fearon
		Principal Financial Officer

EX-32.1

Eaton Corporation plc

2017 Annual Report on Form 10-K

Item 15(b)

Exhibit 32.1

Certification

This written statement is submitted in accordance with Section 906 of the Sarbanes-Oxley Act of 2002. It accompanies Eaton Corporation plc’s Annual Report on Form 10-K for the year ended December 31, 2017 (“10-K Report”).

I hereby certify that, based on my knowledge, the Report on Form 10-K fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C 78m), and information contained in the 10-K Report fairly presents, in all material respects, the financial condition and results of operations of Eaton Corporation plc and its consolidated subsidiaries.

Date:	February 28, 2018	/s/ Craig Arnold
		Craig Arnold
		Principal Executive Officer

EX-32.2

Eaton Corporation plc

2017 Annual Report on Form 10-K

Item 15(b)

Exhibit 32.2

Certification

This written statement is submitted in accordance with Section 906 of the Sarbanes-Oxley Act of 2002. It accompanies Eaton Corporation plc’s Annual Report on Form 10-K for the year ended December 31, 2017 (“10-K Report”).

I hereby certify that, based on my knowledge, the Report on Form 10-K fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C 78m), and information contained in the 10-K Report fairly presents, in all material respects, the financial condition and results of operations of Eaton Corporation plc and its consolidated subsidiaries.

Date:	February 28, 2018	/s/ Richard H. Fearon
		Richard H. Fearon
		Principal Financial Officer

XML

Document and Entity Information Document - USD ($) shares in Millions, $ in Billions	12 Months Ended
	Dec. 31, 2017	Jan. 31, 2018	Jun. 30, 2017
Document and Entity Information [Abstract]
Entity Registrant Name	Eaton Corp plc
Entity Central Index Key	0001551182
Trading Symbol	ETN
Document Type	10-K
Document Period End Date	Dec. 31, 2017
Amendment Flag	false
Document Fiscal Year Focus	2017
Document Fiscal Period Focus	FY
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	Yes
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Public Float			$ 34.6
Entity Ordinary Shares, Shares Outstanding		440.2

XML

Consolidated Statements of Income - USD ($) shares in Millions, $ in Millions	3 Months Ended						12 Months Ended
	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Sep. 30, 2016	Jun. 30, 2016	Mar. 31, 2016	Dec. 31, 2017		Dec. 31, 2016	[1]	Dec. 31, 2015	[1]
Income Statement [Abstract]
Net sales							$ 20,404		$ 19,747		$ 20,855
Cost of products sold	$ 3,466	$ 3,448	$ 3,307	$ 3,374	$ 3,422	$ 3,294	13,756		13,409		14,304
Selling and administrative expense							3,565		3,505		3,596
Research and development expense							584		589		625
Interest expense - net							246		233		232
Gain on sale of business							1,077		0		0
Other income - net							(38)		(107)		(35)
Income before income taxes	1,694	572	467	570	550	439	3,368		2,118	[2]	2,133	[2]
Income tax expense	293	55	33	50	60	38	382		199	[2]	159	[2]
Net income	1,401	517	434	520	490	401	2,986	[3]	1,919	[2],[3]	1,974	[2],[3]
Less net income for noncontrolling interests							(1)		(3)		(2)
Net income attributable to Eaton ordinary shareholders	$ 1,401	$ 516	$ 434	$ 521	$ 489	$ 402	$ 2,985		$ 1,916	[2],[4]	$ 1,972	[2],[4]
Net income per share attributable to Eaton ordinary shareholders
Net income per ordinary share - diluted (usd per share)	$ 3.14	$ 1.15	$ 0.96	$ 1.14	$ 1.07	$ 0.87	$ 6.68		$ 4.20		$ 4.22
Basic (usd per share)	$ 3.16	$ 1.16	$ 0.97	$ 1.15	$ 1.07	$ 0.88	$ 6.71		$ 4.21		$ 4.23
Weighted-average number of ordinary shares outstanding
Diluted (shares)							447.0		456.5		467.1
Basic (shares)							444.5		455.0	[4]	465.5	[4]
Cash dividends declared per ordinary share (usd per share)							$ 2.40		$ 2.28		$ 2.20

[1] *Year ended December 31, 2016 and 2015 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

[2] *Other corporate expense - net and Income tax expense in 2016 and 2015 have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14.

[3] *The balances at January 1, 2015 and the year ended December 31, 2015 and 2016 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

[4] *Certain amounts have been adjusted to reflect the retrospective application of the Company's change in inventory accounting method, as described in Notes 1 and 14.

XML

Consolidated Statements of Comprehensive Income - USD ($) $ in Millions		12 Months Ended
		Dec. 31, 2017	Dec. 31, 2016	[3]	Dec. 31, 2015	[3]
Statement of Comprehensive Income [Abstract]
Net income	[1]	$ 2,986	$ 1,919	[2]	$ 1,974	[2]
Less net income for noncontrolling interests		(1)	(3)		(2)
Net income attributable to Eaton ordinary shareholders		2,985	1,916	[2],[4]	1,972	[2],[4]
Other comprehensive income (loss), net of tax
Currency translation and related hedging instruments		807	(570)		(1,078)
Pensions and other postretirement benefits		241	(6)		111
Cash flow hedges		(4)	(9)		3
Net current-period Other comprehensive income (loss)		1,044	(585)		(964)
Total comprehensive income attributable to Eaton ordinary shareholders		$ 4,029	$ 1,331		$ 1,008

[1] *The balances at January 1, 2015 and the year ended December 31, 2015 and 2016 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

[2] *Other corporate expense - net and Income tax expense in 2016 and 2015 have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14.

[3] *Year ended December 31, 2016 and 2015 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

[4] *Certain amounts have been adjusted to reflect the retrospective application of the Company's change in inventory accounting method, as described in Notes 1 and 14.

XML

Consolidated Balance Sheets - USD ($) $ in Millions		Dec. 31, 2017	Dec. 31, 2016	[1]
Current assets
Cash		$ 561	$ 543	[2]
Short-term investments		534	203
Accounts receivable - net		3,943	3,560
Inventory		2,620	2,346
Prepaid expenses and other current assets		679	381
Total current assets		8,337	7,033
Property, plant and equipment
Land and buildings		2,491	2,369
Machinery and equipment		6,014	5,670
Gross property, plant and equipment		8,505	8,039
Accumulated depreciation		(5,003)	(4,596)
Net property, plant and equipment		3,502	3,443
Other noncurrent assets
Goodwill		13,568	13,201
Other intangible assets		5,265	5,514
Deferred income taxes		253	325
Other assets		1,698	960
Total assets		32,623	30,476	[3]
Current liabilities
Short-term debt		6	14
Current portion of long-term debt		578	1,552
Accounts payable		2,166	1,718
Accrued compensation		453	379
Other current liabilities		1,872	1,822
Total current liabilities		5,075	5,485
Noncurrent liabilities
Long-term debt		7,167	6,711
Pension liabilities		1,226	1,659
Other postretirement benefits liabilities		362	368
Deferred income taxes		538	321
Other noncurrent liabilities		965	934
Total noncurrent liabilities		10,258	9,993
Shareholders’ equity
Ordinary shares (439.9 million outstanding in 2017 and 449.4 million in 2016)		4	5
Capital in excess of par value		11,987	11,845
Retained earnings		8,669	7,555
Accumulated other comprehensive loss		(3,404)	(4,448)
Shares held in trust		(3)	(3)
Total Eaton shareholders’ equity		17,253	14,954
Noncontrolling interests		37	44
Total equity	[4]	17,290	14,998
Total liabilities and equity		$ 32,623	$ 30,476

[1] *December 31, 2016 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

[2] *Year ended December 31, 2016 and 2015 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

[3] *Corporate identifiable assets in 2016 and 2015 have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14.

[4] *The balances at January 1, 2015 and the year ended December 31, 2015 and 2016 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

XML

Consolidated Balance Sheets Parentheticals - shares shares in Millions	Dec. 31, 2017	Dec. 31, 2016
Statement of Financial Position [Abstract]
Ordinary shares outstanding shares	439.9	449.4

XML

Consolidated Statements of Cash Flows - USD ($) $ in Millions		12 Months Ended
		Dec. 31, 2017		Dec. 31, 2016		Dec. 31, 2015
Operating activities
Net income	[1]	$ 2,986		$ 1,919	[2],[3]	$ 1,974	[2],[3]
Adjustments to reconcile to net cash provided by operating activities
Depreciation and amortization		914		929	[3]	925	[3]
Deferred income taxes		(206)		(83)	[3]	(105)	[3]
Pension and other postretirement benefits expense		208		235	[3]	323	[3]
Contributions to pension plans		(473)		(262)	[3]	(330)	[3]
Contributions to other postretirement benefits plans		(20)		(30)	[3]	(31)	[3]
Gain on sale of business, net		(843)		0	[3]	0	[3]
Gain on sale of businesses		(1,077)		0	[3]	0	[3]
Changes in working capital
Accounts receivable - net		(231)		(170)	[3]	5	[3]
Inventory		(202)		34	[3]	(8)	[3]
Accounts payable		388		0	[3]	(120)	[3]
Accrued compensation		59		20	[3]	(28)	[3]
Accrued income and other taxes		(4)		30	[3]	(9)	[3]
Other current assets		2		(21)	[3]	7	[3]
Other current liabilities		(203)		(44)	[3]	(38)	[3]
Other - net		291		13	[3]	(156)	[3]
Net cash provided by operating activities		2,666		2,570	[3]	2,409	[3]
Investing activities
Capital expenditures for property, plant and equipment		(520)		(497)	[3]	(506)	[3]
Proceeds from sale of business		607		0	[3]	1	[3]
Cash received from (paid for) acquisitions of businesses, net of cash acquired		0		1	[3]	(72)	[3]
Sales (purchases) of short-term investments - net		(298)		(40)	[3]	37	[3]
Other - net		(6)		7	[3]	(35)	[3]
Net cash used in investing activities		(217)		(529)	[3]	(575)	[3]
Financing activities
Proceeds from borrowings		1,000		631	[3]	425	[3]
Payments on borrowings		(1,554)		(653)	[3]	(1,027)	[3]
Cash dividends paid		(1,068)		(1,037)	[3]	(1,026)	[3]
Exercise of employee stock options		66		74	[3]	52	[3]
Repurchase of shares		(850)		(730)	[3]	(682)	[3]
Employee taxes paid from shares withheld		(22)		(18)	[3]	(38)	[3]
Other - net		(14)		(5)	[3]	(9)	[3]
Net cash used in financing activities		(2,442)		(1,738)	[3]	(2,305)	[3]
Effect of currency on cash		11		(28)	[3]	(42)	[3]
Total increase (decrease) in cash		18		275	[3]	(513)	[3]
Cash at the beginning of the period	[3]	543	[4]	268		781
Cash at the end of the period		$ 561		$ 543	[3],[4]	$ 268	[3]

[1] *The balances at January 1, 2015 and the year ended December 31, 2015 and 2016 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

[2] *Other corporate expense - net and Income tax expense in 2016 and 2015 have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14.

[3] *Year ended December 31, 2016 and 2015 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

[4] *December 31, 2016 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

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Consolidated Statements of Shareholders' Equity Statement - USD ($) shares in Millions, $ in Millions		Total		Ordinary shares	Capital in excess of par value	Retained earnings		Accumulated other comprehensive loss	Shares held in trust	Total Eaton shareholders' equity		Noncontrolling interests
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Inventory accounting method change	[1]	$ 70				$ 70				$ 70
Beginning balance, adjusted balance	[1]	15,909		$ 5	$ 11,605	7,148		$ (2,899)	$ (3)	15,856		$ 53
Beginning balance at Dec. 31, 2014	[1]	15,839		$ 5	11,605	7,078		(2,899)	(3)	15,786		53
Beginning balance, shares at Dec. 31, 2014	[1]			467.9
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	[1]	1,974	[2],[3]			1,972				1,972		2
Other comprehensive income (loss), net of tax	[1]	(964)						(964)		(964)
Cash dividends paid		(1,035)	[1]			(1,026)	[1]			(1,026)	[1]	(9)
Issuance of shares under equity-based compensation plans - net (net of income tax benefit), shares				2.2
Issuance of shares under equity-based compensation plans - net (net of income tax benefit)		96	[1]		99	(3)	[1]			96	[1]
Changes in noncontrolling interest of consolidated subsidiaries - net		(4)	[1]		(3)					(3)	[1]	(1)
Repurchase of shares, shares				(11.3)
Repurchase of shares	[1]	(682)				(682)				(682)
Ending balance, shares at Dec. 31, 2015	[1]			458.8
Ending balance at Dec. 31, 2015	[1]	15,294		$ 5	11,701	7,409		(3,863)	(3)	15,249		45
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	[1]	1,919	[2],[3]			1,916				1,916		3
Other comprehensive income (loss), net of tax		(585)	[1]					(585)		(585)	[1]
Cash dividends paid		(1,039)	[1]			(1,037)	[1]			(1,037)	[1]	(2)
Issuance of shares under equity-based compensation plans - net (net of income tax benefit), shares				2.4
Issuance of shares under equity-based compensation plans - net (net of income tax benefit)		141	[1]		144	(3)	[1]			141	[1]
Changes in noncontrolling interest of consolidated subsidiaries - net		(2)	[1]									(2)
Repurchase of shares, shares				(11.8)
Repurchase of shares	[1]	(730)				(730)				(730)
Ending balance, shares at Dec. 31, 2016	[1]			449.4
Ending balance at Dec. 31, 2016	[1]	14,998	[4]	$ 5	11,845	7,555		(4,448)	(3)	14,954		44
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Cumulative-effect adjustment upon adoption of ASU 2016-09 | ASU 2016-09		48				48				48
Net income		2,986	[1]			2,985	[1]			2,985	[1]	1
Other comprehensive income (loss), net of tax	[1]	1,044						1,044		1,044
Cash dividends paid		(1,073)	[1]			(1,068)	[1]			(1,068)	[1]	(5)
Issuance of shares under equity-based compensation plans - net (net of income tax benefit), shares				2.0
Issuance of shares under equity-based compensation plans - net (net of income tax benefit)		140	[1]		142	(2)	[1]			140	[1]
Changes in noncontrolling interest of consolidated subsidiaries - net		(3)	[1]									(3)
Repurchase of shares, shares				(11.5)
Repurchase of shares		(850)	[1]	$ (1)		(849)	[1]			(850)	[1]
Ending balance, shares at Dec. 31, 2017				439.9
Ending balance at Dec. 31, 2017		$ 17,290	[1]	$ 4	$ 11,987	$ 8,669	[1]	$ (3,404)	$ (3)	$ 17,253	[1]	$ 37

[1] *The balances at January 1, 2015 and the year ended December 31, 2015 and 2016 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

[2] *Other corporate expense - net and Income tax expense in 2016 and 2015 have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14.

[3] *Year ended December 31, 2016 and 2015 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

[4] *December 31, 2016 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

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Consolidated Statements of Shareholders' Equity Parenthetical - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Statement of Stockholders' Equity [Abstract]
Issuance of shares under equity-based compensation plans - net, net of income tax benefit	$ 1	$ 1	$ 20

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Summary of Significant Accounting Policies

12 Months Ended

Dec. 31, 2017

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

General Information and Basis of Presentation

Eaton Corporation plc (Eaton or the Company) is a power management company with 2017 net sales of $20.4 billion. The Company provides energy-efficient solutions that help its customers effectively manage electrical, hydraulic and mechanical power more efficiently, safely and sustainably. Eaton has approximately 96,000 employees in 59 countries and sells products to customers in more than 175 countries.

The consolidated financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States. Preparation of the consolidated financial statements requires management to make estimates and assumptions that affect amounts reported in the consolidated financial statements and notes. Actual results could differ from these estimates. Management has evaluated subsequent events through the date the consolidated financial statements were filed with the Securities Exchange Commission.

The consolidated financial statements include the accounts of Eaton and all subsidiaries and other entities it controls. Intercompany transactions and balances have been eliminated. The equity method of accounting is used for investments in associate companies where the Company has significant influence and generally a 20% to 50% ownership interest. Equity investments are evaluated for impairment whenever events or circumstances indicate the book value of the investment exceeds fair value. An impairment would exist if there is an other-than-temporary decline in value. Eaton does not have off-balance sheet arrangements or financings with unconsolidated entities. In the ordinary course of business, the Company leases certain real properties and equipment, as described in Note 8.

Eaton's functional currency is United States Dollars (USD). The functional currency for most subsidiaries is their local currency. Financial statements for these subsidiaries are translated at year-end exchange rates as to assets and liabilities and weighted-average exchange rates as to revenues and expenses. The resulting translation adjustments are recognized in Accumulated other comprehensive loss.

During 2017, the Company adopted Accounting Standards Update 2016-09, Compensation-Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting, (ASU 2016-09). Upon adoption, the Company recorded deferred tax assets of $48 for all excess tax benefits that had not been previously recognized. This was accomplished through a cumulative-effect adjustment to retained earnings. ASU 2016-09 also requires that all excess tax benefits and deficiencies generated in the current and future periods be recorded as income tax benefit or expense in the reporting period in which they occur. These excess tax benefits and deficiencies, which were previously required to be presented as financing activities on the Company’s Consolidated Statements of Cash Flows, are now classified as operating activities prospectively. The Company also reclassified $22, $18, and $38 for 2017, 2016, and 2015, respectively, from operating activities to financing activities on the Company’s Consolidated Statements of Cash Flows for withholding payments made to taxing authorities from shares withheld from employees. The Company will continue to estimate forfeitures as part of recording equity-based compensation expense.

During the fourth quarter of 2017, the Company changed its method of accounting for certain inventory in the United States from the last-in, first-out (LIFO) method to the first-in, first-out (FIFO) method. All prior periods presented have been retrospectively adjusted to apply the new method of accounting. See Note 14 for more information on the change in inventory accounting method.

Certain prior year amounts have been reclassified to conform to the current year presentation.

Revenue Recognition

Sales of products are recognized when a sales agreement is in place, products have been shipped to unaffiliated customers and title has transferred in accordance with shipping terms, the selling price is fixed and determinable and collectability is reasonably assured, all significant related acts of performance have been completed, and no other significant uncertainties exist. Shipping and handling costs billed to customers are included in Net sales and the related costs in Cost of products sold. Although the majority of the sales agreements contain standard terms and conditions, there are agreements that contain multiple elements or non-standard terms and conditions. As a result, judgment is required to determine the appropriate accounting, including whether the deliverables specified in these agreements should be treated as separate units of accounting for recognition purposes, and, if so, how the sales price should be allocated among the elements and when to recognize sales for each element. For delivered elements, sales generally are recognized only when the delivered elements have standalone value and there are no uncertainties regarding customer acceptance. Sales for service contracts generally are recognized as the services are provided.

Eaton records reductions to revenue for customer and distributor incentives, primarily comprised of rebates, at the time of the initial sale. Rebates are estimated based on sales terms, historical experience, trend analysis, and projected market conditions in the various markets served. The rebate programs offered vary across businesses due to the numerous markets Eaton serves, but the most common incentives relate to amounts paid or credited to customers for achieving defined volume levels.

Goodwill and Indefinite Life Intangible Assets

Goodwill is evaluated annually for impairment as of July 1 using either a quantitative or qualitative analysis. Goodwill is tested for impairment at the reporting unit level, which is equivalent to Eaton's operating segments and based on the net assets for each segment, including goodwill and intangible assets. Goodwill is assigned to each operating segment, as this represents the lowest level that constitutes a business and is the level at which management regularly reviews the operating results. The Company performs a quantitative analysis using a discounted cash flow model and other valuation techniques, but may elect to perform a qualitative analysis. Additionally, goodwill is evaluated for impairment whenever an event occurs or circumstances change that would indicate that it is more likely than not that the fair value of an operating segment is less than its carrying amount.

Goodwill impairment testing in 2017 was performed using qualitative analysis, which is performed by assessing certain trends and factors, including projected market outlook and growth rates, forecasted and actual sales and operating profit margins, discount rates, industry data, and other relevant qualitative factors. These trends and factors are compared to, and based on, the assumptions used in the most recent quantitative assessment performed in 2016. The results of the qualitative analysis did not indicate a need to perform a quantitative analysis.

Goodwill impairment testing for 2016 was performed using a quantitative analysis under which the fair value for each reporting unit was estimated using a discounted cash flow model, which considered forecasted cash flows discounted at an estimated weighted-average cost of capital. The forecasted cash flows were based on the Company's long-term operating plan and a terminal value was used to estimate the operating segment's cash flows beyond the period covered by the operating plan. The weighted-average cost of capital is an estimate of the overall after-tax rate of return required by equity and debt market holders of a business enterprise. These analyses require the exercise of significant judgments, including judgments about appropriate discount rates, perpetual growth rates and the timing of expected future cash flows of the respective reporting unit. Sensitivity analyses were performed around these assumptions in order to assess the reasonableness of the assumptions and the resulting estimated fair values.

Based on a qualitative analysis performed in 2017 and a quantitative analysis performed in 2016, the fair value of Eaton's reporting units continue to substantially exceed their respective carrying amounts.

Indefinite life intangible assets consist of certain trademarks. They are evaluated annually for impairment as of July 1 using either a quantitative or qualitative analysis to determine whether their fair values exceed their respective carrying amounts. Indefinite life intangible asset impairment testing for 2017 and 2016 was performed using a quantitative analysis. The Company determines the fair value of these assets using a royalty relief methodology similar to that employed when the associated assets were acquired, but using updated estimates of future sales, cash flows and profitability. Additionally, indefinite life intangible assets are evaluated for impairment whenever an event occurs or circumstances change that would indicate that it is more likely than not that the asset is impaired. For 2017 and 2016, the fair value of indefinite lived intangible assets exceeded the respective carrying value.

For additional information about goodwill and other intangible assets, see Note 5.

Other Long-Lived Assets

Depreciation and amortization for property, plant and equipment, and intangible assets subject to amortization, are generally computed by the straight-line method and included in Cost of products sold, Selling and administrative expense, and Research and development expense, as appropriate. Cost of buildings are depreciated generally over 40 years and machinery and equipment over 3 to 10 years. At December 31, 2017, the weighted-average amortization period for intangible assets subject to amortization was 17 years for patents and technology, primarily as a result of the long life of aircraft platforms; 17 years for customer relationships; and 17 years for certain trademarks. Software is generally amortized up to a life of 15 years.

Other long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate the carrying amount may not be recoverable. Upon indications of impairment, assets and liabilities are grouped at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. The asset group would be considered impaired when the estimated future net undiscounted cash flows generated by the asset group are less than its carrying value. Determining asset groups and underlying cash flows requires the use of significant judgment.

Retirement Benefits Plans

For the principal pension plans in the United States, Canada, Puerto Rico and the United Kingdom, the Company uses a market-related value of plan assets to calculate the expected return on assets used to determine net periodic benefit costs. The market-related value of plan assets is a calculated value that recognizes changes in the fair value of plan assets over a five year period. All other plans use fair value of plan assets.

Net actuarial gains or losses are amortized to expense on a plan-by-plan basis when they exceed the accounting corridor. The Company’s corridors are set at either 8% or 10%, depending on the plan, of the greater of the plan assets or benefit obligations. Gains or losses outside of the corridor are subject to amortization over an average employee future service period that differs by plan, but is approximately 12 years on a weighted average basis. If most or all of the plan’s participants are no longer actively accruing benefits, the average life expectancy is used.

Warranty Accruals

Product warranty accruals are established at the time the related sale is recognized through a charge to Cost of products sold. Warranty accrual estimates are based primarily on historical warranty claim experience and specific customer contracts. Provisions for warranty accruals are comprised of basic warranties for products sold, as well as accruals for product recalls and other events when they are known and estimable. See Note 8 for additional information about warranty accruals.

Asset Retirement Obligations

A conditional asset retirement obligation is recognized at fair value when incurred if the fair value of the liability can be reasonably estimated. Uncertainty about the timing or method of settlement of a conditional asset retirement obligation would be considered in the measurement of the liability when sufficient information exists. Eaton believes that for substantially all of its asset retirement obligations, there is an indeterminate settlement date because the range of time over which the Company may settle the obligation is unknown or cannot be estimated. A liability for these obligations will be recognized when sufficient information is available to estimate fair value.

Income Taxes

Deferred income tax assets and liabilities are determined based on the difference between the financial statement and tax basis of the respective assets and liabilities, using enacted tax rates in effect for the year when the differences are expected to reverse. Deferred income tax assets are recognized for income tax loss carryforwards and income tax credit carryforwards. Judgment is required in determining and evaluating income tax provisions and valuation allowances for deferred income tax assets. Eaton recognizes the income tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by taxing authorities, based on the technical merits of the position. Eaton evaluates and adjusts these accruals based on changing facts and circumstances. Eaton recognizes interest and penalties related to unrecognized income tax benefits in the provision for income tax expense. Penalties on unrecognized income tax benefits have been accrued for jurisdictions where penalties are automatically applied to any deficiency, regardless of the merit of the position. For additional information about income taxes, see Note 9.

Equity-Based Compensation

Eaton recognizes equity-based compensation expense based on the grant date fair value of the award. Awards with service conditions or both service and market conditions are expensed over the period during which an employee is required to provide service in exchange for the award. Awards with both service and performance conditions are expensed over the period an employee is required to provide service based on the number of units for which achievement of the performance objective is probable. Participants awarded restricted stock units (RSUs) in 2015 and 2016, do not receive dividends; therefore, their fair value is determined by reducing the closing market price of the Company’s ordinary shares on the date of grant by the present value of the estimated dividends had they been paid. The fair value of RSUs awarded in 2017, restricted stock awards (RSAs) and performance stock units (PSUs) with performance conditions are determined based on the closing market price of the Company’s ordinary shares at the date of grant. The Company uses a Monte Carlo simulation to estimate the fair value of PSUs with market conditions, which incorporates assumptions regarding expected stock price volatility and the risk-free interest rate. Stock options are granted with an exercise price equal to the closing market price of Eaton ordinary shares on the date of grant. The fair value of stock options is determined using a Black-Scholes option-pricing model, which incorporates assumptions regarding the expected stock price volatility, the expected option life, the risk-free interest rate, and the expected dividend yield. See Note 11 for additional information about equity-based compensation.

Derivative Financial Instruments and Hedging Activities

Eaton uses derivative financial instruments to manage the exposure to the volatility in raw material costs, currency, and interest rates on certain debt. These instruments are marked to fair value in the accompanying Consolidated Balance Sheets. Changes in the fair value of derivative assets or liabilities (i.e., gains or losses) are recognized depending upon the type of hedging relationship and whether an instrument has been designated as a hedge. For those instruments that qualify for hedge accounting, Eaton designates the hedging instrument, based upon the exposure being hedged, as a cash flow hedge, a fair value hedge, or a hedge of a net investment in a foreign operation. Changes in fair value of these instruments that do not qualify for hedge accounting are recognized immediately in net income. See Note 13 for additional information about hedges and derivative financial instruments.

Recently Issued Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update 2014-09, Revenue from Contracts with Customers (ASU 2014-09). This accounting standard supersedes all existing US GAAP revenue recognition guidance. Under ASU 2014-09, a company will recognize revenue when it transfers the control of promised goods or services to customers in an amount that reflects the consideration which the company expects to collect in exchange for those goods or services. ASU 2014-09 will require additional disclosures in the notes to the consolidated financial statements.

Eaton adopted the standard at the start of the first quarter of 2018 using the modified retrospective approach and recorded a cumulative effect adjustment to retained earnings based on the current terms and conditions for open contracts as of January 1, 2018. The adoption of the standard did not have a material impact on the Company’s Consolidated financial statements. While, certain revenue streams moved from point-in-time or multiple elements to over time because of the continuous transfer of control to customers, we do not expect these changes to be material. The Company implemented the appropriate changes to business processes and controls to support recognition and disclosure under the new standard, including the new qualitative and quantitative disclosures that will include information on the nature, amount, timing and significant judgments impacting revenue from contracts with customers.

In October 2016, the FASB issued Accounting Standards Update 2016-16, Intra-Entity Transfers of Assets Other Than Inventory (ASU 2016-16). This accounting standard requires companies to recognize the income tax effects of intercompany sales and transfers of assets other than inventory in the period in which the transfer occurs. The previous accounting standard required companies to defer the income tax effects of intercompany transfers of assets by recording a prepaid tax, until such assets were sold to an outside party or otherwise recognized. ASU 2016-16 is effective for annual and interim periods beginning after December 15, 2017. Upon adoption, ASU 2016-16 requires companies to write off any income tax amounts that had been deferred as prepaid taxes from past intercompany transactions, and record deferred tax balances for amounts that have not been recognized, through a cumulative-effect adjustment to retained earnings. The Company adopted ASU 2016-16 at the start of the first quarter of 2018 by recording a cumulative-effect adjustment of approximately $200 to reduce retained earnings.

In February 2016, the FASB issued Accounting Standards Update 2016-02, Leases (Topic 842), (ASU 2016-02). This accounting standard requires that a lessee recognize a lease asset and a lease liability on its balance sheet for all leases, including operating leases, with a term greater than 12 months. ASU 2016-02 will require additional disclosures in the notes to the consolidated financial statements and is effective for annual and interim reporting periods beginning after December 15, 2018. A project team has been formed to evaluate and implement the new standard. The project team is working to gather the data required to account for leases under the new standard, and validating the functionality of third-party lease accounting software. In addition, the Company is in the process of identifying and implementing the appropriate changes to business processes and controls to support recognition and disclosure under the new standard. Eaton plans to adopt the standard as of the first quarter of 2019. Eaton is evaluating the impact of ASU 2016-02 and an estimate of the impact to the consolidated financial statements cannot be made at this time.

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Acquisitions and Sales of Businesses

12 Months Ended

Dec. 31, 2017

Business Combinations [Abstract]

Acquisitions and Sales of Businesses

ACQUISITIONS OF BUSINESSES

Sale of heavy-duty and medium-duty commercial vehicle automated transmission business

On July 31, 2017, Eaton sold a 50% interest in its heavy-duty and medium-duty commercial vehicle automated transmission business for $600 in cash to Cummins, Inc. The new joint venture is named Eaton Cummins Automated Transmission Technologies (ECATT). The Company recognized a pre-tax gain of $1,077, of which $533 related to the pre-tax gain from the $600 proceeds from the sale and $544 related to the Company’s remaining 50% investment in the joint venture being remeasured to fair value. The after-tax gain was $843. The fair value is based on the price paid to Eaton for the 50% interest sold to Cummins, Inc. and further supported by a discounted cash flow model. Eaton accounts for its investment on the equity method of accounting.

Acquisition of Ephesus Lighting, Inc.

On October 28, 2015, Eaton acquired Ephesus Lighting, Inc. (Ephesus). Ephesus is a leader in LED lighting for stadiums and other high lumen outdoor and industrial applications. Its sales for the 12 months ended September 30, 2015 were $23. Ephesus is reported within the Electrical Products business segment.

Acquisition of UK Safety Technology Manufacturer Oxalis Group Ltd.

On January 12, 2015, Eaton acquired Oxalis Group Ltd. (Oxalis). Oxalis is a manufacturer of closed-circuit television camera stations, public address and general alarm systems and other electrical products for the hazardous area, marine and industrial communications markets. Its sales for the 12 months ended December 31, 2014 were $9. Oxalis is reported within the Electrical Systems and Services business segment.

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Acquisition Integration Charges

12 Months Ended

Dec. 31, 2017

Business Combinations [Abstract]

Acquisition Integration Charges

ACQUISITION INTEGRATION CHARGES

Eaton incurs integration charges related to acquired businesses. A summary of these charges follows:

	2017		2016		2015
Electrical Products	$	4	$	3	$	25
Electrical Systems and Services	—		1		15
Hydraulics	—		—		2
Total business segments	4		4		42
Corporate	—		—		5
Total acquisition integration charges before income taxes	4		4		47
Income taxes	2		1		16
Total after income taxes	$	2	$	3	$	31
Per ordinary share - diluted	$	—	$	0.01	$	0.07

Business segment acquisition integration charges in 2017 related to the integration of Ephesus. The charges associated with Ephesus were included in Selling and administrative expense. Business segment acquisition integration charges in 2016 related to the integration of Ephesus and Oxalis. The charges associated with Ephesus were included in Cost of products sold and Selling and administrative expense, while the charges associated with Oxalis were included in Cost of products sold. Business segment acquisition charges in 2015 related primarily to the integration of Cooper Industries plc, which was acquired in 2012. The charges in 2015 were included in Cost of products sold or Selling and administrative expense, as appropriate. In Business Segment Information, the charges reduced Operating profit of the related business segment.

The integration of Cooper included costs related to restructuring activities Eaton undertook in an effort to gain efficiencies in selling, marketing, traditional back-office functions and manufacturing and distribution. These actions resulted in charges of $20 during 2015, comprised of severance costs and other expense totaling $1 and $19, respectively, of which $14 were incurred in the Electrical Products segment, and $6 were incurred in the Electrical Systems and Services segment.

Corporate integration charges related primarily to the acquisition of Cooper. These charges were included in Selling and administrative expense. In Business Segment Information, the charges were included in Other corporate expense - net.

See Note 15 for additional information about business segments.

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Restructuring Charges Restructuring Charges

12 Months Ended

Dec. 31, 2017

Restructuring and Related Activities [Abstract]

Restructuring and Related Activities Disclosure

RESTRUCTURING CHARGES

During 2015, Eaton announced its commitment to undertake actions to reduce its cost structure in all business segments and at corporate. Restructuring charges incurred under this plan were $116, $211, and $129 in 2017, 2016, and 2015, respectively. The multi-year initiative concluded at the end of 2017.

A summary of restructuring charges by type follows:

	2017		2016		2015
Workforce reductions	$	57	$	177	$	112
Plant closings and other costs	59		34		17
Total	$	116	$	211	$	129

A summary of restructuring charges by segment follows:

	2017		2016		2015
Electrical Products	$	29	$	44	$	12
Electrical Systems & Services	16		49		29
Hydraulics	32		67		31
Aerospace	2		4		5
Vehicle	12		35		34
Corporate	25		12		18
Total	$	116	$	211	$	129

A summary of liabilities related to workforce reductions, plant closings and other associated costs announced in 2015 follows:

	Workforce reductions			Plant closing and other			Total
Balance at December 31, 2015	$	54		$	—		$	54
Liability recognized	177			34			211
Payments	(116		)	(13		)	(129		)
Other adjustments	(2		)	(20		)	(22		)
Balance at December 31, 2016	113			1			114
Liability recognized	57			59			116
Payments	(102		)	(39		)	(141		)
Other adjustments	(1		)	(16		)	(17		)
Balance at December 31, 2017	$	67		$	5		$	72

These charges were included in Cost of products sold, Selling and administrative expenses or Other income-net, as appropriate. In Business Segment Information, the charges reduced Operating profit of the related business segment. See Note 15 for additional information about business segments.

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Goodwill and Other Intangible Assets

12 Months Ended

Dec. 31, 2017

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Other Intangible Assets

GOODWILL AND OTHER INTANGIBLE ASSETS

Changes in the carrying amount of goodwill by segment follow:

	Electrical Products			Electrical Systems and Services			Hydraulics			Aerospace			Vehicle			Total
December 31, 2015	$	6,642		$	4,279		$	1,259		$	956		$	343		$	13,479
Translation	(145		)	(76		)	(38		)	(18		)	(1		)	(278		)
December 31, 2016	6,497			4,203			1,221			938			342			13,201
Goodwill written off from sale of business	—			(3		)	—			—			(52		)	(55		)
Translation	262			111			36			9			4			422
December 31, 2017	$	6,759		$	4,311		$	1,257		$	947		$	294		$	13,568

A summary of other intangible assets follows:

	2017				2016
	Historical cost		Accumulated amortization		Historical cost		Accumulated amortization
Intangible assets not subject to amortization
Trademarks	$	1,654			$	1,637
Intangible assets subject to amortization
Customer relationships	$	3,586	$	1,475	$	3,456	$	1,199
Patents and technology	1,395		628		1,342		519
Trademarks	1,137		473		1,104		378
Other	99		30		97		26
Total intangible assets subject to amortization	$	6,217	$	2,606	$	5,999	$	2,122

Amortization expense related to intangible assets subject to amortization in 2017, and estimated amortization expense for each of the next five years, follows:

2017	$	383
2018	369
2019	362
2020	357
2021	346
2022	336

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Debt

12 Months Ended

Dec. 31, 2017

Debt Disclosure [Abstract]

Debt

DEBT

A summary of long-term debt, including the current portion, follows:

	2017			2016
5.30% notes due 2017 ($150 converted to floating rate by interest rate swap)	$	—		$	250
6.10% debentures due 2017	—			289
1.50% senior notes due 2017 ($750 converted to floating rate by interest rate swap)	—			1,000
5.60% notes due 2018 ($415 converted to floating rate by interest rate swap)	450			450
4.215% Japanese yen notes due 2018	88			86
6.95% notes due 2019 ($300 converted to floating rate by interest rate swap)	300			300
3.875% debentures due 2020 ($150 converted to floating rate by interest rate swap)	239			239
3.47% notes due 2021 ($275 converted to floating rate by interest rate swap)	300			300
8.10% debentures due 2022 ($100 converted to floating rate by interest rate swap)	100			100
2.75% senior notes due 2022 ($1,400 converted to floating rate by interest rate swap)	1,600			1,600
3.68% notes due 2023 ($200 converted to floating rate by interest rate swap)	300			300
0.75% euro notes due 2024	659			580
6.50% debentures due 2025	145			145
3.10% senior notes due 2027	700			—
7.65% debentures due 2029 ($50 converted to floating rate by interest rate swap)	200			200
4.00% senior notes due 2032	700			700
5.45% debentures due 2034 ($25 converted to floating rate by interest rate swap)	136			136
5.80% notes due 2037	240			240
4.15% senior notes due 2042	1,000			1,000
3.92% senior notes due 2047	300			—
5.25% to 8.875% notes (maturities ranging from 2018 to 2035, including $50 converted to floating rate by interest rate swap)	239			239
Other	49			109
Total long-term debt	7,745			8,263
Less current portion of long-term debt	(578		)	(1,552		)
Long-term debt less current portion	$	7,167		$	6,711

Substantially all these long-term debt instruments are fully and unconditionally guaranteed on an unsubordinated, unsecured basis by Eaton and certain of its direct and indirect subsidiaries (the Senior Notes). Further, all of these long-term debt instruments except the 4.215% Japanese yen notes due 2018, the 3.875% debentures due 2020, the 3.47% notes due 2021, the 3.68% notes due 2023, and the 0.75% Euro notes due 2024 are registered by Eaton Corporation under the Securities Act of 1933, as amended (the Registered Senior Notes).

On November 17, 2017, Eaton refinanced a $500, four-year revolving credit facility with a $500, three-year revolving credit facility that will expire November 17, 2020 and also refinanced a $750, five-year revolving credit facility with a $750, five-year revolving credit facility that will expire November 17, 2022. Eaton also maintains a $750, five-year revolving credit facility that will expire October 14, 2021. These refinancings maintain long-term revolving credit facilities at a total of $2,000. The revolving credit facilities are used to support commercial paper borrowings and are fully and unconditionally guaranteed by Eaton and certain of its direct and indirect subsidiaries on an unsubordinated, unsecured basis. There were no borrowings outstanding under Eaton's revolving credit facilities at December 31, 2017 or 2016. The Company had available lines of credit of $741 from various banks primarily for the issuance of letters of credit, of which there was $297 outstanding at December 31, 2017. Borrowings outside the United States are generally denominated in local currencies.

The Company repaid the 5.30% notes on March 15, 2017 for $250, the 6.10% debentures on June 29, 2017 for $289 and the 1.50% senior notes on November 2, 2017 for $1,000. The Company repaid the 2.375% debentures on January 15, 2016, for $240.

Short-term debt was $6 all of which was outside the United States as of December 31, 2017.

On September 15, 2017, a subsidiary of Eaton issued senior notes (the 2017 Senior Notes) with a face amount of $1,000. The 2017 Senior Notes are comprised of two tranches of $700 and $300, which mature in 2027 and 2047, respectively, with interest payable semi-annually at a respective rate of 3.1% and 3.9%. The issuer received proceeds totaling $993 from the issuance, net of financing costs. The 2017 Senior Notes are fully and unconditionally guaranteed on an unsubordinated, unsecured basis by Eaton and certain of its direct and indirect subsidiaries. The 2017 Senior Notes contain customary optional redemption and par call provisions. The 2017 Senior Notes also contain a change of control provision which requires the Company to make an offer to purchase all or any part of the 2017 Senior Notes at a purchase price of 101% of the principal amount plus accrued and unpaid interest. The capitalized deferred financing fees are amortized in Interest expense-net over the respective terms of the 2017 Senior Notes. The 2017 Senior Notes are subject to customary non-financial covenants.

On September 20, 2016, a subsidiary of Eaton issued euro denominated notes (Euro Notes) with a face value of €550 ($615 based on the September 20, 2016 spot rate), in accordance with Regulation S promulgated under the Securities Act of 1933, as amended. The Euro Notes mature in 2024 with interest payable annually at a rate of 0.75%. The issuer received proceeds totaling €544 ($609 based on the September 20, 2016 spot rate) from the issuance, net of financing costs and discounts. The senior Euro Notes are fully and unconditionally guaranteed on an unsubordinated, unsecured basis by Eaton and certain of its direct and indirect subsidiaries. The Euro Notes contain an optional redemption provision by which the Company may make an offer to purchase all or any part of the Euro Notes prior to June 20, 2024 at a purchase price of the greater of (a) 100% of the principal amount of the respective Euro Notes being redeemed, or (b) the sum of the present values of the respective remaining scheduled payments of principal and interest, discounted to the redemption date on an annual basis at the benchmark Bund Rate plus 20 basis points. In each case, the redemption price will include any accrued and unpaid interest on the Euro Notes being redeemed. At any time on or after June 20, 2024, the Company may redeem the Euro Notes, in whole or in part, at a redemption price equal to 100% of the principal amount to be redeemed plus accrued and unpaid interest. The Euro Notes also contain a change of control provision which requires the Company to make an offer to purchase all or any part of the Euro Notes at a purchase price of 101% of the principal amount plus accrued and unpaid interest. The capitalized deferred financing fees and discounts are amortized in Interest expense - net over the respective terms of the Euro Notes. The Euro Notes are subject to customary non-financial covenants. 

Eaton is in compliance with each of its debt covenants for all periods presented.

Maturities of long-term debt for each of the next five years follow:

2018	$	578
2019	340
2020	241
2021	302
2022	1,701

Interest paid on debt follows:

2017	$	293
2016	266
2015	271

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Retirement Benefits Plans

12 Months Ended

Dec. 31, 2017

Retirement Benefits [Abstract]

Retirement Benefit Plans

RETIREMENT BENEFITS PLANS

Eaton has defined benefits pension plans and other postretirement benefits plans.

Obligations and Funded Status

	United States pension liabilities						Non-United States pension liabilities						Other postretirement liabilities
	2017			2016			2017			2016			2017			2016
Funded status
Fair value of plan assets	$	3,585		$	2,969		$	1,727		$	1,478		$	55		$	74
Benefit obligations	(3,961		)	(3,771		)	(2,399		)	(2,314		)	(448		)	(473		)
Funded status	$	(376	)	$	(802	)	$	(672	)	$	(836	)	$	(393	)	$	(399	)
Amounts recognized in the Consolidated    Balance Sheets
Non-current assets	$	82		$	34		$	136		$	33		$	—		$	—
Current liabilities	(15		)	(24		)	(25		)	(22		)	(31		)	(31		)
Non-current liabilities	(443		)	(812		)	(783		)	(847		)	(362		)	(368		)
Total	$	(376	)	$	(802	)	$	(672	)	$	(836	)	$	(393	)	$	(399	)
Amounts recognized in Accumulated other    comprehensive loss (pretax)
Net actuarial loss	$	1,059		$	1,232		$	596		$	771		$	19		$	21
Prior service cost (credit)	4			3			8			8			(46		)	(60		)
Total	$	1,063		$	1,235		$	604		$	779		$	(27	)	$	(39	)

Change in Benefit Obligations

	United States pension liabilities						Non-United States pension liabilities						Other postretirement liabilities
	2017			2016			2017			2016			2017			2016
Balance at January 1	$	3,771		$	3,829		$	2,314		$	2,175		$	473		$	575
Service cost	96			111			71			63			3			4
Interest cost	123			125			55			62			14			17
Actuarial (gain) loss	271			52			(148		)	355			2			(72		)
Gross benefits paid	(301		)	(346		)	(97		)	(94		)	(74		)	(79		)
Currency translation	—			—			223			(245		)	3			1
Plan amendments	1			—			—			2			—			—
Other	—			—			(19		)	(4		)	27			27
Balance at December 31	$	3,961		$	3,771		$	2,399		$	2,314		$	448		$	473
Accumulated benefit obligation	$	3,802		$	3,620		$	2,283		$	2,189

Change in Plan Assets

	United States pension liabilities						Non-United States pension liabilities						Other postretirement liabilities
	2017			2016			2017			2016			2017			2016
Balance at January 1	$	2,969		$	2,934		$	1,478		$	1,472		$	74		$	93
Actual return on plan assets	543			221			131			212			8			3
Employer contributions	374			160			99			102			20			30
Gross benefits paid	(301		)	(346		)	(97		)	(94		)	(74		)	(79		)
Currency translation	—			—			135			(211		)	—			—
Other	—			—			(19		)	(3		)	27			27
Balance at December 31	$	3,585		$	2,969		$	1,727		$	1,478		$	55		$	74

The components of pension plans with an accumulated benefit obligation in excess of plan assets at December 31 follow:

	United States pension liabilities				Non-United States pension liabilities
	2017		2016		2017		2016
Projected benefit obligation	$	3,540	$	3,342	$	966	$	1,902
Accumulated benefit obligation	3,380		3,190		911		1,824
Fair value of plan assets	3,081		2,505		175		1,066

Changes in pension and other postretirement benefit liabilities recognized in Accumulated other comprehensive loss follow:

	United States pension liabilities						Non-United States pension liabilities						Other postretirement liabilities
	2017			2016			2017			2016			2017			2016
Balance at January 1	$	1,235		$	1,327		$	779		$	653		$	(39	)	$	21
Prior service cost arising during the year	1			—			—			2			—			—
Net loss (gain) arising during the year	(28		)	81			(185		)	235			(2		)	(69		)
Currency translation	—			—			66			(75		)	1			1
Less amounts included in expense during the year	(145		)	(173		)	(56		)	(36		)	13			8
Net change for the year	(172		)	(92		)	(175		)	126			12			(60		)
Balance at December 31	$	1,063		$	1,235		$	604		$	779		$	(27	)	$	(39	)

Benefits Expense

	United States pension benefit expense									Non-United States pension benefit expense									Other postretirement benefits expense
	2017			2016			2015			2017			2016			2015			2017			2016			2015
Service cost	$	96		$	111		$	123		$	71		$	63		$	71		$	3		$	4		$	6
Interest cost	123			125			156			55			62			72			14			17			24
Expected return on plan assets	(244		)	(250		)	(262		)	(94		)	(92		)	(99		)	(4		)	(6		)	(5		)
Amortization	83			92			119			51			33			40			(13		)	(9		)	2
	58			78			136			83			66			84			—			6			27
Settlements and special termination benefits	62			81			74			5			3			2			—			1			—
Total expense	$	120		$	159		$	210		$	88		$	69		$	86		$	—		$	7		$	27

The estimated pretax net amounts that will be recognized from Accumulated other comprehensive loss into net periodic benefit cost in 2018 follow:

	United States pension liabilities		Non-United States pension liabilities		Other postretirement liabilities
Actuarial loss	$	146	$	38	$	1
Prior service cost (credit)	1		1		(14		)
Total	$	147	$	39	$	(13	)

Retirement Benefits Plans Assumptions

In 2015, 2016 and 2017, for purposes of determining liabilities related to pension plans and other postretirement benefits plans in the United States, the Company used 2014 mortality tables and generational improvement scales that are based on MP-2015, MP-2016 and MP-2017, respectively.

In 2016, the Company adopted a change in the method it uses to estimate the service and interest cost components of net periodic benefit cost for its defined benefit pension and other postretirement benefit plans. Prior to 2016, for the vast majority of its plans, the service and interest cost components were estimated using a single weighted-average discount rate derived from the yield curve used to measure the benefit obligation at the beginning of the period. Beginning in 2016, the Company used a spot rate approach by applying the specific spot rates along the yield curve to the relevant projected cash flows in the estimation of the service and interest components of benefit cost, resulting in a more precise measurement. This change does not affect the measurement of total benefit obligations. The change was accounted for as a change in estimate and, accordingly, was accounted for prospectively starting in 2016. The reductions in service cost and interest cost for 2016 associated with this change in estimate were $3 and $42, respectively.

Pension Plans

	United States pension plans						Non-United States pension plans
	2017		2016		2015		2017		2016		2015
Assumptions used to determine benefit obligation at year-end
Discount rate	3.64	%	4.12	%	4.22	%	2.62	%	2.63	%	3.46	%
Rate of compensation increase	3.15	%	3.15	%	3.18	%	3.11	%	3.13	%	3.12	%
Assumptions used to determine expense
Discount rate used to determine benefit obligation	4.12	%	4.22	%	3.97	%	2.63	%	3.46	%	3.33	%
Discount rate used to determine service cost	4.31	%	4.35	%	3.97	%	3.38	%	4.13	%	3.33	%
Discount rate used to determine interest cost	3.40	%	3.42	%	3.97	%	2.34	%	3.07	%	3.33	%
Expected long-term return on plan assets	7.90	%	8.50	%	8.50	%	6.30	%	6.62	%	6.92	%
Rate of compensation increase	3.15	%	3.18	%	3.16	%	3.13	%	3.12	%	3.13	%

The expected long-term rate of return on pension assets was determined for each country and reflects long-term historical data taking into account each plan's target asset allocation. The expected long-term rates of return on pension assets for United States pension plans and Non-United States pension plans for 2018 are 7.52% and 6.40%, respectively. The discount rates were determined using appropriate bond data for each country.

Other Postretirement Benefits Plans

Substantially all of the obligation for other postretirement benefits plans relates to United States plans. Assumptions used to determine other postretirement benefits obligations and expense follow:

	Other postretirement benefits plans
	2017		2016		2015
Assumptions used to determine benefit obligation at year-end
Discount rate	3.55	%	3.96	%	4.04	%
Health care cost trend rate assumed for next year	8.25	%	7.35	%	7.10	%
Ultimate health care cost trend rate	4.75	%	4.75	%	4.75	%
Year ultimate health care cost trend rate is achieved	2027		2026		2025
Assumptions used to determine expense
Discount rate used to determine benefit obligation	3.96	%	4.04	%	3.79	%
Discount rate used to determine service cost	4.11	%	4.26	%	3.79	%
Discount rate used to determine interest cost	3.18	%	3.12	%	3.79	%
Initial health care cost trend rate	7.35	%	7.10	%	6.31	%
Ultimate health care cost trend rate	4.75	%	4.75	%	4.77	%
Year ultimate health care cost trend rate is achieved	2026		2025		2024

Assumed health care cost trend rates may have a significant effect on the amounts reported for the health care plans. A 1-percentage point change in the assumed health care cost trend rates would have the following effects:

	1% increase		1% decrease
Effect on total service and interest cost	$	1	$	(1	)
Effect on other postretirement liabilities	13		(12		)

Employer Contributions to Retirement Benefits Plans

Contributions to pension plans that Eaton expects to make in 2018, and made in 2017, 2016 and 2015, follow:

	2018		2017		2016		2015
United States plans	$	16	$	374	$	160	$	221
Non-United States plans	96		99		102		109
Total contributions	$	112	$	473	$	262	$	330

The following table provides the estimated pension and other postretirement benefit payments for each of the next five years, and the five years thereafter in the aggregate. For other postretirement benefits liabilities, the expected subsidy receipts related to the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 would reduce the gross payments listed below.

	Estimated United States pension payments		Estimated non-United States pension payments		Estimated other postretirement benefit payments
					Gross		Medicare prescription drug subsidy
2018	$	291	$	88	$	47	$	(2	)
2019	291		90		43		(2		)
2020	292		93		39		(2		)
2021	299		95		35		(1		)
2022	298		99		35		—
2023 - 2027	1,478		548		141		(2		)

Pension Plan Assets

Investment policies and strategies are developed on a country specific basis. The United States plans, representing 67% of worldwide pension assets, and the United Kingdom plans representing 26% of worldwide pension assets, are invested primarily for growth, as the majority of the assets are in plans with active participants and ongoing accruals. In general, the plans have their primary allocation to diversified global equities, primarily through index funds in the form of common collective and other trusts. The United States plans' target allocation is 28% United States equities, 28% non-United States equities, 9% real estate (primarily equity of real estate investment trusts), 31% debt securities and 4% other, including hedge funds, private equity and cash equivalents. The United Kingdom plans' target asset allocations are 61% equities and the remainder in debt securities, cash equivalents and real estate investments. The equity risk for the plans is managed through broad geographic diversification and diversification across industries and levels of market capitalization. The majority of debt allocations for these plans are longer duration government and corporate debt. The United States, United Kingdom and Canada pension plans are authorized to use derivatives to achieve more economically desired market exposures and to use futures, swaps and options to gain or hedge exposures.

Other Postretirement Benefits Plan Assets

The Voluntary Employee Benefit Association trust which holds U.S. other postretirement benefits plan assets has investment guidelines that include allocations to global equities and fixed income investments. The trust's 2017 target investment allocation is 43% diversified global equities and 57% fixed income securities held in a trust that invests primarily in exchange traded funds.

Fair Value Measurements

Financial instruments included in pension and other postretirement benefits plan assets are categorized into a fair value hierarchy of three levels, based on the degree of subjectivity inherent in the valuation methodology as follows:

Level 1 - Quoted prices (unadjusted) for identical assets in active markets.

Level 2 - Quoted prices for similar assets in active markets, and inputs that are observable for the asset, either directly or indirectly, for substantially the full term of the financial instrument.

Level 3 - Unobservable prices or inputs.

Certain investments that are measured at fair value using the net asset value per share practical expedient have not been categorized in the fair value hierarchy and are being presented in the tables to permit a reconciliation to total plan assets.

Pension Plans

A summary of the fair value of pension plan assets at December 31, 2017 and 2016, follows:

	Total		Quoted prices in active markets for identical assets (Level 1)		Other observable inputs (Level 2)		Unobservable inputs (Level 3)
2017
Common collective trusts
Non-United States equity and global equities	$	741	$	—	$	741	$	—
United States equity	86		—		86		—
Fixed income	478		—		478		—
Fixed income securities	709		—		709		—
United States treasuries	67		67		—		—
Bank loans	161		—		161		—
Real estate	239		220		—		19
Equity securities	139		139		—		—
Cash equivalents	86		51		35		—
Exchange traded funds	224		224		—		—
Other	81		—		8		73
Common collective and other trusts measured at net asset value	2,225
Hedge funds measured at net asset value	67
Money market funds measured at net asset value	9
Total pension plan assets	$	5,312	$	701	$	2,218	$	92

	Total		Quoted prices in active markets for identical assets (Level 1)		Other observable inputs (Level 2)		Unobservable inputs (Level 3)
2016
Common collective trusts
Non-United States equity and global equities	$	413	$	—	$	413	$	—
United States equity	94		—		94		—
Fixed income	422		—		422		—
Fixed income securities	359		—		359		—
United States treasuries	123		123		—		—
Bank loans	150		—		150		—
Real estate	201		195		—		6
Equity securities	104		104		—		—
Cash equivalents	276		21		255		—
Exchange traded funds	55		55		—		—
Other	109		—		14		95
Common collective and other trusts measured at net asset value	2,038
Hedge funds measured at net asset value	85
Money market funds measured at net asset value	18
Total pension plan assets	$	4,447	$	498	$	1,707	$	101

The fair value measurement of plan assets using significant unobservable inputs (Level 3) changed during 2016 and 2017 due to the following:

	Real estate			Other			Total
Balance at December 31, 2015	$	7		$	86		$	93
Actual return on plan assets:
Gains (losses) relating to assets still held at year-end	—			(6		)	(6		)
Purchases, sales, settlements - net	(1		)	15			14
Transfers into or out of Level 3	—			—			—
Balance at December 31, 2016	6			95			101
Actual return on plan assets:
Gains (losses) relating to assets still held at year-end	1			(5		)	(4		)
Purchases, sales, settlements - net	12			(17		)	(5		)
Transfers into or out of Level 3	—			—			—
Balance at December 31, 2017	$	19		$	73		$	92

Other Postretirement Benefits Plans

A summary of the fair value of other postretirement benefits plan assets at December 31, 2017 and 2016, follows:

	Total		Quoted prices in active markets for identical assets (Level 1)		Other observable inputs (Level 2)		Unobservable inputs (Level 3)
2017
Cash equivalents	$	7	$	7	$	—	$	—
Common collective and other trusts measured at net asset value	48
Total other postretirement benefits plan assets	$	55	$	7	$	—	$	—

	Total		Quoted prices in active markets for identical assets (Level 1)		Other observable inputs (Level 2)		Unobservable inputs (Level 3)
2016
Cash equivalents	$	8	$	8	$	—	$	—
Common collective and other trusts measured at net asset value	66
Total other postretirement benefits plan assets	$	74	$	8	$	—	$	—

Valuation Methodologies

Following is a description of the valuation methodologies used for pension and other postretirement benefits plan assets measured at fair value. There have been no changes in the methodologies used at December 31, 2017 and 2016.

Common collective and other trusts - Valued at the net unit value of units held by the trust at year end. The unit value is determined by the total value of fund assets divided by the total number of units of the fund owned. The equity investments in collective trusts are predominantly in index funds for which the underlying securities are actively traded in public markets based upon readily measurable prices. The investments in other trusts are predominantly in exchange traded funds for which the underlying securities are actively traded in public markets based upon readily measurable prices. Common collective and other trusts measured at fair value using the net asset value per share practical expedient have not been categorized in the fair value hierarchy and are being presented in the tables above to permit a reconciliation of the fair value hierarchy to the total plan assets.

Fixed income securities - These securities consist of publicly traded United States and non-United States fixed interest obligations (principally corporate and government bonds and debentures). The fair value of corporate and government debt securities is determined through third-party pricing models that consider various assumptions, including time value, yield curves, credit ratings, and current market prices. The Company verifies the results of trustees or custodians and evaluates the pricing classification of these securities by performing analyses using other third-party sources.

United States treasuries - Valued at the closing price of each security.

Bank loans - These securities consist of senior secured term loans of publicly traded and privately held United States and non-United States floating rate obligations (principally corporations of non-investment grade rating). The fair value is determined through third-party pricing models that primarily utilize dealer quoted current market prices. The Company verifies the results of trustees or custodians and evaluates the pricing classification of these securities by performing analyses using other third-party sources.

Equity securities - These securities consist of direct investments in the stock of publicly traded companies. Such investments are valued based on the closing price reported in an active market on which the individual securities are traded. As such, the direct investments are classified as Level 1.

Real estate - Consists of direct investments in the stock of publicly traded companies and investments in pooled funds that invest directly in real estate. The publicly traded companies are valued based on the closing price reported in an active market on which the individual securities are traded and as such are classified as Level 1. The pooled funds rely on appraisal based valuations and as such are classified as Level 3.

Cash equivalents - Primarily certificates of deposit, commercial paper, and repurchase agreements.

Exchange traded funds - Valued at the closing price of the exchange traded fund's shares.

Hedge funds - Consists of direct investments in hedge funds through limited partnership interests. Net asset values are based on the estimated fair value of the ownership interest in the investment as determined by the General Partner. The majority of the holdings of the hedge funds are in equity securities traded on public exchanges. The investment terms of the hedge funds allow capital to be redeemed quarterly given prior notice with certain limitations. Hedge funds measured at fair value using the net asset value per share practical expedient have not been categorized in the fair value hierarchy and are being presented in the tables above to permit a reconciliation of the fair value hierarchy to the total plan assets.

Money market funds - Money market funds measured at fair value using the net asset value per share practical expedient have not been categorized in the fair value hierarchy and are being presented in the tables above to permit a reconciliation of the fair value hierarchy to the total plan assets.

Other - Primarily insurance contracts for international plans and also futures contracts and over-the-counter options. These investments are valued based on the closing prices of future contracts or indices as available on Bloomberg or similar service, and private equity investments.

For additional information regarding fair value measurements, see Note 12.

Defined Contribution Plans

The Company has various defined contribution benefit plans, primarily consisting of the plans in the United States. The total contributions related to these plans are charged to expense and were as follows:

2017	$	114
2016	72
2015	137

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Commitments and Contingencies

12 Months Ended

Dec. 31, 2017

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

COMMITMENTS AND CONTINGENCIES

Legal Contingencies

Eaton is subject to a broad range of claims, administrative and legal proceedings such as lawsuits that relate to contractual allegations, tax audits, patent infringement, personal injuries, antitrust matters and employment-related matters. Eaton is also subject to asbestos claims from historic products which may have contained asbestos. Insurance may cover some of the costs associated with these claims and proceedings. Although it is not possible to predict with certainty the outcome or cost of these matters, the Company believes they will not have a material adverse effect on the consolidated financial statements. During the fourth quarter of 2016, the Company was able to resolve several insurance matters. In total, the income from insurance matters was $68.

In December 2011, Pepsi-Cola Metropolitan Bottling Company, Inc. (“Pepsi”) filed an action against (a) Cooper Industries, LLC, Cooper Industries, Ltd., Cooper Holdings, Ltd., Cooper US, Inc., and Cooper Industries plc (collectively, “Cooper”), (b) M&F Worldwide Corp., Mafco Worldwide Corp., Mafco Consolidated Group LLC, and PCT International Holdings, Inc. (collectively, “Mafco”), and (c) the Pneumo Abex Asbestos Claims Settlement Trust (the “Trust”) in Texas state court. Pepsi alleged that it was harmed by a 2011 settlement agreement (“2011 Settlement”) among Cooper, Mafco, and Pneumo Abex, LLC (“Pneumo,” which prior to the 2011 Settlement was a Mafco subsidiary), which settlement resolved litigation that Pneumo had previously brought against Cooper involving, among other things, a guaranty related to Pneumo’s friction products business. In November 2015, after a Texas court ruled that Pepsi's claims should be heard in arbitration, Pepsi filed a demand for arbitration against Cooper, Mafco, the Trust, and Pneumo. Pepsi subsequently dropped claims against all parties except Cooper. An arbitration under the auspices of the American Arbitration Association commenced in October 2017. Pepsi’s experts have opined, among other things, that the value contributed to the Trust for a release of the guaranty was approximately $440 below reasonably equivalent value, and that an inability of Pneumo to satisfy future liabilities may result in plaintiffs suing Pepsi under various theories. Cooper submitted various expert reports and, among other things, Cooper’s experts opine that Pepsi has no basis to seek any damages and that Cooper paid reasonably equivalent value for the release of its indemnity obligations under the guaranty. The arbitration proceedings closed in December 2017. The parties are awaiting the issuance of a decision. The Company believes that the claims of Pepsi are without merit, and that the ultimate resolution of this matter will not have a material impact on the Company’s consolidated financial statements.

In December 2010, a Brazilian court held that a judgment obtained by a Brazilian company, Raysul, against another Brazilian company, Saturnia, which was sold by Eaton in 2006, could be enforced against Eaton Ltda. The judgment was based on an alleged violation of an agency agreement between Raysul and Saturnia. At March 31, 2016, the Company had a total accrual of 100 Brazilian Reais related to this matter ($31 based on June 2016 exchange rates). In June 2016, Eaton signed a settlement agreement and resolved the matter, which did not have a material impact on the consolidated financial statements.

Environmental Contingencies

Eaton has established policies to ensure that its operations are conducted in keeping with good corporate citizenship and with a positive commitment to the protection of the natural and workplace environments. The Company's manufacturing facilities are required to be certified to ISO 14001, an international standard for environmental management systems. The Company routinely reviews EHS performance at each of its facilities and continuously strives to improve pollution prevention.

Eaton is involved in remedial response and voluntary environmental remediation at a number of sites, including certain of its currently-owned or formerly-owned plants. The Company has also been named a potentially responsible party under the United States federal Superfund law, or the state equivalents thereof, at a number of disposal sites. The Company became involved in these sites as a result of government action or in connection with business acquisitions. At the end of 2017, the Company was involved with a total of 118 sites worldwide, including the Superfund sites mentioned above, with none of these sites being individually significant to the Company.

Remediation activities, generally involving soil and/or groundwater contamination, include pre-cleanup activities such as fact finding and investigation, risk assessment, feasibility study, design and action planning, performance (where actions may range from monitoring, to removal of contaminants, to installation of longer-term remediation systems), and operation and maintenance of a remediation system. The extent of expected remediation activities and costs varies by site. A number of factors affect the cost of environmental remediation, including the number of parties involved at a particular site, the determination of the extent of contamination, the length of time the remediation may require, the complexity of environmental regulations, and the continuing advancement of remediation technology. Taking these factors into account, Eaton has estimated the costs of remediation, which will be paid over a period of years. The Company accrues an amount on an undiscounted basis, consistent with the estimates of these costs, when it is probable that a liability has been incurred. Actual results may differ from these estimates. At December 31, 2017 and 2016, the Company had an accrual totaling $120 and $124, respectively, for these costs.

Based upon Eaton's analysis and subject to the difficulty in estimating these future costs, the Company expects that any sum it may be required to pay in connection with environmental matters is not reasonably possible to exceed the recorded liability by an amount that would have a material effect on its financial position, results of operations or cash flows.

Warranty Accruals

A summary of the current and long-term warranty accruals follows:

	2017			2016			2015
Balance at January 1	$	180		$	195		$	213
Provision	163			117			104
Settled	(156		)	(130		)	(114		)
Other	1			(2		)	(8		)
Balance at December 31	$	188		$	180		$	195

Lease Commitments

Eaton leases certain real properties and equipment. A summary of minimum rental commitments at December 31, 2017 under noncancelable operating leases, which expire at various dates and in most cases contain renewal options, for each of the next five years and thereafter in the aggregate, follow:

2018	$	159
2019	119
2020	85
2021	63
2022	42
Thereafter	71
Total noncancelable lease commitments	$	539

A summary of rental expense follows:

2017	$	222
2016	220
2015	225

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Income Taxes

12 Months Ended

Dec. 31, 2017

Income Tax Disclosure [Abstract]

Income Taxes

INCOME TAXES

Certain amounts below have been adjusted to reflect the retrospective application of the Company's change in inventory accounting methods, as described in Notes 1 and 14.

Eaton Corporation plc is domiciled in Ireland. Income (loss) before income taxes and income tax (benefit) expense are summarized below based on the geographic location of the operation to which such earnings and income taxes are attributable.

	Income (loss) before income taxes
	2017			2016			2015
Ireland	$	(1,090	)	$	(923	)	$	(608	)
Foreign	4,458			3,041			2,741
Total income before income taxes	$	3,368		$	2,118		$	2,133

	Income tax expense (benefit)
	2017			2016			2015
Current
Ireland	$	1		$	2		$	8
Foreign
United States	123			93			110
Non-United States	234			209			240
Total current income tax expense	358			304			358
Deferred
Ireland	—			2			1
Foreign
United States	82			(77		)	(76		)
Non-United States	(58		)	(30		)	(124		)
Total deferred income tax expense (benefit)	24			(105		)	(199		)
Total income tax expense	$	382		$	199		$	159

Reconciliations of income taxes from the Ireland national statutory rate of 25% to the consolidated effective income tax rate follow:

	2017		2016		2015
Income taxes at the applicable statutory rate	25.0	%	25.0	%	25.0	%
Ireland operations
Ireland tax on trading income	—	%	(0.3	)%	(0.4	)%
Nondeductible interest expense	8.2	%	11.5	%	7.9	%
Foreign operations
United States operations (earnings taxed at other than     the applicable statutory rate)	1.7	%	0.1	%	(0.6	)%
U.S. federal tax rate change	(7.5	)%	—	%	—	%
U.S. tax on foreign earnings	4.8	%	—	%	—	%
U.S. foreign tax credit	(3.9	)%	0.6	%	(0.8	)%
Credit for research activities	(0.5	)%	(0.8	)%	(0.8	)%
U.S. Other - net	3.2	%	2.5	%	5.4	%
Non-U.S. operations (earnings taxed at other than    the applicable statutory tax rate)	(22.9	)%	(26.8	)%	(25.1	)%
Non-U.S. operations - other items	0.4	%	0.9	%	(0.5	)%
Worldwide operations
Adjustments to tax liabilities	(1.8	)%	(2.5	)%	(1.4	)%
Adjustments to valuation allowances	4.6	%	(0.8	)%	(1.2	)%
Effective income tax expense rate	11.3	%	9.4	%	7.5	%

During 2017, income tax expense of $382 was recognized (an effective tax rate of 11.3%) compared to income tax expense of $199 for 2016 (an effective tax rate of 9.4%) and income tax expense of $159 for 2015 (an effective tax rate of 7.5%). The 2017 effective tax rate includes tax expense of $234 on the gain related to the sale of business discussed in Note 2 and a tax benefit of $62 related to the U.S. Tax Cuts and Jobs Act (TCJA) which is discussed in further detail below. Excluding the gain and related tax impact on the sale of business, and the impact of the TCJA, the effective tax rate for 2017 was expense of 9.2%. The decrease from 9.4% for 2016 compared to 9.2% for 2017 was due to the resolution of tax contingencies in various tax jurisdictions and the excess tax benefits recognized for employee share-based payments pursuant to the adoption of Accounting Standards Update 2016-09, Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting. The increase from 7.5% for 2015 compared to 9.4% for 2016 is primarily due to greater levels of income earned in higher tax jurisdictions, partially offset by net decreases in worldwide tax liabilities.

The U.S. Tax Cuts and Jobs Act was enacted on December 22, 2017. The TCJA reduces the U.S. federal corporate tax rate from 35% to 21% and requires a one-time transition tax on certain unremitted earnings of non-U.S. subsidiaries owned directly or indirectly by U.S. subsidiaries of the Company. For 2017, we have recorded a provisional tax benefit amount of $62 for the impact on our deferred tax balances and the one-time transition tax.

The Company remeasured certain deferred tax assets and liabilities based on the rates at which they are expected to reverse in the future, which is generally 21%. Additionally, given the significant changes included in the TCJA, the Company re-evaluated the realizability of certain deferred tax assets, including foreign tax credits and interest deferral, and determined that valuation allowances needed to be adjusted. The Company is still analyzing certain aspects of the TCJA, including interpretations by state and local tax authorities, and additional Treasury guidance may be issued which could potentially affect the measurement of these balances or give rise to new deferred tax amounts. The Company recorded a provisional $79 tax benefit for the remeasurement of deferred tax balances and related valuation allowances.

The one-time transition tax is based on post-1986 unremitted earnings and profits (E&P) of non-U.S. subsidiaries owned directly or indirectly by U.S. subsidiaries of the Company which have been previously deferred from U.S. income taxes. The amount of the transition tax also depends on the amount of E&P held in cash or other specified assets. The Company recorded a provisional tax expense of $17 for the transition tax. This amount may change when Treasury issues additional guidance and the Company finalizes the calculation of E&P, including the amounts held in cash or other specified assets, and finalizes the calculation of available foreign tax credits.

No provision has been made for income taxes on undistributed earnings of foreign subsidiaries of approximately $22.1 billion at December 31, 2017, since it is the Company's intention to indefinitely reinvest undistributed earnings of its foreign subsidiaries. It is not practicable to estimate the additional income taxes and applicable withholding taxes that would be payable on the remittance of such undistributed earnings.

The Company expects to deploy capital to those markets which offer particularly attractive growth opportunities. The cash that is permanently reinvested is typically used to expand operations either organically or through acquisitions. In addition, the Company expects that minimal to no Irish tax would apply to dividends paid to the Irish parent due to the impact of the Irish foreign tax credit system. The Company's public dividends and share repurchases are funded primarily from Non-U.S. operations.

Worldwide income tax payments, net of tax refunds, follow:

2017	$	288
2016	272
2015	302

Deferred Income Tax Assets and Liabilities

Components of noncurrent deferred income taxes follow:

	2017			2016
	Noncurrent assets and liabilities			Noncurrent assets and liabilities
Accruals and other adjustments
Employee benefits	$	430		$	761
Depreciation and amortization	(1,324		)	(1,823		)
Other accruals and adjustments	380			761
Ireland income tax loss carryforwards	1			1
Foreign income tax loss carryforwards	1,962			1,796
Foreign income tax credit carryforwards	404			277
Valuation allowance for income tax loss and income tax    credit carryforwards	(1,992		)	(1,728		)
Other valuation allowances	(146		)	(41		)
Total deferred income taxes	$	(285	)	$	4

At December 31, 2017, Eaton Corporation plc and certain Irish subsidiaries had tax loss carryforwards that are available to reduce future taxable income and tax liabilities. These carryforwards and their respective expiration dates are summarized below:

	2018 through 2022		2023 through 2027		2028 through 2032		2033 through 2037		Not subject to expiration		Valuation allowance
Ireland income tax loss carryforwards	$	—	$	—	$	—	$	—	$	8	$	—
Ireland deferred income tax assets for income tax loss carryforwards	—		—		—		—		1		(1		)

At December 31, 2017, the Company's foreign subsidiaries, including all U.S. and non-U.S. subsidiaries, had income tax loss carryforwards and income tax credit carryforwards that are available to reduce future taxable income or tax liabilities. These carryforwards and their respective expiration dates are summarized below:

	2018 through 2022		2023 through 2027		2028 through 2032		2033 through 2037		Not subject to expiration		Valuation allowance
Foreign income tax loss carryforwards	$	918	$	7,528	$	14	$	545	$	4,047	$	—
Foreign deferred income tax assets for income tax loss carryforwards	112		721		14		175		1,047		(1,830		)
Foreign deferred income tax assets for income tax loss carryforwards after ASU 2013-11	101		715		14		86		1,047		(1,830		)
Foreign income tax credit carryforwards	86		205		78		115		64		(161		)
Foreign income tax credit carryforwards after ASU 2013-11	82		168		27		94		33		(161		)

Recoverability of Deferred Income Tax Assets

Eaton is subject to the income tax laws in the jurisdictions in which it operates. In order to determine its income tax provision for financial statement purposes, Eaton must make significant estimates and judgments about its business operations in these jurisdictions. These estimates and judgments are also used in determining the deferred income tax assets and liabilities that have been recognized for differences between the financial statement and income tax basis of assets and liabilities, and income tax loss carryforwards and income tax credit carryforwards.

Management evaluates the realizability of deferred income tax assets for each of the jurisdictions in which it operates. If the Company experiences cumulative pretax income in a particular jurisdiction in the three-year period including the current and prior two years, management normally concludes that the deferred income tax assets will more likely than not be realizable and no valuation allowance is recognized, unless known or planned operating developments, or changes in tax laws, would lead management to conclude otherwise. However, if the Company experiences cumulative pretax losses in a particular jurisdiction in the three-year period including the current and prior two years, management then considers a series of factors in the determination of whether the deferred income tax assets can be realized. These factors include historical operating results, known or planned operating developments, the period of time over which certain temporary differences will reverse, consideration of the utilization of certain deferred income tax liabilities, tax law carryback capability in the particular country, prudent and feasible tax planning strategies, changes in tax laws, and estimates of future earnings and taxable income using the same assumptions as those used for the Company's goodwill and other impairment testing. After evaluation of these factors, if the deferred income tax assets are expected to be realized within the tax carryforward period allowed for that specific country, management would conclude that no valuation allowance would be required. To the extent that the deferred income tax assets exceed the amount that is expected to be realized within the tax carryforward period for a particular jurisdiction, management would establish a valuation allowance.

Applying the above methodology, valuation allowances have been established for certain deferred income tax assets to the extent they are not expected to be realized within the particular tax carryforward period.

Unrecognized Income Tax Benefits

A summary of gross unrecognized income tax benefits follows:

	2017			2016			2015
Balance at January 1	$	629		$	584		$	493
Increases and decreases as a result of positions taken during prior years
Transfers from valuation allowances	—			—			—
Other increases, including currency translation	10			21			34
Other decreases, including currency translation	(30		)	(24		)	(34		)
Balances related to acquired businesses	—			—			(1		)
Increases as a result of positions taken during the current year	162			90			109
Decreases relating to settlements with tax authorities	(10		)	(19		)	—
Decreases as a result of a lapse of the applicable statute of limitations	(26		)	(23		)	(17		)
Balance at December 31	$	735		$	629		$	584

Eaton's long-term policy has been to enter into tax planning strategies only if it is more likely than not that the benefit would be sustained upon audit. For example, the Company does not enter into any of the United States Internal Revenue Service (IRS) Listed Transactions as set forth in Treasury Regulation 1.6011-4.

If all unrecognized tax benefits were recognized, the net impact on the provision for income tax expense would be $652.

As of December 31, 2017 and 2016, Eaton had accrued approximately $80 and $94, respectively, for the payment of worldwide interest and penalties, which are not included in the table of unrecognized income tax benefits above. Eaton recognizes interest and penalties related to unrecognized income tax benefits in the provision for income tax expense. The Company has accrued penalties in jurisdictions primarily where they are automatically applied to any deficiency, regardless of the merit of the position.

As part of Eaton’s broader efforts to streamline operations, accelerate organic growth, and increase administrative efficiencies, the Company centralized certain activities and assets, which resulted in an increase in current income taxes payable, prepaid tax, and unrecognized tax benefits for 2017. These changes did not impact the Company’s 2017 effective tax rate.

The resolution of the majority of Eaton's unrecognized income tax benefits is dependent upon uncontrollable factors such as the prospect of retroactive regulations; new case law; and the willingness of the income tax authority to settle the issue, including the timing thereof. Therefore, for the majority of unrecognized income tax benefits, it is not reasonably possible to estimate the increase or decrease in the next 12 months. For each of the unrecognized income tax benefits where it is possible to estimate the increase or decrease in the balance within the next 12 months, the Company does not anticipate any significant change.

Eaton or its subsidiaries file income tax returns in Ireland and many countries around the world. With only few exceptions, Irish and non-United States subsidiaries of Eaton are no longer subject to examinations for years before 2007.

The United States Internal Revenue Service (“IRS”) has completed its examination of Eaton Corporation and Includible Subsidiaries’ (Eaton Corp.) United States income tax returns for 2005 through 2010 and has issued Statutory Notices of Deficiency (Notices) as discussed below. The statute of limitations on these tax years remains open until the matters are resolved. The IRS is currently examining tax years 2011 through 2013. The statute of limitations for tax years 2011 through 2013 is open until August 31, 2018. Tax years 2014 through 2016 are still subject to examination by the IRS.

Eaton is also under examination for the income tax filings in various states and localities of the United States. With only a few exceptions, Eaton Corp. is no longer subject to income tax examinations from states and localities within the United States for years before 2012. Income tax returns of states and localities within the United States will be reopened to the extent of United States federal income tax adjustments, if any, going back to 2005 when those audit years are finalized. Some states and localities may not limit their assessment to the United States federal adjustments, and may require the opening of the entire tax year. In addition, with only a few exceptions, BZ Holdings Inc. and Includible Subsidiaries (the former U.S. holding company for Cooper Industries) are no longer subject to United States state and local income tax examinations for years before 2012.

In 2011, the IRS issued a Notice for Eaton Corp. for the 2005 and 2006 tax years (the 2011 Notice). The 2011 Notice proposed assessments of $75 in additional taxes plus $52 in penalties related primarily to transfer pricing adjustments for products manufactured in the Company's facilities in Puerto Rico and the Dominican Republic and sold to affiliated companies located in the U.S.. Eaton Corp. has set its transfer prices for products sold between these affiliates at the same prices that Eaton Corp. sells such products to third parties as required by two successive Advance Pricing Agreements (APAs) Eaton Corp. entered into with the IRS that governed the 2005-2010 tax years. The Company has continued to apply the arms-length transfer pricing methodology for 2011 through the current reporting period. Immediately prior to the 2011 Notice being issued, the IRS sent a letter stating that it was retrospectively canceling the APAs. Eaton Corp. contested the proposed assessments in United States Tax Court. The case involved both whether the APAs should be enforced and, if not, the appropriate transfer pricing methodology. On July 26, 2017, the United States Tax Court issued a ruling in which it agreed with Eaton Corp. that the IRS must abide by the terms of the APAs for the tax years 2005-2006. The Tax Court’s ruling on the APAs did not have a material impact on Eaton’s consolidated financial statements.

In 2014, Eaton Corp. received a Notice from the IRS for the 2007 through 2010 tax years (the 2014 Notice) proposing assessments of $190 in additional taxes plus $72 in penalties, net of agreed credits and deductions, which the company has also contested in Tax Court. The proposed assessments pertain primarily to the same transfer pricing issues and APA for which the Tax Court has issued its ruling during 2017 as noted above. The Company believes that the Tax Court’s ruling for tax years 2005-2006 will also be applicable to the 2007-2010 years. Following the issuance of the Tax Court’s ruling, Eaton and the IRS recognized that the ruling on the enforceability of the APAs did not address a secondary issue regarding the transfer pricing for a certain royalty paid from 2006-2010. Eaton Corp. reported a consistent royalty rate for 2006-2010. The IRS has agreed to the royalty rate as reported by Eaton Corp. in 2006. Although the IRS has not proposed an alternative rate, it has not agreed to apply the same royalty rate in the 2007-2010 years.  

The 2014 Notice also includes a separate proposed assessment involving the recognition of income for several of Eaton Corp.’s controlled foreign corporations. The Company believes that the proposed assessment is without merit. Eaton and the IRS have both moved for partial summary judgment on this issue. The Tax Court heard oral arguments on the motions in January 2018, following which the Court ordered further briefing.

During 2010, the Company received a tax assessment of $49 (translated at the December 31, 2017 exchange rate), plus interest and penalties, in Brazil for the tax years 2005 through 2008 that relates to the amortization of certain goodwill generated from the acquisition of third-party businesses and corporate reorganizations. The Company is contesting the assessment, which is under review at the administrative appeals level. During 2013, the Brazilian tax authorities began an audit of tax years 2009 through 2012. During 2014, the Company received a tax assessment of $37 (translated at the December 31, 2017 exchange rate), plus interest and penalties, for the 2009 through 2012 tax years (primarily relating to the same issues concerning the 2005 through 2008 tax years), which the Company is also contesting and is under review at the administrative appeals level. Multiple outside advisors have stated that Brazilian tax authorities are raising the issue for most clients with similar facts and that the matter is expected to require at least 10 years to resolve. The Company continues to believe that final resolution of the assessments will not have a material impact on its consolidated financial statements.

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Eaton Shareholders' Equity

12 Months Ended

Dec. 31, 2017

Equity [Abstract]

Eaton Shareholders' Equity

EATON SHAREHOLDERS' EQUITY

There are 750 million Eaton ordinary shares authorized ($0.01 par value per share), 439.9 million and 449.4 million of which were issued and outstanding at December 31, 2017 and 2016, respectively. Eaton's Memorandum and Articles of Association authorized 40 thousand deferred ordinary shares (€1.00 par value per share) and 10 thousand preferred A shares ($1.00 par value per share), all of which were issued and outstanding at December 31, 2017 and 2016, and 10 million serial preferred shares ($0.01 par value per share), none of which is outstanding at December 31, 2017 and 2016. At December 31, 2017, there were 13,089 holders of record of Eaton ordinary shares. Additionally, 20,138 current and former employees were shareholders through participation in the Eaton Savings Plan, Eaton Personal Investment Plan, or the Eaton Puerto Rico Retirement Savings Plan.

On October 22, 2013, Eaton's Board of Directors adopted a share repurchase program (the 2013 Program). Under the 2013 Program, the ordinary shares were expected to be repurchased over time, depending on market conditions, the market price of ordinary shares, capital levels, and other considerations. During 2016 and 2015, 1.5 million and 11.3 million ordinary shares were repurchased under the 2013 Program in the open market at a total cost of $82 and $682, respectively. On February 24, 2016, the Board of Directors approved a new share repurchase program for share repurchases up to $2,500 of ordinary shares (2016 Program). Under the 2016 Program, the ordinary shares are expected to be repurchased over time, depending on market conditions, the market price of ordinary shares, capital levels, and other considerations. During 2017 and 2016, 11.5 million and 10.3 million shares, respectively, were purchased on the open market under the 2016 Program for a total cost of $850 and $648, respectively.

Eaton has deferral plans that permit certain employees and directors to defer a portion of their compensation. A trust contains $11 and $13 of ordinary shares and marketable securities at December 31, 2017 and 2016, respectively, to fund a portion of these liabilities. The marketable securities were included in Other assets and the ordinary shares were included in Shareholders' equity at historical cost.

On February 28, 2018, Eaton's Board of Directors declared a quarterly dividend of $0.66 per ordinary share, a 10% increase over the dividend paid in the fourth quarter of 2017. The dividend is payable on March 23, 2018, to shareholders of record at the close of business on March 12, 2018.

Comprehensive Income (Loss)

Comprehensive income (loss) consists primarily of net income, currency translation and related hedging instruments, changes in unrecognized costs of pension and other postretirement benefits, and changes in the effective portion of open derivative contracts designated as cash flow hedges. The following table summarizes the pre-tax and after-tax amounts recognized in Comprehensive income (loss):

	2017						2016						2015
	Pre-tax			After-tax			Pre-tax			After-tax			Pre-tax			After-tax
Currency translation and related hedging instruments	$	800		$	807		$	(562	)	$	(570	)	$	(1,080	)	$	(1,078	)
Pensions and other postretirement benefits
Prior service credit (cost) arising during the year	(1		)	—			(2		)	(2		)	1			1
Net gain (loss) arising during the year	215			169			(247		)	(197		)	(123		)	(89		)
Currency translation	(67		)	(53		)	74			62			62			46
Other	—			(5		)	—			(2		)	—			(3		)
Amortization of actuarial loss and prior service cost    reclassified to earnings	188			130			201			133			237			156
	335			241			26			(6		)	177			111
Cash flow hedges
Gain (loss) on derivatives designated as cash flow hedges	(24		)	(15		)	(21		)	(14		)	20			13
Changes in cash flow hedges reclassified to earnings	17			11			8			5			(16		)	(10		)
Cash flow hedges, net of reclassification adjustments	(7		)	(4		)	(13		)	(9		)	4			3
Other comprehensive income (loss) attributable to Eaton ordinary shareholders	$	1,128		$	1,044		$	(549	)	$	(585	)	$	(899	)	$	(964	)

The changes in Accumulated other comprehensive loss follow:

	Currency translation and related hedging instruments			Pensions and other postretirement benefits			Cash flow hedges			Total
Balance at December 31, 2016	$	(3,062	)	$	(1,380	)	$	(6	)	$	(4,448	)
Other comprehensive income (loss) before     reclassifications	807			111			(15		)	903
Amounts reclassified from Accumulated other    comprehensive loss (income)	—			130			11			141
Net current-period Other comprehensive    income (loss)	807			241			(4		)	1,044
Balance at December 31, 2017	$	(2,255	)	$	(1,139	)	$	(10	)	$	(3,404	)

The reclassifications out of Accumulated other comprehensive loss follow:

	December 31, 2017			Consolidated Statements of Income classification
Amortization of defined benefit pension and other    postretirement benefits items
Actuarial loss and prior service cost	$	(188	)	1
Tax benefit	58
Total, net of tax	(130		)
Gains and (losses) on cash flow hedges
Currency exchange contracts	(17		)	Cost of products sold
Tax benefit	6
Total, net of tax	(11		)
Total reclassifications for the period	$	(141	)

¹ These components of Accumulated other comprehensive loss are included in the computation of net periodic benefit cost. See Note 7 for additional information about defined benefit pension and other postretirement benefits items.

Net Income Per Share Attributable to Eaton Ordinary Shareholders

A summary of the calculation of net income per share attributable to Eaton ordinary shareholders follows:

(Shares in millions)	2017		2016*		2015*
Net income attributable to Eaton ordinary shareholders	$	2,985	$	1,916	$	1,972
Weighted-average number of ordinary shares outstanding - diluted	447.0		456.5		467.1
Less dilutive effect of equity-based compensation	2.5		1.5		1.6
Weighted-average number of ordinary shares outstanding - basic	444.5		455.0		465.5
Net income per share attributable to Eaton ordinary shareholders
Diluted	$	6.68	$	4.20	$	4.22
Basic	6.71		4.21		4.23

*Certain amounts have been adjusted to reflect the retrospective application of the Company's change in inventory accounting method, as described in Notes 1 and 14.

In 2017, 2016, and 2015, 0.4 million, 1.7 million, and 1.6 million stock options, respectively, were excluded from the calculation of diluted net income per share attributable to Eaton ordinary shareholders because the exercise price of the options exceeded the average market price of the ordinary shares during the period and their effect, accordingly, would have been antidilutive.

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Equity-Based Compensation

12 Months Ended

Dec. 31, 2017

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Equity-Based Compensation

EQUITY-BASED COMPENSATION

Restricted Stock Units and Awards

Restricted stock units (RSUs) and restricted stock awards (RSAs) have been issued to certain employees and directors. Participants awarded RSUs in 2015 and 2016 do not receive dividends; therefore, the fair value is determined by reducing the closing market price of the Company’s ordinary shares on the date of grant by the present value of the estimated dividends had they been paid. The fair value of RSUs awarded in 2017 and RSAs are determined based on the closing market price of the Company’s ordinary shares at the date of grant. The RSUs entitle the holder to receive one ordinary share for each RSU upon vesting, generally over three years. RSAs are issued and outstanding at the time of grant, but remain subject to forfeiture until vested, generally over three or four years. A summary of the RSU and RSA activity for 2017 follows:

(Restricted stock units and awards in millions)	Number of restricted stock units and awards		Weighted-average fair value per unit and award
Non-vested at January 1	2.6		$	57.87
Granted	0.9		72.09
Vested	(0.9	)	61.80
Forfeited	(0.2	)	61.66
Non-vested at December 31	2.4		$	62.24

Information related to RSUs and RSAs follows:

	2017		2016		2015
Pretax expense for RSUs and RSAs	$	66	$	65	$	68
After-tax expense for RSUs and RSAs	43		42		44
Fair value of vested RSUs and RSAs	73		71		110

As of December 31, 2017, total compensation expense not yet recognized related to non-vested RSUs and RSAs was $79, and the weighted-average period in which the expense is expected to be recognized is 2.3 years. Excess tax benefit for RSUs and RSAs totaled $2 for 2017. There was no excess tax benefit for RSUs and RSAs in 2016 and 2015.

Performance Share Units

In February 2017 and 2016, the Compensation and Organization Committee of the Board of Directors approved the grant of performance share units (PSUs) to certain employees that vest based on the satisfaction of a three-year service period and total shareholder return relative to that of a group of peers. Awards earned at the end of the three-year vesting period range from 0% to 200% of the targeted number of PSUs granted based on the ranking of total shareholder return of the Company, assuming reinvestment of all dividends, relative to a defined peer group of companies. Equity-based compensation expense for these PSUs is recognized over the period during which an employee is required to provide service in exchange for the award. Upon vesting, dividends that have accumulated during the vesting period are paid on earned awards.

The Company uses a Monte Carlo simulation to estimate the fair value of PSUs with market conditions. The principal assumptions utilized in valuing these PSUs include the expected stock price volatility (based on the most recent 3-year period as of the grant date) and the risk-free interest rate (an estimate based on the yield of United States Treasury zero coupon bonds with a 3-year maturity as of the grant date). A summary of the assumptions used in determining fair value of these PSUs follows:

	2017			2016
Expected volatility	24		%	24		%
Risk-free interest rate	1.46		%	0.88		%
Weighted-average fair value of PSUs granted	$	80.07		$	76.41

A summary of the 2017 activity for these PSUs follows:

(Performance share units in millions)	Number of performance share units		Weighted-average fair value per unit
Non-vested at January 1	0.5		$	76.41
Granted1	0.4		80.07
Vested	—		—
Forfeited	(0.1	)	77.90
Non-vested at December 31	0.8		$	77.97

¹ Performance shares granted assuming the Company will perform at target relative to peers.

In February 2015 and 2016, performance share units were granted to certain employees that entitles the holder to receive one ordinary share for each PSU that vest based on the satisfaction of a three-year service period and the achievement of certain performance metrics over that same period. Upon vesting, PSU holders receive dividends that accumulate during the vesting period. The fair value of these PSUs is determined based on the closing market price of the Company's ordinary shares at the date of grant. Equity-based compensation expense is recognized over the period an employee is required to provide service based on the number of PSUs for which achievement of the performance objectives is probable. A summary of the 2017 activity for these PSUs follows:

(Performance share units in millions)	Number of performance share units		Weighted-average fair value per unit
Non-vested at January 1	0.7		$	68.23
Granted	—		—
Vested	(0.1	)	71.72
Forfeited	(0.5	)	71.72
Non-vested at December 31	0.1		$	56.55

Information related to PSUs follows:

	2017		2016		2015
Pretax expense for PSUs	$	22	$	13	$	2
After-tax expense for PSUs	13		8		1

As of December 31, 2017, total compensation expense not yet recognized related to non-vested PSUs was $30 and the weighted average period in which the expense is to be recognized is 1.6 years. There was no excess tax benefit for PSUs in 2017, 2016 and 2015.

Stock Options

Under various plans, stock options have been granted to certain employees and directors to purchase ordinary shares at prices equal to fair market value on the date of grant. Substantially all of these options vest ratably during the three-year period following the date of grant and expire 10 years from the date of grant. Compensation expense is recognized for stock options based on the fair value of the options at the date of grant and amortized on a straight-line basis over the period the employee or director is required to provide service.

The Company uses a Black-Scholes option pricing model to estimate the fair value of stock options. The principal assumptions utilized in valuing stock options include the expected stock price volatility (based on the most recent historical period equal to the expected life of the option); the expected option life (an estimate based on historical experience); the expected dividend yield; and the risk-free interest rate (an estimate based on the yield of United States Treasury zero coupon with a maturity equal to the expected life of the option). A summary of the assumptions used in determining the fair value of stock options follows:

	2017			2016			2015
Expected volatility	27		%	27		%	29		%
Expected option life in years	6.6			5.5			5.5
Expected dividend yield	2.8		%	2.5		%	2.6		%
Risk-free interest rate	1.8 to 2.1%			1.2 to 1.5%			1.6 to 1.5%
Weighted-average fair value of stock options granted	$	15.11		$	11.80		$	15.25

A summary of stock option activity follows:

(Options in millions)	Weighted-average exercise price per option		Options		Weighted-average remaining contractual life in years	Aggregate intrinsic value
Outstanding at January 1, 2017	$	56.75	5.5
Granted	71.89		0.7
Exercised	46.31		(1.5	)
Forfeited and canceled	59.23		(0.1	)
Outstanding at December 31, 2017	$	62.43	4.6		6.3	$	77.3
Exercisable at December 31, 2017	$	61.06	2.9		5.1	$	52.1
Reserved for future grants at December 31, 2017			15.0

The aggregate intrinsic value in the table above represents the total excess of the $79.01 closing price of Eaton ordinary shares on the last trading day of 2017 over the exercise price of the stock option, multiplied by the related number of options outstanding and exercisable. The aggregate intrinsic value is not recognized for financial accounting purposes and the value changes based on the daily changes in the fair market value of the Company's ordinary shares.

Information related to stock options follows:

	2017		2016		2015
Pretax expense for stock options	$	11	$	14	$	12
After-tax expense for stock options	8		9		8
Proceeds from stock options exercised	66		74		52
Income tax benefit related to stock options exercised
Tax benefit classified in operating activities in the Consolidated    Statements of Cash Flows	13		5		4
Excess tax benefit classified in financing activities in the    Consolidated Statements of Cash Flows	—		1		1
Intrinsic value of stock options exercised	41		42		44
Total fair value of stock options vested	$	11	$	14	$	12
Stock options exercised, in millions of options	1.5		1.9		1.4

As of December 31, 2017, total compensation expense not yet recognized related to non-vested stock options was $8.8, and the weighted-average period in which the expense is expected to be recognized is 1.7 years.

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Fair Value Measurements

12 Months Ended

Dec. 31, 2017

Fair Value Disclosures [Abstract]

FAIR VALUE MEASUREMENTS

FAIR VALUE MEASUREMENTS

Fair value is measured based on an exit price, representing the amount that would be received to sell an asset or paid to satisfy a liability in an orderly transaction between market participants. Fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions, a fair value hierarchy is established, which categorizes the inputs used in measuring fair value as follows: (Level 1) observable inputs such as quoted prices in active markets; (Level 2) inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and (Level 3) unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.

A summary of financial instruments recognized at fair value, and the fair value measurements used, follows:

	Total			Quoted prices in active markets for identical assets (Level 1)		Other observable inputs (Level 2)			Unobservable inputs (Level 3)
2017
Cash	$	561		$	561	$	—		$	—
Short-term investments	534			534		—			—
Net derivative contracts	36			—		36			—
2016
Cash	$	543		$	543	$	—		$	—
Short-term investments	203			203		—			—
Net derivative contracts	(3		)	—		(3		)	—

Eaton values its financial instruments using an industry standard market approach, in which prices and other relevant information is generated by market transactions involving identical or comparable assets or liabilities. No financial instruments were measured using unobservable inputs.

Other Fair Value Measurements

Long-term debt and the current portion of long-term debt had a carrying value of $7,745 and fair value of $8,048 at December 31, 2017 compared to $8,263 and $8,477, respectively, at December 31, 2016. The fair value of Eaton's debt instruments was estimated using prevailing market interest rates on debt with similar creditworthiness, terms and maturities and is considered a Level 2 fair value measurement.

As discussed in Note 2, on July 31, 2017 Eaton sold a 50% interest in its heavy-duty and medium-duty commercial vehicle automated transmission business to Cummins, Inc. Eaton's remaining 50% interest was remeasured to a fair value of $600 on July 31, 2017 using a discounted cash flow model which is considered a Level 3 fair value measurement. The model includes estimates of future cash flows, future growth rates, terminal value amounts, and the applicable weighted-average cost of capital used to discount those estimated cash flows. Eaton will account for its investment on the equity method of accounting.

Short-Term Investments

Eaton invests excess cash generated from operations in short-term marketable investments. For those investments classified as “available-for-sale”, Eaton marks these investments to fair value with the offset recognized in Accumulated other comprehensive loss. A summary of the carrying value of short-term investments follows:

	2017		2016
Time deposits, certificates of deposit and demand deposits with banks	$	435	$	149
Money market investments	99		54
Total short-term investments	$	534	$	203

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Derivative Financial Instruments and Hedging Activities

12 Months Ended

Dec. 31, 2017

Derivative Instruments and Hedging Activities Disclosure [Abstract]

DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES

DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES

In the normal course of business, Eaton is exposed to certain risks related to fluctuations in interest rates, currency exchange rates and commodity prices. The Company uses various derivative and non-derivative financial instruments, primarily interest rate swaps, currency forward exchange contracts, currency swaps and, to a lesser extent, commodity contracts, to manage risks from these market fluctuations. The instruments used by Eaton are straightforward, non-leveraged instruments. The counterparties to these instruments are financial institutions with strong credit ratings. Eaton maintains control over the size of positions entered into with any one counterparty and regularly monitors the credit rating of these institutions. Such instruments are not purchased and sold for trading purposes.

Derivative financial instruments are accounted for at fair value and recognized as assets or liabilities in the Consolidated Balance Sheets. Accounting for the gain or loss resulting from the change in the fair value of the derivative financial instrument depends on whether it has been designated, and is effective, as part of a hedging relationship and, if so, as to the nature of the hedging activity. Eaton formally documents all relationships between derivative financial instruments accounted for as designated hedges and the hedged item, as well as its risk-management objective and strategy for undertaking the hedge transaction. This process includes linking derivative financial instruments to a recognized asset or liability, specific firm commitment, forecasted transaction, or net investment in a foreign operation. These financial instruments can be designated as:

• Hedges of the change in the fair value of a recognized fixed-rate asset or liability, or the firm commitment to acquire such an asset or liability (a fair value hedge); for these hedges, the gain or loss from the derivative financial instrument, as well as the offsetting loss or gain on the hedged item attributable to the hedged risk, are recognized in income during the period of change in fair value.

• Hedges of the variable cash flows of a recognized variable-rate asset or liability, or the forecasted acquisition of such an asset or liability (a cash flow hedge); for these hedges, the effective portion of the gain or loss from the derivative financial instrument is recognized in Accumulated other comprehensive loss and reclassified to income in the same period when the gain or loss on the hedged item is included in income.

• Hedges of the currency exposure related to a net investment in a foreign operation (a net investment hedge); for these hedges, the effective portion of the gain or loss from the derivative financial instrument is recognized in Accumulated other comprehensive loss and reclassified to income in the same period when the gain or loss related to the net investment in the foreign operation is included in income.

The gain or loss from a derivative financial instrument designated as a hedge that is effective is classified in the same line of the Consolidated Statements of Income as the offsetting loss or gain on the hedged item. The change in fair value of a derivative financial instrument that is not effective as a hedge is immediately recognized in income. The cash flows resulting from these financial instruments are classified in operating activities on the Consolidated Statements of Cash Flows.

For derivatives that are not designated as a hedge, any gain or loss is immediately recognized in income. The majority of derivatives used in this manner relate to risks resulting from assets or liabilities denominated in a foreign currency and certain commodity contracts that arise in the normal course of business. During 2017 and 2016, Eaton recognized gains of $2 and $7, respectively, associated with these commodity hedge contracts. Gains and losses associated with commodity hedge contracts are classified in Cost of products sold.

Eaton uses certain of its debt denominated in foreign currency to hedge portions of its net investments in foreign operations against foreign currency exposure (net investment hedges). Foreign currency denominated debt designated as non-derivative net investment hedging instruments on an after-tax basis was $88 and $86 at December 31, 2017 and 2016, respectively, and designated on a pre-tax basis was $652 and $572 at December 31, 2017 and 2016, respectively. See Note 6 for additional information about debt.

Interest Rate Risk

Eaton has entered into fixed-to-floating interest rate swaps to manage interest rate risk of certain long-term debt. These interest rate swaps are accounted for as fair value hedges of certain long-term debt. The maturity of the swap corresponds with the maturity of the debt instrument as noted in the table of long-term debt in Note 6. Eaton also entered into several forward starting floating-to-fixed interest rate swaps to manage interest rate risk in anticipation of debt that was refinanced in 2017.

A summary of interest rate swaps outstanding at December 31, 2017, follows:

Fixed-to-Floating Interest Rate Swaps

Notional amount		Fixed interest rate received	Floating interest rate paid	Basis for contracted floating interest rate paid
$	415	5.60%	4.59%	6 month LIBOR + 3.18%
300		6.95%	6.31%	3 month LIBOR + 5.07%
25		8.88%	5.24%	6 month LIBOR + 3.84%
150		3.88%	3.22%	1 month LIBOR + 2.12%
275		3.47%	2.84%	1 month LIBOR + 1.74%
100		8.10%	7.08%	1 month LIBOR + 5.90%
1,400		2.75%	1.66%	1 month LIBOR + 0.58%
200		3.68%	2.17%	1 month LIBOR + 1.07%
25		7.63%	3.87%	6 month LIBOR + 2.48%
50		7.65%	3.98%	6 month LIBOR + 2.57%
25		5.45%	1.68%	6 month LIBOR + 0.28%

Derivative Financial Statement Impacts

The fair value of derivative financial instruments recognized in the Consolidated Balance Sheets follows:

	Notional amount		Other  current assets		Other noncurrent assets		Other current liabilities		Other noncurrent liabilities		Type of hedge	Term
December 31, 2017
Derivatives designated as hedges
Fixed-to-floating interest rate swaps	$	2,965	$	1	$	41	$	—	$	17	Fair value	6 months to 17 years
Currency exchange contracts	924		7		7		22		2		Cash flow	1 to 36 months
Total			$	8	$	48	$	22	$	19
Derivatives not designated as hedges
Currency exchange contracts	$	3,719	$	39			$	19				1 to 12 months
Commodity contracts	13		1				—					1 to 12 months
Total			$	40			$	19

December 31, 2016
Derivatives designated as hedges
Fixed-to-floating interest rate swaps	$	3,765	$	1	$	65	$	—	$	8	Fair value	3 months to 18 years
Forward starting floating-to-fixed interest rate swaps	450		—		19		—		1		Cash flow	11 years
Currency exchange contracts	802		11		1		22		17		Cash flow	1 to 36 months
Total			$	12	$	85	$	22	$	26
Derivatives not designated as hedges
Currency exchange contracts	$	5,333	$	31			$	85				1 to 12 months
Commodity contracts	10		2				—					1 to 12 months
Total			$	33			$	85

The currency exchange contracts shown in the table above as derivatives not designated as hedges are primarily contracts entered into to manage currency volatility or exposure on intercompany sales and loans. While Eaton does not elect hedge accounting treatment for these derivatives, Eaton targets managing 100% of the intercompany balance sheet exposure to minimize the effect of currency volatility related to the movement of goods and services in the normal course of its operations. This activity represents the great majority of these currency exchange contracts.

The impact of derivative instruments to the Consolidated Statements of Income and Comprehensive Income follow:

	Gain (loss) recognized in other comprehensive (loss) income						Location of gain (loss) reclassified from Accumulated other comprehensive loss	Gain (loss) reclassified from Accumulated other comprehensive loss
	2017			2016				2017			2016
Derivatives designated as cash flow hedges
Forward starting floating-to-fixed interest rate swaps	$	(15	)	$	18		Interest expense - net	$	—		$	—
Interest rate locks	(9		)	—			Interest expense - net	—			—
Currency exchange contracts	—			(39		)	Cost of products sold	(17		)	(8		)
Total	$	(24	)	$	(21	)		$	(17	)	$	(8	)

Amounts recognized in net income follow:

	2017			2016
Derivatives designated as fair value hedges
Fixed-to-floating interest rate swaps	$	(33	)	$	(36	)
Related long-term debt converted to floating interest    rates by interest rate swaps	33			36
	$	—		$	—

Gains and losses described above were recognized in Interest expense - net.

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Accounts Receivable and Inventory

12 Months Ended

Dec. 31, 2017

Accounts Receivable and Inventory [Abstract]

Inventory

ACCOUNTS RECEIVABLE AND INVENTORY

Accounts Receivable

Eaton performs ongoing credit evaluation of its customers and maintains sufficient allowances for potential credit losses. The Company evaluates the collectability of its accounts receivable based on the length of time the receivable is past due and any anticipated future write-off based on historic experience. Accounts receivable balances are written off against an allowance for doubtful accounts after a final determination of uncollectability has been made. Accounts receivable are net of an allowance for doubtful accounts of $57 and $50 at December 31, 2017 and 2016.

Inventory

Inventory is carried at lower of cost or net realizable value. During the fourth quarter of 2017, the Company changed its method of accounting for certain inventory in the United States from the LIFO method to the FIFO method. The FIFO method of accounting for inventory is preferable because it conforms the Company's entire inventory to a single method of accounting and improves comparability with the Company's peers. Cost components include raw materials, purchased components, direct labor, indirect labor, utilities, depreciation, inbound freight charges, purchasing and receiving costs, inspection costs, warehousing costs, and costs of the distribution network.

The components of inventory follow:

	2017		2016 As adjusted
Raw materials	$	953	$	879
Work-in-process	471		395
Finished goods	1,196		1,072
Total inventory	$	2,620	$	2,346

All prior periods presented in the financial statements have been retrospectively adjusted to apply the new method of FIFO accounting for certain U.S. inventory. The cumulative effect of this change on periods prior to those presented herein resulted in an increase in Retained earnings of $70 as of January 1, 2015. The Tax Cuts and Jobs Act ("TCJA"), which was signed into law on December 22, 2017, would have required $14 of additional tax expense to adjust the deferred tax asset related to the LIFO reserve to the new tax rate if inventories continued to be computed under the LIFO method. The change from the LIFO method to the FIFO method eliminated the need to record this $14 of additional tax expense.

As a result of the retrospective application of this change in accounting method, the following financial statement line items within the accompanying financial statements were adjusted, as follows:

		December 31, 2017										December 31, 2016							December 31, 2015
(In millions except for per share data)		As computed under LIFO		As reported under FIFO		Effect of change						As originally reported		As adjusted		Effect of change			As originally reported		As adjusted		Effect of change
						TCJA			Other
Consolidated Statements of Income
	Cost of products sold	$	13,770	$	13,756	$	—		$	(14	)	$	13,400	$	13,409	$	9		$	14,292	$	14,304	$	12
	Income before income taxes	3,354		3,368		—			14			2,127		2,118		(9		)	2,145		2,133		(12		)
	Income tax expense	391		382		(14		)	5			202		199		(3		)	164		159		(5		)
	Net income	2,963		2,986		14			9			1,925		1,919		(6		)	1,981		1,974		(7		)
	Net income attributable to Eaton ordinary shareholders	$	2,962	$	2,985	$	14		$	9		$	1,922	$	1,916	$	(6	)	$	1,979	$	1,972	$	(7	)
Net income per ordinary share
	Diluted	$	6.63	$	6.68	$	0.03		$	0.02		$	4.21	$	4.20	$	(0.01	)	$	4.23	$	4.22	$	(0.01	)
	Basic	$	6.66	$	6.71	$	0.03		$	0.02		$	4.22	$	4.21	$	(0.01	)	$	4.25	$	4.23	$	(0.02	)
Consolidated Statements of Comprehensive Income
	Net income	$	2,963	$	2,986	$	14		$	9		$	1,925	$	1,919	$	(6	)	$	1,981	$	1,974	$	(7	)
	Net income attributable to Eaton ordinary shareholders	2,962		2,985		14			9			1,922		1,916		(6		)	1,979		1,972		(7		)
	Total comprehensive income attributable to Eaton ordinary shareholders	$	4,006	$	4,029	$	14		$	9		$	1,337	$	1,331	$	(6	)	$	1,015	$	1,008	$	(7	)

		December 31, 2017									December 31, 2016									December 31, 2015
(In millions except for per share data)		As computed under LIFO			As reported under FIFO			Effect of change			As originally reported			As adjusted			Effect of change			As originally reported			As adjusted			Effect of change
Consolidated Balance Sheets
	Inventory	$	2,514		$	2,620		$	106		$	2,254		$	2,346		$	92
	Deferred income taxes - noncurrent asset	253			253			—			360			325			(35		)
	Deferred income taxes - noncurrent liability	512			538			26			321			321			—
	Retained earnings	$	8,589		$	8,669		$	80		$	7,498		$	7,555		$	57
Consolidated Statements of Cash Flows
	Net income	$	2,963		$	2,986		$	23		$	1,925		$	1,919		$	(6	)	$	1,981		$	1,974		$	(7	)
	Deferred income taxes	(197		)	(206		)	(9		)	(80		)	(83		)	(3		)	(100		)	(105		)	(5		)
	Inventory	$	(188	)	$	(202	)	$	(14	)	$	25		$	34		$	9		$	(20	)	$	(8	)	$	12

As a result of the retrospective application of this change in accounting principle, the following financial statement line items within the unaudited interim 2017 and 2016 quarterly condensed consolidated financial statements were adjusted, as follows:

	(unaudited)	Three months ended
		March 30, 2017							June 30, 2017							September 30, 2017
(In millions except for per share data)		As originally reported		As adjusted		Effect of change			As originally reported		As adjusted		Effect of change			As originally reported		As adjusted		Effect of change
Consolidated Statements of Income
	Cost of products sold	$	3,310	$	3,307	$	(3	)	$	3,450	$	3,448	$	(2	)	$	3,469	$	3,466	$	(3	)
	Income before income taxes	464		467		3			570		572		2			1,691		1,694		3
	Income tax expense	32		33		1			54		55		1			292		293		1
	Net income	432		434		2			516		517		1			1,399		1,401		2
	Net income attributable to Eaton ordinary shareholders	$	432	$	434	$	2		$	515	$	516	$	1		$	1,399	$	1,401	$	2
Net income per ordinary share
	Diluted	$	0.96	$	0.96	$	—		$	1.15	$	1.15	$	—		$	3.14	$	3.14	$	—
	Basic	$	0.96	$	0.97	$	0.01		$	1.15	$	1.16	$	0.01		$	3.16	$	3.16	$	—

	(unaudited)	Three months ended
		March 30, 2016							June 30, 2016							September 30, 2016
(In millions except for per share data)		As originally reported		As adjusted		Effect of change			As originally reported		As adjusted		Effect of change			As originally reported		As adjusted		Effect of change
Consolidated Statements of Income
	Cost of products sold	$	3,291	$	3,294	$	3		$	3,419	$	3,422	$	3		$	3,371	$	3,374	$	3
	Income before income taxes	442		439		(3		)	553		550		(3		)	573		570		(3		)
	Income tax expense	39		38		(1		)	61		60		(1		)	51		50		(1		)
	Net income	403		401		(2		)	492		490		(2		)	522		520		(2		)
	Net income attributable to Eaton ordinary shareholders	$	404	$	402	$	(2	)	$	491	$	489	$	(2	)	$	523	$	521	$	(2	)
Net income per ordinary share
	Diluted	$	0.88	$	0.87	$	(0.01	)	$	1.07	$	1.07	$	—		$	1.15	$	1.14	$	(0.01	)
	Basic	$	0.88	$	0.88	$	—		$	1.08	$	1.07	$	(0.01	)	$	1.15	$	1.15	$	—

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Business Segment and Geographic Region Information

12 Months Ended

Dec. 31, 2017

Segment Reporting [Abstract]

Business Segment and Geographic Region Information

BUSINESS SEGMENT AND GEOGRAPHIC REGION INFORMATION

Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated on a regular basis by the chief operating decision maker, or decision making group, in deciding how to allocate resources to an individual segment and in assessing performance. Eaton’s segments are as follows:

Electrical Products and Electrical Systems and Services

The Electrical Products segment consists of electrical components, industrial components, residential products, single phase power quality, emergency lighting, fire detection, wiring devices, structural support systems, circuit protection, and lighting products. The Electrical Systems and Services segment consists of power distribution and assemblies, three phase power quality, hazardous duty electrical equipment, intrinsically safe explosion-proof instrumentation, utility power distribution, power reliability equipment, and services. The principal markets for these segments are industrial, institutional, governmental, utility, commercial, residential and information technology. These products are used wherever there is a demand for electrical power in commercial buildings, data centers, residences, apartment and office buildings, hospitals, factories, utilities, and industrial and energy facilities. The segments share several common global customers, but a large number of customers are located regionally. Sales are made directly to original equipment manufacturers, utilities, and certain other end users, as well as through distributors, resellers, and manufacturers' representatives.

Hydraulics

The Hydraulics segment is a global leader in hydraulics components, systems and services for industrial and mobile equipment. Eaton offers a wide range of power products including pumps, motors and hydraulic power units; a broad range of controls and sensing products including valves, cylinders and electronic controls; a full range of fluid conveyance products including industrial and hydraulic hose, fittings, and assemblies, thermoplastic hose and tubing, couplings, connectors, and assembly equipment; filtration systems solutions; industrial drum and disc brakes; and golf grips. The principal markets for the Hydraulics segment include renewable energy, marine, agriculture, oil and gas, construction, mining, forestry, utility, material handling, truck and bus, machine tools, molding, primary metals, and power generation. Key manufacturing customers in these markets and other customers are located globally. Products are sold and serviced through a variety of channels.

Aerospace

The Aerospace segment is a leading global supplier of aerospace fuel, hydraulics, and pneumatic systems for commercial and military use. Products include hydraulic power generation systems for aerospace applications including pumps, motors, hydraulic power units, hose and fittings, electro-hydraulic pumps; controls and sensing products including valves, cylinders, electronic controls, electromechanical actuators, sensors, aircraft flap and slat systems and nose wheel steering systems; fluid conveyance products, including hose, thermoplastic tubing, fittings, adapters, couplings, sealing and ducting; and fuel systems including fuel pumps, sensors, valves, adapters and regulators. The principal markets for the Aerospace segment are manufacturers of commercial and military aircraft and related after-market customers. These manufacturers and other customers operate globally. Products are sold and serviced through a variety of channels.

Vehicle

The Vehicle segment is a leader in the design, manufacture, marketing, and supply of: drivetrain, powertrain systems and critical components that reduce emissions and improve fuel economy, stability, performance, and safety of cars, light trucks and commercial vehicles. Products include transmissions, clutches, hybrid power systems, superchargers, engine valves and valve actuation systems, cylinder heads, locking and limited slip differentials, transmission controls, fuel vapor components, fluid connectors and conveyance products for the global vehicle industry. The principal markets for the Vehicle segment are original equipment manufacturers and aftermarket customers of heavy-, medium-, and light-duty trucks, SUVs, CUVs, passenger cars and agricultural equipment.

Other Information

No single customer represented greater than 10% of net sales in 2017, 2016 or 2015, respectively.

The accounting policies of the business segments are generally the same as the policies described in Note 1, except that operating profit only reflects the service cost component related to pensions and other postretirement benefits. Intersegment sales and transfers are accounted for at the same prices as if the sales and transfers were made to third parties. These intersegment sales are eliminated in consolidation. Operating profit includes the operating profit from intersegment sales.

For purposes of business segment performance measurement, the Company does not allocate items that are of a non-operating nature or are of a corporate or functional governance nature. Corporate expenses consist of transaction costs associated with the acquisition of certain businesses and corporate office expenses including compensation, benefits, occupancy, depreciation, and other administrative costs. Identifiable assets of the business segments exclude goodwill, other intangible assets, and general corporate assets, which principally consist of certain cash, short-term investments, deferred income taxes, certain accounts receivable, certain property, plant and equipment, and certain other assets.

Business Segment Information

	2017			2016			2015
Net sales
Electrical Products	$	7,193		$	6,957		$	6,976
Electrical Systems and Services	5,666			5,662			5,931
Hydraulics	2,468			2,222			2,459
Aerospace	1,744			1,753			1,807
Vehicle	3,333			3,153			3,682
Total net sales	$	20,404		$	19,747		$	20,855
Segment operating profit
Electrical Products	$	1,287		$	1,240		$	1,156
Electrical Systems and Services	770			711			776
Hydraulics	288			198			246
Aerospace	332			335			310
Vehicle	537			474			645
Total segment operating profit	3,214			2,958			3,133
Corporate
Amortization of intangible assets	(388		)	(392		)	(406		)
Interest expense - net	(246		)	(233		)	(232		)
Pension and other postretirement benefits expense	(45		)	(60		)	(130		)
Gain on sale of business	1,077			—			—
Other corporate expense - net*	(244		)	(155		)	(232		)
Income before income taxes*	3,368			2,118			2,133
Income tax expense*	382			199			159
Net income*	2,986			1,919			1,974
Less net income for noncontrolling interests	(1		)	(3		)	(2		)
Net income attributable to Eaton ordinary shareholders*	$	2,985		$	1,916		$	1,972

*Other corporate expense - net and Income tax expense in 2016 and 2015 have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14.

Business segment operating profit was reduced by acquisition integration charges as follows:

	2017		2016		2015
Electrical Products	$	4	$	3	$	25
Electrical Systems and Services	—		1		15
Hydraulics	—		—		2
Total	$	4	$	4	$	42

Corporate acquisition integration charges totaled $5 in 2015, and are included above in Other corporate expense - net. There was no corporate acquisition integration charges in 2017 and 2016. See Note 3 for additional information about acquisition integration charges.

	2017		2016		2015
Identifiable assets
Electrical Products	$	2,570	$	2,363	$	2,538
Electrical Systems and Services	2,141		2,222		2,285
Hydraulics	1,345		1,188		1,138
Aerospace	938		830		841
Vehicle	2,379		1,549		1,579
Total identifiable assets	9,373		8,152		8,381
Goodwill	13,568		13,201		13,479
Other intangible assets	5,265		5,514		6,014
Corporate*	4,417		3,609		3,185
Total assets*	$	32,623	$	30,476	$	31,059
*Corporate identifiable assets in 2016 and 2015 have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14.
Capital expenditures for property, plant and equipment
Electrical Products	$	134	$	134	$	137
Electrical Systems and Services	83		78		94
Hydraulics	96		92		61
Aerospace	37		28		33
Vehicle	141		142		119
Total	491		474		444
Corporate	29		23		62
Total expenditures for property, plant and equipment	$	520	$	497	$	506
Depreciation of property, plant and equipment
Electrical Products	$	143	$	141	$	137
Electrical Systems and Services	83		82		82
Hydraulics	61		64		67
Aerospace	26		27		28
Vehicle	109		109		113
Total	422		423		427
Corporate	54		63		52
Total depreciation of property, plant and equipment	$	476	$	486	$	479

Geographic Region Information

Net sales are measured based on the geographic destination of sales. Long-lived assets consist of property, plant and equipment - net.

	2017		2016		2015
Net sales
United States	$	11,222	$	10,937	$	11,396
Canada	942		898		969
Latin America	1,485		1,448		1,726
Europe	4,394		4,228		4,379
Asia Pacific	2,361		2,236		2,385
Total	$	20,404	$	19,747	$	20,855
Long-lived assets
United States	$	1,872	$	1,924	$	1,982
Canada	20		19		19
Latin America	290		281		243
Europe	769		681		734
Asia Pacific	551		538		587
Total	$	3,502	$	3,443	$	3,565

XML

Condensed Consolidating Financial Statements

12 Months Ended

Dec. 31, 2017

Condensed Financial Information of Parent Company Only Disclosure [Abstract]

Condensed Consolidating Financial Statements

CONDENSED CONSOLIDATING FINANCIAL STATEMENTS

The Registered Senior Notes issued by Eaton Corporation are registered under the Securities Act of 1933. Eaton and certain other of Eaton's 100% owned direct and indirect subsidiaries (the Guarantors) fully and unconditionally guaranteed (subject, in the case of the Guarantors, other than Eaton, to customary release provisions as described below), on a joint and several basis, the Registered Senior Notes. The following condensed consolidating financial statements are included so that separate financial statements of Eaton, Eaton Corporation and each of the Guarantors are not required to be filed with the Securities and Exchange Commission. The consolidating adjustments primarily relate to eliminations of investments in subsidiaries and intercompany balances and transactions. The condensed consolidating financial statements present investments in subsidiaries using the equity method of accounting. See Note 6 for additional information related to the Registered Senior Notes.

The guarantee of a Guarantor that is not a parent of the issuer will be automatically and unconditionally released and discharged in the event of any sale of the Guarantor or of all or substantially all of its assets, or in connection with the release or termination of the Guarantor as a guarantor under all other U.S. debt securities or U.S. syndicated credit facilities, subject to limitations set forth in the indenture. The guarantee of a Guarantor that is a direct or indirect parent of the issuer will only be automatically and unconditionally released and discharged in connection with the release or termination of such Guarantor as a guarantor under all other debt securities or syndicated credit facilities (in both cases, U.S. or otherwise), subject to limitations set forth in the indenture.

During 2017, 2016 and 2015, the Company undertook certain steps to restructure ownership of various subsidiaries. The transactions were entirely among wholly-owned subsidiaries under the common control of Eaton. This restructuring has been reflected as of the beginning of the earliest period presented below.

Additionally, certain amounts in 2016 and 2015 have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14.

CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME YEAR ENDED DECEMBER 31, 2017
	Eaton Corporation plc			Eaton Corporation			Guarantors			Other subsidiaries			Consolidating adjustments			Total
Net sales	$	—		$	6,659		$	6,563		$	12,599		$	(5,417	)	$	20,404
Cost of products sold	—			5,276			4,840			9,054			(5,414		)	13,756
Selling and administrative expense	136			1,172			759			1,498			—			3,565
Research and development expense	—			215			207			162			—			584
Interest expense (income) - net	—			245			21			(21		)	1			246
Gain on sale of business	—			560			—			517			—			1,077
Other expense (income) - net	79			9			(70		)	(56		)	—			(38		)
Equity in loss (earnings) of    subsidiaries, net of tax	(3,644		)	(1,139		)	(4,958		)	(4,665		)	14,406			—
Intercompany expense (income) - net	444			(561		)	1,197			(1,080		)	—			—
Income (loss) before income taxes	2,985			2,002			4,567			8,224			(14,410		)	3,368
Income tax expense (benefit)	—			499			(232		)	115			—			382
Net income (loss)	2,985			1,503			4,799			8,109			(14,410		)	2,986
Less net loss (income) for    noncontrolling interests	—			—			—			(3		)	2			(1		)
Net income (loss) attributable to    Eaton ordinary shareholders	$	2,985		$	1,503		$	4,799		$	8,106		$	(14,408	)	$	2,985
Other comprehensive income (loss)	1,044			41			1,064			2,192			(3,297		)	1,044
Total comprehensive income (loss) attributable to Eaton    ordinary shareholders	$	4,029		$	1,544		$	5,863		$	10,298		$	(17,705	)	$	4,029

CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME YEAR ENDED DECEMBER 31, 2016
	Eaton Corporation plc			Eaton Corporation			Guarantors			Other subsidiaries			Consolidating adjustments			Total
Net sales	$	—		$	6,447		$	6,351		$	11,961		$	(5,012	)	$	19,747
Cost of products sold	—			5,076			4,697			8,649			(5,013		)	13,409
Selling and administrative expense	140			1,153			760			1,452			—			3,505
Research and development expense	—			235			186			168			—			589
Interest expense (income) - net	—			233			17			(16		)	(1		)	233
Other expense (income) - net	(35		)	(48		)	43			(67		)	—			(107		)
Equity in loss (earnings) of    subsidiaries, net of tax	(2,433		)	(770		)	(3,266		)	(2,808		)	9,277			—
Intercompany expense (income) - net	412			(122		)	1,230			(1,520		)	—			—
Income (loss) before income taxes	1,916			690			2,684			6,103			(9,275		)	2,118
Income tax expense (benefit)	—			23			26			149			1			199
Net income (loss)	1,916			667			2,658			5,954			(9,276		)	1,919
Less net loss (income) for    noncontrolling interests	—			—			—			(5		)	2			(3		)
Net income (loss) attributable to    Eaton ordinary shareholders	$	1,916		$	667		$	2,658		$	5,949		$	(9,274	)	$	1,916
Other comprehensive income (loss)	(585		)	54			(566		)	(1,344		)	1,856			(585		)
Total comprehensive income (loss) attributable to Eaton    ordinary shareholders	$	1,331		$	721		$	2,092		$	4,605		$	(7,418	)	$	1,331

CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME YEAR ENDED DECEMBER 31, 2015
	Eaton Corporation plc			Eaton Corporation			Guarantors			Other subsidiaries			Consolidating adjustments			Total
Net sales	$	—		$	6,926		$	6,660		$	12,531		$	(5,262	)	$	20,855
Cost of products sold	—			5,518			5,041			8,978			(5,233		)	14,304
Selling and administrative expense	141			1,223			738			1,494			—			3,596
Research and development expense	—			266			197			162			—			625
Interest expense (income) - net	—			222			21			(13		)	2			232
Other expense (income) - net	—			—			24			(59		)	—			(35		)
Equity in loss (earnings) of    subsidiaries, net of tax	(2,449		)	(821		)	(3,221		)	(2,761		)	9,252			—
Intercompany expense (income) - net	336			(384		)	1,218			(1,170		)	—			—
Income (loss) before income taxes	1,972			902			2,642			5,900			(9,283		)	2,133
Income tax expense (benefit)	—			87			(69		)	152			(11		)	159
Net income (loss)	1,972			815			2,711			5,748			(9,272		)	1,974
Less net loss (income) for    noncontrolling interests	—			—			—			(3		)	1			(2		)
Net income (loss) attributable to    Eaton ordinary shareholders	$	1,972		$	815		$	2,711		$	5,745		$	(9,271	)	$	1,972
Other comprehensive income (loss)	(964		)	5			(951		)	(2,000		)	2,946			(964		)
Total comprehensive income (loss) attributable to Eaton    ordinary shareholders	$	1,008		$	820		$	1,760		$	3,745		$	(6,325	)	$	1,008

CONDENSED CONSOLIDATING BALANCE SHEETS DECEMBER 31, 2017
	Eaton Corporation plc		Eaton Corporation		Guarantors		Other subsidiaries		Consolidating adjustments			Total
Assets
Current assets
Cash	$	—	$	183	$	12	$	366	$	—		$	561
Short-term investments	—		—		—		534		—			534
Accounts receivable - net	—		482		1,317		2,144		—			3,943
Intercompany accounts receivable	8		2,865		5,146		2,741		(10,760		)	—
Inventory	—		473		692		1,537		(82		)	2,620
Prepaid expenses and other    current assets	—		229		145		277		28			679
Total current assets	8		4,232		7,312		7,599		(10,814		)	8,337
Property, plant and equipment - net	—		835		684		1,983		—			3,502
Other noncurrent assets
Goodwill	—		1,307		6,293		5,968		—			13,568
Other intangible assets	—		138		3,002		2,125		—			5,265
Deferred income taxes	—		356		—		221		(324		)	253
Investment in subsidiaries	15,045		15,439		87,919		39,527		(157,930		)	—
Intercompany loans receivable	3,122		7,104		2,735		61,225		(74,186		)	—
Other assets	—		748		163		787		—			1,698
Total assets	$	18,175	$	30,159	$	108,108	$	119,435	$	(243,254	)	$	32,623
Liabilities and shareholders’    equity
Current liabilities
Short-term debt	$	—	$	—	$	—	$	6	$	—		$	6
Current portion of long-term debt	—		542		35		1		—			578
Accounts payable	—		533		313		1,320		—			2,166
Intercompany accounts payable	4		4,920		4,405		1,431		(10,760		)	—
Accrued compensation	—		128		63		262		—			453
Other current liabilities	1		564		308		1,000		(1		)	1,872
Total current liabilities	5		6,687		5,124		4,020		(10,761		)	5,075
Noncurrent liabilities
Long-term debt	—		6,180		976		8		3			7,167
Pension liabilities	—		341		83		802		—			1,226
Other postretirement benefits    liabilities	—		192		94		76		—			362
Deferred income taxes	—		—		558		304		(324		)	538
Intercompany loans payable	917		3,718		68,405		1,146		(74,186		)	—
Other noncurrent liabilities	—		314		272		379		—			965
Total noncurrent liabilities	917		10,745		70,388		2,715		(74,507		)	10,258
Shareholders’ equity
Eaton shareholders’ equity	17,253		12,727		32,596		112,663		(157,986		)	17,253
Noncontrolling interests	—		—		—		37		—			37
Total equity	17,253		12,727		32,596		112,700		(157,986		)	17,290
Total liabilities and equity	$	18,175	$	30,159	$	108,108	$	119,435	$	(243,254	)	$	32,623

CONDENSED CONSOLIDATING BALANCE SHEETS DECEMBER 31, 2016
	Eaton Corporation plc		Eaton Corporation		Guarantors		Other subsidiaries		Consolidating adjustments			Total
Assets
Current assets
Cash	$	1	$	92	$	5	$	445	$	—		$	543
Short-term investments	—		—		—		203		—			203
Accounts receivable - net	—		536		1,049		1,975		—			3,560
Intercompany accounts receivable	5		953		4,239		3,382		(8,579		)	—
Inventory	—		443		638		1,344		(79		)	2,346
Prepaid expenses and other    current assets	—		77		42		237		25			381
Total current assets	6		2,101		5,973		7,586		(8,633		)	7,033
Property, plant and equipment - net	—		857		706		1,880		—			3,443
Other noncurrent assets
Goodwill	—		1,362		6,293		5,546		—			13,201
Other intangible assets	—		169		3,442		1,903		—			5,514
Deferred income taxes	—		864		15		218		(772		)	325
Investment in subsidiaries	32,852		20,200		92,766		44,345		(190,163		)	—
Intercompany loans receivable	—		7,609		2,061		56,938		(66,608		)	—
Other assets	—		490		134		336		—			960
Total assets	$	32,858	$	33,652	$	111,390	$	118,752	$	(266,176	)	$	30,476
Liabilities and shareholders’    equity
Current liabilities
Short-term debt	$	—	$	—	$	8	$	6	$	—		$	14
Current portion of long-term debt	—		1,250		296		6		—			1,552
Accounts payable	1		412		252		1,053		—			1,718
Intercompany accounts payable	281		3,332		3,130		1,836		(8,579		)	—
Accrued compensation	—		98		58		223		—			379
Other current liabilities	1		590		276		957		(2		)	1,822
Total current liabilities	283		5,682		4,020		4,081		(8,581		)	5,485
Noncurrent liabilities
Long-term debt	—		5,767		936		8		—			6,711
Pension liabilities	—		610		161		888		—			1,659
Other postretirement benefits    liabilities	—		198		99		71		—			368
Deferred income taxes	—		—		732		361		(772		)	321
Intercompany loans payable	17,621		3,768		44,788		431		(66,608		)	—
Other noncurrent liabilities	—		326		212		396		—			934
Total noncurrent liabilities	17,621		10,669		46,928		2,155		(67,380		)	9,993
Shareholders’ equity
Eaton shareholders’ equity	14,954		17,301		60,442		112,478		(190,221		)	14,954
Noncontrolling interests	—		—		—		38		6			44
Total equity	14,954		17,301		60,442		112,516		(190,215		)	14,998
Total liabilities and equity	$	32,858	$	33,652	$	111,390	$	118,752	$	(266,176	)	$	30,476

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS DECEMBER 31, 2017
	Eaton Corporation plc			Eaton Corporation			Guarantors			Other subsidiaries			Consolidating adjustments			Total
Net cash provided by (used in)    operating activities	$	258		$	(498	)	$	(30	)	$	4,545		$	(1,609	)	$	2,666
Investing activities
Capital expenditures for property,    plant and equipment	—			(90		)	(110		)	(320		)	—			(520		)
Cash received from sales (paid for    acquisitions) of affiliates	—			—			(92		)	92			—			—
Purchases of short-term investments - net	—			—			—			(298		)	—			(298		)
Investments in affiliates	(190		)	—			—			(90		)	280			—
Return of investments in affiliates	—			—			90			—			(90		)	—
Loans to affiliates	—			(444		)	—			(6,723		)	7,167			—
Repayments of loans from affiliates	—			303			46			3,817			(4,166		)	—
Proceeds from sale of business	—			338			—			269			—			607
Other - net	—			(45		)	9			30			—			(6		)
Net cash provided by (used in)     investing activities	(190		)	62			(57		)	(3,223		)	3,191			(217		)
Financing activities
Proceeds from borrowings	—			1,000			—			—			—			1,000
Payments on borrowings	—			(1,250		)	(297		)	(7		)	—			(1,554		)
Proceeds from borrowings from    affiliates	2,605			3,130			991			441			(7,167		)	—
Payments on borrowings from    affiliates	(822		)	(2,904		)	(353		)	(87		)	4,166			—
Capital contributions from affiliates	—			—			90			190			(280		)	—
Return of capital to affiliates	—			—			—			(90		)	90			—
Other intercompany financing    activities	—			573			469			(1,042		)	—			—
Cash dividends paid	(1,068		)	—			—			—			—			(1,068		)
Cash dividends paid to affiliates	—			—			(800		)	(809		)	1,609			—
Exercise of employee stock options	66			—			—			—			—			66
Repurchase of shares	(850		)	—			—			—			—			(850		)
Employee taxes paid from shares    withheld	—			(14		)	(5		)	(3		)	—			(22		)
Other - net	—			(8		)	(1		)	(5		)	—			(14		)
Net cash provided by (used in)    financing activities	(69		)	527			94			(1,412		)	(1,582		)	(2,442		)
Effect of currency on cash	—			—			—			11			—			11
Total increase (decrease) in cash	(1		)	91			7			(79		)	—			18
Cash at the beginning of the period	1			92			5			445			—			543
Cash at the end of the period	$	—		$	183		$	12		$	366		$	—		$	561

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS DECEMBER 31, 2016
	Eaton Corporation plc			Eaton Corporation			Guarantors			Other subsidiaries			Consolidating adjustments			Total
Net cash provided by (used in)    operating activities	$	(253	)	$	22		$	(232	)	$	3,033		$	—		$	2,570
Investing activities
Capital expenditures for property,    plant and equipment	—			(92		)	(114		)	(291		)	—			(497		)
Cash received from acquisitions of    businesses, net of cash acquired	—			—			1			—			—			1
Sales (purchases) of short-term investments - net	—			—			2			(42		)	—			(40		)
Investments in affiliates	(1,250		)	—			(120		)	(1,370		)	2,740			—
Return of investments in affiliates	—			—			47			—			(47		)	—
Loans to affiliates	—			(251		)	(655		)	(8,208		)	9,114			—
Repayments of loans from affiliates	—			1,293			—			5,951			(7,244		)	—
Other - net	—			(9		)	41			(25		)	—			7
Net cash provided by (used in)     investing activities	(1,250		)	941			(798		)	(3,985		)	4,563			(529		)
Financing activities
Proceeds from borrowings	—			21			610			—			—			631
Payments on borrowings	—			(408		)	(233		)	(12		)	—			(653		)
Proceeds from borrowings from    affiliates	3,843			4,045			1,120			106			(9,114		)	—
Payments on borrowings from    affiliates	(646		)	(4,712		)	(1,844		)	(42		)	7,244			—
Capital contribution from affiliates	—			—			1,370			1,370			(2,740		)	—
Return of capital to affiliates	—			—			—			(47		)	47			—
Other intercompany financing    activities	—			168			12			(180		)	—			—
Cash dividends paid	(1,037		)	—			—			—			—			(1,037		)
Exercise of employee stock options	74			—			—			—			—			74
Repurchase of shares	(730		)	—			—			—			—			(730		)
Employee taxes paid from shares    withheld	—			(12		)	(3		)	(3		)	—			(18		)
Other - net	—			1			(4		)	(2		)	—			(5		)
Net cash provided by (used in)    financing activities	1,504			(897		)	1,028			1,190			(4,563		)	(1,738		)
Effect of currency on cash	—			—			—			(28		)	—			(28		)
Total increase (decrease) in cash	1			66			(2		)	210			—			275
Cash at the beginning of the period	—			26			7			235			—			268
Cash at the end of the period	$	1		$	92		$	5		$	445		$	—		$	543

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS DECEMBER 31, 2015
	Eaton Corporation plc			Eaton Corporation			Guarantors			Other subsidiaries			Consolidating adjustments			Total
Net cash provided by (used in)    operating activities	$	(137	)	$	(195	)	$	(281	)	$	3,026		$	(4	)	$	2,409
Investing activities
Capital expenditures for property,    plant and equipment	—			(94		)	(146		)	(266		)	—			(506		)
Cash paid for acquisitions of    businesses, net of cash acquired	—			—			(36		)	(36		)	—			(72		)
Sales (purchases) of short-term    investments - net	—			—			(2		)	39			—			37
Investments in affiliates	(1,482		)	—			(1,176		)	(1,482		)	4,140			—
Loans to affiliates	—			(889		)	(39		)	(10,608		)	11,536			—
Repayments of loans from affiliates	—			342			359			7,493			(8,194		)	—
Proceeds from the sales of    businesses	—			—			—			1			—			1
Other - net	—			(50		)	47			(32		)	—			(35		)
Net cash provided by (used in)    investing activities	(1,482		)	(691		)	(993		)	(4,891		)	7,482			(575		)
Financing activities
Proceeds from borrowings	—			408			—			17			—			425
Payments on borrowings	—			(724		)	(301		)	(2		)	—			(1,027		)
Proceeds from borrowings from    affiliates	3,322			6,885			997			332			(11,536		)	—
Payments on borrowings from    affiliates	(48		)	(6,467		)	(1,282		)	(397		)	8,194			—
Capital contribution from affiliates	—			1,176			1,482			1,482			(4,140		)	—
Other intercompany financing    activities	—			(518		)	378			140			—			—
Cash dividends paid	(1,026		)	—			—			—			—			(1,026		)
Cash dividends paid to affiliates	—			—			—			(4		)	4			—
Exercise of employee stock options	52			—			—			—			—			52
Repurchase of shares	(682		)	—			—			—			—			(682		)
Employee taxes paid from shares    withheld	—			(26		)	(6		)	(6		)	—			(38		)
Other - net	—			1			—			(10		)	—			(9		)
Net cash provided by (used in)    financing activities	1,618			735			1,268			1,552			(7,478		)	(2,305		)
Effect of currency on cash	—			—			—			(42		)	—			(42		)
Total increase (decrease) in cash	(1		)	(151		)	(6		)	(355		)	—			(513		)
Cash at the beginning of the period	1			177			13			590			—			781
Cash at the end of the period	$	—		$	26		$	7		$	235		$	—		$	268

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Summary of Significant Accounting Policies (Policies)

12 Months Ended

Dec. 31, 2017

Accounting Policies [Abstract]

General Information

General Information and Basis of Presentation

Eaton Corporation plc (Eaton or the Company) is a power management company with 2017 net sales of $20.4 billion. The Company provides energy-efficient solutions that help its customers effectively manage electrical, hydraulic and mechanical power more efficiently, safely and sustainably. Eaton has approximately 96,000 employees in 59 countries and sells products to customers in more than 175 countries.

The consolidated financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States. Preparation of the consolidated financial statements requires management to make estimates and assumptions that affect amounts reported in the consolidated financial statements and notes. Actual results could differ from these estimates. Management has evaluated subsequent events through the date the consolidated financial statements were filed with the Securities Exchange Commission.

The consolidated financial statements include the accounts of Eaton and all subsidiaries and other entities it controls. Intercompany transactions and balances have been eliminated. The equity method of accounting is used for investments in associate companies where the Company has significant influence and generally a 20% to 50% ownership interest. Equity investments are evaluated for impairment whenever events or circumstances indicate the book value of the investment exceeds fair value. An impairment would exist if there is an other-than-temporary decline in value. Eaton does not have off-balance sheet arrangements or financings with unconsolidated entities. In the ordinary course of business, the Company leases certain real properties and equipment, as described in Note 8.

Eaton's functional currency is United States Dollars (USD). The functional currency for most subsidiaries is their local currency. Financial statements for these subsidiaries are translated at year-end exchange rates as to assets and liabilities and weighted-average exchange rates as to revenues and expenses. The resulting translation adjustments are recognized in Accumulated other comprehensive loss.

During 2017, the Company adopted Accounting Standards Update 2016-09, Compensation-Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting, (ASU 2016-09). Upon adoption, the Company recorded deferred tax assets of $48 for all excess tax benefits that had not been previously recognized. This was accomplished through a cumulative-effect adjustment to retained earnings. ASU 2016-09 also requires that all excess tax benefits and deficiencies generated in the current and future periods be recorded as income tax benefit or expense in the reporting period in which they occur. These excess tax benefits and deficiencies, which were previously required to be presented as financing activities on the Company’s Consolidated Statements of Cash Flows, are now classified as operating activities prospectively. The Company also reclassified $22, $18, and $38 for 2017, 2016, and 2015, respectively, from operating activities to financing activities on the Company’s Consolidated Statements of Cash Flows for withholding payments made to taxing authorities from shares withheld from employees. The Company will continue to estimate forfeitures as part of recording equity-based compensation expense.

During the fourth quarter of 2017, the Company changed its method of accounting for certain inventory in the United States from the last-in, first-out (LIFO) method to the first-in, first-out (FIFO) method. All prior periods presented have been retrospectively adjusted to apply the new method of accounting. See Note 14 for more information on the change in inventory accounting method.

Certain prior year amounts have been reclassified to conform to the current year presentation.

Business Description and Basis of Presentation

Eaton Corporation plc (Eaton or the Company) is a power management company with 2017 net sales of $20.4 billion. The Company provides energy-efficient solutions that help its customers effectively manage electrical, hydraulic and mechanical power more efficiently, safely and sustainably. Eaton has approximately 96,000 employees in 59 countries and sells products to customers in more than 175 countries.

The consolidated financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States. Preparation of the consolidated financial statements requires management to make estimates and assumptions that affect amounts reported in the consolidated financial statements and notes. Actual results could differ from these estimates. Management has evaluated subsequent events through the date the consolidated financial statements were filed with the Securities Exchange Commission.

Consolidation Policy

The consolidated financial statements include the accounts of Eaton and all subsidiaries and other entities it controls. Intercompany transactions and balances have been eliminated. The equity method of accounting is used for investments in associate companies where the Company has significant influence and generally a 20% to 50% ownership interest. Equity investments are evaluated for impairment whenever events or circumstances indicate the book value of the investment exceeds fair value. An impairment would exist if there is an other-than-temporary decline in value. Eaton does not have off-balance sheet arrangements or financings with unconsolidated entities. In the ordinary course of business, the Company leases certain real properties and equipment, as described in Note 8.

Foreign Currency Translation

Eaton's functional currency is United States Dollars (USD). The functional currency for most subsidiaries is their local currency. Financial statements for these subsidiaries are translated at year-end exchange rates as to assets and liabilities and weighted-average exchange rates as to revenues and expenses. The resulting translation adjustments are recognized in Accumulated other comprehensive loss.

Reclassifications

Certain prior year amounts have been reclassified to conform to the current year presentation.

Revenue Recognition

Revenue Recognition

Sales of products are recognized when a sales agreement is in place, products have been shipped to unaffiliated customers and title has transferred in accordance with shipping terms, the selling price is fixed and determinable and collectability is reasonably assured, all significant related acts of performance have been completed, and no other significant uncertainties exist. Shipping and handling costs billed to customers are included in Net sales and the related costs in Cost of products sold. Although the majority of the sales agreements contain standard terms and conditions, there are agreements that contain multiple elements or non-standard terms and conditions. As a result, judgment is required to determine the appropriate accounting, including whether the deliverables specified in these agreements should be treated as separate units of accounting for recognition purposes, and, if so, how the sales price should be allocated among the elements and when to recognize sales for each element. For delivered elements, sales generally are recognized only when the delivered elements have standalone value and there are no uncertainties regarding customer acceptance. Sales for service contracts generally are recognized as the services are provided.

Eaton records reductions to revenue for customer and distributor incentives, primarily comprised of rebates, at the time of the initial sale. Rebates are estimated based on sales terms, historical experience, trend analysis, and projected market conditions in the various markets served. The rebate programs offered vary across businesses due to the numerous markets Eaton serves, but the most common incentives relate to amounts paid or credited to customers for achieving defined volume levels.

Goodwill and Indefinite Life Intangible Assets

Goodwill and Indefinite Life Intangible Assets

Goodwill is evaluated annually for impairment as of July 1 using either a quantitative or qualitative analysis. Goodwill is tested for impairment at the reporting unit level, which is equivalent to Eaton's operating segments and based on the net assets for each segment, including goodwill and intangible assets. Goodwill is assigned to each operating segment, as this represents the lowest level that constitutes a business and is the level at which management regularly reviews the operating results. The Company performs a quantitative analysis using a discounted cash flow model and other valuation techniques, but may elect to perform a qualitative analysis. Additionally, goodwill is evaluated for impairment whenever an event occurs or circumstances change that would indicate that it is more likely than not that the fair value of an operating segment is less than its carrying amount.

Goodwill impairment testing in 2017 was performed using qualitative analysis, which is performed by assessing certain trends and factors, including projected market outlook and growth rates, forecasted and actual sales and operating profit margins, discount rates, industry data, and other relevant qualitative factors. These trends and factors are compared to, and based on, the assumptions used in the most recent quantitative assessment performed in 2016. The results of the qualitative analysis did not indicate a need to perform a quantitative analysis.

Goodwill impairment testing for 2016 was performed using a quantitative analysis under which the fair value for each reporting unit was estimated using a discounted cash flow model, which considered forecasted cash flows discounted at an estimated weighted-average cost of capital. The forecasted cash flows were based on the Company's long-term operating plan and a terminal value was used to estimate the operating segment's cash flows beyond the period covered by the operating plan. The weighted-average cost of capital is an estimate of the overall after-tax rate of return required by equity and debt market holders of a business enterprise. These analyses require the exercise of significant judgments, including judgments about appropriate discount rates, perpetual growth rates and the timing of expected future cash flows of the respective reporting unit. Sensitivity analyses were performed around these assumptions in order to assess the reasonableness of the assumptions and the resulting estimated fair values.

Based on a qualitative analysis performed in 2017 and a quantitative analysis performed in 2016, the fair value of Eaton's reporting units continue to substantially exceed their respective carrying amounts.

Indefinite life intangible assets consist of certain trademarks. They are evaluated annually for impairment as of July 1 using either a quantitative or qualitative analysis to determine whether their fair values exceed their respective carrying amounts. Indefinite life intangible asset impairment testing for 2017 and 2016 was performed using a quantitative analysis. The Company determines the fair value of these assets using a royalty relief methodology similar to that employed when the associated assets were acquired, but using updated estimates of future sales, cash flows and profitability. Additionally, indefinite life intangible assets are evaluated for impairment whenever an event occurs or circumstances change that would indicate that it is more likely than not that the asset is impaired. For 2017 and 2016, the fair value of indefinite lived intangible assets exceeded the respective carrying value.

For additional information about goodwill and other intangible assets, see Note 5.

Other Long-Lived Assets

Other Long-Lived Assets

Depreciation and amortization for property, plant and equipment, and intangible assets subject to amortization, are generally computed by the straight-line method and included in Cost of products sold, Selling and administrative expense, and Research and development expense, as appropriate. Cost of buildings are depreciated generally over 40 years and machinery and equipment over 3 to 10 years. At December 31, 2017, the weighted-average amortization period for intangible assets subject to amortization was 17 years for patents and technology, primarily as a result of the long life of aircraft platforms; 17 years for customer relationships; and 17 years for certain trademarks. Software is generally amortized up to a life of 15 years.

Other long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate the carrying amount may not be recoverable. Upon indications of impairment, assets and liabilities are grouped at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. The asset group would be considered impaired when the estimated future net undiscounted cash flows generated by the asset group are less than its carrying value. Determining asset groups and underlying cash flows requires the use of significant judgment.

Retirement Benefits Plans

Retirement Benefits Plans

For the principal pension plans in the United States, Canada, Puerto Rico and the United Kingdom, the Company uses a market-related value of plan assets to calculate the expected return on assets used to determine net periodic benefit costs. The market-related value of plan assets is a calculated value that recognizes changes in the fair value of plan assets over a five year period. All other plans use fair value of plan assets.

Net actuarial gains or losses are amortized to expense on a plan-by-plan basis when they exceed the accounting corridor. The Company’s corridors are set at either 8% or 10%, depending on the plan, of the greater of the plan assets or benefit obligations. Gains or losses outside of the corridor are subject to amortization over an average employee future service period that differs by plan, but is approximately 12 years on a weighted average basis. If most or all of the plan’s participants are no longer actively accruing benefits, the average life expectancy is used.

Warranty Accruals

Warranty Accruals

Product warranty accruals are established at the time the related sale is recognized through a charge to Cost of products sold. Warranty accrual estimates are based primarily on historical warranty claim experience and specific customer contracts. Provisions for warranty accruals are comprised of basic warranties for products sold, as well as accruals for product recalls and other events when they are known and estimable. See Note 8 for additional information about warranty accruals.

Asset Retirement Obligations

Asset Retirement Obligations

A conditional asset retirement obligation is recognized at fair value when incurred if the fair value of the liability can be reasonably estimated. Uncertainty about the timing or method of settlement of a conditional asset retirement obligation would be considered in the measurement of the liability when sufficient information exists. Eaton believes that for substantially all of its asset retirement obligations, there is an indeterminate settlement date because the range of time over which the Company may settle the obligation is unknown or cannot be estimated. A liability for these obligations will be recognized when sufficient information is available to estimate fair value.

Income Taxes

Income Taxes

Deferred income tax assets and liabilities are determined based on the difference between the financial statement and tax basis of the respective assets and liabilities, using enacted tax rates in effect for the year when the differences are expected to reverse. Deferred income tax assets are recognized for income tax loss carryforwards and income tax credit carryforwards. Judgment is required in determining and evaluating income tax provisions and valuation allowances for deferred income tax assets. Eaton recognizes the income tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by taxing authorities, based on the technical merits of the position. Eaton evaluates and adjusts these accruals based on changing facts and circumstances. Eaton recognizes interest and penalties related to unrecognized income tax benefits in the provision for income tax expense. Penalties on unrecognized income tax benefits have been accrued for jurisdictions where penalties are automatically applied to any deficiency, regardless of the merit of the position. For additional information about income taxes, see Note 9.

Equity-Based Compensation

Equity-Based Compensation

Eaton recognizes equity-based compensation expense based on the grant date fair value of the award. Awards with service conditions or both service and market conditions are expensed over the period during which an employee is required to provide service in exchange for the award. Awards with both service and performance conditions are expensed over the period an employee is required to provide service based on the number of units for which achievement of the performance objective is probable. Participants awarded restricted stock units (RSUs) in 2015 and 2016, do not receive dividends; therefore, their fair value is determined by reducing the closing market price of the Company’s ordinary shares on the date of grant by the present value of the estimated dividends had they been paid. The fair value of RSUs awarded in 2017, restricted stock awards (RSAs) and performance stock units (PSUs) with performance conditions are determined based on the closing market price of the Company’s ordinary shares at the date of grant. The Company uses a Monte Carlo simulation to estimate the fair value of PSUs with market conditions, which incorporates assumptions regarding expected stock price volatility and the risk-free interest rate. Stock options are granted with an exercise price equal to the closing market price of Eaton ordinary shares on the date of grant. The fair value of stock options is determined using a Black-Scholes option-pricing model, which incorporates assumptions regarding the expected stock price volatility, the expected option life, the risk-free interest rate, and the expected dividend yield. See Note 11 for additional information about equity-based compensation.

Derivative Financial Instruments and Hedging Activities

Derivative Financial Instruments and Hedging Activities

Eaton uses derivative financial instruments to manage the exposure to the volatility in raw material costs, currency, and interest rates on certain debt. These instruments are marked to fair value in the accompanying Consolidated Balance Sheets. Changes in the fair value of derivative assets or liabilities (i.e., gains or losses) are recognized depending upon the type of hedging relationship and whether an instrument has been designated as a hedge. For those instruments that qualify for hedge accounting, Eaton designates the hedging instrument, based upon the exposure being hedged, as a cash flow hedge, a fair value hedge, or a hedge of a net investment in a foreign operation. Changes in fair value of these instruments that do not qualify for hedge accounting are recognized immediately in net income. See Note 13 for additional information about hedges and derivative financial instruments.

Recently Issued Accounting Pronouncement

Recently Issued Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update 2014-09, Revenue from Contracts with Customers (ASU 2014-09). This accounting standard supersedes all existing US GAAP revenue recognition guidance. Under ASU 2014-09, a company will recognize revenue when it transfers the control of promised goods or services to customers in an amount that reflects the consideration which the company expects to collect in exchange for those goods or services. ASU 2014-09 will require additional disclosures in the notes to the consolidated financial statements.

Eaton adopted the standard at the start of the first quarter of 2018 using the modified retrospective approach and recorded a cumulative effect adjustment to retained earnings based on the current terms and conditions for open contracts as of January 1, 2018. The adoption of the standard did not have a material impact on the Company’s Consolidated financial statements. While, certain revenue streams moved from point-in-time or multiple elements to over time because of the continuous transfer of control to customers, we do not expect these changes to be material. The Company implemented the appropriate changes to business processes and controls to support recognition and disclosure under the new standard, including the new qualitative and quantitative disclosures that will include information on the nature, amount, timing and significant judgments impacting revenue from contracts with customers.

In October 2016, the FASB issued Accounting Standards Update 2016-16, Intra-Entity Transfers of Assets Other Than Inventory (ASU 2016-16). This accounting standard requires companies to recognize the income tax effects of intercompany sales and transfers of assets other than inventory in the period in which the transfer occurs. The previous accounting standard required companies to defer the income tax effects of intercompany transfers of assets by recording a prepaid tax, until such assets were sold to an outside party or otherwise recognized. ASU 2016-16 is effective for annual and interim periods beginning after December 15, 2017. Upon adoption, ASU 2016-16 requires companies to write off any income tax amounts that had been deferred as prepaid taxes from past intercompany transactions, and record deferred tax balances for amounts that have not been recognized, through a cumulative-effect adjustment to retained earnings. The Company adopted ASU 2016-16 at the start of the first quarter of 2018 by recording a cumulative-effect adjustment of approximately $200 to reduce retained earnings.

In February 2016, the FASB issued Accounting Standards Update 2016-02, Leases (Topic 842), (ASU 2016-02). This accounting standard requires that a lessee recognize a lease asset and a lease liability on its balance sheet for all leases, including operating leases, with a term greater than 12 months. ASU 2016-02 will require additional disclosures in the notes to the consolidated financial statements and is effective for annual and interim reporting periods beginning after December 15, 2018. A project team has been formed to evaluate and implement the new standard. The project team is working to gather the data required to account for leases under the new standard, and validating the functionality of third-party lease accounting software. In addition, the Company is in the process of identifying and implementing the appropriate changes to business processes and controls to support recognition and disclosure under the new standard. Eaton plans to adopt the standard as of the first quarter of 2019. Eaton is evaluating the impact of ASU 2016-02 and an estimate of the impact to the consolidated financial statements cannot be made at this time.

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Acquisition Integration Charges (Tables)

12 Months Ended

Dec. 31, 2017

Business Combinations [Abstract]

Acquisition Integration Charges and Transaction Costs

A summary of these charges follows:

	2017		2016		2015
Electrical Products	$	4	$	3	$	25
Electrical Systems and Services	—		1		15
Hydraulics	—		—		2
Total business segments	4		4		42
Corporate	—		—		5
Total acquisition integration charges before income taxes	4		4		47
Income taxes	2		1		16
Total after income taxes	$	2	$	3	$	31
Per ordinary share - diluted	$	—	$	0.01	$	0.07

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Restructuring Charges (Tables)

12 Months Ended

Dec. 31, 2017

Restructuring and Related Activities [Abstract]

Restructuring Charges by Type

A summary of restructuring charges by type follows:

	2017		2016		2015
Workforce reductions	$	57	$	177	$	112
Plant closings and other costs	59		34		17
Total	$	116	$	211	$	129

Restructuring Charges by Segment

A summary of restructuring charges by segment follows:

	2017		2016		2015
Electrical Products	$	29	$	44	$	12
Electrical Systems & Services	16		49		29
Hydraulics	32		67		31
Aerospace	2		4		5
Vehicle	12		35		34
Corporate	25		12		18
Total	$	116	$	211	$	129

Restructuring Liability Rollforward

A summary of liabilities related to workforce reductions, plant closings and other associated costs announced in 2015 follows:

	Workforce reductions			Plant closing and other			Total
Balance at December 31, 2015	$	54		$	—		$	54
Liability recognized	177			34			211
Payments	(116		)	(13		)	(129		)
Other adjustments	(2		)	(20		)	(22		)
Balance at December 31, 2016	113			1			114
Liability recognized	57			59			116
Payments	(102		)	(39		)	(141		)
Other adjustments	(1		)	(16		)	(17		)
Balance at December 31, 2017	$	67		$	5		$	72

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Goodwill and Other Intangible Assets Goodwill (Tables)

12 Months Ended

Dec. 31, 2017

Goodwill and Intangible Assets Disclosure [Abstract]

Rollforward of goodwill

Changes in the carrying amount of goodwill by segment follow:

	Electrical Products			Electrical Systems and Services			Hydraulics			Aerospace			Vehicle			Total
December 31, 2015	$	6,642		$	4,279		$	1,259		$	956		$	343		$	13,479
Translation	(145		)	(76		)	(38		)	(18		)	(1		)	(278		)
December 31, 2016	6,497			4,203			1,221			938			342			13,201
Goodwill written off from sale of business	—			(3		)	—			—			(52		)	(55		)
Translation	262			111			36			9			4			422
December 31, 2017	$	6,759		$	4,311		$	1,257		$	947		$	294		$	13,568

Summary of other intangible assets

A summary of other intangible assets follows:

	2017				2016
	Historical cost		Accumulated amortization		Historical cost		Accumulated amortization
Intangible assets not subject to amortization
Trademarks	$	1,654			$	1,637
Intangible assets subject to amortization
Customer relationships	$	3,586	$	1,475	$	3,456	$	1,199
Patents and technology	1,395		628		1,342		519
Trademarks	1,137		473		1,104		378
Other	99		30		97		26
Total intangible assets subject to amortization	$	6,217	$	2,606	$	5,999	$	2,122

Expense related to intangible assets subject to amortization in 2014, and for each of the next five years

Amortization expense related to intangible assets subject to amortization in 2017, and estimated amortization expense for each of the next five years, follows:

2017	$	383
2018	369
2019	362
2020	357
2021	346
2022	336

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Debt Debt (Tables)

12 Months Ended

Dec. 31, 2017

Debt Disclosure [Abstract]

Summary of long-term debt, including the current portion

A summary of long-term debt, including the current portion, follows:

	2017			2016
5.30% notes due 2017 ($150 converted to floating rate by interest rate swap)	$	—		$	250
6.10% debentures due 2017	—			289
1.50% senior notes due 2017 ($750 converted to floating rate by interest rate swap)	—			1,000
5.60% notes due 2018 ($415 converted to floating rate by interest rate swap)	450			450
4.215% Japanese yen notes due 2018	88			86
6.95% notes due 2019 ($300 converted to floating rate by interest rate swap)	300			300
3.875% debentures due 2020 ($150 converted to floating rate by interest rate swap)	239			239
3.47% notes due 2021 ($275 converted to floating rate by interest rate swap)	300			300
8.10% debentures due 2022 ($100 converted to floating rate by interest rate swap)	100			100
2.75% senior notes due 2022 ($1,400 converted to floating rate by interest rate swap)	1,600			1,600
3.68% notes due 2023 ($200 converted to floating rate by interest rate swap)	300			300
0.75% euro notes due 2024	659			580
6.50% debentures due 2025	145			145
3.10% senior notes due 2027	700			—
7.65% debentures due 2029 ($50 converted to floating rate by interest rate swap)	200			200
4.00% senior notes due 2032	700			700
5.45% debentures due 2034 ($25 converted to floating rate by interest rate swap)	136			136
5.80% notes due 2037	240			240
4.15% senior notes due 2042	1,000			1,000
3.92% senior notes due 2047	300			—
5.25% to 8.875% notes (maturities ranging from 2018 to 2035, including $50 converted to floating rate by interest rate swap)	239			239
Other	49			109
Total long-term debt	7,745			8,263
Less current portion of long-term debt	(578		)	(1,552		)
Long-term debt less current portion	$	7,167		$	6,711

Mandatory maturities of long-term debt for each of the next five years

Maturities of long-term debt for each of the next five years follow:

2018	$	578
2019	340
2020	241
2021	302
2022	1,701

Interest paid on debt

Interest paid on debt follows:

2017	$	293
2016	266
2015	271

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Retirement Benefits Plans (Tables)

12 Months Ended

Dec. 31, 2017

Retirement Benefits [Abstract]

Obligations and funded status

Obligations and Funded Status

	United States pension liabilities						Non-United States pension liabilities						Other postretirement liabilities
	2017			2016			2017			2016			2017			2016
Funded status
Fair value of plan assets	$	3,585		$	2,969		$	1,727		$	1,478		$	55		$	74
Benefit obligations	(3,961		)	(3,771		)	(2,399		)	(2,314		)	(448		)	(473		)
Funded status	$	(376	)	$	(802	)	$	(672	)	$	(836	)	$	(393	)	$	(399	)
Amounts recognized in the Consolidated    Balance Sheets
Non-current assets	$	82		$	34		$	136		$	33		$	—		$	—
Current liabilities	(15		)	(24		)	(25		)	(22		)	(31		)	(31		)
Non-current liabilities	(443		)	(812		)	(783		)	(847		)	(362		)	(368		)
Total	$	(376	)	$	(802	)	$	(672	)	$	(836	)	$	(393	)	$	(399	)
Amounts recognized in Accumulated other    comprehensive loss (pretax)
Net actuarial loss	$	1,059		$	1,232		$	596		$	771		$	19		$	21
Prior service cost (credit)	4			3			8			8			(46		)	(60		)
Total	$	1,063		$	1,235		$	604		$	779		$	(27	)	$	(39	)

Change in benefit obligations

Change in Benefit Obligations

	United States pension liabilities						Non-United States pension liabilities						Other postretirement liabilities
	2017			2016			2017			2016			2017			2016
Balance at January 1	$	3,771		$	3,829		$	2,314		$	2,175		$	473		$	575
Service cost	96			111			71			63			3			4
Interest cost	123			125			55			62			14			17
Actuarial (gain) loss	271			52			(148		)	355			2			(72		)
Gross benefits paid	(301		)	(346		)	(97		)	(94		)	(74		)	(79		)
Currency translation	—			—			223			(245		)	3			1
Plan amendments	1			—			—			2			—			—
Other	—			—			(19		)	(4		)	27			27
Balance at December 31	$	3,961		$	3,771		$	2,399		$	2,314		$	448		$	473
Accumulated benefit obligation	$	3,802		$	3,620		$	2,283		$	2,189

Change in plan assets

Change in Plan Assets

	United States pension liabilities						Non-United States pension liabilities						Other postretirement liabilities
	2017			2016			2017			2016			2017			2016
Balance at January 1	$	2,969		$	2,934		$	1,478		$	1,472		$	74		$	93
Actual return on plan assets	543			221			131			212			8			3
Employer contributions	374			160			99			102			20			30
Gross benefits paid	(301		)	(346		)	(97		)	(94		)	(74		)	(79		)
Currency translation	—			—			135			(211		)	—			—
Other	—			—			(19		)	(3		)	27			27
Balance at December 31	$	3,585		$	2,969		$	1,727		$	1,478		$	55		$	74

Components of pension plans with accumulated benefit obligations in excess of plan assets

The components of pension plans with an accumulated benefit obligation in excess of plan assets at December 31 follow:

	United States pension liabilities				Non-United States pension liabilities
	2017		2016		2017		2016
Projected benefit obligation	$	3,540	$	3,342	$	966	$	1,902
Accumulated benefit obligation	3,380		3,190		911		1,824
Fair value of plan assets	3,081		2,505		175		1,066

Changes in pension and other postretirement benefits liabilities recognized in Accumulated other comprehensive loss

Changes in pension and other postretirement benefit liabilities recognized in Accumulated other comprehensive loss follow:

	United States pension liabilities						Non-United States pension liabilities						Other postretirement liabilities
	2017			2016			2017			2016			2017			2016
Balance at January 1	$	1,235		$	1,327		$	779		$	653		$	(39	)	$	21
Prior service cost arising during the year	1			—			—			2			—			—
Net loss (gain) arising during the year	(28		)	81			(185		)	235			(2		)	(69		)
Currency translation	—			—			66			(75		)	1			1
Less amounts included in expense during the year	(145		)	(173		)	(56		)	(36		)	13			8
Net change for the year	(172		)	(92		)	(175		)	126			12			(60		)
Balance at December 31	$	1,063		$	1,235		$	604		$	779		$	(27	)	$	(39	)

Benefits expense

Benefits Expense

	United States pension benefit expense									Non-United States pension benefit expense									Other postretirement benefits expense
	2017			2016			2015			2017			2016			2015			2017			2016			2015
Service cost	$	96		$	111		$	123		$	71		$	63		$	71		$	3		$	4		$	6
Interest cost	123			125			156			55			62			72			14			17			24
Expected return on plan assets	(244		)	(250		)	(262		)	(94		)	(92		)	(99		)	(4		)	(6		)	(5		)
Amortization	83			92			119			51			33			40			(13		)	(9		)	2
	58			78			136			83			66			84			—			6			27
Settlements and special termination benefits	62			81			74			5			3			2			—			1			—
Total expense	$	120		$	159		$	210		$	88		$	69		$	86		$	—		$	7		$	27

Estimated pretax net amounts that will be recognized from Accumulated other comprehensive loss into net periodic benefit cost

The estimated pretax net amounts that will be recognized from Accumulated other comprehensive loss into net periodic benefit cost in 2018 follow:

	United States pension liabilities		Non-United States pension liabilities		Other postretirement liabilities
Actuarial loss	$	146	$	38	$	1
Prior service cost (credit)	1		1		(14		)
Total	$	147	$	39	$	(13	)

Assumptions used to determine other postretirement obligations and expense

Pension Plans

	United States pension plans						Non-United States pension plans
	2017		2016		2015		2017		2016		2015
Assumptions used to determine benefit obligation at year-end
Discount rate	3.64	%	4.12	%	4.22	%	2.62	%	2.63	%	3.46	%
Rate of compensation increase	3.15	%	3.15	%	3.18	%	3.11	%	3.13	%	3.12	%
Assumptions used to determine expense
Discount rate used to determine benefit obligation	4.12	%	4.22	%	3.97	%	2.63	%	3.46	%	3.33	%
Discount rate used to determine service cost	4.31	%	4.35	%	3.97	%	3.38	%	4.13	%	3.33	%
Discount rate used to determine interest cost	3.40	%	3.42	%	3.97	%	2.34	%	3.07	%	3.33	%
Expected long-term return on plan assets	7.90	%	8.50	%	8.50	%	6.30	%	6.62	%	6.92	%
Rate of compensation increase	3.15	%	3.18	%	3.16	%	3.13	%	3.12	%	3.13	%

Assumptions used to determine other postretirement benefits obligations and expense

Assumptions used to determine other postretirement benefits obligations and expense follow:

	Other postretirement benefits plans
	2017		2016		2015
Assumptions used to determine benefit obligation at year-end
Discount rate	3.55	%	3.96	%	4.04	%
Health care cost trend rate assumed for next year	8.25	%	7.35	%	7.10	%
Ultimate health care cost trend rate	4.75	%	4.75	%	4.75	%
Year ultimate health care cost trend rate is achieved	2027		2026		2025
Assumptions used to determine expense
Discount rate used to determine benefit obligation	3.96	%	4.04	%	3.79	%
Discount rate used to determine service cost	4.11	%	4.26	%	3.79	%
Discount rate used to determine interest cost	3.18	%	3.12	%	3.79	%
Initial health care cost trend rate	7.35	%	7.10	%	6.31	%
Ultimate health care cost trend rate	4.75	%	4.75	%	4.77	%
Year ultimate health care cost trend rate is achieved	2026		2025		2024

1-percentage change in the assumed health care cost trend rates

A 1-percentage point change in the assumed health care cost trend rates would have the following effects:

	1% increase		1% decrease
Effect on total service and interest cost	$	1	$	(1	)
Effect on other postretirement liabilities	13		(12		)

Employer contributions to pension plans

Contributions to pension plans that Eaton expects to make in 2018, and made in 2017, 2016 and 2015, follow:

	2018		2017		2016		2015
United States plans	$	16	$	374	$	160	$	221
Non-United States plans	96		99		102		109
Total contributions	$	112	$	473	$	262	$	330

Expected pension and other postretirement benefit payments and expected subsidy

For other postretirement benefits liabilities, the expected subsidy receipts related to the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 would reduce the gross payments listed below.

	Estimated United States pension payments		Estimated non-United States pension payments		Estimated other postretirement benefit payments
					Gross		Medicare prescription drug subsidy
2018	$	291	$	88	$	47	$	(2	)
2019	291		90		43		(2		)
2020	292		93		39		(2		)
2021	299		95		35		(1		)
2022	298		99		35		—
2023 - 2027	1,478		548		141		(2		)

Fair value of pension plan assets

A summary of the fair value of pension plan assets at December 31, 2017 and 2016, follows:

	Total		Quoted prices in active markets for identical assets (Level 1)		Other observable inputs (Level 2)		Unobservable inputs (Level 3)
2017
Common collective trusts
Non-United States equity and global equities	$	741	$	—	$	741	$	—
United States equity	86		—		86		—
Fixed income	478		—		478		—
Fixed income securities	709		—		709		—
United States treasuries	67		67		—		—
Bank loans	161		—		161		—
Real estate	239		220		—		19
Equity securities	139		139		—		—
Cash equivalents	86		51		35		—
Exchange traded funds	224		224		—		—
Other	81		—		8		73
Common collective and other trusts measured at net asset value	2,225
Hedge funds measured at net asset value	67
Money market funds measured at net asset value	9
Total pension plan assets	$	5,312	$	701	$	2,218	$	92

	Total		Quoted prices in active markets for identical assets (Level 1)		Other observable inputs (Level 2)		Unobservable inputs (Level 3)
2016
Common collective trusts
Non-United States equity and global equities	$	413	$	—	$	413	$	—
United States equity	94		—		94		—
Fixed income	422		—		422		—
Fixed income securities	359		—		359		—
United States treasuries	123		123		—		—
Bank loans	150		—		150		—
Real estate	201		195		—		6
Equity securities	104		104		—		—
Cash equivalents	276		21		255		—
Exchange traded funds	55		55		—		—
Other	109		—		14		95
Common collective and other trusts measured at net asset value	2,038
Hedge funds measured at net asset value	85
Money market funds measured at net asset value	18
Total pension plan assets	$	4,447	$	498	$	1,707	$	101

Fair value measurement of plan assets using significant unobservable inputs

The fair value measurement of plan assets using significant unobservable inputs (Level 3) changed during 2016 and 2017 due to the following:

	Real estate			Other			Total
Balance at December 31, 2015	$	7		$	86		$	93
Actual return on plan assets:
Gains (losses) relating to assets still held at year-end	—			(6		)	(6		)
Purchases, sales, settlements - net	(1		)	15			14
Transfers into or out of Level 3	—			—			—
Balance at December 31, 2016	6			95			101
Actual return on plan assets:
Gains (losses) relating to assets still held at year-end	1			(5		)	(4		)
Purchases, sales, settlements - net	12			(17		)	(5		)
Transfers into or out of Level 3	—			—			—
Balance at December 31, 2017	$	19		$	73		$	92

Fair value of other postretirement benefits plan assets

A summary of the fair value of other postretirement benefits plan assets at December 31, 2017 and 2016, follows:

	Total		Quoted prices in active markets for identical assets (Level 1)		Other observable inputs (Level 2)		Unobservable inputs (Level 3)
2017
Cash equivalents	$	7	$	7	$	—	$	—
Common collective and other trusts measured at net asset value	48
Total other postretirement benefits plan assets	$	55	$	7	$	—	$	—

	Total		Quoted prices in active markets for identical assets (Level 1)		Other observable inputs (Level 2)		Unobservable inputs (Level 3)
2016
Cash equivalents	$	8	$	8	$	—	$	—
Common collective and other trusts measured at net asset value	66
Total other postretirement benefits plan assets	$	74	$	8	$	—	$	—

Employer contributions to defined contribution benefit plans, charged to expense

The total contributions related to these plans are charged to expense and were as follows:

2017	$	114
2016	72
2015	137

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Commitments and Contingencies (Tables)

12 Months Ended

Dec. 31, 2017

Commitments and Contingencies Disclosure [Abstract]

Current and long-term warranty accruals

A summary of the current and long-term warranty accruals follows:

	2017			2016			2015
Balance at January 1	$	180		$	195		$	213
Provision	163			117			104
Settled	(156		)	(130		)	(114		)
Other	1			(2		)	(8		)
Balance at December 31	$	188		$	180		$	195

Future minimum rental commitments for noncancelable operating leases

A summary of minimum rental commitments at December 31, 2017 under noncancelable operating leases, which expire at various dates and in most cases contain renewal options, for each of the next five years and thereafter in the aggregate, follow:

2018	$	159
2019	119
2020	85
2021	63
2022	42
Thereafter	71
Total noncancelable lease commitments	$	539

Rental expense

A summary of rental expense follows:

2017	$	222
2016	220
2015	225

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Income Taxes (Tables)

12 Months Ended

Dec. 31, 2017

Income Tax Disclosure [Abstract]

Income (loss) before income taxes

Income (loss) before income taxes and income tax (benefit) expense are summarized below based on the geographic location of the operation to which such earnings and income taxes are attributable.

	Income (loss) before income taxes
	2017			2016			2015
Ireland	$	(1,090	)	$	(923	)	$	(608	)
Foreign	4,458			3,041			2,741
Total income before income taxes	$	3,368		$	2,118		$	2,133

Income tax (benefit) expense

	Income tax expense (benefit)
	2017			2016			2015
Current
Ireland	$	1		$	2		$	8
Foreign
United States	123			93			110
Non-United States	234			209			240
Total current income tax expense	358			304			358
Deferred
Ireland	—			2			1
Foreign
United States	82			(77		)	(76		)
Non-United States	(58		)	(30		)	(124		)
Total deferred income tax expense (benefit)	24			(105		)	(199		)
Total income tax expense	$	382		$	199		$	159

Reconciliations of income taxes from the appropriate statutory rate

Reconciliations of income taxes from the Ireland national statutory rate of 25% to the consolidated effective income tax rate follow:

	2017		2016		2015
Income taxes at the applicable statutory rate	25.0	%	25.0	%	25.0	%
Ireland operations
Ireland tax on trading income	—	%	(0.3	)%	(0.4	)%
Nondeductible interest expense	8.2	%	11.5	%	7.9	%
Foreign operations
United States operations (earnings taxed at other than     the applicable statutory rate)	1.7	%	0.1	%	(0.6	)%
U.S. federal tax rate change	(7.5	)%	—	%	—	%
U.S. tax on foreign earnings	4.8	%	—	%	—	%
U.S. foreign tax credit	(3.9	)%	0.6	%	(0.8	)%
Credit for research activities	(0.5	)%	(0.8	)%	(0.8	)%
U.S. Other - net	3.2	%	2.5	%	5.4	%
Non-U.S. operations (earnings taxed at other than    the applicable statutory tax rate)	(22.9	)%	(26.8	)%	(25.1	)%
Non-U.S. operations - other items	0.4	%	0.9	%	(0.5	)%
Worldwide operations
Adjustments to tax liabilities	(1.8	)%	(2.5	)%	(1.4	)%
Adjustments to valuation allowances	4.6	%	(0.8	)%	(1.2	)%
Effective income tax expense rate	11.3	%	9.4	%	7.5	%

Worldwide income tax payments

Worldwide income tax payments, net of tax refunds, follow:

2017	$	288
2016	272
2015	302

Components of current and long-term deferred income taxes

Components of noncurrent deferred income taxes follow:

	2017			2016
	Noncurrent assets and liabilities			Noncurrent assets and liabilities
Accruals and other adjustments
Employee benefits	$	430		$	761
Depreciation and amortization	(1,324		)	(1,823		)
Other accruals and adjustments	380			761
Ireland income tax loss carryforwards	1			1
Foreign income tax loss carryforwards	1,962			1,796
Foreign income tax credit carryforwards	404			277
Valuation allowance for income tax loss and income tax    credit carryforwards	(1,992		)	(1,728		)
Other valuation allowances	(146		)	(41		)
Total deferred income taxes	$	(285	)	$	4

Non-United States subsidiaries tax loss carryforwards and income tax credit carryforwards and expiration dates

These carryforwards and their respective expiration dates are summarized below:

	2018 through 2022		2023 through 2027		2028 through 2032		2033 through 2037		Not subject to expiration		Valuation allowance
Ireland income tax loss carryforwards	$	—	$	—	$	—	$	—	$	8	$	—
Ireland deferred income tax assets for income tax loss carryforwards	—		—		—		—		1		(1		)

United States state and local tax loss carryforwards and tax credit carryforwards and expiration dates

These carryforwards and their respective expiration dates are summarized below:

	2018 through 2022		2023 through 2027		2028 through 2032		2033 through 2037		Not subject to expiration		Valuation allowance
Foreign income tax loss carryforwards	$	918	$	7,528	$	14	$	545	$	4,047	$	—
Foreign deferred income tax assets for income tax loss carryforwards	112		721		14		175		1,047		(1,830		)
Foreign deferred income tax assets for income tax loss carryforwards after ASU 2013-11	101		715		14		86		1,047		(1,830		)
Foreign income tax credit carryforwards	86		205		78		115		64		(161		)
Foreign income tax credit carryforwards after ASU 2013-11	82		168		27		94		33		(161		)

Summary of gross unrecognized income tax benefits

A summary of gross unrecognized income tax benefits follows:

	2017			2016			2015
Balance at January 1	$	629		$	584		$	493
Increases and decreases as a result of positions taken during prior years
Transfers from valuation allowances	—			—			—
Other increases, including currency translation	10			21			34
Other decreases, including currency translation	(30		)	(24		)	(34		)
Balances related to acquired businesses	—			—			(1		)
Increases as a result of positions taken during the current year	162			90			109
Decreases relating to settlements with tax authorities	(10		)	(19		)	—
Decreases as a result of a lapse of the applicable statute of limitations	(26		)	(23		)	(17		)
Balance at December 31	$	735		$	629		$	584

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Eaton Shareholders' Equity (Tables)

12 Months Ended

Dec. 31, 2017

Equity [Abstract]

Comprehensive Income (Loss)

The following table summarizes the pre-tax and after-tax amounts recognized in Comprehensive income (loss):

	2017						2016						2015
	Pre-tax			After-tax			Pre-tax			After-tax			Pre-tax			After-tax
Currency translation and related hedging instruments	$	800		$	807		$	(562	)	$	(570	)	$	(1,080	)	$	(1,078	)
Pensions and other postretirement benefits
Prior service credit (cost) arising during the year	(1		)	—			(2		)	(2		)	1			1
Net gain (loss) arising during the year	215			169			(247		)	(197		)	(123		)	(89		)
Currency translation	(67		)	(53		)	74			62			62			46
Other	—			(5		)	—			(2		)	—			(3		)
Amortization of actuarial loss and prior service cost    reclassified to earnings	188			130			201			133			237			156
	335			241			26			(6		)	177			111
Cash flow hedges
Gain (loss) on derivatives designated as cash flow hedges	(24		)	(15		)	(21		)	(14		)	20			13
Changes in cash flow hedges reclassified to earnings	17			11			8			5			(16		)	(10		)
Cash flow hedges, net of reclassification adjustments	(7		)	(4		)	(13		)	(9		)	4			3
Other comprehensive income (loss) attributable to Eaton ordinary shareholders	$	1,128		$	1,044		$	(549	)	$	(585	)	$	(899	)	$	(964	)

Schedule of Accumulated Other Comprehensive Income (Loss) [Table Text Block]

The changes in Accumulated other comprehensive loss follow:

	Currency translation and related hedging instruments			Pensions and other postretirement benefits			Cash flow hedges			Total
Balance at December 31, 2016	$	(3,062	)	$	(1,380	)	$	(6	)	$	(4,448	)
Other comprehensive income (loss) before     reclassifications	807			111			(15		)	903
Amounts reclassified from Accumulated other    comprehensive loss (income)	—			130			11			141
Net current-period Other comprehensive    income (loss)	807			241			(4		)	1,044
Balance at December 31, 2017	$	(2,255	)	$	(1,139	)	$	(10	)	$	(3,404	)

Reclassification out of Accumulated Other Comprehensive Income [Table Text Block]

The reclassifications out of Accumulated other comprehensive loss follow:

	December 31, 2017			Consolidated Statements of Income classification
Amortization of defined benefit pension and other    postretirement benefits items
Actuarial loss and prior service cost	$	(188	)	1
Tax benefit	58
Total, net of tax	(130		)
Gains and (losses) on cash flow hedges
Currency exchange contracts	(17		)	Cost of products sold
Tax benefit	6
Total, net of tax	(11		)
Total reclassifications for the period	$	(141	)

¹ These components of Accumulated other comprehensive loss are included in the computation of net periodic benefit cost. See Note 7 for additional information about defined benefit pension and other postretirement benefits items.

Schedule of Earnings Per Share, Basic and Diluted [Table Text Block]

A summary of the calculation of net income per share attributable to Eaton ordinary shareholders follows:

(Shares in millions)	2017		2016*		2015*
Net income attributable to Eaton ordinary shareholders	$	2,985	$	1,916	$	1,972
Weighted-average number of ordinary shares outstanding - diluted	447.0		456.5		467.1
Less dilutive effect of equity-based compensation	2.5		1.5		1.6
Weighted-average number of ordinary shares outstanding - basic	444.5		455.0		465.5
Net income per share attributable to Eaton ordinary shareholders
Diluted	$	6.68	$	4.20	$	4.22
Basic	6.71		4.21		4.23

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Equity-Based Compensation (Tables)

12 Months Ended

Dec. 31, 2017

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Summary of RSU and RSA activity

A summary of the RSU and RSA activity for 2017 follows:

(Restricted stock units and awards in millions)	Number of restricted stock units and awards		Weighted-average fair value per unit and award
Non-vested at January 1	2.6		$	57.87
Granted	0.9		72.09
Vested	(0.9	)	61.80
Forfeited	(0.2	)	61.66
Non-vested at December 31	2.4		$	62.24

Information Related to RSUs and RSAs

Information related to RSUs and RSAs follows:

	2017		2016		2015
Pretax expense for RSUs and RSAs	$	66	$	65	$	68
After-tax expense for RSUs and RSAs	43		42		44
Fair value of vested RSUs and RSAs	73		71		110

Schedule of Share-based Payment Award, Performance Share Units (Market-Based), Valuation Assumptions

A summary of the assumptions used in determining fair value of these PSUs follows:

	2017			2016
Expected volatility	24		%	24		%
Risk-free interest rate	1.46		%	0.88		%
Weighted-average fair value of PSUs granted	$	80.07		$	76.41

(Performance share units in millions)

A summary of the 2017 activity for these PSUs follows:

(Performance share units in millions)	Number of performance share units		Weighted-average fair value per unit
Non-vested at January 1	0.5		$	76.41
Granted1	0.4		80.07
Vested	—		—
Forfeited	(0.1	)	77.90
Non-vested at December 31	0.8		$	77.97

¹ Performance shares granted assuming the Company will perform at target relative to peers.

Share-based Compensation, Performance Shares Award Outstanding Activity

A summary of the 2017 activity for these PSUs follows:

(Performance share units in millions)	Number of performance share units		Weighted-average fair value per unit
Non-vested at January 1	0.7		$	68.23
Granted	—		—
Vested	(0.1	)	71.72
Forfeited	(0.5	)	71.72
Non-vested at December 31	0.1		$	56.55

Information Related to PSUs

Information related to PSUs follows:

	2017		2016		2015
Pretax expense for PSUs	$	22	$	13	$	2
After-tax expense for PSUs	13		8		1

Assumptions used in determining fair value of stock options

A summary of the assumptions used in determining the fair value of stock options follows:

	2017			2016			2015
Expected volatility	27		%	27		%	29		%
Expected option life in years	6.6			5.5			5.5
Expected dividend yield	2.8		%	2.5		%	2.6		%
Risk-free interest rate	1.8 to 2.1%			1.2 to 1.5%			1.6 to 1.5%
Weighted-average fair value of stock options granted	$	15.11		$	11.80		$	15.25

Summary of stock option activity

A summary of stock option activity follows:

(Options in millions)	Weighted-average exercise price per option		Options		Weighted-average remaining contractual life in years	Aggregate intrinsic value
Outstanding at January 1, 2017	$	56.75	5.5
Granted	71.89		0.7
Exercised	46.31		(1.5	)
Forfeited and canceled	59.23		(0.1	)
Outstanding at December 31, 2017	$	62.43	4.6		6.3	$	77.3
Exercisable at December 31, 2017	$	61.06	2.9		5.1	$	52.1
Reserved for future grants at December 31, 2017			15.0

Information related to stock options

Information related to stock options follows:

	2017		2016		2015
Pretax expense for stock options	$	11	$	14	$	12
After-tax expense for stock options	8		9		8
Proceeds from stock options exercised	66		74		52
Income tax benefit related to stock options exercised
Tax benefit classified in operating activities in the Consolidated    Statements of Cash Flows	13		5		4
Excess tax benefit classified in financing activities in the    Consolidated Statements of Cash Flows	—		1		1
Intrinsic value of stock options exercised	41		42		44
Total fair value of stock options vested	$	11	$	14	$	12
Stock options exercised, in millions of options	1.5		1.9		1.4

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Fair Value Measurements (Tables)

12 Months Ended

Dec. 31, 2017

Fair Value Disclosures [Abstract]

Summary of financial instruments recognized at fair value and fair value measurement used

A summary of financial instruments recognized at fair value, and the fair value measurements used, follows:

	Total			Quoted prices in active markets for identical assets (Level 1)		Other observable inputs (Level 2)			Unobservable inputs (Level 3)
2017
Cash	$	561		$	561	$	—		$	—
Short-term investments	534			534		—			—
Net derivative contracts	36			—		36			—
2016
Cash	$	543		$	543	$	—		$	—
Short-term investments	203			203		—			—
Net derivative contracts	(3		)	—		(3		)	—

Summary of carrying value of short-term investments

A summary of the carrying value of short-term investments follows:

	2017		2016
Time deposits, certificates of deposit and demand deposits with banks	$	435	$	149
Money market investments	99		54
Total short-term investments	$	534	$	203

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Derivative Financial Instruments and Hedging Activities (Tables)

12 Months Ended

Dec. 31, 2017

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Summary of interest rate swaps

A summary of interest rate swaps outstanding at December 31, 2017, follows:

Fixed-to-Floating Interest Rate Swaps

Notional amount		Fixed interest rate received	Floating interest rate paid	Basis for contracted floating interest rate paid
$	415	5.60%	4.59%	6 month LIBOR + 3.18%
300		6.95%	6.31%	3 month LIBOR + 5.07%
25		8.88%	5.24%	6 month LIBOR + 3.84%
150		3.88%	3.22%	1 month LIBOR + 2.12%
275		3.47%	2.84%	1 month LIBOR + 1.74%
100		8.10%	7.08%	1 month LIBOR + 5.90%
1,400		2.75%	1.66%	1 month LIBOR + 0.58%
200		3.68%	2.17%	1 month LIBOR + 1.07%
25		7.63%	3.87%	6 month LIBOR + 2.48%
50		7.65%	3.98%	6 month LIBOR + 2.57%
25		5.45%	1.68%	6 month LIBOR + 0.28%

Fair value of derivative financial instruments recognized in the Consolidated Balance Sheet

The fair value of derivative financial instruments recognized in the Consolidated Balance Sheets follows:

	Notional amount		Other  current assets		Other noncurrent assets		Other current liabilities		Other noncurrent liabilities		Type of hedge	Term
December 31, 2017
Derivatives designated as hedges
Fixed-to-floating interest rate swaps	$	2,965	$	1	$	41	$	—	$	17	Fair value	6 months to 17 years
Currency exchange contracts	924		7		7		22		2		Cash flow	1 to 36 months
Total			$	8	$	48	$	22	$	19
Derivatives not designated as hedges
Currency exchange contracts	$	3,719	$	39			$	19				1 to 12 months
Commodity contracts	13		1				—					1 to 12 months
Total			$	40			$	19

December 31, 2016
Derivatives designated as hedges
Fixed-to-floating interest rate swaps	$	3,765	$	1	$	65	$	—	$	8	Fair value	3 months to 18 years
Forward starting floating-to-fixed interest rate swaps	450		—		19		—		1		Cash flow	11 years
Currency exchange contracts	802		11		1		22		17		Cash flow	1 to 36 months
Total			$	12	$	85	$	22	$	26
Derivatives not designated as hedges
Currency exchange contracts	$	5,333	$	31			$	85				1 to 12 months
Commodity contracts	10		2				—					1 to 12 months
Total			$	33			$	85

Impact of Derivative Instruments on the Consolidated Statements of Income and Comprehensive Income

The impact of derivative instruments to the Consolidated Statements of Income and Comprehensive Income follow:

	Gain (loss) recognized in other comprehensive (loss) income						Location of gain (loss) reclassified from Accumulated other comprehensive loss	Gain (loss) reclassified from Accumulated other comprehensive loss
	2017			2016				2017			2016
Derivatives designated as cash flow hedges
Forward starting floating-to-fixed interest rate swaps	$	(15	)	$	18		Interest expense - net	$	—		$	—
Interest rate locks	(9		)	—			Interest expense - net	—			—
Currency exchange contracts	—			(39		)	Cost of products sold	(17		)	(8		)
Total	$	(24	)	$	(21	)		$	(17	)	$	(8	)

Amounts recognized in net income

Amounts recognized in net income follow:

	2017			2016
Derivatives designated as fair value hedges
Fixed-to-floating interest rate swaps	$	(33	)	$	(36	)
Related long-term debt converted to floating interest    rates by interest rate swaps	33			36
	$	—		$	—

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Accounts Receivable and Inventory (Tables)

12 Months Ended

Dec. 31, 2017

Accounts Receivable and Inventory [Abstract]

Components of inventory

The components of inventory follow:

	2017		2016 As adjusted
Raw materials	$	953	$	879
Work-in-process	471		395
Finished goods	1,196		1,072
Total inventory	$	2,620	$	2,346

Schedule of effects of retrospective application of change in accounting principal on financial statement line items

As a result of the retrospective application of this change in accounting method, the following financial statement line items within the accompanying financial statements were adjusted, as follows:

		December 31, 2017										December 31, 2016							December 31, 2015
(In millions except for per share data)		As computed under LIFO		As reported under FIFO		Effect of change						As originally reported		As adjusted		Effect of change			As originally reported		As adjusted		Effect of change
						TCJA			Other
Consolidated Statements of Income
	Cost of products sold	$	13,770	$	13,756	$	—		$	(14	)	$	13,400	$	13,409	$	9		$	14,292	$	14,304	$	12
	Income before income taxes	3,354		3,368		—			14			2,127		2,118		(9		)	2,145		2,133		(12		)
	Income tax expense	391		382		(14		)	5			202		199		(3		)	164		159		(5		)
	Net income	2,963		2,986		14			9			1,925		1,919		(6		)	1,981		1,974		(7		)
	Net income attributable to Eaton ordinary shareholders	$	2,962	$	2,985	$	14		$	9		$	1,922	$	1,916	$	(6	)	$	1,979	$	1,972	$	(7	)
Net income per ordinary share
	Diluted	$	6.63	$	6.68	$	0.03		$	0.02		$	4.21	$	4.20	$	(0.01	)	$	4.23	$	4.22	$	(0.01	)
	Basic	$	6.66	$	6.71	$	0.03		$	0.02		$	4.22	$	4.21	$	(0.01	)	$	4.25	$	4.23	$	(0.02	)
Consolidated Statements of Comprehensive Income
	Net income	$	2,963	$	2,986	$	14		$	9		$	1,925	$	1,919	$	(6	)	$	1,981	$	1,974	$	(7	)
	Net income attributable to Eaton ordinary shareholders	2,962		2,985		14			9			1,922		1,916		(6		)	1,979		1,972		(7		)
	Total comprehensive income attributable to Eaton ordinary shareholders	$	4,006	$	4,029	$	14		$	9		$	1,337	$	1,331	$	(6	)	$	1,015	$	1,008	$	(7	)

		December 31, 2017									December 31, 2016									December 31, 2015
(In millions except for per share data)		As computed under LIFO			As reported under FIFO			Effect of change			As originally reported			As adjusted			Effect of change			As originally reported			As adjusted			Effect of change
Consolidated Balance Sheets
	Inventory	$	2,514		$	2,620		$	106		$	2,254		$	2,346		$	92
	Deferred income taxes - noncurrent asset	253			253			—			360			325			(35		)
	Deferred income taxes - noncurrent liability	512			538			26			321			321			—
	Retained earnings	$	8,589		$	8,669		$	80		$	7,498		$	7,555		$	57
Consolidated Statements of Cash Flows
	Net income	$	2,963		$	2,986		$	23		$	1,925		$	1,919		$	(6	)	$	1,981		$	1,974		$	(7	)
	Deferred income taxes	(197		)	(206		)	(9		)	(80		)	(83		)	(3		)	(100		)	(105		)	(5		)
	Inventory	$	(188	)	$	(202	)	$	(14	)	$	25		$	34		$	9		$	(20	)	$	(8	)	$	12

As a result of the retrospective application of this change in accounting principle, the following financial statement line items within the unaudited interim 2017 and 2016 quarterly condensed consolidated financial statements were adjusted, as follows:

	(unaudited)	Three months ended
		March 30, 2017							June 30, 2017							September 30, 2017
(In millions except for per share data)		As originally reported		As adjusted		Effect of change			As originally reported		As adjusted		Effect of change			As originally reported		As adjusted		Effect of change
Consolidated Statements of Income
	Cost of products sold	$	3,310	$	3,307	$	(3	)	$	3,450	$	3,448	$	(2	)	$	3,469	$	3,466	$	(3	)
	Income before income taxes	464		467		3			570		572		2			1,691		1,694		3
	Income tax expense	32		33		1			54		55		1			292		293		1
	Net income	432		434		2			516		517		1			1,399		1,401		2
	Net income attributable to Eaton ordinary shareholders	$	432	$	434	$	2		$	515	$	516	$	1		$	1,399	$	1,401	$	2
Net income per ordinary share
	Diluted	$	0.96	$	0.96	$	—		$	1.15	$	1.15	$	—		$	3.14	$	3.14	$	—
	Basic	$	0.96	$	0.97	$	0.01		$	1.15	$	1.16	$	0.01		$	3.16	$	3.16	$	—

	(unaudited)	Three months ended
		March 30, 2016							June 30, 2016							September 30, 2016
(In millions except for per share data)		As originally reported		As adjusted		Effect of change			As originally reported		As adjusted		Effect of change			As originally reported		As adjusted		Effect of change
Consolidated Statements of Income
	Cost of products sold	$	3,291	$	3,294	$	3		$	3,419	$	3,422	$	3		$	3,371	$	3,374	$	3
	Income before income taxes	442		439		(3		)	553		550		(3		)	573		570		(3		)
	Income tax expense	39		38		(1		)	61		60		(1		)	51		50		(1		)
	Net income	403		401		(2		)	492		490		(2		)	522		520		(2		)
	Net income attributable to Eaton ordinary shareholders	$	404	$	402	$	(2	)	$	491	$	489	$	(2	)	$	523	$	521	$	(2	)
Net income per ordinary share
	Diluted	$	0.88	$	0.87	$	(0.01	)	$	1.07	$	1.07	$	—		$	1.15	$	1.14	$	(0.01	)
	Basic	$	0.88	$	0.88	$	—		$	1.08	$	1.07	$	(0.01	)	$	1.15	$	1.15	$	—

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Business Segment and Geographic Region Information (Tables)

12 Months Ended

Dec. 31, 2017

Segment Reporting Information [Line Items]

Business Segment Information - Net sales, Segment operating profit and Corporate

	2017			2016			2015
Net sales
Electrical Products	$	7,193		$	6,957		$	6,976
Electrical Systems and Services	5,666			5,662			5,931
Hydraulics	2,468			2,222			2,459
Aerospace	1,744			1,753			1,807
Vehicle	3,333			3,153			3,682
Total net sales	$	20,404		$	19,747		$	20,855
Segment operating profit
Electrical Products	$	1,287		$	1,240		$	1,156
Electrical Systems and Services	770			711			776
Hydraulics	288			198			246
Aerospace	332			335			310
Vehicle	537			474			645
Total segment operating profit	3,214			2,958			3,133
Corporate
Amortization of intangible assets	(388		)	(392		)	(406		)
Interest expense - net	(246		)	(233		)	(232		)
Pension and other postretirement benefits expense	(45		)	(60		)	(130		)
Gain on sale of business	1,077			—			—
Other corporate expense - net*	(244		)	(155		)	(232		)
Income before income taxes*	3,368			2,118			2,133
Income tax expense*	382			199			159
Net income*	2,986			1,919			1,974
Less net income for noncontrolling interests	(1		)	(3		)	(2		)
Net income attributable to Eaton ordinary shareholders*	$	2,985		$	1,916		$	1,972

*Other corporate expense - net and Income tax expense in 2016 and 2015 have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14.

Business Segment Information - Acquisition integration charges

Business segment operating profit was reduced by acquisition integration charges as follows:

	2017		2016		2015
Electrical Products	$	4	$	3	$	25
Electrical Systems and Services	—		1		15
Hydraulics	—		—		2
Total	$	4	$	4	$	42

Business Segment Information - Identifiable assets, Capital expenditures for property, plant, and equipment, and Depreciation of property, plant, and equipment

	2017		2016		2015
Identifiable assets
Electrical Products	$	2,570	$	2,363	$	2,538
Electrical Systems and Services	2,141		2,222		2,285
Hydraulics	1,345		1,188		1,138
Aerospace	938		830		841
Vehicle	2,379		1,549		1,579
Total identifiable assets	9,373		8,152		8,381
Goodwill	13,568		13,201		13,479
Other intangible assets	5,265		5,514		6,014
Corporate*	4,417		3,609		3,185
Total assets*	$	32,623	$	30,476	$	31,059
*Corporate identifiable assets in 2016 and 2015 have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14.
Capital expenditures for property, plant and equipment
Electrical Products	$	134	$	134	$	137
Electrical Systems and Services	83		78		94
Hydraulics	96		92		61
Aerospace	37		28		33
Vehicle	141		142		119
Total	491		474		444
Corporate	29		23		62
Total expenditures for property, plant and equipment	$	520	$	497	$	506
Depreciation of property, plant and equipment
Electrical Products	$	143	$	141	$	137
Electrical Systems and Services	83		82		82
Hydraulics	61		64		67
Aerospace	26		27		28
Vehicle	109		109		113
Total	422		423		427
Corporate	54		63		52
Total depreciation of property, plant and equipment	$	476	$	486	$	479

Geographic Region Information - Net sales and long-lived assets

Net sales are measured based on the geographic destination of sales. Long-lived assets consist of property, plant and equipment - net.

	2017		2016		2015
Net sales
United States	$	11,222	$	10,937	$	11,396
Canada	942		898		969
Latin America	1,485		1,448		1,726
Europe	4,394		4,228		4,379
Asia Pacific	2,361		2,236		2,385
Total	$	20,404	$	19,747	$	20,855
Long-lived assets
United States	$	1,872	$	1,924	$	1,982
Canada	20		19		19
Latin America	290		281		243
Europe	769		681		734
Asia Pacific	551		538		587
Total	$	3,502	$	3,443	$	3,565

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Condensed Consolidating Financial Statements (Tables)

12 Months Ended

Dec. 31, 2017

Condensed Financial Information of Parent Company Only Disclosure [Abstract]

Condensed Consolidating Financial Statements

CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME YEAR ENDED DECEMBER 31, 2017
	Eaton Corporation plc			Eaton Corporation			Guarantors			Other subsidiaries			Consolidating adjustments			Total
Net sales	$	—		$	6,659		$	6,563		$	12,599		$	(5,417	)	$	20,404
Cost of products sold	—			5,276			4,840			9,054			(5,414		)	13,756
Selling and administrative expense	136			1,172			759			1,498			—			3,565
Research and development expense	—			215			207			162			—			584
Interest expense (income) - net	—			245			21			(21		)	1			246
Gain on sale of business	—			560			—			517			—			1,077
Other expense (income) - net	79			9			(70		)	(56		)	—			(38		)
Equity in loss (earnings) of    subsidiaries, net of tax	(3,644		)	(1,139		)	(4,958		)	(4,665		)	14,406			—
Intercompany expense (income) - net	444			(561		)	1,197			(1,080		)	—			—
Income (loss) before income taxes	2,985			2,002			4,567			8,224			(14,410		)	3,368
Income tax expense (benefit)	—			499			(232		)	115			—			382
Net income (loss)	2,985			1,503			4,799			8,109			(14,410		)	2,986
Less net loss (income) for    noncontrolling interests	—			—			—			(3		)	2			(1		)
Net income (loss) attributable to    Eaton ordinary shareholders	$	2,985		$	1,503		$	4,799		$	8,106		$	(14,408	)	$	2,985
Other comprehensive income (loss)	1,044			41			1,064			2,192			(3,297		)	1,044
Total comprehensive income (loss) attributable to Eaton    ordinary shareholders	$	4,029		$	1,544		$	5,863		$	10,298		$	(17,705	)	$	4,029

CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME YEAR ENDED DECEMBER 31, 2016
	Eaton Corporation plc			Eaton Corporation			Guarantors			Other subsidiaries			Consolidating adjustments			Total
Net sales	$	—		$	6,447		$	6,351		$	11,961		$	(5,012	)	$	19,747
Cost of products sold	—			5,076			4,697			8,649			(5,013		)	13,409
Selling and administrative expense	140			1,153			760			1,452			—			3,505
Research and development expense	—			235			186			168			—			589
Interest expense (income) - net	—			233			17			(16		)	(1		)	233
Other expense (income) - net	(35		)	(48		)	43			(67		)	—			(107		)
Equity in loss (earnings) of    subsidiaries, net of tax	(2,433		)	(770		)	(3,266		)	(2,808		)	9,277			—
Intercompany expense (income) - net	412			(122		)	1,230			(1,520		)	—			—
Income (loss) before income taxes	1,916			690			2,684			6,103			(9,275		)	2,118
Income tax expense (benefit)	—			23			26			149			1			199
Net income (loss)	1,916			667			2,658			5,954			(9,276		)	1,919
Less net loss (income) for    noncontrolling interests	—			—			—			(5		)	2			(3		)
Net income (loss) attributable to    Eaton ordinary shareholders	$	1,916		$	667		$	2,658		$	5,949		$	(9,274	)	$	1,916
Other comprehensive income (loss)	(585		)	54			(566		)	(1,344		)	1,856			(585		)
Total comprehensive income (loss) attributable to Eaton    ordinary shareholders	$	1,331		$	721		$	2,092		$	4,605		$	(7,418	)	$	1,331

CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME YEAR ENDED DECEMBER 31, 2015
	Eaton Corporation plc			Eaton Corporation			Guarantors			Other subsidiaries			Consolidating adjustments			Total
Net sales	$	—		$	6,926		$	6,660		$	12,531		$	(5,262	)	$	20,855
Cost of products sold	—			5,518			5,041			8,978			(5,233		)	14,304
Selling and administrative expense	141			1,223			738			1,494			—			3,596
Research and development expense	—			266			197			162			—			625
Interest expense (income) - net	—			222			21			(13		)	2			232
Other expense (income) - net	—			—			24			(59		)	—			(35		)
Equity in loss (earnings) of    subsidiaries, net of tax	(2,449		)	(821		)	(3,221		)	(2,761		)	9,252			—
Intercompany expense (income) - net	336			(384		)	1,218			(1,170		)	—			—
Income (loss) before income taxes	1,972			902			2,642			5,900			(9,283		)	2,133
Income tax expense (benefit)	—			87			(69		)	152			(11		)	159
Net income (loss)	1,972			815			2,711			5,748			(9,272		)	1,974
Less net loss (income) for    noncontrolling interests	—			—			—			(3		)	1			(2		)
Net income (loss) attributable to    Eaton ordinary shareholders	$	1,972		$	815		$	2,711		$	5,745		$	(9,271	)	$	1,972
Other comprehensive income (loss)	(964		)	5			(951		)	(2,000		)	2,946			(964		)
Total comprehensive income (loss) attributable to Eaton    ordinary shareholders	$	1,008		$	820		$	1,760		$	3,745		$	(6,325	)	$	1,008

CONDENSED CONSOLIDATING BALANCE SHEETS DECEMBER 31, 2017
	Eaton Corporation plc		Eaton Corporation		Guarantors		Other subsidiaries		Consolidating adjustments			Total
Assets
Current assets
Cash	$	—	$	183	$	12	$	366	$	—		$	561
Short-term investments	—		—		—		534		—			534
Accounts receivable - net	—		482		1,317		2,144		—			3,943
Intercompany accounts receivable	8		2,865		5,146		2,741		(10,760		)	—
Inventory	—		473		692		1,537		(82		)	2,620
Prepaid expenses and other    current assets	—		229		145		277		28			679
Total current assets	8		4,232		7,312		7,599		(10,814		)	8,337
Property, plant and equipment - net	—		835		684		1,983		—			3,502
Other noncurrent assets
Goodwill	—		1,307		6,293		5,968		—			13,568
Other intangible assets	—		138		3,002		2,125		—			5,265
Deferred income taxes	—		356		—		221		(324		)	253
Investment in subsidiaries	15,045		15,439		87,919		39,527		(157,930		)	—
Intercompany loans receivable	3,122		7,104		2,735		61,225		(74,186		)	—
Other assets	—		748		163		787		—			1,698
Total assets	$	18,175	$	30,159	$	108,108	$	119,435	$	(243,254	)	$	32,623
Liabilities and shareholders’    equity
Current liabilities
Short-term debt	$	—	$	—	$	—	$	6	$	—		$	6
Current portion of long-term debt	—		542		35		1		—			578
Accounts payable	—		533		313		1,320		—			2,166
Intercompany accounts payable	4		4,920		4,405		1,431		(10,760		)	—
Accrued compensation	—		128		63		262		—			453
Other current liabilities	1		564		308		1,000		(1		)	1,872
Total current liabilities	5		6,687		5,124		4,020		(10,761		)	5,075
Noncurrent liabilities
Long-term debt	—		6,180		976		8		3			7,167
Pension liabilities	—		341		83		802		—			1,226
Other postretirement benefits    liabilities	—		192		94		76		—			362
Deferred income taxes	—		—		558		304		(324		)	538
Intercompany loans payable	917		3,718		68,405		1,146		(74,186		)	—
Other noncurrent liabilities	—		314		272		379		—			965
Total noncurrent liabilities	917		10,745		70,388		2,715		(74,507		)	10,258
Shareholders’ equity
Eaton shareholders’ equity	17,253		12,727		32,596		112,663		(157,986		)	17,253
Noncontrolling interests	—		—		—		37		—			37
Total equity	17,253		12,727		32,596		112,700		(157,986		)	17,290
Total liabilities and equity	$	18,175	$	30,159	$	108,108	$	119,435	$	(243,254	)	$	32,623

CONDENSED CONSOLIDATING BALANCE SHEETS DECEMBER 31, 2016
	Eaton Corporation plc		Eaton Corporation		Guarantors		Other subsidiaries		Consolidating adjustments			Total
Assets
Current assets
Cash	$	1	$	92	$	5	$	445	$	—		$	543
Short-term investments	—		—		—		203		—			203
Accounts receivable - net	—		536		1,049		1,975		—			3,560
Intercompany accounts receivable	5		953		4,239		3,382		(8,579		)	—
Inventory	—		443		638		1,344		(79		)	2,346
Prepaid expenses and other    current assets	—		77		42		237		25			381
Total current assets	6		2,101		5,973		7,586		(8,633		)	7,033
Property, plant and equipment - net	—		857		706		1,880		—			3,443
Other noncurrent assets
Goodwill	—		1,362		6,293		5,546		—			13,201
Other intangible assets	—		169		3,442		1,903		—			5,514
Deferred income taxes	—		864		15		218		(772		)	325
Investment in subsidiaries	32,852		20,200		92,766		44,345		(190,163		)	—
Intercompany loans receivable	—		7,609		2,061		56,938		(66,608		)	—
Other assets	—		490		134		336		—			960
Total assets	$	32,858	$	33,652	$	111,390	$	118,752	$	(266,176	)	$	30,476
Liabilities and shareholders’    equity
Current liabilities
Short-term debt	$	—	$	—	$	8	$	6	$	—		$	14
Current portion of long-term debt	—		1,250		296		6		—			1,552
Accounts payable	1		412		252		1,053		—			1,718
Intercompany accounts payable	281		3,332		3,130		1,836		(8,579		)	—
Accrued compensation	—		98		58		223		—			379
Other current liabilities	1		590		276		957		(2		)	1,822
Total current liabilities	283		5,682		4,020		4,081		(8,581		)	5,485
Noncurrent liabilities
Long-term debt	—		5,767		936		8		—			6,711
Pension liabilities	—		610		161		888		—			1,659
Other postretirement benefits    liabilities	—		198		99		71		—			368
Deferred income taxes	—		—		732		361		(772		)	321
Intercompany loans payable	17,621		3,768		44,788		431		(66,608		)	—
Other noncurrent liabilities	—		326		212		396		—			934
Total noncurrent liabilities	17,621		10,669		46,928		2,155		(67,380		)	9,993
Shareholders’ equity
Eaton shareholders’ equity	14,954		17,301		60,442		112,478		(190,221		)	14,954
Noncontrolling interests	—		—		—		38		6			44
Total equity	14,954		17,301		60,442		112,516		(190,215		)	14,998
Total liabilities and equity	$	32,858	$	33,652	$	111,390	$	118,752	$	(266,176	)	$	30,476

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS DECEMBER 31, 2017
	Eaton Corporation plc			Eaton Corporation			Guarantors			Other subsidiaries			Consolidating adjustments			Total
Net cash provided by (used in)    operating activities	$	258		$	(498	)	$	(30	)	$	4,545		$	(1,609	)	$	2,666
Investing activities
Capital expenditures for property,    plant and equipment	—			(90		)	(110		)	(320		)	—			(520		)
Cash received from sales (paid for    acquisitions) of affiliates	—			—			(92		)	92			—			—
Purchases of short-term investments - net	—			—			—			(298		)	—			(298		)
Investments in affiliates	(190		)	—			—			(90		)	280			—
Return of investments in affiliates	—			—			90			—			(90		)	—
Loans to affiliates	—			(444		)	—			(6,723		)	7,167			—
Repayments of loans from affiliates	—			303			46			3,817			(4,166		)	—
Proceeds from sale of business	—			338			—			269			—			607
Other - net	—			(45		)	9			30			—			(6		)
Net cash provided by (used in)     investing activities	(190		)	62			(57		)	(3,223		)	3,191			(217		)
Financing activities
Proceeds from borrowings	—			1,000			—			—			—			1,000
Payments on borrowings	—			(1,250		)	(297		)	(7		)	—			(1,554		)
Proceeds from borrowings from    affiliates	2,605			3,130			991			441			(7,167		)	—
Payments on borrowings from    affiliates	(822		)	(2,904		)	(353		)	(87		)	4,166			—
Capital contributions from affiliates	—			—			90			190			(280		)	—
Return of capital to affiliates	—			—			—			(90		)	90			—
Other intercompany financing    activities	—			573			469			(1,042		)	—			—
Cash dividends paid	(1,068		)	—			—			—			—			(1,068		)
Cash dividends paid to affiliates	—			—			(800		)	(809		)	1,609			—
Exercise of employee stock options	66			—			—			—			—			66
Repurchase of shares	(850		)	—			—			—			—			(850		)
Employee taxes paid from shares    withheld	—			(14		)	(5		)	(3		)	—			(22		)
Other - net	—			(8		)	(1		)	(5		)	—			(14		)
Net cash provided by (used in)    financing activities	(69		)	527			94			(1,412		)	(1,582		)	(2,442		)
Effect of currency on cash	—			—			—			11			—			11
Total increase (decrease) in cash	(1		)	91			7			(79		)	—			18
Cash at the beginning of the period	1			92			5			445			—			543
Cash at the end of the period	$	—		$	183		$	12		$	366		$	—		$	561

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS DECEMBER 31, 2016
	Eaton Corporation plc			Eaton Corporation			Guarantors			Other subsidiaries			Consolidating adjustments			Total
Net cash provided by (used in)    operating activities	$	(253	)	$	22		$	(232	)	$	3,033		$	—		$	2,570
Investing activities
Capital expenditures for property,    plant and equipment	—			(92		)	(114		)	(291		)	—			(497		)
Cash received from acquisitions of    businesses, net of cash acquired	—			—			1			—			—			1
Sales (purchases) of short-term investments - net	—			—			2			(42		)	—			(40		)
Investments in affiliates	(1,250		)	—			(120		)	(1,370		)	2,740			—
Return of investments in affiliates	—			—			47			—			(47		)	—
Loans to affiliates	—			(251		)	(655		)	(8,208		)	9,114			—
Repayments of loans from affiliates	—			1,293			—			5,951			(7,244		)	—
Other - net	—			(9		)	41			(25		)	—			7
Net cash provided by (used in)     investing activities	(1,250		)	941			(798		)	(3,985		)	4,563			(529		)
Financing activities
Proceeds from borrowings	—			21			610			—			—			631
Payments on borrowings	—			(408		)	(233		)	(12		)	—			(653		)
Proceeds from borrowings from    affiliates	3,843			4,045			1,120			106			(9,114		)	—
Payments on borrowings from    affiliates	(646		)	(4,712		)	(1,844		)	(42		)	7,244			—
Capital contribution from affiliates	—			—			1,370			1,370			(2,740		)	—
Return of capital to affiliates	—			—			—			(47		)	47			—
Other intercompany financing    activities	—			168			12			(180		)	—			—
Cash dividends paid	(1,037		)	—			—			—			—			(1,037		)
Exercise of employee stock options	74			—			—			—			—			74
Repurchase of shares	(730		)	—			—			—			—			(730		)
Employee taxes paid from shares    withheld	—			(12		)	(3		)	(3		)	—			(18		)
Other - net	—			1			(4		)	(2		)	—			(5		)
Net cash provided by (used in)    financing activities	1,504			(897		)	1,028			1,190			(4,563		)	(1,738		)
Effect of currency on cash	—			—			—			(28		)	—			(28		)
Total increase (decrease) in cash	1			66			(2		)	210			—			275
Cash at the beginning of the period	—			26			7			235			—			268
Cash at the end of the period	$	1		$	92		$	5		$	445		$	—		$	543

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS DECEMBER 31, 2015
	Eaton Corporation plc			Eaton Corporation			Guarantors			Other subsidiaries			Consolidating adjustments			Total
Net cash provided by (used in)    operating activities	$	(137	)	$	(195	)	$	(281	)	$	3,026		$	(4	)	$	2,409
Investing activities
Capital expenditures for property,    plant and equipment	—			(94		)	(146		)	(266		)	—			(506		)
Cash paid for acquisitions of    businesses, net of cash acquired	—			—			(36		)	(36		)	—			(72		)
Sales (purchases) of short-term    investments - net	—			—			(2		)	39			—			37
Investments in affiliates	(1,482		)	—			(1,176		)	(1,482		)	4,140			—
Loans to affiliates	—			(889		)	(39		)	(10,608		)	11,536			—
Repayments of loans from affiliates	—			342			359			7,493			(8,194		)	—
Proceeds from the sales of    businesses	—			—			—			1			—			1
Other - net	—			(50		)	47			(32		)	—			(35		)
Net cash provided by (used in)    investing activities	(1,482		)	(691		)	(993		)	(4,891		)	7,482			(575		)
Financing activities
Proceeds from borrowings	—			408			—			17			—			425
Payments on borrowings	—			(724		)	(301		)	(2		)	—			(1,027		)
Proceeds from borrowings from    affiliates	3,322			6,885			997			332			(11,536		)	—
Payments on borrowings from    affiliates	(48		)	(6,467		)	(1,282		)	(397		)	8,194			—
Capital contribution from affiliates	—			1,176			1,482			1,482			(4,140		)	—
Other intercompany financing    activities	—			(518		)	378			140			—			—
Cash dividends paid	(1,026		)	—			—			—			—			(1,026		)
Cash dividends paid to affiliates	—			—			—			(4		)	4			—
Exercise of employee stock options	52			—			—			—			—			52
Repurchase of shares	(682		)	—			—			—			—			(682		)
Employee taxes paid from shares    withheld	—			(26		)	(6		)	(6		)	—			(38		)
Other - net	—			1			—			(10		)	—			(9		)
Net cash provided by (used in)    financing activities	1,618			735			1,268			1,552			(7,478		)	(2,305		)
Effect of currency on cash	—			—			—			(42		)	—			(42		)
Total increase (decrease) in cash	(1		)	(151		)	(6		)	(355		)	—			(513		)
Cash at the beginning of the period	1			177			13			590			—			781
Cash at the end of the period	$	—		$	26		$	7		$	235		$	—		$	268

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Summary of Significant Accounting Policies - General Information and Basis of Presentation (Details) $ in Millions	12 Months Ended
	Dec. 31, 2017 USD ($)	Dec. 31, 2016 USD ($)	[1]	Dec. 31, 2015 USD ($)	[1]	Jul. 31, 2017
Accounting Policies [Abstract]
Net sales	$ 20,404	$ 19,747		$ 20,855
Number of Eaton employees	96,000
Countries of operation	59
Countries where products are sold	175
Investments in associate companies [Line Items]
Equity method of accounting, ownership interest (in percentage)						50.00%
Minimum [Member]
Investments in associate companies [Line Items]
Equity method of accounting, ownership interest (in percentage)	20.00%
Maximum [Member]
Investments in associate companies [Line Items]
Equity method of accounting, ownership interest (in percentage)	50.00%

[1] *Year ended December 31, 2016 and 2015 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

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Summary of Significant Accounting Policies - Other Long-Lived Assets (Details)	12 Months Ended
	Dec. 31, 2017
Patents and technology [Member]
Long-Lived Assets [Line Items]
Weighted average amortization period for intangible assets (in years)	17 years
Customer relationships [Member]
Long-Lived Assets [Line Items]
Weighted average amortization period for intangible assets (in years)	17 years
Trademarks [Member]
Long-Lived Assets [Line Items]
Weighted average amortization period for intangible assets (in years)	17 years
Buildings [Member]
Long-Lived Assets [Line Items]
Property, plant and equipment useful life (in years)	40 years
Machinery and equipment [Member] | Minimum [Member]
Long-Lived Assets [Line Items]
Property, plant and equipment useful life (in years)	3 years
Machinery and equipment [Member] | Maximum [Member]
Long-Lived Assets [Line Items]
Property, plant and equipment useful life (in years)	10 years
Software [Member] | Maximum [Member]
Long-Lived Assets [Line Items]
Property, plant and equipment useful life (in years)	15 years

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Summary of Significant Accounting Policies - Equity-Based Compensation (Details) - USD ($) $ in Millions		12 Months Ended
	Jan. 01, 2017	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Deferred Tax Asset recognized adoption of ASU 2016-09	$ 48
Equity-based compensation, vesting period (in years)		3 years
Reclassifications due to adoption of ASU 2016-09		$ 22	$ 18	$ 38

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Summary of Significant Accounting Policies - Recently Issued Accounting Pronouncements (Details) - USD ($) $ in Millions		Jan. 01, 2018	Dec. 31, 2014
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Cumulative effect on retained earnings from new method of accounting	[1]		$ (70)
Retained Earnings [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Cumulative effect on retained earnings from new method of accounting	[1]		$ (70)
Accounting Standards Update 2016-16 [Member] | Scenario, Forecast [Member] | Retained Earnings [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Cumulative effect on retained earnings from new method of accounting		$ 200

[1] *The balances at January 1, 2015 and the year ended December 31, 2015 and 2016 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

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Acquisitions and Sales of Businesses - Narrative (Details) - USD ($) $ in Millions		12 Months Ended
	Jul. 31, 2017	Dec. 31, 2017	Dec. 31, 2016	[1]	Dec. 31, 2015	[1]	Sep. 30, 2015	Dec. 31, 2014
Business Acquisition [Line Items]
Interest in business sold	50.00%
Proceeds from sale of business	$ 600
Deconsolidation, gain (loss)	1,077
Pre-tax gain on sale of business	533
Revaluation gain	$ 544
Equity method of accounting, ownership interest (in percentage)	50.00%
Gain on sale of business, net	$ 843	$ (843)	$ 0		$ 0
Ephesus Lighting, Inc. [Member] | Electrical Products [Member]
Business Acquisition [Line Items]
Revenue reported for last annual period of acquired entity							$ 23
Oxalis Group Ltd. [Member] | Electrical Systems and Services [Member]
Business Acquisition [Line Items]
Revenue reported for last annual period of acquired entity								$ 9

[1] *Year ended December 31, 2016 and 2015 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

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Acquisition Integration Charges - Transaction Costs (Details) - USD ($) $ / shares in Units, $ in Millions	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Acquisition Integration Charges
Business segment acquisition integration pretax charges	$ 4	$ 4	$ 42
Transaction costs [Abstract]
Total acquisition integration charges before income taxes	4	4	47
Income taxes	2	1	16
Total after income taxes	$ 2	$ 3	$ 31
Per ordinary share - diluted	$ 0.00	$ 0.01	$ 0.07
Electrical Products [Member]
Acquisition Integration Charges
Business segment acquisition integration pretax charges	$ 4	$ 3	$ 25
Electrical Systems and Services [Member]
Acquisition Integration Charges
Business segment acquisition integration pretax charges	0	1	15
Hydraulics [Member]
Acquisition Integration Charges
Business segment acquisition integration pretax charges	0	0	2
Total business segments [Member]
Acquisition Integration Charges
Business segment acquisition integration pretax charges	4	4	42
Corporate [Member]
Acquisition Integration Charges
Corporate acquisition integration charges	$ 0	$ 0	$ 5

XML

Acquisition Integration Charges - Restructuring Charges (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Acquisition Integration Charges [Line Items]
Restructuring charges	$ 116	$ 211	$ 129
Severance costs	57	177	112
Electrical Products [Member]
Acquisition Integration Charges [Line Items]
Restructuring charges	29	44	12
Electrical Systems and Services [Member]
Acquisition Integration Charges [Line Items]
Restructuring charges	$ 16	$ 49	29
Restructuring activities related to the acquisition and integration of Cooper Industries plc [Member]
Acquisition Integration Charges [Line Items]
Restructuring charges			20
Severance costs			1
Other restructuring costs			19
Restructuring activities related to the acquisition and integration of Cooper Industries plc [Member] | Electrical Products [Member]
Acquisition Integration Charges [Line Items]
Restructuring charges			14
Restructuring activities related to the acquisition and integration of Cooper Industries plc [Member] | Electrical Systems and Services [Member]
Acquisition Integration Charges [Line Items]
Restructuring charges			$ 6

XML

Restructuring Charges - Narrative (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Restructuring Cost and Reserve [Line Items]
Restructuring charges	$ 116	$ 211	$ 129
Severance costs	57	177	112
Employee Severance [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring charges	57	177
Hydraulics [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring charges	32	67	31
Aerospace [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring charges	2	4	5
Vehicle [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring charges	12	35	34
Corporate, Non-Segment [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring charges	$ 25	$ 12	$ 18

XML

Restructuring Charges - Segments (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Restructuring Cost and Reserve [Line Items]
Restructuring Charges	$ 116	$ 211	$ 129
Electrical Products [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring Charges	29	44	12
Electrical Systems and Services [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring Charges	16	49	29
Hydraulics [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring Charges	32	67	31
Aerospace [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring Charges	2	4	5
Vehicle [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring Charges	12	35	34
Corporate, Non-Segment [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring Charges	$ 25	$ 12	$ 18

XML

Restructuring Charges - Restructuring Roll Forward (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Restructuring Reserve [Roll Forward]
Restructuring Reserve	$ 114	$ 54
Liability recognized	116	211	$ 129
Payments	(141)	(129)
Other adjustments	(17)	(22)
Restructuring Reserve	72	114	54
Employee Severance [Member]
Restructuring Reserve [Roll Forward]
Restructuring Reserve	113	54
Liability recognized	57	177
Payments	(102)	(116)
Other adjustments	(1)	(2)
Restructuring Reserve	67	113	54
Other Restructuring [Member]
Restructuring Reserve [Roll Forward]
Restructuring Reserve	1	0
Liability recognized	59	34
Payments	(39)	(13)
Other adjustments	(16)	(20)
Restructuring Reserve	$ 5	$ 1	$ 0

XML

Restructuring Charges - Restructuring Charges by Type (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Restructuring Charges by Type [Line Items]
Restructuring charges	$ 116	$ 211	$ 129
Severance costs	57	177	112
Restructuring payments for plant closing and other	59	34	17
Electrical Products [Member]
Restructuring Charges by Type [Line Items]
Restructuring charges	29	44	12
Electrical Systems and Services [Member]
Restructuring Charges by Type [Line Items]
Restructuring charges	16	49	29
Hydraulics [Member]
Restructuring Charges by Type [Line Items]
Restructuring charges	32	67	31
Aerospace [Member]
Restructuring Charges by Type [Line Items]
Restructuring charges	2	4	5
Vehicle [Member]
Restructuring Charges by Type [Line Items]
Restructuring charges	12	35	34
Corporate, Non-Segment [Member]
Restructuring Charges by Type [Line Items]
Restructuring charges	$ 25	$ 12	$ 18

XML

Goodwill and Other Intangible Assets - Schedule of Goodwill by Segment (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2017		Dec. 31, 2016
Goodwill [Roll Forward]
Goodwill	$ 13,201	[1]	$ 13,479
Goodwill written off from sale of business	(55)
Translation	422		(278)
Goodwill	13,568		13,201	[1]
Electrical Products [Member]
Goodwill [Roll Forward]
Goodwill	6,497		6,642
Goodwill written off from sale of business	0
Translation	262		(145)
Goodwill	6,759		6,497
Electrical Systems and Services [Member]
Goodwill [Roll Forward]
Goodwill	4,203		4,279
Goodwill written off from sale of business	(3)
Translation	111		(76)
Goodwill	4,311		4,203
Hydraulics [Member]
Goodwill [Roll Forward]
Goodwill	1,221		1,259
Goodwill written off from sale of business	0
Translation	36		(38)
Goodwill	1,257		1,221
Aerospace [Member]
Goodwill [Roll Forward]
Goodwill	938		956
Goodwill written off from sale of business	0
Translation	9		(18)
Goodwill	947		938
Vehicle [Member]
Goodwill [Roll Forward]
Goodwill	342		343
Goodwill written off from sale of business	(52)
Translation	4		(1)
Goodwill	$ 294		$ 342

[1] *December 31, 2016 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

XML

Goodwill and Other Intangible Assets - Schedule of Other Intangible Assets by Major Class (Details) - USD ($) $ in Millions	Dec. 31, 2017	Dec. 31, 2016
Summary of other intangible assets
Intangible assets not subject to amortization - trademarks	$ 1,654	$ 1,637
Intangible assets subject to amortization
Historical cost	6,217	5,999
Accumulated amortization	2,606	2,122
Customer relationships [Member]
Intangible assets subject to amortization
Historical cost	3,586	3,456
Accumulated amortization	1,475	1,199
Patents and technology [Member]
Intangible assets subject to amortization
Historical cost	1,395	1,342
Accumulated amortization	628	519
Trademarks [Member]
Intangible assets subject to amortization
Historical cost	1,137	1,104
Accumulated amortization	473	378
Other [Member]
Intangible assets subject to amortization
Historical cost	99	97
Accumulated amortization	$ 30	$ 26

XML

Goodwill and Other Intangible Assets - Intangible Assets Amortization Expense (Details) $ in Millions	12 Months Ended
	Dec. 31, 2017 USD ($)
Goodwill and Intangible Assets Disclosure [Abstract]
2017	$ 383
2018	369
2019	362
2020	357
2021	346
2022	$ 336

XML

Debt - Summary of Long-term Debt (Details) - USD ($) $ in Millions	Dec. 31, 2017	Dec. 31, 2016
Debt Instrument [Line Items]
Total long-term debt	$ 7,745	$ 8,263
Less current portion of long-term debt	(578)	(1,552)
Long-term debt less current portion	$ 7,167	$ 6,711	[1]
Senior notes due 2024 [Member]
Debt Instrument [Line Items]
Debt instrument, stated interest rate (in percentage)	0.75%	0.75%
Notes [Member] | Notes due 2017 [Member]
Debt Instrument [Line Items]
Notes	$ 0	$ 250
Debt instrument, stated interest rate (in percentage)	5.30%	5.30%
Related long term debt converted to floating interest rates by interest rate swaps	$ 150
Notes [Member] | Notes due 2018 [Member]
Debt Instrument [Line Items]
Notes	$ 450	$ 450
Debt instrument, stated interest rate (in percentage)	5.60%	5.60%
Related long term debt converted to floating interest rates by interest rate swaps	$ 415
Notes [Member] | Notes due 2019 [Member]
Debt Instrument [Line Items]
Notes	$ 300	$ 300
Debt instrument, stated interest rate (in percentage)	6.95%	6.95%
Related long term debt converted to floating interest rates by interest rate swaps	$ 300
Notes [Member] | Notes due 2021 [Member]
Debt Instrument [Line Items]
Notes	$ 300	$ 300
Debt instrument, stated interest rate (in percentage)	3.47%	3.47%
Related long term debt converted to floating interest rates by interest rate swaps	$ 275
Notes [Member] | Debentures due 2022 [Member]
Debt Instrument [Line Items]
Related long term debt converted to floating interest rates by interest rate swaps	100
Notes [Member] | Notes due 2023 [Member]
Debt Instrument [Line Items]
Notes	$ 300	$ 300
Debt instrument, stated interest rate (in percentage)	3.68%	3.68%
Related long term debt converted to floating interest rates by interest rate swaps	$ 200
Notes [Member] | Senior notes due 2024 [Member]
Debt Instrument [Line Items]
Long term debt debentures	659	$ 580
Notes [Member] | Notes due 2037 [Member]
Debt Instrument [Line Items]
Notes	$ 240	$ 240
Debt instrument, stated interest rate (in percentage)	5.80%	5.80%
Notes [Member] | Notes due from 2018 to 2035 [Member]
Debt Instrument [Line Items]
Notes	$ 239	$ 239
Related long term debt converted to floating interest rates by interest rate swaps	$ 50	$ 50
Notes [Member] | Notes due from 2018 to 2035 [Member] | Minimum [Member]
Debt Instrument [Line Items]
Debt instrument, stated interest rate (in percentage)	5.25%	5.25%
Notes [Member] | Notes due from 2018 to 2035 [Member] | Maximum [Member]
Debt Instrument [Line Items]
Debt instrument, stated interest rate (in percentage)	8.875%	8.875%
Debenture [Member] | Debenture due 2017 [Member]
Debt Instrument [Line Items]
Long term debt debentures	$ 0	$ 289
Debt instrument, stated interest rate (in percentage)	6.10%	6.10%
Debenture [Member] | Debentures due 2020 [Member]
Debt Instrument [Line Items]
Long term debt debentures	$ 239	$ 239
Debt instrument, stated interest rate (in percentage)	3.875%	3.875%
Related long term debt converted to floating interest rates by interest rate swaps	$ 150
Debenture [Member] | Debentures due 2022 [Member]
Debt Instrument [Line Items]
Long term debt debentures	$ 100	$ 100
Debt instrument, stated interest rate (in percentage)	8.10%	8.10%
Debenture [Member] | Debentures due 2025 [Member]
Debt Instrument [Line Items]
Long term debt debentures	$ 145	$ 145
Debt instrument, stated interest rate (in percentage)	6.50%	6.50%
Debenture [Member] | Debentures due 2029 [Member]
Debt Instrument [Line Items]
Long term debt debentures	$ 200	$ 200
Debt instrument, stated interest rate (in percentage)	7.65%	7.65%
Related long term debt converted to floating interest rates by interest rate swaps	$ 50
Debenture [Member] | Debentures due 2034 [Member]
Debt Instrument [Line Items]
Long term debt debentures	$ 136	$ 136
Debt instrument, stated interest rate (in percentage)	5.45%	5.45%
Related long term debt converted to floating interest rates by interest rate swaps	$ 25
Senior Notes [Member] | Senior notes due 2017 [Member]
Debt Instrument [Line Items]
Senior Notes, Noncurrent	$ 0	$ 1,000
Debt instrument, stated interest rate (in percentage)	1.50%	1.50%
Related long term debt converted to floating interest rates by interest rate swaps	$ 750
Senior Notes [Member] | Senior notes due 2022 [Member]
Debt Instrument [Line Items]
Senior Notes, Noncurrent	$ 1,600	$ 1,600
Debt instrument, stated interest rate (in percentage)	2.75%	2.75%
Related long term debt converted to floating interest rates by interest rate swaps	$ 1,400
Senior Notes [Member] | Senior notes due 2024 [Member]
Debt Instrument [Line Items]
Debt instrument, stated interest rate (in percentage)		0.75%
Senior Notes [Member] | Senior notes due 2027 [Member]
Debt Instrument [Line Items]
Notes	$ 700	$ 0
Debt instrument, stated interest rate (in percentage)	3.10%	0.00%
Senior Notes [Member] | Senior notes due 2032 [Member]
Debt Instrument [Line Items]
Senior Notes, Noncurrent	$ 700	$ 700
Debt instrument, stated interest rate (in percentage)	4.00%	4.00%
Senior Notes [Member] | Senior notes due 2042 [Member]
Debt Instrument [Line Items]
Senior Notes, Noncurrent	$ 1,000	$ 1,000
Debt instrument, stated interest rate (in percentage)	4.15%	4.15%
Senior Notes [Member] | Senior notes due 2047 [Member]
Debt Instrument [Line Items]
Notes	$ 300	$ 0
Debt instrument, stated interest rate (in percentage)	3.92%	3.92%
Japanese Yen notes payable [Member] | Japanese Yen notes due 2018 [Member]
Debt Instrument [Line Items]
Notes	$ 88	$ 86
Debt instrument, stated interest rate (in percentage)	4.215%	4.215%
Other long-term debt [Member]
Debt Instrument [Line Items]
Other	$ 49	$ 109

[1] *December 31, 2016 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

XML

Debt - Narrative (Details) € in Millions								12 Months Ended
	Oct. 03, 2019 USD ($)	Nov. 17, 2017 USD ($)	Nov. 16, 2017 USD ($)	Nov. 02, 2017 USD ($)	Sep. 15, 2017 USD ($)	Jun. 29, 2017 USD ($)	Mar. 15, 2017 USD ($)	Dec. 31, 2017 USD ($)	Dec. 31, 2016 USD ($)		Dec. 31, 2015 USD ($)	[1]	Sep. 30, 2016 EUR (€)	Sep. 30, 2016 USD ($)	Jan. 15, 2016 USD ($)
Debt Instrument [Line Items]
Payments on borrowings								$ 1,554,000,000	$ 653,000,000	[1]	$ 1,027,000,000
Short-term debt								$ 6,000,000	$ 14,000,000	[2]
Face amount					$ 1,000,000,000
Proceeds from debt					$ 993,000,000
Tranche One [Member]
Debt Instrument [Line Items]
Debt instrument, stated interest rate (in percentage)					3.10%
Face amount					$ 700,000,000
Tranche Two [Member]
Debt Instrument [Line Items]
Debt instrument, stated interest rate (in percentage)					3.90%
Face amount					$ 300,000,000
Senior notes due 2024 [Member]
Debt Instrument [Line Items]
Debt instrument, stated interest rate (in percentage)								0.75%	0.75%
Notes [Member] | Notes due 2017 [Member]
Debt Instrument [Line Items]
Debt instrument, stated interest rate (in percentage)								5.30%	5.30%
Payments on borrowings							$ 250,000,000
Notes [Member] | Senior notes due 2024 [Member]
Debt Instrument [Line Items]
Long term debt debentures								$ 659,000,000	$ 580,000,000
Debenture [Member] | Debenture due 2017 [Member]
Debt Instrument [Line Items]
Debt instrument, stated interest rate (in percentage)								6.10%	6.10%
Payments on borrowings						$ 289,000,000
Long term debt debentures								$ 0	$ 289,000,000
Debenture [Member] | Debentures due 2016 [Member]
Debt Instrument [Line Items]
Debt instrument, stated interest rate (in percentage)															2.375%
Long term debt debentures															$ 240,000,000
Senior Notes [Member]
Debt Instrument [Line Items]
Issuance of senior notes													€ 550	$ 615,000,000
Proceeds from issuance of senior notes													€ 544	$ 609,000,000
Senior Notes [Member] | Senior notes due 2017 [Member]
Debt Instrument [Line Items]
Debt instrument, stated interest rate (in percentage)								1.50%	1.50%
Payments on borrowings				$ 1,000,000,000
Senior Notes [Member] | Senior notes due 2024 [Member]
Debt Instrument [Line Items]
Debt instrument, stated interest rate (in percentage)									0.75%
Revolving Credit Facility [Member]
Debt Instrument [Line Items]
Credit facility, maximum borrowing capacity								$ 2,000,000,000
Revolving Credit Facility [Member] | Original Four-Year Credit Facility [Member]
Debt Instrument [Line Items]
Credit facility, maximum borrowing capacity			$ 500,000,000
Revolving credit facility, term (in years)			4 years
Revolving Credit Facility [Member] | Refinanced three-year revolving credit facility [Member]
Debt Instrument [Line Items]
Credit facility, maximum borrowing capacity		$ 500,000,000
Revolving credit facility, term (in years)		3 years
Revolving Credit Facility [Member] | Original Five-Year Revolving Facility [Member]
Debt Instrument [Line Items]
Credit facility, maximum borrowing capacity			$ 750,000,000
Revolving credit facility, term (in years)			5 years
Revolving Credit Facility [Member] | Refinanced Five-Year Revolving Credit Facility [Member]
Debt Instrument [Line Items]
Credit facility, maximum borrowing capacity		$ 750,000,000
Revolving credit facility, term (in years)		5 years
Revolving Credit Facility [Member] | Five-Year Revolving Credit Facility, Expires October 14, 2021 [Member]
Debt Instrument [Line Items]
Credit facility, maximum borrowing capacity	$ 750,000,000
Revolving credit facility, term (in years)	5 years
Letter of Credit [Member]
Debt Instrument [Line Items]
Credit facility, maximum borrowing capacity								741,000,000
Letters of credit outstanding, amount								$ 297,000,000

[1] *Year ended December 31, 2016 and 2015 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

[2] *December 31, 2016 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

XML

Debt - Schedule of Maturities of Long-term Debt (Details) $ in Millions	Dec. 31, 2017 USD ($)
Debt Disclosure [Abstract]
2018	$ 578
2019	340
2020	241
2021	302
2022	$ 1,701

XML

Debt - Interest Paid on Debt (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Debt Disclosure [Abstract]
Interest paid on debt	$ 293	$ 266	$ 271

XML

Retirement Benefits Plans - Obligations and Funded Status (Details) - USD ($) $ in Millions	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Funded status
Fair value of plan assets	$ 5,312	$ 4,447
Pension plan [Member] | United States pension liabilities [Member]
Funded status
Fair value of plan assets	3,585	2,969	$ 2,934
Benefit obligations	(3,961)	(3,771)	(3,829)
Funded status	(376)	(802)
Amounts recognized in the Consolidated Balance Sheets
Non-current assets	82	34
Current liabilities	(15)	(24)
Non-current liabilities	(443)	(812)
Total	(376)	(802)
Amounts recognized in Accumulated other comprehensive loss (pretax)
Net actuarial loss	1,059	1,232
Prior service cost (credit)	4	3
Total	1,063	1,235	1,327
Pension plan [Member] | Non-United States pension liabilities [Member]
Funded status
Fair value of plan assets	1,727	1,478	1,472
Benefit obligations	(2,399)	(2,314)	(2,175)
Funded status	(672)	(836)
Amounts recognized in the Consolidated Balance Sheets
Non-current assets	136	33
Current liabilities	(25)	(22)
Non-current liabilities	(783)	(847)
Total	(672)	(836)
Amounts recognized in Accumulated other comprehensive loss (pretax)
Net actuarial loss	596	771
Prior service cost (credit)	8	8
Total	604	779	653
Other postretirement liabilities [Member]
Funded status
Fair value of plan assets	55	74	93
Benefit obligations	(448)	(473)	(575)
Funded status	(393)	(399)
Amounts recognized in the Consolidated Balance Sheets
Non-current assets	0	0
Current liabilities	(31)	(31)
Non-current liabilities	(362)	(368)
Total	(393)	(399)
Amounts recognized in Accumulated other comprehensive loss (pretax)
Net actuarial loss	19	21
Prior service cost (credit)	(46)	(60)
Total	$ (27)	$ (39)	$ 21

XML

Retirement Benefits Plans - Change in Benefit Obligations (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Pension plan [Member] | United States pension liabilities [Member]
Change in benefit obligations
Balance at January 1	$ 3,771	$ 3,829
Service cost	96	111	$ 123
Interest cost	123	125	156
Actuarial (gain) loss	271	52
Gross benefits paid	(301)	(346)
Currency translation	0	0
Plan amendments	1	0
Other	0	0
Balance at December 31	3,961	3,771	3,829
Accumulated benefit obligation	3,802	3,620
Pension plan [Member] | Non-United States pension liabilities [Member]
Change in benefit obligations
Balance at January 1	2,314	2,175
Service cost	71	63	71
Interest cost	55	62	72
Actuarial (gain) loss	(148)	355
Gross benefits paid	(97)	(94)
Currency translation	223	(245)
Plan amendments	0	2
Other	(19)	(4)
Balance at December 31	2,399	2,314	2,175
Accumulated benefit obligation	2,283	2,189
Other postretirement liabilities [Member]
Change in benefit obligations
Balance at January 1	473	575
Service cost	3	4	6
Interest cost	14	17	24
Actuarial (gain) loss	2	(72)
Gross benefits paid	(74)	(79)
Currency translation	3	1
Plan amendments	0	0
Other	27	27
Balance at December 31	$ 448	$ 473	$ 575

XML

Retirement Benefits Plans - Change in Plan Assets (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Change in plan assets
Balance at January 1	$ 4,447
Balance at December 31	5,312	$ 4,447
Pension plan [Member]
Change in plan assets
Employer contributions	473	262	$ 330
Pension plan [Member] | United States pension liabilities [Member]
Change in plan assets
Balance at January 1	2,969	2,934
Actual return on plan assets	543	221
Employer contributions	374	160	221
Gross benefits paid	(301)	(346)
Currency translation	0	0
Other	0	0
Balance at December 31	3,585	2,969	2,934
Pension plan [Member] | Non-United States pension liabilities [Member]
Change in plan assets
Balance at January 1	1,478	1,472
Actual return on plan assets	131	212
Employer contributions	99	102	109
Gross benefits paid	(97)	(94)
Currency translation	135	(211)
Other	(19)	(3)
Balance at December 31	1,727	1,478	1,472
Other postretirement liabilities [Member]
Change in plan assets
Balance at January 1	74	93
Actual return on plan assets	8	3
Employer contributions	20	30
Gross benefits paid	(74)	(79)
Currency translation	0	0
Other	27	27
Balance at December 31	$ 55	$ 74	$ 93

XML

Retirement Benefits Plans - Components of Pension Plans with Accumulated Benefit Obligation in Excess of Plan Assets (Details) - Pension plan [Member] - USD ($) $ in Millions	Dec. 31, 2017	Dec. 31, 2016
United States pension liabilities [Member]
Components of pension plans with an accumulated benefit obligation in excess of plan assets
Projected benefit obligation	$ 3,540	$ 3,342
Accumulated benefit obligation	3,380	3,190
Fair value of plan assets	3,081	2,505
Non-United States pension liabilities [Member]
Components of pension plans with an accumulated benefit obligation in excess of plan assets
Projected benefit obligation	966	1,902
Accumulated benefit obligation	911	1,824
Fair value of plan assets	$ 175	$ 1,066

XML

Retirement Benefits Plans - Changes in Pension and Other Postretirement Liabilities Recognized in AOCI (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Changes in pension and other postretirement benefit liabilities recognized in Accumulated other comprehensive loss
Prior service cost arising during the year	$ 1	$ 2	$ (1)
Less amounts included in expense during the year	(215)	247	123
Net change for the year	0	0	0
Pension plan [Member] | United States pension liabilities [Member]
Changes in pension and other postretirement benefit liabilities recognized in Accumulated other comprehensive loss
Balance at January 1	1,235	1,327
Prior service cost arising during the year	1	0
Net loss (gain) arising during the year	(28)	81
Currency translation	0	0
Less amounts included in expense during the year	(145)	(173)
Net change for the year	(172)	(92)
Balance at December 31	1,063	1,235	1,327
Pension plan [Member] | Non-United States pension liabilities [Member]
Changes in pension and other postretirement benefit liabilities recognized in Accumulated other comprehensive loss
Balance at January 1	779	653
Prior service cost arising during the year	0	2
Net loss (gain) arising during the year	(185)	235
Currency translation	66	(75)
Less amounts included in expense during the year	(56)	(36)
Net change for the year	(175)	126
Balance at December 31	604	779	653
Other postretirement liabilities [Member]
Changes in pension and other postretirement benefit liabilities recognized in Accumulated other comprehensive loss
Balance at January 1	(39)	21
Prior service cost arising during the year	0	0
Net loss (gain) arising during the year	(2)	(69)
Currency translation	1	1
Less amounts included in expense during the year	13	8
Net change for the year	12	(60)
Balance at December 31	$ (27)	$ (39)	$ 21

XML

Retirement Benefits Plans - Benefits Expense (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Pension plan [Member] | United States pension liabilities [Member]
Defined Benefit Plans and Other Postretirement Benefit Plans
Service cost	$ 96	$ 111	$ 123
Interest cost	123	125	156
Expected return on plan assets	(244)	(250)	(262)
Amortization	83	92	119
Benefit plans	58	78	136
Settlements and special termination benefits	62	81	74
Total expense	120	159	210
Pension plan [Member] | Non-United States pension liabilities [Member]
Defined Benefit Plans and Other Postretirement Benefit Plans
Service cost	71	63	71
Interest cost	55	62	72
Expected return on plan assets	(94)	(92)	(99)
Amortization	51	33	40
Benefit plans	83	66	84
Settlements and special termination benefits	5	3	2
Total expense	88	69	86
Other postretirement benefits plans [Member]
Defined Benefit Plans and Other Postretirement Benefit Plans
Service cost	3	4	6
Interest cost	14	17	24
Expected return on plan assets	(4)	(6)	(5)
Amortization	(13)	(9)	2
Benefit plans	0	6	27
Settlements and special termination benefits	0	1	0
Total expense	$ 0	$ 7	$ 27

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Retirement Benefits Plans - Estimated Future Pretax Amounts Recognized From AOCI to Net Periodic Benefit Cost (Details) - Scenario, Forecast [Member] $ in Millions	12 Months Ended
	Dec. 31, 2018 USD ($)
Pension plan [Member] | United States pension liabilities [Member]
Defined Benefit Plans and Other Postretirement Benefit Plans
Actuarial loss	$ 146
Prior service cost (credit)	1
Total	147
Pension plan [Member] | Non-United States pension liabilities [Member]
Defined Benefit Plans and Other Postretirement Benefit Plans
Actuarial loss	38
Prior service cost (credit)	1
Total	39
Other postretirement liabilities [Member]
Defined Benefit Plans and Other Postretirement Benefit Plans
Actuarial loss	1
Prior service cost (credit)	(14)
Total	$ (13)

XML

Retirement Benefits Plans - Discount Rates (Details) $ in Millions	Dec. 31, 2016 USD ($)
Retirement Benefits [Abstract]
Service Cost Reduction	$ 3
Interest Cost Reduction	$ 42

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Retirement Benefits Plans - Pension Plans Assumptions (Details) - Pension plan [Member]	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
United States pension liabilities [Member]
Assumptions used to determine benefit obligation at year-end
Discount rate		3.64%	4.12%	4.22%
Rate of compensation increase		3.15%	3.15%	3.18%
Assumptions used to determine expense
Discount rate used to determine benefit obligation		4.12%	4.22%	3.97%
Discount rate used to determine service cost		4.31%	4.35%	3.97%
Discount rate used to determine interest cost		3.40%	3.42%	3.97%
Expected long-term return on plan assets	7.52%	7.90%	8.50%	8.50%
Rate of compensation increase		3.15%	3.18%	3.16%
Non-United States pension liabilities [Member]
Assumptions used to determine benefit obligation at year-end
Discount rate		2.62%	2.63%	3.46%
Rate of compensation increase		3.11%	3.13%	3.12%
Assumptions used to determine expense
Discount rate used to determine benefit obligation		2.63%	3.46%	3.33%
Discount rate used to determine service cost		3.38%	4.13%	3.33%
Discount rate used to determine interest cost		2.34%	3.07%	3.33%
Expected long-term return on plan assets	6.40%	6.30%	6.62%	6.92%
Rate of compensation increase		3.13%	3.12%	3.13%

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Retirement Benefits Plans - Other Postretirement Benefits Plan Assumptions (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Defined Benefit Plan, Effect of One-Percentage Point Change in Assumed Health Care Cost Trend Rate [Abstract]
Effect on total service and interest cost, 1% increase	$ 1
Effect on total service and interest cost, 1% decrease	(1)
Effect on other postretirement liabilities, 1% increase	13
Effect on other postretirement liabilities, 1% decrease	$ (12)
Other postretirement benefits plans [Member]
Assumptions used to determine benefit obligation at year-end
Discount rate	3.55%	3.96%	4.04%
Health care cost trend rate assumed for next year	8.25%	7.35%	7.10%
Ultimate health care cost trend rate	4.75%	4.75%	4.75%
Year ultimate health care cost trend rate is achieved	2027	2026	2025
Assumptions used to determine expense
Discount rate used to determine benefit obligation	3.96%	4.04%	3.79%
Discount rate used to determine service cost	4.11%	4.26%	3.79%
Discount rate used to determine interest cost	3.18%	3.12%	3.79%
Initial health care cost trend rate	7.35%	7.10%	6.31%
Ultimate health care cost trend rate	4.75%	4.75%	4.77%
Year ultimate health care cost trend rate is achieved	2026	2025	2024

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Retirement Benefits Plans - Employer Contributions to Retirement Benefits Plans (Details) - Pension plan [Member] - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2018
Defined Benefit Plans and Other Postretirement Benefit Plans
Expected future contributions, defined benefit plans				$ 112
Employer contributions to pension plans	$ 473	$ 262	$ 330
United States pension liabilities [Member]
Defined Benefit Plans and Other Postretirement Benefit Plans
Expected future contributions, defined benefit plans				16
Employer contributions to pension plans	374	160	221
Non-United States pension liabilities [Member]
Defined Benefit Plans and Other Postretirement Benefit Plans
Expected future contributions, defined benefit plans				$ 96
Employer contributions to pension plans	$ 99	$ 102	$ 109

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- Estimated Pension and Other Postretirement Benefit Payments (Details) $ in Millions	Dec. 31, 2017 USD ($)
Pension plan [Member] | United States pension liabilities [Member]
Defined Benefit Plans and Other Postretirement Benefit Plans
2018	$ 291
2019	291
2020	292
2021	299
2022	298
2023 - 2027	1,478
Pension plan [Member] | Non-United States pension liabilities [Member]
Defined Benefit Plans and Other Postretirement Benefit Plans
2018	88
2019	90
2020	93
2021	95
2022	99
2023 - 2027	548
Other postretirement benefits plans [Member]
Defined Benefit Plans and Other Postretirement Benefit Plans
2018	47
Medicare prescription drug subsidy 2018	(2)
2019	43
Medicare prescription drug subsidy 2019	(2)
2020	39
Medicare prescription drug subsidy 2020	(2)
2021	35
Medicare prescription drug subsidy 2021	(1)
2022	35
Medicare prescription drug subsidy 2022	0
2023 - 2027	141
Medicare prescription drug subsidy 2023 - 2027	$ (2)

XML

Retirement Benefits Plans - Fair Value of Pension Plan Assets (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016
Defined Benefit Plan Disclosure [Line Items]
United States pension plans percentage of worldwide pension assets	67.00%
United Kingdom pension plans percentage of worldwide pension assets	26.00%
United States pension plans' target allocation of United States equities	28.00%
United States pension plans' target allocation of non-United States equities	28.00%
United States pension plans' target allocation of real estate	9.00%
United State pension plans' target allocation of debt securities	31.00%
United States pension plans' target allocation of other, including hedge funds and cash equivalents	4.00%
United Kingdom pension plans' target allocation of equities	61.00%
VEBA target trust allocation in diversified global equities	43.00%
VEBA target trust allocation in fixed income securities	57.00%
Total pension plan assets	$ 5,312	$ 4,447
Quoted prices in active markets for identical assets (Level 1) [Member]
Defined Benefit Plan Disclosure [Line Items]
Total pension plan assets	701	498
Other observable inputs (Level 2) [Member]
Defined Benefit Plan Disclosure [Line Items]
Total pension plan assets	2,218	1,707
Unobservable inputs (Level 3) [Member]
Defined Benefit Plan Disclosure [Line Items]
Total pension plan assets	92	101
Non-United States Equity and Global Equities [Member]
Defined Benefit Plan Disclosure [Line Items]
Total pension plan assets	741	413
Non-United States Equity and Global Equities [Member] | Quoted prices in active markets for identical assets (Level 1) [Member]
Defined Benefit Plan Disclosure [Line Items]
Total pension plan assets	0	0
Non-United States Equity and Global Equities [Member] | Other observable inputs (Level 2) [Member]
Defined Benefit Plan Disclosure [Line Items]
Total pension plan assets	741	413
Non-United States Equity and Global Equities [Member] | Unobservable inputs (Level 3) [Member]
Defined Benefit Plan Disclosure [Line Items]
Total pension plan assets	0	0
United States Equity [Member]
Defined Benefit Plan Disclosure [Line Items]
Total pension plan assets	86	94
United States Equity [Member] | Quoted prices in active markets for identical assets (Level 1) [Member]
Defined Benefit Plan Disclosure [Line Items]
Total pension plan assets	0	0
United States Equity [Member] | Other observable inputs (Level 2) [Member]
Defined Benefit Plan Disclosure [Line Items]
Total pension plan assets	86	94
United States Equity [Member] | Unobservable inputs (Level 3) [Member]
Defined Benefit Plan Disclosure [Line Items]
Total pension plan assets	0	0
Fixed Income [Member]
Defined Benefit Plan Disclosure [Line Items]
Total pension plan assets	478	422
Fixed Income [Member] | Quoted prices in active markets for identical assets (Level 1) [Member]
Defined Benefit Plan Disclosure [Line Items]
Total pension plan assets	0	0
Fixed Income [Member] | Other observable inputs (Level 2) [Member]
Defined Benefit Plan Disclosure [Line Items]
Total pension plan assets	478	422
Fixed Income [Member] | Unobservable inputs (Level 3) [Member]
Defined Benefit Plan Disclosure [Line Items]
Total pension plan assets	0	0
Fixed Income Securities [Member]
Defined Benefit Plan Disclosure [Line Items]
Total pension plan assets	709	359
Fixed Income Securities [Member] | Quoted prices in active markets for identical assets (Level 1) [Member]
Defined Benefit Plan Disclosure [Line Items]
Total pension plan assets	0	0
Fixed Income Securities [Member] | Other observable inputs (Level 2) [Member]
Defined Benefit Plan Disclosure [Line Items]
Total pension plan assets	709	359
Fixed Income Securities [Member] | Unobservable inputs (Level 3) [Member]
Defined Benefit Plan Disclosure [Line Items]
Total pension plan assets	0	0
United States treasuries [Member]
Defined Benefit Plan Disclosure [Line Items]
Total pension plan assets	67	123
United States treasuries [Member] | Quoted prices in active markets for identical assets (Level 1) [Member]
Defined Benefit Plan Disclosure [Line Items]
Total pension plan assets	67	123
United States treasuries [Member] | Other observable inputs (Level 2) [Member]
Defined Benefit Plan Disclosure [Line Items]
Total pension plan assets	0	0
United States treasuries [Member] | Unobservable inputs (Level 3) [Member]
Defined Benefit Plan Disclosure [Line Items]
Total pension plan assets	0	0
Bank Loans [Member]
Defined Benefit Plan Disclosure [Line Items]
Total pension plan assets	161	150
Bank Loans [Member] | Quoted prices in active markets for identical assets (Level 1) [Member]
Defined Benefit Plan Disclosure [Line Items]
Total pension plan assets	0	0
Bank Loans [Member] | Other observable inputs (Level 2) [Member]
Defined Benefit Plan Disclosure [Line Items]
Total pension plan assets	161	150
Bank Loans [Member] | Unobservable inputs (Level 3) [Member]
Defined Benefit Plan Disclosure [Line Items]
Total pension plan assets	0	0
Real Estate Securities [Member]
Defined Benefit Plan Disclosure [Line Items]
Total pension plan assets	239	201
Real Estate Securities [Member] | Quoted prices in active markets for identical assets (Level 1) [Member]
Defined Benefit Plan Disclosure [Line Items]
Total pension plan assets	220	195
Real Estate Securities [Member] | Other observable inputs (Level 2) [Member]
Defined Benefit Plan Disclosure [Line Items]
Total pension plan assets	0	0
Real Estate Securities [Member] | Unobservable inputs (Level 3) [Member]
Defined Benefit Plan Disclosure [Line Items]
Total pension plan assets	19	6
Equity Securities [Member]
Defined Benefit Plan Disclosure [Line Items]
Total pension plan assets	139	104
Equity Securities [Member] | Quoted prices in active markets for identical assets (Level 1) [Member]
Defined Benefit Plan Disclosure [Line Items]
Total pension plan assets	139	104
Equity Securities [Member] | Other observable inputs (Level 2) [Member]
Defined Benefit Plan Disclosure [Line Items]
Total pension plan assets	0	0
Equity Securities [Member] | Unobservable inputs (Level 3) [Member]
Defined Benefit Plan Disclosure [Line Items]
Total pension plan assets	0	0
Cash Equivalents [Member]
Defined Benefit Plan Disclosure [Line Items]
Total pension plan assets	86	276
Cash Equivalents [Member] | Quoted prices in active markets for identical assets (Level 1) [Member]
Defined Benefit Plan Disclosure [Line Items]
Total pension plan assets	51	21
Cash Equivalents [Member] | Other observable inputs (Level 2) [Member]
Defined Benefit Plan Disclosure [Line Items]
Total pension plan assets	35	255
Cash Equivalents [Member] | Unobservable inputs (Level 3) [Member]
Defined Benefit Plan Disclosure [Line Items]
Total pension plan assets	0	0
Exchange Traded Funds [Member]
Defined Benefit Plan Disclosure [Line Items]
Total pension plan assets	224	55
Exchange Traded Funds [Member] | Quoted prices in active markets for identical assets (Level 1) [Member]
Defined Benefit Plan Disclosure [Line Items]
Total pension plan assets	224	55
Exchange Traded Funds [Member] | Other observable inputs (Level 2) [Member]
Defined Benefit Plan Disclosure [Line Items]
Total pension plan assets	0	0
Exchange Traded Funds [Member] | Unobservable inputs (Level 3) [Member]
Defined Benefit Plan Disclosure [Line Items]
Total pension plan assets	0	0
Other Pension Plan Asset [Member]
Defined Benefit Plan Disclosure [Line Items]
Total pension plan assets	81	109
Other Pension Plan Asset [Member] | Quoted prices in active markets for identical assets (Level 1) [Member]
Defined Benefit Plan Disclosure [Line Items]
Total pension plan assets	0	0
Other Pension Plan Asset [Member] | Other observable inputs (Level 2) [Member]
Defined Benefit Plan Disclosure [Line Items]
Total pension plan assets	8	14
Other Pension Plan Asset [Member] | Unobservable inputs (Level 3) [Member]
Defined Benefit Plan Disclosure [Line Items]
Total pension plan assets	73	95
Common Collective Trusts [Member]
Defined Benefit Plan Disclosure [Line Items]
Total pension plan assets	2,225	2,038
Hedge Funds, Equity [Member]
Defined Benefit Plan Disclosure [Line Items]
Total pension plan assets	67	85
Money Market Funds [Member]
Defined Benefit Plan Disclosure [Line Items]
Total pension plan assets	$ 9	$ 18

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Retirement Benefits Plans - Change in Plan Level 3 Assets (Details) - Fair Value, Inputs, Level 3 [Member] - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016
Defined Benefit Plan, Change in Fair Value of Plan Assets, Level 3 Reconciliation [Roll Forward]
Beginning balance	$ 101	$ 93
Gains (losses) relating to assets still held at year-end	(4)	(6)
Purchases, sales, settlements - net	(5)	14
Transfers into or out of Level 3	0	0
Beginning balance	92	101
Real Estate Funds [Member]
Defined Benefit Plan, Change in Fair Value of Plan Assets, Level 3 Reconciliation [Roll Forward]
Beginning balance	6	7
Gains (losses) relating to assets still held at year-end	1	0
Purchases, sales, settlements - net	12	(1)
Transfers into or out of Level 3	0	0
Beginning balance	19	6
Other Pension Plan Assets [Member]
Defined Benefit Plan, Change in Fair Value of Plan Assets, Level 3 Reconciliation [Roll Forward]
Beginning balance	95	86
Gains (losses) relating to assets still held at year-end	(5)	(6)
Purchases, sales, settlements - net	(17)	15
Transfers into or out of Level 3	0	0
Beginning balance	$ 73	$ 95

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Retirement Benefits Plans - Fair Value of Other Postretirement Benefits Plan Assets (Details) - USD ($) $ in Millions	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Fair Value of Other Postretirement Benefits Plan Assets [Line Items]
Total pension plan assets	$ 5,312	$ 4,447
Quoted prices in active markets for identical assets (Level 1) [Member]
Fair Value of Other Postretirement Benefits Plan Assets [Line Items]
Total pension plan assets	701	498
Other observable inputs (Level 2) [Member]
Fair Value of Other Postretirement Benefits Plan Assets [Line Items]
Total pension plan assets	2,218	1,707
Unobservable inputs (Level 3) [Member]
Fair Value of Other Postretirement Benefits Plan Assets [Line Items]
Total pension plan assets	92	101
Other postretirement benefits plans [Member]
Fair Value of Other Postretirement Benefits Plan Assets [Line Items]
Cash equivalents	7	8
Common Collective Trusts, Fixed Income	48	66
Total other postretirement benefits plan assets	55	74
Total pension plan assets	55	74	$ 93
Other postretirement benefits plans [Member] | Quoted prices in active markets for identical assets (Level 1) [Member]
Fair Value of Other Postretirement Benefits Plan Assets [Line Items]
Cash equivalents	7	8
Total pension plan assets	7	8
Other postretirement benefits plans [Member] | Other observable inputs (Level 2) [Member]
Fair Value of Other Postretirement Benefits Plan Assets [Line Items]
Cash equivalents	0	0
Total pension plan assets	0	0
Other postretirement benefits plans [Member] | Unobservable inputs (Level 3) [Member]
Fair Value of Other Postretirement Benefits Plan Assets [Line Items]
Cash equivalents	0	0
Total pension plan assets	$ 0	$ 0

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Retirement Benefits Plans - Defined Contribution Plans (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Retirement Benefits [Abstract]
Employer contributions to defined contribution plans	$ 114	$ 72	$ 137

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Commitments and Contingencies - Narrative (Details) BRL in Millions, $ in Millions		12 Months Ended
	Oct. 20, 2017 USD ($)	Dec. 31, 2017 USD ($)	Dec. 31, 2016 USD ($)	Dec. 31, 2015 USD ($)	Jun. 30, 2016 USD ($)	Mar. 31, 2016 BRL
Loss Contingency Accrual [Roll Forward]
Loss Contingency, Damages Sought, Value	$ 440
Raysul total loss contingency accrual					$ 31	BRL 100
Number of environmental remediation sites world wide		118
Accrual for environmental loss contingencies		$ 120	$ 124
Current and long-term warranty accruals [Table]
Balance at January 1		180	195	$ 213
Provision		163	117	104
Settled		(156)	(130)	(114)
Other		1	(2)	(8)
Balance at December 31		188	180	195
Minimum rental commitments under noncancelable operating leases
2018		159
2019		119
2020		85
2021		63
2022		42
Thereafter		71
Total noncancelable lease commitments		539
Summary of Rental Expense
Rental expense		$ 222	$ 220	$ 225

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Income Taxes - Income (Loss) Before Income Taxes (Details) - USD ($) $ in Millions	3 Months Ended						12 Months Ended
	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Sep. 30, 2016	Jun. 30, 2016	Mar. 31, 2016	Dec. 31, 2017	Dec. 31, 2016		Dec. 31, 2015
Income (Loss) Before Income Taxes [Line Items]
Total income before income taxes	$ 1,694	$ 572	$ 467	$ 570	$ 550	$ 439	$ 3,368	$ 2,118	[1],[2]	$ 2,133	[1],[2]
Ireland [Member]
Income (Loss) Before Income Taxes [Line Items]
Total income before income taxes							(1,090)	(923)		(608)
Foreign [Member]
Income (Loss) Before Income Taxes [Line Items]
Total income before income taxes							$ 4,458	$ 3,041		$ 2,741

[1] *Other corporate expense - net and Income tax expense in 2016 and 2015 have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14.

[2] *Year ended December 31, 2016 and 2015 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

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Income Taxes - Income Tax (Benefit) Expense (Details) - USD ($) $ in Millions	3 Months Ended						12 Months Ended
	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Sep. 30, 2016	Jun. 30, 2016	Mar. 31, 2016	Dec. 31, 2017	Dec. 31, 2016		Dec. 31, 2015
Current Income Tax Expense (Benefit) [Abstract]
Total current income tax expense							$ 358	$ 304		$ 358
Deferred Income Tax Benefit [Abstract]
Total deferred income tax benefit							24	(105)		(199)
Income tax expense (benefit)	$ 293	$ 55	$ 33	$ 50	$ 60	$ 38	382	199	[1],[2]	159	[1],[2]
Ireland [Member]
Current Income Tax Expense (Benefit) [Abstract]
Ireland							1	2		8
Deferred Income Tax Benefit [Abstract]
Ireland							0	2		1
United States - Federal [Member]
Current Income Tax Expense (Benefit) [Abstract]
United States - Federal							123	93		110
Deferred Income Tax Benefit [Abstract]
United States - Federal							82	(77)		(76)
Foreign - other [Member]
Current Income Tax Expense (Benefit) [Abstract]
Foreign - other							234	209		240
Deferred Income Tax Benefit [Abstract]
Foreign - other							$ (58)	$ (30)		$ (124)

[1] *Other corporate expense - net and Income tax expense in 2016 and 2015 have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14.

[2] *Year ended December 31, 2016 and 2015 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

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Income Taxes - Reconciliations of Income Taxes from the Appropriate Statutory Rate (Details)	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Reconciliation of income taxes from appropriate statutory rate to the consolidated effective income tax rate [Line Items]
Income taxes at the applicable statutory rate	25.00%	25.00%	25.00%
Effective income tax expense rate	11.30%	9.40%	7.50%
Ireland Operations [Member]
Reconciliation of income taxes from appropriate statutory rate to the consolidated effective income tax rate [Line Items]
Ireland tax on trading income	0.00%	(0.30%)	(0.40%)
Nondeductible interest expense	8.20%	11.50%	7.90%
United States operations [Member]
Reconciliation of income taxes from appropriate statutory rate to the consolidated effective income tax rate [Line Items]
United States operations (earnings taxed at other than the applicable statutory rate)	1.70%	0.10%	(0.60%)
U.S. federal tax rate change	(7.50%)	0.00%	0.00%
U.S. tax on foreign earnings	4.80%	0.00%	0.00%
U.S. foreign tax credit	(3.90%)	0.60%	(0.80%)
Credit for research activities	(0.50%)	(0.80%)	(0.80%)
Other reconciling items percent	3.20%	2.50%	5.40%
Other foreign operations [Member]
Reconciliation of income taxes from appropriate statutory rate to the consolidated effective income tax rate [Line Items]
Other reconciling items percent	0.40%	0.90%	(0.50%)
Non-U.S. operations (earnings taxed at other than the applicable statutory tax rate)	(22.90%)	(26.80%)	(25.10%)
Worldwide Operations [Member]
Reconciliation of income taxes from appropriate statutory rate to the consolidated effective income tax rate [Line Items]
Adjustments to tax liabilities	(1.80%)	(2.50%)	(1.40%)
Adjustments to valuation allowances	4.60%	(0.80%)	(1.20%)
Effective Income Tax Rate [Member]
Reconciliation of income taxes from appropriate statutory rate to the consolidated effective income tax rate [Line Items]
Effective income tax expense rate	11.30%	9.40%	7.50%

XML

Income Taxes - Worldwide Income Tax Payments (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Income Tax Disclosure [Abstract]
Income taxes paid	$ 288	$ 272	$ 302

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Income Taxes - Components of Current and Long-Term Deferred Income Taxes (Details) - Long-term assets and liabilities [Member] - USD ($) $ in Millions	Dec. 31, 2017	Dec. 31, 2016
Deferred Tax Assets, Tax Deferred Expense, Reserves and Accruals [Abstract]
Employee benefits	$ 430	$ 761
Depreciation and amortization	(1,324)	(1,823)
Other accruals and adjustments	380	761
Deferred Tax Assets, Net, Classification [Abstract]
Ireland income tax loss carryforwards	1	1
Foreign income tax loss carryforwards	1,962	1,796
Foreign income tax credit carryforwards	404	277
Valuation allowance for income tax loss and income tax credit carryforwards	(1,992)	(1,728)
Other valuation allowances	(146)	(41)
Total deferred income taxes	$ (285)	$ 4

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Income Taxes - Operating Loss and Tax Credit Carryforwards, Foreign, By Expiration Dates (Details) $ in Millions	Dec. 31, 2017 USD ($)
2018 through 2022 [Member]
Operating Loss and Tax Credit Carry Forward [Line Items]
Ireland deferred income tax assets for income tax loss carryforwards	$ 0
2023 through 2027 [Member]
Operating Loss and Tax Credit Carry Forward [Line Items]
Ireland deferred income tax assets for income tax loss carryforwards	0
2028 through 2032 [Member]
Operating Loss and Tax Credit Carry Forward [Line Items]
Ireland deferred income tax assets for income tax loss carryforwards	0
2033 through 2037 [Member]
Operating Loss and Tax Credit Carry Forward [Line Items]
Ireland deferred income tax assets for income tax loss carryforwards	0
Not subject to expiration [Member]
Operating Loss and Tax Credit Carry Forward [Line Items]
Ireland deferred income tax assets for income tax loss carryforwards	1
2018 through 2022 [Member]
Operating Loss and Tax Credit Carry Forward [Line Items]
Ireland income tax loss carryforwards	0
2023 through 2027 [Member]
Operating Loss and Tax Credit Carry Forward [Line Items]
Ireland income tax loss carryforwards	0
2028 through 2032 [Member]
Operating Loss and Tax Credit Carry Forward [Line Items]
Ireland income tax loss carryforwards	0
2033 through 2037 [Member]
Operating Loss and Tax Credit Carry Forward [Line Items]
Ireland income tax loss carryforwards	0
Not subject to expiration [Member]
Operating Loss and Tax Credit Carry Forward [Line Items]
Ireland income tax loss carryforwards	8
Related valuation allowance [Member]
Operating Loss and Tax Credit Carry Forward [Line Items]
Ireland income tax loss carryforwards	0
Ireland deferred income tax assets for income tax loss carryforwards	$ (1)

XML

Income Taxes - Operating Loss and Tax Credit Carryforwards, Domestic, By Expiration Dates (Details) $ in Millions	Dec. 31, 2017 USD ($)
Internal Revenue Service (IRS) [Member] | Domestic Tax Authority [Member] | 2018 through 2022 [Member]
Operating Loss and Tax Credit Carry Forward [Line Items]
Foreign income tax loss carryforwards	$ 918
Foreign deferred income tax assets for income tax loss carryforwards	112
Foreign income tax credit carryforwards	86
Internal Revenue Service (IRS) [Member] | Domestic Tax Authority [Member] | 2018 through 2022 [Member] | After ASU 2013-11 [Member]
Operating Loss and Tax Credit Carry Forward [Line Items]
Foreign deferred income tax assets for income tax loss carryforwards	101
Internal Revenue Service (IRS) [Member] | Domestic Tax Authority [Member] | 2023 through 2027 [Member]
Operating Loss and Tax Credit Carry Forward [Line Items]
Foreign income tax loss carryforwards	7,528
Foreign deferred income tax assets for income tax loss carryforwards	721
Foreign income tax credit carryforwards	205
Internal Revenue Service (IRS) [Member] | Domestic Tax Authority [Member] | 2023 through 2027 [Member] | After ASU 2013-11 [Member]
Operating Loss and Tax Credit Carry Forward [Line Items]
Foreign deferred income tax assets for income tax loss carryforwards	715
Internal Revenue Service (IRS) [Member] | Domestic Tax Authority [Member] | 2028 through 2032 [Member]
Operating Loss and Tax Credit Carry Forward [Line Items]
Foreign income tax loss carryforwards	14
Foreign deferred income tax assets for income tax loss carryforwards	14
Foreign income tax credit carryforwards	78
Internal Revenue Service (IRS) [Member] | Domestic Tax Authority [Member] | 2028 through 2032 [Member] | After ASU 2013-11 [Member]
Operating Loss and Tax Credit Carry Forward [Line Items]
Foreign deferred income tax assets for income tax loss carryforwards	14
Internal Revenue Service (IRS) [Member] | Domestic Tax Authority [Member] | 2033 through 2037 [Member]
Operating Loss and Tax Credit Carry Forward [Line Items]
Foreign income tax loss carryforwards	545
Foreign deferred income tax assets for income tax loss carryforwards	175
Foreign income tax credit carryforwards	115
Internal Revenue Service (IRS) [Member] | Domestic Tax Authority [Member] | 2033 through 2037 [Member] | After ASU 2013-11 [Member]
Operating Loss and Tax Credit Carry Forward [Line Items]
Foreign deferred income tax assets for income tax loss carryforwards	86
Internal Revenue Service (IRS) [Member] | Domestic Tax Authority [Member] | Not subject to expiration [Member]
Operating Loss and Tax Credit Carry Forward [Line Items]
Foreign income tax loss carryforwards	4,047
Foreign deferred income tax assets for income tax loss carryforwards	1,047
Foreign income tax credit carryforwards	64
Internal Revenue Service (IRS) [Member] | Domestic Tax Authority [Member] | Not subject to expiration [Member] | After ASU 2013-11 [Member]
Operating Loss and Tax Credit Carry Forward [Line Items]
Foreign deferred income tax assets for income tax loss carryforwards	1,047
Internal Revenue Service (IRS) [Member] | Domestic Tax Authority [Member] | Valuation allowance [Member]
Operating Loss and Tax Credit Carry Forward [Line Items]
Foreign income tax loss carryforwards	0
Foreign deferred income tax assets for income tax loss carryforwards	(1,830)
Foreign income tax credit carryforwards	(161)
Internal Revenue Service (IRS) [Member] | Domestic Tax Authority [Member] | Valuation allowance [Member] | After ASU 2013-11 [Member]
Operating Loss and Tax Credit Carry Forward [Line Items]
Foreign deferred income tax assets for income tax loss carryforwards	(1,830)
Domestic Tax Authority [Member] | Internal Revenue Service (IRS) [Member] | 2018 through 2022 [Member] | After ASU 2013-11 [Member]
Operating Loss and Tax Credit Carry Forward [Line Items]
Foreign income tax credit carryforwards	82
Domestic Tax Authority [Member] | Internal Revenue Service (IRS) [Member] | 2023 through 2027 [Member] | After ASU 2013-11 [Member]
Operating Loss and Tax Credit Carry Forward [Line Items]
Foreign income tax credit carryforwards	168
Domestic Tax Authority [Member] | Internal Revenue Service (IRS) [Member] | 2028 through 2032 [Member] | After ASU 2013-11 [Member]
Operating Loss and Tax Credit Carry Forward [Line Items]
Foreign income tax credit carryforwards	27
Domestic Tax Authority [Member] | Internal Revenue Service (IRS) [Member] | 2033 through 2037 [Member] | After ASU 2013-11 [Member]
Operating Loss and Tax Credit Carry Forward [Line Items]
Foreign income tax credit carryforwards	94
Domestic Tax Authority [Member] | Internal Revenue Service (IRS) [Member] | Not subject to expiration [Member] | After ASU 2013-11 [Member]
Operating Loss and Tax Credit Carry Forward [Line Items]
Foreign income tax credit carryforwards	33
Domestic Tax Authority [Member] | Internal Revenue Service (IRS) [Member] | Valuation allowance [Member] | After ASU 2013-11 [Member]
Operating Loss and Tax Credit Carry Forward [Line Items]
Foreign income tax credit carryforwards	$ (161)

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Income Taxes - Summary of Gross Unrecognized Income Tax Benefits (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Income Tax Disclosure [Abstract]
Balance at January 1	$ 629	$ 584	$ 493
Increases and decreases as a result of positions taken during prior years
Transfers from valuation allowances	0	0	0
Other increases, including currency translation	10	21	34
Other decreases, including currency translation	(30)	(24)	(34)
Balances related to acquired businesses	0	0	(1)
Increases as a result of positions taken during the current year	162	90	109
Decreases relating to settlements with tax authorities	(10)	(19)	0
Decreases as a result of a lapse of the applicable statute of limitations	(26)	(23)	(17)
Balance at December 31	$ 735	$ 629	$ 584

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Income Taxes - Narrative (Details) - USD ($) $ in Millions	3 Months Ended						12 Months Ended
	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Sep. 30, 2016	Jun. 30, 2016	Mar. 31, 2016	Dec. 31, 2017	Dec. 31, 2016		Dec. 31, 2015
Income Taxes [Abstract]
Effective income tax rate reconciliation, at Ireland statutory income tax rate, percent							25.00%	25.00%		25.00%
Income tax expense	$ 293	$ 55	$ 33	$ 50	$ 60	$ 38	$ 382	$ 199	[1],[2]	$ 159	[1],[2]
Effective income tax (benefit) expense rate							11.30%	9.40%		7.50%
Income tax expense related to the gain on sale of a business							$ 234
Income tax benefit related to U.S. Tax Cuts and Jobs Acts (TCJA)							$ 62
Income tax rate excluding gain and related tax impact on the sale of business and U.S. Tax Cuts and Jobs Act (TCJA)							9.20%
Deferred other tax expense (benefit)							$ 79
Provisional tax expense for one time transition tax							17
Undistributed earnings of United States and other foreign subsidiaries where no provision has been made							22,100
Unrecognized tax benefits that would impact effective tax rate							652
Income tax examination, penalties and interest accrued							80	$ 94
2011 Notice [Member]
Income Taxes [Abstract]
IRS Statutory Notice of Deficiency proposed assessment of additional taxes							75
Penalties associated with IRS Statutory Notice of Deficiency proposed assessment							52
2014 Notice [Member]
Income Taxes [Abstract]
IRS Statutory Notice of Deficiency proposed assessment of additional taxes							190
Penalties associated with IRS Statutory Notice of Deficiency proposed assessment							72
2010 Notice [Member]
Income Taxes [Abstract]
Brazil tax assessment, plus interest and penalties							49
2014 Notice [Member]
Income Taxes [Abstract]
Brazil tax assessment, plus interest and penalties							$ 37
Number of years estimated to resolve Brazilian tax assessment							10

[1] *Other corporate expense - net and Income tax expense in 2016 and 2015 have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14.

[2] *Year ended December 31, 2016 and 2015 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

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Eaton Shareholders' Equity - Other Comprehensive Income (Loss) (Details) - USD ($) $ in Millions		12 Months Ended
		Dec. 31, 2017	Dec. 31, 2016		Dec. 31, 2015
Equity [Abstract]
Currency translation and related hedging instuments pre-tax		$ 800	$ (562)		$ (1,080)
Currency translation and related hedging instruments after-tax		807	(570)	[1]	(1,078)	[1]
Pension and Other Postretirement Benefits [Abstract]
Prior service credit (cost) arising during the year pre-tax		(1)	(2)		1
Prior service credit (cost) arising during the year after-tax		0	(2)		1
Net (loss) gain arising during the year pre-tax		215	(247)		(123)
Net (loss) gain arising during the year after-tax		169	(197)		(89)
Currency translation pre-tax		(67)	74		62
Currency translation after-tax		(53)	62		46
Other pre-tax		0	0		0
Other after-tax		(5)	(2)		(3)
Amortization of actuarial loss and prior service cost reclassified to earnings pre-tax		188	201		237
Amortization of actuarial loss and prior service cost reclassified to earnings after-tax		130	133		156
Total pensions and other postretirement benefits included in other comprehensive income (loss), pre-tax		335	26		177
Total pensions and other postretirement benefits included in other comprehensive income (loss), after-tax		241	(6)		111
Other Accumulated Comprehensive Income (Loss) Cash Flow Hedges
Gain (loss) on derivatives designated as cash flow hedges pre-tax		(24)	(21)		20
Gain (loss) on derivatives designated as cash flow hedges after-tax		(15)	(14)		13
Changes in cash flow hedges reclassified to earnings pre-tax		17	8		(16)
Changes in cash flow hedges reclassified to earnings after-tax		11	5		(10)
Cash flow hedges, net of reclassification adjustments pre-tax		(7)	(13)		4
Cash flow hedges, net of reclassification adjustments after-tax		(4)	(9)	[1]	3	[1]
Other comprehensive (loss) income attributable to Eaton ordinary shareholders pre-tax		1,128	(549)		(899)
Other comprehensive (loss) income attributable to Eaton ordinary shareholders after-tax	[2]	$ 1,044	$ (585)		$ (964)

[1] *Year ended December 31, 2016 and 2015 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

[2] *The balances at January 1, 2015 and the year ended December 31, 2015 and 2016 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

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Eaton Shareholders' Equity - Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Millions		12 Months Ended
		Dec. 31, 2017	Dec. 31, 2016		Dec. 31, 2015	[2]
Changes in accumulated other comprehensive income (loss) [Line Items]
Opening Balance	[1]	$ (4,448)
Net current-period Other comprehensive income (loss)		1,044	$ (585)	[2]	$ (964)
Closing Balance		(3,404)	(4,448)	[1]
Currency translation and related hedging instruments [Member]
Changes in accumulated other comprehensive income (loss) [Line Items]
Opening Balance		(3,062)
Other comprehensive income (loss) before reclassifications		807
Amounts reclassified from Accumulated other comprehensive loss (income)		0
Net current-period Other comprehensive income (loss)		807
Closing Balance		(2,255)	(3,062)
Pensions and Other Postretirement Benefits [Member]
Changes in accumulated other comprehensive income (loss) [Line Items]
Opening Balance		(1,380)
Other comprehensive income (loss) before reclassifications		111
Amounts reclassified from Accumulated other comprehensive loss (income)		130
Net current-period Other comprehensive income (loss)		241
Closing Balance		(1,139)	(1,380)
Cash Flow Hedges [Member]
Changes in accumulated other comprehensive income (loss) [Line Items]
Opening Balance		(6)
Other comprehensive income (loss) before reclassifications		(15)
Amounts reclassified from Accumulated other comprehensive loss (income)		11
Net current-period Other comprehensive income (loss)		(4)
Closing Balance		(10)	(6)
Accumulated Other Comprehensive Income (Loss) [Member]
Changes in accumulated other comprehensive income (loss) [Line Items]
Opening Balance		(4,448)
Other comprehensive income (loss) before reclassifications		903
Amounts reclassified from Accumulated other comprehensive loss (income)		141
Net current-period Other comprehensive income (loss)		1,044
Closing Balance		$ (3,404)	$ (4,448)

[1] *December 31, 2016 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

[2] *Year ended December 31, 2016 and 2015 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

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Eaton Shareholders' Equity - Reclassifications Out of Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Millions		3 Months Ended						12 Months Ended
		Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Sep. 30, 2016	Jun. 30, 2016	Mar. 31, 2016	Dec. 31, 2017	Dec. 31, 2016	[2]	Dec. 31, 2015	[2]
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives[Line Items]
Tax (benefit) expense		$ (293)	$ (55)	$ (33)	$ (50)	$ (60)	$ (38)	$ (382)	$ (199)	[1]	$ (159)	[1]
Currency exchange contracts		$ 3,466	$ 3,448	$ 3,307	$ 3,374	$ 3,422	$ 3,294	13,756	$ 13,409		$ 14,304
Reclassification out of Accumulated Other Comprehensive Loss [Member]
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives[Line Items]
Total reclassifications for the period								(141)
Reclassification out of Accumulated Other Comprehensive Loss [Member] | Amortization of defined benefit pension and other postretirement benefits items [Member]
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives[Line Items]
Actuarial loss and prior service cost	[3]							(188)
Tax (benefit) expense								58
Total reclassifications for the period								(130)
Reclassification out of Accumulated Other Comprehensive Loss [Member] | Gains and losses on cash flow hedges [Member]
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives[Line Items]
Tax (benefit) expense								6
Total reclassifications for the period								(11)
Reclassification out of Accumulated Other Comprehensive Loss [Member] | Gains and losses on cash flow hedges [Member] | Currency exchange contracts [Member]
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives[Line Items]
Currency exchange contracts								$ (17)

[1] *Other corporate expense - net and Income tax expense in 2016 and 2015 have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14.

[2] *Year ended December 31, 2016 and 2015 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

[3] These components of Accumulated other comprehensive loss are included in the computation of net periodic benefit cost. See Note 7 for additional information about defined benefit pension and other postretirement benefits items.

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Eaton Shareholders' Equity - Net Income per Ordinary Share (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions	3 Months Ended						12 Months Ended
	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Sep. 30, 2016	Jun. 30, 2016	Mar. 31, 2016	Dec. 31, 2017	Dec. 31, 2016		Dec. 31, 2015
Equity [Abstract]
Net income attributable to Eaton ordinary shareholders	$ 1,401	$ 516	$ 434	$ 521	$ 489	$ 402	$ 2,985	$ 1,916	[1],[2],[3]	$ 1,972	[1],[2],[3]
Weighted-average number of ordinary shares outstanding - diluted (shares)							447.0	456.5	[3]	467.1	[3]
Less dilutive effect of equity-based compensation							2.5	1.5	[1]	1.6	[1]
Weighted-average number of ordinary shares outstanding - basic (shares)							444.5	455.0	[1],[3]	465.5	[1],[3]
Net income per ordinary share - diluted (usd per share)	$ 3.14	$ 1.15	$ 0.96	$ 1.14	$ 1.07	$ 0.87	$ 6.68	$ 4.20	[3]	$ 4.22	[3]
Net income per ordinary share - basic (usd per share)	$ 3.16	$ 1.16	$ 0.97	$ 1.15	$ 1.07	$ 0.88	$ 6.71	$ 4.21	[3]	$ 4.23	[3]

[1] *Certain amounts have been adjusted to reflect the retrospective application of the Company's change in inventory accounting method, as described in Notes 1 and 14.

[2] *Other corporate expense - net and Income tax expense in 2016 and 2015 have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14.

[3] *Year ended December 31, 2016 and 2015 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

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Eaton Shareholders' Equity (Textuals) (Details) $ / shares in Units, $ in Millions			12 Months Ended
	Feb. 28, 2018 $ / shares	Feb. 24, 2016 USD ($)	Dec. 31, 2017 USD ($) $ / shares shares	Dec. 31, 2016 USD ($) $ / shares shares		Dec. 31, 2015 USD ($) $ / shares shares		Mar. 12, 2018 $ / shares	Dec. 31, 2017 € / shares
Shareholders Equity Textuals Abstract
Ordinary shares authorized			750,000,000
Eaton Corporation plc ordinary share par value | $ / shares			$ 0.01
Ordinary shares issued and outstanding (shares)			439,900,000	449,400,000
Deferred ordinary shares authorized			40,000
Deferred ordinary shares par value | € / shares									€ 1.00
Deferred ordinary shares, shares issued and outstanding			40,000	40,000
Preferred A Shares authorized			10,000
Preferred A Shares par value | $ / shares			$ 1.00
Preferred A Shares, Shares Issued			10,000	10,000
Preferred A Shares, Shares Outstanding			10,000	10,000
Serial preferred shares authorized			10,000,000
Serial preferred share par value per share | $ / shares			$ 0.01
Serial preferred shares, shares issued and outstanding			0	0
Number of holders of record of Eaton ordinary shares			13,089
Number of current and former employees who were shareholders through various Eaton plans			20,138
Disclosure of Repurchase Agreements [Abstract]
2013 Share repurchase program, shares repurchased				1,500,000		11,300,000
2013 Share repurchase program - cost | $				$ 82		$ 682
2016 Share repurchase program, shares repurchased during period			11,500,000	10,300,000
2016 share repurchase program- cost | $			$ 850	$ 648
Employee Trust [Abstract]
Deferred compensation plan trust of shares and marketable secutities | $			$ 11	$ 13
Quarterly dividends, per share, declared (usd per share) | $ / shares			$ 2.40	$ 2.28	[1]	$ 2.20	[1]
Stock Repurchased During Period, Shares						0
Antidilutive securities excluded from computation of net income per ordinary share			400,000	1,700,000		1,600,000
2016 Program [Member]
Disclosure of Repurchase Agreements [Abstract]
2016 Share Repurchase Program, Authorized Dollar Amount | $		$ 2,500
Scenario, Forecast [Member]
Employee Trust [Abstract]
Quarterly dividends, per share, declared (usd per share) | $ / shares	$ 0.66
Dividend increase percentage over dividend paid in prior quarter	10.00%
Dividends Payable, Amount Per Share | $ / shares								$ 0.66

[1] *Year ended December 31, 2016 and 2015 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

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Equity-Based Compensation Restricted Stock Units and Awards Activity (Details) $ / shares in Units, shares in Millions, $ in Millions	12 Months Ended
	Dec. 31, 2017 USD ($) $ / shares shares
Weighted-average fair value per unit and award
Compensation expense not yet recognized related to non-vested RSUs and RSAs | $	$ 79
Non-vested stock options weighted-average period for total compensation expense to be recognized ( in years)	1 year 8 months 12 days
Excess tax benefit for equity-based compensation | $	$ 2
Restricted Stock Units (RSUs) [Member]
Number of restricted stock units and awards
Non-vested at January 1 (shares) | shares	2.6
Granted (shares) | shares	0.9
Vested (shares) | shares	(0.9)
Forfeited (shares) | shares	(0.2)
Non-vested at December 31 (shares) | shares	2.4
Weighted-average fair value per unit and award
Non-vested at January 1 (usd per share) | $ / shares	$ 57.87
Granted (usd per share) | $ / shares	72.09
Vested (usd per share) | $ / shares	61.80
Forfeited (usd per share) | $ / shares	61.66
Non-vested at December 31 (usd per share) | $ / shares	$ 62.24
Non-vested stock options weighted-average period for total compensation expense to be recognized ( in years)	2 years 3 months 18 days

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Equity-Based Compensation Information Related to Restricted Stock Units and Awards (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Pretax expense for RSUs and RSAs	$ 66	$ 65	$ 68
After-tax expense for RSUs and RSAs	43	42	44
Fair value of vested RSUs and RSAs	$ 73	$ 71	$ 110

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Equity-Based Compensation Performance Share Units (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Weighted-average fair value per unit and award
Pretax expense for PSUs	$ 22	$ 13	$ 2
After-tax expense for PSUs	13	$ 8	$ 1
Total compensation cost not yet recognized, PSUs	$ 30
Non-vested stock options weighted-average period for total compensation expense to be recognized ( in years)	1 year 8 months 12 days
Performance Shares [Member]
Number of performance stock units and awards
Non-vested at January 1 (shares)	0.5
Granted (shares)	0.4
Vested (shares)	0.0
Forfeited (shares)	(0.1)
Non-vested at December 31 (shares)	0.8	0.5
Weighted-average fair value per unit and award
Non-vested at January 1 (usd per share)	$ 76.41
Granted (usd per share)	80.07
Vested (usd per share)	0.00
Forfeited (usd per share)	77.90
Non-vested at December 31 (usd per share)	$ 77.97	$ 76.41
Performance Share Unit [Member]
Number of performance stock units and awards
Non-vested at January 1 (shares)	0.7
Granted (shares)	0.0
Vested (shares)	(0.1)
Forfeited (shares)	(0.5)
Non-vested at December 31 (shares)	0.1	0.7
Weighted-average fair value per unit and award
Non-vested at January 1 (usd per share)	$ 68.23
Granted (usd per share)	0.00
Vested (usd per share)	71.72
Forfeited (usd per share)	71.72
Non-vested at December 31 (usd per share)	$ 56.55	$ 68.23
Non-vested stock options weighted-average period for total compensation expense to be recognized ( in years)	1 year 7 months 6 days
Minimum [Member] | Performance Shares [Member]
Weighted-average fair value per unit and award
Range of PSU Award	0.00%
Maximum [Member] | Performance Shares [Member]
Weighted-average fair value per unit and award
Range of PSU Award	200.00%

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Equity-Based Compensation Performance Share Units (Market Based) (Details) - $ / shares	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Expected volatility	24.00%	24.00%
Risk-free interest rate	1.46%	0.88%
Weighted-average fair value of PSUs granted	$ 80.07	$ 76.41

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Equity-Based Compensation Stock Options Fair Value Assumptions (Details) - $ / shares	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Expected volatility (in percentage)	27.00%	27.00%	29.00%
Expected option life in years (in years)	6 years 7 months	5 years 6 months	5 years 6 months
Expected dividend yield (in percentage)	2.80%	2.50%	2.60%
Risk-free interest rate minimum (in percentage)	1.80%	1.20%	1.50%
Risk-free interest rate maximum (in percentage)	2.10%	1.50%	1.60%
Weighted-average fair value of stock options granted (in usd per share)	$ 15.11	$ 11.80	$ 15.25
Stock option vesting period (in years)	3 years
Stock option expiration date after date of grant	10 years

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Equity-Based Compensation Stock Options Activity (Details) $ / shares in Units, shares in Millions, $ in Millions	12 Months Ended
	Dec. 31, 2017 USD ($) $ / shares shares
Options
Closing price of Eaton ordinary shares on last trading day | $ / shares	$ 79.01
Weighted-average exercise price per option [Member]
Weighted-average exercise price per option
Opening balance (usd per share) | $ / shares	56.75
Granted (usd per share) | $ / shares	71.89
Exercised (usd per share) | $ / shares	46.31
Forfeited and cancelled (usd per share) | $ / shares	59.23
Closing balance (usd per share) | $ / shares	62.43
Exercisable at December 31, 2017 | $ / shares	$ 61.06
Stock Options [Member]
Options
Outstanding at January 1, 2017, shares | shares	5.5
Granted, shares | shares	0.7
Exercised, shares | shares	(1.5)
Forfeited and cancelled, shares | shares	(0.1)
Outstanding at December 31, 2017, shares | shares	4.6
Exercisable at December 31, 2017, shares | shares	2.9
Reserved for future grants at December 31, 2017, shares | shares	15.0
Weighted-average remaining contractual life in years [Member]
Options
Outstanding at December 31, 2017	6 years 3 months 18 days
Exercisable at December 31, 2017	5 years 1 month 6 days
Aggregate Intrinsic Value [Member]
Options
Outstanding at December 31, 2017 | $	$ 77.3
Exercisable at December 31, 2017 | $	$ 52.1

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Equity-Based Compensation Information Related to Stock Options (Details) - USD ($) shares in Millions, $ in Millions	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016		Dec. 31, 2015
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Pretax expense for stock options	$ 11.0	$ 14.0		$ 12.0
After-tax expense for stock options	8.0	9.0		8.0
Proceeds from stock options exercised	66.0	74.0	[1]	52.0	[1]
Income tax benefit related to stock options exercised
Tax benefit classified in operating activities in the Consolidated Statements of Cash Flows	13.0	5.0		4.0
Excess tax benefit classified in financing activities in the Consolidated Statements of Cash Flows	0.0	1.0		1.0
Intrinsic value of stock options exercised	41.0	42.0		44.0
Total fair value of stock options vested	$ 11.0	$ 14.0		$ 12.0
Stock options exercised, in millions of options	1.5	1.9		1.4
Non-vested stock option compensation expense not yet recognized	$ 8.8
Non-vested stock options weighted-average period for total compensation expense to be recognized ( in years)	1 year 8 months 12 days

[1] *Year ended December 31, 2016 and 2015 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

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Fair Value Measurements - Assets Measured on Recurring Basis (Details) - USD ($) $ in Millions	Dec. 31, 2017	Dec. 31, 2016
Summary of financial instruments recognized at fair value and fair value measurement used
Cash	$ 561	$ 543
Short-term investments	534	203	[1]
Net derivative contracts	36	(3)
Quoted prices in active markets for identical assets (Level 1) [Member]
Summary of financial instruments recognized at fair value and fair value measurement used
Cash	561	543
Short-term investments	534	203
Net derivative contracts	0	0
Other observable inputs (Level 2) [Member]
Summary of financial instruments recognized at fair value and fair value measurement used
Cash	0	0
Short-term investments	0	0
Net derivative contracts	36	(3)
Unobservable inputs (Level 3) [Member]
Summary of financial instruments recognized at fair value and fair value measurement used
Cash	0	0
Short-term investments	0	0
Net derivative contracts	$ 0	$ 0

[1] *December 31, 2016 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

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Fair Value Measurements Fair Value Measurements (Details 1) - USD ($) $ in Millions	Dec. 31, 2017	Dec. 31, 2016
Fair Value Disclosures [Abstract]
Time deposits, certificates of deposit and demand deposits with banks	$ 435	$ 149
Money market investments	99	54
Total short-term investments	$ 534	$ 203	[1]

[1] *December 31, 2016 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

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Fair Value Measurements Fair Value Measurements (Details Textuals) - USD ($) $ in Millions	Dec. 31, 2017	Jul. 31, 2017	Dec. 31, 2016
Fair Value Disclosures [Abstract]
Long-term debt and current portion of long term debt, carrying value	$ 7,745		$ 8,263
Long-term debt and current portion of long-term debt, fair value	$ 8,048		$ 8,477
Interest in business sold		50.00%
Equity method of accounting, ownership interest (in percentage)		50.00%
Investments, fair value		$ 600

XML

Derivative Financial Instruments and Hedging Activities - Gain on Commodity Hedge Contracts (Details) - USD ($) $ in Millions	3 Months Ended
	Dec. 31, 2017	Dec. 31, 2016
Derivative Instruments and Hedging Activities Disclosure [Abstract]
Commodity contracts	$ 2	$ 7

XML

Derivative Financial Instruments and Hedging Activities - Derivative Financial Statement Impacts (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016
Other current assets [Member]
Derivatives, Fair Value [Line Items]
Derivative Instruments Not Designated as Hedging Instruments, Asset, at Fair Value	$ 40	$ 33
Derivatives designated as hedges
Derivative asset designated as hedging instrument	8	12
Other noncurrent assets [Member]
Derivatives designated as hedges
Derivative asset designated as hedging instrument	48	85
Other current liabilities [Member]
Derivatives, Fair Value [Line Items]
Derivative Instruments Not Designated as Hedging Instruments, Liability, at Fair Value	19	85
Derivatives designated as hedges
Derivative liability designated as hedging instrument	22	22
Other noncurrent liabilities [Member]
Derivatives designated as hedges
Derivative liability designated as hedging instrument	19	26
Designated as Hedging Instrument [Member] | Fair Value Hedging [Member] | Fixed-to-floating interest rate swaps
Derivatives designated as hedges
Notional amount	2,965	3,765
Designated as Hedging Instrument [Member] | Fair Value Hedging [Member] | Fixed-to-floating interest rate swaps | Other current assets [Member]
Derivatives designated as hedges
Derivative asset designated as hedging instrument	1	1
Designated as Hedging Instrument [Member] | Fair Value Hedging [Member] | Fixed-to-floating interest rate swaps | Other noncurrent assets [Member]
Derivatives designated as hedges
Derivative asset designated as hedging instrument	41	65
Designated as Hedging Instrument [Member] | Fair Value Hedging [Member] | Fixed-to-floating interest rate swaps | Other current liabilities [Member]
Derivatives designated as hedges
Derivative liability designated as hedging instrument	0	0
Designated as Hedging Instrument [Member] | Fair Value Hedging [Member] | Fixed-to-floating interest rate swaps | Other noncurrent liabilities [Member]
Derivatives designated as hedges
Derivative liability designated as hedging instrument	17	8
Designated as Hedging Instrument [Member] | Cash Flow Hedging [Member] | Floating-to-fixed interest rate swaps
Derivatives designated as hedges
Notional amount		450
Designated as Hedging Instrument [Member] | Cash Flow Hedging [Member] | Floating-to-fixed interest rate swaps | Other current assets [Member]
Derivatives designated as hedges
Derivative asset designated as hedging instrument		0
Designated as Hedging Instrument [Member] | Cash Flow Hedging [Member] | Floating-to-fixed interest rate swaps | Other noncurrent assets [Member]
Derivatives designated as hedges
Derivative asset designated as hedging instrument		19
Designated as Hedging Instrument [Member] | Cash Flow Hedging [Member] | Floating-to-fixed interest rate swaps | Other current liabilities [Member]
Derivatives designated as hedges
Derivative liability designated as hedging instrument		0
Designated as Hedging Instrument [Member] | Cash Flow Hedging [Member] | Floating-to-fixed interest rate swaps | Other noncurrent liabilities [Member]
Derivatives designated as hedges
Derivative liability designated as hedging instrument		1
Designated as Hedging Instrument [Member] | Cash Flow Hedging [Member] | Currency exchange contracts
Derivatives designated as hedges
Notional amount	924	802
Designated as Hedging Instrument [Member] | Cash Flow Hedging [Member] | Currency exchange contracts | Other current assets [Member]
Derivatives designated as hedges
Derivative asset designated as hedging instrument	7	11
Designated as Hedging Instrument [Member] | Cash Flow Hedging [Member] | Currency exchange contracts | Other noncurrent assets [Member]
Derivatives designated as hedges
Derivative asset designated as hedging instrument	7	1
Designated as Hedging Instrument [Member] | Cash Flow Hedging [Member] | Currency exchange contracts | Other current liabilities [Member]
Derivatives designated as hedges
Derivative liability designated as hedging instrument	22	22
Designated as Hedging Instrument [Member] | Cash Flow Hedging [Member] | Currency exchange contracts | Other noncurrent liabilities [Member]
Derivatives designated as hedges
Derivative liability designated as hedging instrument	2	17
Not Designated as Hedging Instrument [Member] | Currency exchange contracts
Derivatives designated as hedges
Notional amount	3,719	5,333
Not Designated as Hedging Instrument [Member] | Currency exchange contracts | Other current assets [Member]
Derivatives, Fair Value [Line Items]
Derivative Instruments Not Designated as Hedging Instruments, Asset, at Fair Value	39	31
Not Designated as Hedging Instrument [Member] | Currency exchange contracts | Other current liabilities [Member]
Derivatives, Fair Value [Line Items]
Derivative Instruments Not Designated as Hedging Instruments, Liability, at Fair Value	19	85
Not Designated as Hedging Instrument [Member] | Commodity contracts
Derivatives designated as hedges
Notional amount	13	10
Not Designated as Hedging Instrument [Member] | Commodity contracts | Other current assets [Member]
Derivatives, Fair Value [Line Items]
Derivative Instruments Not Designated as Hedging Instruments, Asset, at Fair Value	1	2
Not Designated as Hedging Instrument [Member] | Commodity contracts | Other current liabilities [Member]
Derivatives, Fair Value [Line Items]
Derivative Instruments Not Designated as Hedging Instruments, Liability, at Fair Value	0	0
Japanese Yen notes due 2018 [Member] | Japanese Yen notes payable [Member] | Non-derivative net investment hedge [Member]
Derivatives, Fair Value [Line Items]
Foreign Currency Note Payable, Noncurrent, after-tax	88	86
Foreign Currency Note Payable, Noncurrent, pre-tax	$ 652	$ 572
Minimum [Member] | Designated as Hedging Instrument [Member] | Fair Value Hedging [Member] | Fixed-to-floating interest rate swaps
Derivatives designated as hedges
Derivative, remaining maturity	6 months	3 months
Minimum [Member] | Designated as Hedging Instrument [Member] | Cash Flow Hedging [Member] | Currency exchange contracts
Derivatives designated as hedges
Derivative, remaining maturity	1 month	1 month
Minimum [Member] | Not Designated as Hedging Instrument [Member] | Currency exchange contracts
Derivatives designated as hedges
Derivative, remaining maturity	1 month	1 month
Minimum [Member] | Not Designated as Hedging Instrument [Member] | Commodity contracts
Derivatives designated as hedges
Derivative, remaining maturity	1 month	1 month
Maximum [Member] | Designated as Hedging Instrument [Member] | Fair Value Hedging [Member] | Fixed-to-floating interest rate swaps
Derivatives designated as hedges
Derivative, remaining maturity	17 years	18 years
Maximum [Member] | Designated as Hedging Instrument [Member] | Cash Flow Hedging [Member] | Floating-to-fixed interest rate swaps
Derivatives designated as hedges
Derivative, remaining maturity		11 years
Maximum [Member] | Designated as Hedging Instrument [Member] | Cash Flow Hedging [Member] | Currency exchange contracts
Derivatives designated as hedges
Derivative, remaining maturity	36 months	36 months
Maximum [Member] | Not Designated as Hedging Instrument [Member] | Currency exchange contracts
Derivatives designated as hedges
Derivative, remaining maturity	12 months	12 months
Maximum [Member] | Not Designated as Hedging Instrument [Member] | Commodity contracts
Derivatives designated as hedges
Derivative, remaining maturity	12 months	12 months

XML

Derivative Financial Instruments and Hedging Activities - Fixed-to-Floating Interest Rate Swaps (Details) $ in Millions	12 Months Ended
	Dec. 31, 2017 USD ($)
Notes due 2018 [Member]
Derivative [Line Items]
Notional amount	$ 415
Fixed interest rate received (percentage)	5.60%
Floating interest rate paid (percentage)	4.59%
Notes due 2019 [Member]
Derivative [Line Items]
Notional amount	$ 300
Fixed interest rate received (percentage)	6.95%
Floating interest rate paid (percentage)	6.31%
Debentures due 2019 [Member]
Derivative [Line Items]
Notional amount	$ 25
Fixed interest rate received (percentage)	8.88%
Floating interest rate paid (percentage)	5.24%
Debentures due 2020 [Member]
Derivative [Line Items]
Notional amount	$ 150
Fixed interest rate received (percentage)	3.88%
Floating interest rate paid (percentage)	3.22%
Notes due 2021 [Member]
Derivative [Line Items]
Notional amount	$ 275
Fixed interest rate received (percentage)	3.47%
Floating interest rate paid (percentage)	2.84%
Debentures due 2022 [Member]
Derivative [Line Items]
Notional amount	$ 100
Fixed interest rate received (percentage)	8.10%
Floating interest rate paid (percentage)	7.08%
Senior notes due 2022 [Member]
Derivative [Line Items]
Notional amount	$ 1,400
Fixed interest rate received (percentage)	2.75%
Floating interest rate paid (percentage)	1.66%
Notes due 2023 [Member]
Derivative [Line Items]
Notional amount	$ 200
Fixed interest rate received (percentage)	3.68%
Floating interest rate paid (percentage)	2.17%
Debentures due 2024 [Member]
Derivative [Line Items]
Notional amount	$ 25
Fixed interest rate received (percentage)	7.63%
Floating interest rate paid (percentage)	3.87%
Debentures due 2029 [Member]
Derivative [Line Items]
Notional amount	$ 50
Fixed interest rate received (percentage)	7.65%
Floating interest rate paid (percentage)	3.98%
Debentures due 2034 [Member]
Derivative [Line Items]
Notional amount	$ 25
Fixed interest rate received (percentage)	5.45%
Floating interest rate paid (percentage)	1.68%
London Interbank Offered Rate (LIBOR) [Member] | Notes due 2018 [Member]
Derivative [Line Items]
Debt instrument, term (in years)	6 months
Basis spread on variable rate (percentage)	3.18%
London Interbank Offered Rate (LIBOR) [Member] | Notes due 2019 [Member]
Derivative [Line Items]
Debt instrument, term (in years)	3 months
Basis spread on variable rate (percentage)	5.07%
London Interbank Offered Rate (LIBOR) [Member] | Debentures due 2019 [Member]
Derivative [Line Items]
Debt instrument, term (in years)	6 months
Basis spread on variable rate (percentage)	3.84%
London Interbank Offered Rate (LIBOR) [Member] | Debentures due 2020 [Member]
Derivative [Line Items]
Debt instrument, term (in years)	1 month
Basis spread on variable rate (percentage)	2.12%
London Interbank Offered Rate (LIBOR) [Member] | Notes due 2021 [Member]
Derivative [Line Items]
Debt instrument, term (in years)	1 month
Basis spread on variable rate (percentage)	1.74%
London Interbank Offered Rate (LIBOR) [Member] | Debentures due 2022 [Member]
Derivative [Line Items]
Debt instrument, term (in years)	1 month
Basis spread on variable rate (percentage)	5.90%
London Interbank Offered Rate (LIBOR) [Member] | Senior notes due 2022 [Member]
Derivative [Line Items]
Debt instrument, term (in years)	1 month
Basis spread on variable rate (percentage)	0.58%
London Interbank Offered Rate (LIBOR) [Member] | Notes due 2023 [Member]
Derivative [Line Items]
Debt instrument, term (in years)	1 month
Basis spread on variable rate (percentage)	1.07%
London Interbank Offered Rate (LIBOR) [Member] | Debentures due 2024 [Member]
Derivative [Line Items]
Debt instrument, term (in years)	6 months
Basis spread on variable rate (percentage)	2.48%
London Interbank Offered Rate (LIBOR) [Member] | Debentures due 2029 [Member]
Derivative [Line Items]
Debt instrument, term (in years)	6 months
Basis spread on variable rate (percentage)	2.57%
London Interbank Offered Rate (LIBOR) [Member] | Debentures due 2034 [Member]
Derivative [Line Items]
Debt instrument, term (in years)	6 months
Basis spread on variable rate (percentage)	0.28%

XML

Derivative Financial Instruments and Hedging Activities - Amounts Recognized in Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016
Amounts recognized in accumulated other comprehensive income
Eaton's target percentage of managing intercompany balance sheet exposure	100.00%
Cash Flow Hedging [Member]
Amounts recognized in accumulated other comprehensive income
Gain (loss) recognized in other comprehensive (loss) income	$ (24)	$ (21)
Gain (loss) reclassified from Accumulated other comprehensive loss	(17)	(8)
Floating-to-fixed interest rate swaps | Cash Flow Hedging [Member]
Amounts recognized in accumulated other comprehensive income
Gain (loss) recognized in other comprehensive (loss) income	(15)	18
Floating-to-fixed interest rate swaps | Interest expense - net [Member] | Cash Flow Hedging [Member]
Amounts recognized in accumulated other comprehensive income
Gain (loss) reclassified from Accumulated other comprehensive loss	0	0
Interest Rate Locks [Member] | Interest expense - net [Member] | Cash Flow Hedging [Member]
Amounts recognized in accumulated other comprehensive income
Gain (loss) recognized in other comprehensive (loss) income	(9)	0
Gain (loss) reclassified from Accumulated other comprehensive loss	0	0
Currency exchange contracts | Cash Flow Hedging [Member]
Amounts recognized in accumulated other comprehensive income
Gain (loss) recognized in other comprehensive (loss) income	0	(39)
Currency exchange contracts | Cost of products sold [Member] | Cash Flow Hedging [Member]
Amounts recognized in accumulated other comprehensive income
Gain (loss) reclassified from Accumulated other comprehensive loss	$ (17)	$ (8)

XML

Derivative Financial Instruments and Hedging Activities - Amounts Recognized in Net income (Details) - Interest expense - net [Member] - Fair Value Hedging [Member] - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016
Derivative Instruments, Gain (Loss) [Line Items]
Derivative designated as fair value hedges	$ 0	$ 0
Interest Rate Contract [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Derivative designated as fair value hedges	(33)	(36)
Related Long Term Debt Converted To Floating Interest Rates By Interest Rate Swaps [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Derivative designated as fair value hedges	$ 33	$ 36

XML

Accounts Receivable and Inventory - Narrative (Details) - USD ($) $ in Millions		12 Months Ended
		Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2014
Accounts Receivable and Inventory [Abstract]
Allowance for doubtful accounts		$ 57	$ 50
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Cumulative effect on retained earnings from new method of accounting	[1]			$ 70
Additional tax expense which would have been recognized if FIFO method had not been adopted		$ 14
Retained Earnings [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Cumulative effect on retained earnings from new method of accounting	[1]			$ 70

[1] *The balances at January 1, 2015 and the year ended December 31, 2015 and 2016 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

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Accounts Receivable and Inventory - Components of Inventory (Details) - USD ($) $ in Millions	Dec. 31, 2017	Dec. 31, 2016
Accounts Receivable and Inventory [Abstract]
Raw materials	$ 953	$ 879
Work-in-process	471	395
Finished goods	1,196	1,072
Total inventory	$ 2,620	$ 2,346	[1]

[1] *December 31, 2016 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

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Accounts Receivable and Inventory - Summary of Retrospective Application from LIFO to FIFO (YTD & QTD)(Details) - USD ($) $ / shares in Units, $ in Millions	3 Months Ended						12 Months Ended
	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Sep. 30, 2016	Jun. 30, 2016	Mar. 31, 2016	Dec. 31, 2017		Dec. 31, 2016		Dec. 31, 2015
Consolidated Statements of Income
Cost of products sold	$ 3,466	$ 3,448	$ 3,307	$ 3,374	$ 3,422	$ 3,294	$ 13,756		$ 13,409	[1]	$ 14,304	[1]
Income before income taxes	1,694	572	467	570	550	439	3,368		2,118	[1],[2]	2,133	[1],[2]
Income tax expense	293	55	33	50	60	38	382		199	[1],[2]	159	[1],[2]
Net income	1,401	517	434	520	490	401	2,986	[3]	1,919	[1],[2],[3]	1,974	[1],[2],[3]
Net income attributable to Eaton ordinary shareholders	$ 1,401	$ 516	$ 434	$ 521	$ 489	$ 402	$ 2,985		$ 1,916	[1],[2],[4]	$ 1,972	[1],[2],[4]
Earnings Per Share [Abstract]
Net income per ordinary share - diluted (usd per share)	$ 3.14	$ 1.15	$ 0.96	$ 1.14	$ 1.07	$ 0.87	$ 6.68		$ 4.20	[1]	$ 4.22	[1]
Net income per ordinary share - basic (usd per share)	$ 3.16	$ 1.16	$ 0.97	$ 1.15	$ 1.07	$ 0.88	$ 6.71		$ 4.21	[1]	$ 4.23	[1]
Total comprehensive income attributable to Eaton ordinary shareholders							$ 4,029		$ 1,331	[1]	$ 1,008	[1]
Statement of Financial Position [Abstract]
Inventory							2,620		2,346	[5]
Deferred income taxes - noncurrent asset							253		325
Deferred income taxes - noncurrent liability							538		321	[5]
Retained earnings							8,669		7,555	[5]
Statement of Cash Flows [Abstract]
Deferred income taxes							(206)		(83)	[1]	(105)	[1]
Inventory							(202)		34	[1]	(8)	[1]
As originally reported [Member]
Consolidated Statements of Income
Cost of products sold	$ 3,469	$ 3,450	$ 3,310	$ 3,371	$ 3,419	$ 3,291	13,770		13,400		14,292
Income before income taxes	1,691	570	464	573	553	442	3,354		2,127		2,145
Income tax expense	292	54	32	51	61	39	391		202		164
Net income	1,399	516	432	522	492	403	2,963		1,925		1,981
Net income attributable to Eaton ordinary shareholders	$ 1,399	$ 515	$ 432	$ 523	$ 491	$ 404	$ 2,962		$ 1,922		$ 1,979
Earnings Per Share [Abstract]
Net income per ordinary share - diluted (usd per share)	$ 3.14	$ 1.15	$ 0.96	$ 1.15	$ 1.07	$ 0.88	$ 6.63		$ 4.21		$ 4.23
Net income per ordinary share - basic (usd per share)	$ 3.16	$ 1.15	$ 0.96	$ 1.15	$ 1.08	$ 0.88	$ 6.66		$ 4.22		$ 4.25
Total comprehensive income attributable to Eaton ordinary shareholders							$ 4,006		$ 1,337		$ 1,015
Statement of Financial Position [Abstract]
Inventory							2,514		2,254
Deferred income taxes - noncurrent asset							253		360
Deferred income taxes - noncurrent liability							512		321
Retained earnings							8,589		7,498
Statement of Cash Flows [Abstract]
Deferred income taxes							(197)		(80)		(100)
Inventory							(188)		25		(20)
Effect of change [Member]
Consolidated Statements of Income
Cost of products sold	$ (3)	$ (2)	$ (3)	$ 3	$ 3	$ 3			9		12
Income before income taxes	3	2	3	(3)	(3)	(3)			(9)		(12)
Income tax expense	1	1	1	(1)	(1)	(1)			(3)		(5)
Net income	2	1	2	(2)	(2)	(2)	23		(6)		(7)
Net income attributable to Eaton ordinary shareholders	$ 2	$ 1	$ 2	$ (2)	$ (2)	$ (2)			$ (6)		$ (7)
Earnings Per Share [Abstract]
Net income per ordinary share - diluted (usd per share)	$ 0.00	$ 0.00	$ 0.00	$ (0.01)	$ 0.00	$ (0.01)			$ (0.01)		$ (0.01)
Net income per ordinary share - basic (usd per share)	$ 0.00	$ 0.01	$ 0.01	$ 0.00	$ (0.01)	$ 0.00			$ (0.01)		$ (0.02)
Total comprehensive income attributable to Eaton ordinary shareholders									$ (6)		$ (7)
Statement of Financial Position [Abstract]
Inventory							106		92
Deferred income taxes - noncurrent asset							0		(35)
Deferred income taxes - noncurrent liability							26		0
Retained earnings							80		57
Statement of Cash Flows [Abstract]
Deferred income taxes							(9)		(3)		(5)
Inventory							(14)		$ 9		$ 12
Effect of change, TCJA [Member]
Consolidated Statements of Income
Income before income taxes							0
Income tax expense							(14)
Net income							14
Net income attributable to Eaton ordinary shareholders							$ 14
Earnings Per Share [Abstract]
Net income per ordinary share - diluted (usd per share)							$ 0.03
Net income per ordinary share - basic (usd per share)							$ 0.03
Total comprehensive income attributable to Eaton ordinary shareholders							$ 14
Effect of change, Other [Member]
Consolidated Statements of Income
Cost of products sold							(14)
Income before income taxes							14
Income tax expense							5
Net income							9
Net income attributable to Eaton ordinary shareholders							$ 9
Earnings Per Share [Abstract]
Net income per ordinary share - diluted (usd per share)							$ 0.02
Net income per ordinary share - basic (usd per share)							$ 0.02
Total comprehensive income attributable to Eaton ordinary shareholders							$ 9

[1] *Year ended December 31, 2016 and 2015 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

[2] *Other corporate expense - net and Income tax expense in 2016 and 2015 have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14.

[3] *The balances at January 1, 2015 and the year ended December 31, 2015 and 2016 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

[4] *Certain amounts have been adjusted to reflect the retrospective application of the Company's change in inventory accounting method, as described in Notes 1 and 14.

[5] *December 31, 2016 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

XML

Business Segment and Geographic Region Information - Business Segment Information (Details) - USD ($) $ in Millions	3 Months Ended						12 Months Ended
	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Sep. 30, 2016	Jun. 30, 2016	Mar. 31, 2016	Dec. 31, 2017		Dec. 31, 2016		Dec. 31, 2015
Business Segment Information
Net sales							$ 20,404		$ 19,747	[1]	$ 20,855	[1]
Segment operating profit							3,214		2,958		3,133
Amortization of intangible assets							(383)
Interest expense - net							(246)		(233)	[1]	(232)	[1]
Gain on sale of business							1,077		0	[1]	0	[1]
Income before income taxes	$ 1,694	$ 572	$ 467	$ 570	$ 550	$ 439	3,368		2,118	[1],[2]	2,133	[1],[2]
Income tax expense	293	55	33	50	60	38	382		199	[1],[2]	159	[1],[2]
Net income	1,401	517	434	520	490	401	2,986	[3]	1,919	[1],[2],[3]	1,974	[1],[2],[3]
Less net income for noncontrolling interests							(1)		(3)	[1]	(2)	[1]
Net income attributable to Eaton ordinary shareholders	$ 1,401	$ 516	$ 434	$ 521	$ 489	$ 402	2,985		1,916	[1],[2],[4]	1,972	[1],[2],[4]
Business segment acquisition integration pretax charges							4		4		42
Electrical Products [Member]
Business Segment Information
Net sales							7,193		6,957		6,976
Segment operating profit							1,287		1,240		1,156
Business segment acquisition integration pretax charges							4		3		25
Electrical Systems and Services [Member]
Business Segment Information
Net sales							5,666		5,662		5,931
Segment operating profit							770		711		776
Business segment acquisition integration pretax charges							0		1		15
Hydraulics [Member]
Business Segment Information
Net sales							2,468		2,222		2,459
Segment operating profit							288		198		246
Business segment acquisition integration pretax charges							0		0		2
Aerospace [Member]
Business Segment Information
Net sales							1,744		1,753		1,807
Segment operating profit							332		335		310
Vehicle [Member]
Business Segment Information
Net sales							3,333		3,153		3,682
Segment operating profit							537		474		645
All Segments [Member]
Business Segment Information
Business segment acquisition integration pretax charges							4		4		42
Corporate [Member]
Business Segment Information
Amortization of intangible assets							(388)		(392)		(406)
Interest expense - net							(246)		(233)		(232)
Pension and other postretirement benefits expense							(45)		(60)		(130)
Gain on sale of business							1,077		0		0
Other corporate expense - net							(244)		(155)	[2]	(232)	[2]
Corporate acquisition integration charges							$ 0		$ 0		$ 5

[1] *Year ended December 31, 2016 and 2015 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

[2] *Other corporate expense - net and Income tax expense in 2016 and 2015 have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14.

[3] *The balances at January 1, 2015 and the year ended December 31, 2015 and 2016 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

[4] *Certain amounts have been adjusted to reflect the retrospective application of the Company's change in inventory accounting method, as described in Notes 1 and 14.

XML

Business Segment and Geographic Region Information - Identifiable Assets, Capital Expenditures for PPE, and Depreciation of PPE by Segment (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016		Dec. 31, 2015
Segment Reporting Information [Line Items]
Total assets	$ 32,623	$ 30,476	[1],[2]	$ 31,059	[1]
Goodwill	13,568	13,201	[2]	13,479
Other intangible assets	5,265	5,514	[2]	6,014
Capital expenditures for property, plant and equipment	520	497	[3]	506	[3]
Depreciation of property, plant and equipment	476	486		479
Electrical Products [Member]
Segment Reporting Information [Line Items]
Total assets	2,570	2,363		2,538
Goodwill	6,759	6,497		6,642
Capital expenditures for property, plant and equipment	134	134		137
Depreciation of property, plant and equipment	143	141		137
Electrical Systems and Services [Member]
Segment Reporting Information [Line Items]
Total assets	2,141	2,222		2,285
Goodwill	4,311	4,203		4,279
Capital expenditures for property, plant and equipment	83	78		94
Depreciation of property, plant and equipment	83	82		82
Hydraulics [Member]
Segment Reporting Information [Line Items]
Total assets	1,345	1,188		1,138
Goodwill	1,257	1,221		1,259
Capital expenditures for property, plant and equipment	96	92		61
Depreciation of property, plant and equipment	61	64		67
Aerospace [Member]
Segment Reporting Information [Line Items]
Total assets	938	830		841
Goodwill	947	938		956
Capital expenditures for property, plant and equipment	37	28		33
Depreciation of property, plant and equipment	26	27		28
Vehicle [Member]
Segment Reporting Information [Line Items]
Total assets	2,379	1,549		1,579
Goodwill	294	342		343
Capital expenditures for property, plant and equipment	141	142		119
Depreciation of property, plant and equipment	109	109		113
All Segments [Member]
Segment Reporting Information [Line Items]
Total assets	9,373	8,152		8,381
Capital expenditures for property, plant and equipment	491	474		444
Depreciation of property, plant and equipment	422	423		427
Corporate [Member]
Segment Reporting Information [Line Items]
Total assets	4,417	3,609	[1]	3,185	[1]
Capital expenditures for property, plant and equipment	29	23		62
Depreciation of property, plant and equipment	$ 54	$ 63		$ 52

[1] *Corporate identifiable assets in 2016 and 2015 have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14.

[2] *December 31, 2016 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

[3] *Year ended December 31, 2016 and 2015 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

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Business Segment and Geographic Region Information - Geographic Region Information (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016		Dec. 31, 2015
Revenues from External Customers and Long-Lived Assets [Line Items]
Net sales	$ 20,404	$ 19,747	[1]	$ 20,855	[1]
Net property, plant and equipment	3,502	3,443	[2]	3,565
United States [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Net sales	11,222	10,937		11,396
Net property, plant and equipment	1,872	1,924		1,982
Canada
Revenues from External Customers and Long-Lived Assets [Line Items]
Net sales	942	898		969
Net property, plant and equipment	20	19		19
Latin America [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Net sales	1,485	1,448		1,726
Net property, plant and equipment	290	281		243
Europe [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Net sales	4,394	4,228		4,379
Net property, plant and equipment	769	681		734
Asia Pacific [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Net sales	2,361	2,236		2,385
Net property, plant and equipment	$ 551	$ 538		$ 587

[1] *Year ended December 31, 2016 and 2015 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

[2] *December 31, 2016 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

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Condensed Consolidating Financial Statements (Narrative) (Details)	Dec. 31, 2017
Condensed Financial Information of Parent Company Only Disclosure [Abstract]
Eaton and certain other of Eaton's principal 100% owned subsidiaries full and unconditional guarantee of the Senior Notes, on a joint and several basis	100.00%

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Condensed Consolidating Financial Statements - Consolidating Statements of Comprehensive Income (Details) - USD ($) $ in Millions	3 Months Ended						12 Months Ended
	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Sep. 30, 2016	Jun. 30, 2016	Mar. 31, 2016	Dec. 31, 2017		Dec. 31, 2016		Dec. 31, 2015
Statement of Comprehensive Income [Abstract]
Net sales							$ 20,404		$ 19,747	[1]	$ 20,855	[1]
Cost of products sold	$ 3,466	$ 3,448	$ 3,307	$ 3,374	$ 3,422	$ 3,294	13,756		13,409	[1]	14,304	[1]
Selling and administrative expense							3,565		3,505	[1]	3,596	[1]
Research and development expense							584		589	[1]	625	[1]
Interest expense (income) - net							246		233	[1]	232	[1]
Gain on sale of business							1,077		0	[1]	0	[1]
Other expense (income) - net							(38)		(107)	[1]	(35)	[1]
Equity in loss (earnings) of subsidiaries, net of tax							0		0		0
Intercompany expense (income) - net							0		0		0
Income before income taxes	1,694	572	467	570	550	439	3,368		2,118	[1],[2]	2,133	[1],[2]
Income tax expense (benefit)	293	55	33	50	60	38	382		199	[1],[2]	159	[1],[2]
Net income	1,401	517	434	520	490	401	2,986	[3]	1,919	[1],[2],[3]	1,974	[1],[2],[3]
Less net income for noncontrolling interests							(1)		(3)	[1]	(2)	[1]
Net income attributable to Eaton ordinary shareholders	$ 1,401	$ 516	$ 434	$ 521	$ 489	$ 402	2,985		1,916	[1],[2],[4]	1,972	[1],[2],[4]
Other comprehensive income (loss)							1,044		(585)	[1]	(964)	[1]
Total comprehensive income attributable to Eaton ordinary shareholders							4,029		1,331	[1]	1,008	[1]
Guarantors
Statement of Comprehensive Income [Abstract]
Net sales							6,563		6,351		6,660
Cost of products sold							4,840		4,697		5,041
Selling and administrative expense							759		760		738
Research and development expense							207		186		197
Interest expense (income) - net							21		17		21
Gain on sale of business							0
Other expense (income) - net							(70)		43		24
Equity in loss (earnings) of subsidiaries, net of tax							(4,958)		(3,266)		(3,221)
Intercompany expense (income) - net							1,197		1,230		1,218
Income before income taxes							4,567		2,684		2,642
Income tax expense (benefit)							(232)		26		(69)
Net income							4,799		2,658		2,711
Less net income for noncontrolling interests							0		0		0
Net income attributable to Eaton ordinary shareholders							4,799		2,658		2,711
Other comprehensive income (loss)							1,064		(566)		(951)
Total comprehensive income attributable to Eaton ordinary shareholders							5,863		2,092		1,760
Other subsidiaries
Statement of Comprehensive Income [Abstract]
Net sales							12,599		11,961		12,531
Cost of products sold							9,054		8,649		8,978
Selling and administrative expense							1,498		1,452		1,494
Research and development expense							162		168		162
Interest expense (income) - net							(21)		(16)		(13)
Gain on sale of business							517
Other expense (income) - net							(56)		(67)		(59)
Equity in loss (earnings) of subsidiaries, net of tax							(4,665)		(2,808)		(2,761)
Intercompany expense (income) - net							(1,080)		(1,520)		(1,170)
Income before income taxes							8,224		6,103		5,900
Income tax expense (benefit)							115		149		152
Net income							8,109		5,954		5,748
Less net income for noncontrolling interests							(3)		(5)		(3)
Net income attributable to Eaton ordinary shareholders							8,106		5,949		5,745
Other comprehensive income (loss)							2,192		(1,344)		(2,000)
Total comprehensive income attributable to Eaton ordinary shareholders							10,298		4,605		3,745
Eaton Corporation plc
Statement of Comprehensive Income [Abstract]
Net sales							0		0		0
Cost of products sold							0		0		0
Selling and administrative expense							136		140		141
Research and development expense							0		0		0
Interest expense (income) - net							0		0		0
Gain on sale of business							0
Other expense (income) - net							79		(35)		0
Equity in loss (earnings) of subsidiaries, net of tax							(3,644)		(2,433)		(2,449)
Intercompany expense (income) - net							444		412		336
Income before income taxes							2,985		1,916		1,972
Income tax expense (benefit)							0		0		0
Net income							2,985		1,916		1,972
Less net income for noncontrolling interests							0		0		0
Net income attributable to Eaton ordinary shareholders							2,985		1,916		1,972
Other comprehensive income (loss)							1,044		(585)		(964)
Total comprehensive income attributable to Eaton ordinary shareholders							4,029		1,331		1,008
Eaton Corporation
Statement of Comprehensive Income [Abstract]
Net sales							6,659		6,447		6,926
Cost of products sold							5,276		5,076		5,518
Selling and administrative expense							1,172		1,153		1,223
Research and development expense							215		235		266
Interest expense (income) - net							245		233		222
Gain on sale of business							560
Other expense (income) - net							9		(48)		0
Equity in loss (earnings) of subsidiaries, net of tax							(1,139)		(770)		(821)
Intercompany expense (income) - net							(561)		(122)		(384)
Income before income taxes							2,002		690		902
Income tax expense (benefit)							499		23		87
Net income							1,503		667		815
Less net income for noncontrolling interests							0		0		0
Net income attributable to Eaton ordinary shareholders							1,503		667		815
Other comprehensive income (loss)							41		54		5
Total comprehensive income attributable to Eaton ordinary shareholders							1,544		721		820
Consolidating adjustments
Statement of Comprehensive Income [Abstract]
Net sales							(5,417)		(5,012)		(5,262)
Cost of products sold							(5,414)		(5,013)		(5,233)
Selling and administrative expense							0		0		0
Research and development expense							0		0		0
Interest expense (income) - net							1		(1)		2
Gain on sale of business							0
Other expense (income) - net							0		0		0
Equity in loss (earnings) of subsidiaries, net of tax							14,406		9,277		9,252
Intercompany expense (income) - net							0		0		0
Income before income taxes							(14,410)		(9,275)		(9,283)
Income tax expense (benefit)							0		1		(11)
Net income							(14,410)		(9,276)		(9,272)
Less net income for noncontrolling interests							2		2		1
Net income attributable to Eaton ordinary shareholders							(14,408)		(9,274)		(9,271)
Other comprehensive income (loss)							(3,297)		1,856		2,946
Total comprehensive income attributable to Eaton ordinary shareholders							$ (17,705)		$ (7,418)		$ (6,325)

[1] *Year ended December 31, 2016 and 2015 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

[2] *Other corporate expense - net and Income tax expense in 2016 and 2015 have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14.

[3] *The balances at January 1, 2015 and the year ended December 31, 2015 and 2016 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

[4] *Certain amounts have been adjusted to reflect the retrospective application of the Company's change in inventory accounting method, as described in Notes 1 and 14.

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Condensed Consolidating Financial Statements - Condensed Consolidating Balance Sheets (Details) - USD ($) $ in Millions		Dec. 31, 2017	Dec. 31, 2016		Dec. 31, 2015		Dec. 31, 2014
Current assets
Cash		$ 561	$ 543	[1],[2]	$ 268	[2]	$ 781	[2]
Short-term investments		534	203
Accounts receivable - net		3,943	3,560	[1]
Intercompany accounts receivable		0	0
Inventory		2,620	2,346	[1]
Prepaid expenses and other current assets		679	381
Total current assets		8,337	7,033	[1]
Property, plant and equipment - net		3,502	3,443	[1]	3,565
Other noncurrent assets
Goodwill		13,568	13,201	[1]	13,479
Other intangible assets		5,265	5,514	[1]	6,014
Deferred income taxes		253	325	[1]
Investment in subsidiaries		0	0
Intercompany loans receivable		0	0
Other assets		1,698	960	[1]
Total assets		32,623	30,476	[1],[3]	31,059	[3]
Current liabilities
Short-term debt		6	14	[1]
Current portion of long-term debt		578	1,552	[1]
Accounts payable		2,166	1,718	[1]
Intercompany accounts payable		0	0
Accrued compensation		453	379	[1]
Other current liabilities		1,872	1,822	[1]
Total current liabilities		5,075	5,485	[1]
Noncurrent liabilities
Long-term debt		7,167	6,711	[1]
Pension liabilities		1,226	1,659	[1]
Other postretirement benefits liabilities		362	368	[1]
Deferred income taxes		538	321	[1]
Intercompany loans payable		0	0
Other noncurrent liabilities		965	934	[1]
Total noncurrent liabilities		10,258	9,993	[1]
Shareholders’ equity
Eaton shareholders’ equity		17,253	14,954	[1]
Noncontrolling interests		37	44	[1]
Total equity	[4]	17,290	14,998	[1]	15,294		15,839
Total liabilities and equity		32,623	30,476	[1]
Guarantors
Current assets
Cash		12	5		7		13
Short-term investments		0	0
Accounts receivable - net		1,317	1,049
Intercompany accounts receivable		5,146	4,239
Inventory		692	638
Prepaid expenses and other current assets		145	42
Total current assets		7,312	5,973
Property, plant and equipment - net		684	706
Other noncurrent assets
Goodwill		6,293	6,293
Other intangible assets		3,002	3,442
Deferred income taxes		0	15
Investment in subsidiaries		87,919	92,766
Intercompany loans receivable		2,735	2,061
Other assets		163	134
Total assets		108,108	111,390
Current liabilities
Short-term debt		0	8
Current portion of long-term debt		35	296
Accounts payable		313	252
Intercompany accounts payable		4,405	3,130
Accrued compensation		63	58
Other current liabilities		308	276
Total current liabilities		5,124	4,020
Noncurrent liabilities
Long-term debt		976	936
Pension liabilities		83	161
Other postretirement benefits liabilities		94	99
Deferred income taxes		558	732
Intercompany loans payable		68,405	44,788
Other noncurrent liabilities		272	212
Total noncurrent liabilities		70,388	46,928
Shareholders’ equity
Eaton shareholders’ equity		32,596	60,442
Noncontrolling interests		0	0
Total equity		32,596	60,442
Total liabilities and equity		108,108	111,390
Other subsidiaries
Current assets
Cash		366	445		235		590
Short-term investments		534	203
Accounts receivable - net		2,144	1,975
Intercompany accounts receivable		2,741	3,382
Inventory		1,537	1,344
Prepaid expenses and other current assets		277	237
Total current assets		7,599	7,586
Property, plant and equipment - net		1,983	1,880
Other noncurrent assets
Goodwill		5,968	5,546
Other intangible assets		2,125	1,903
Deferred income taxes		221	218
Investment in subsidiaries		39,527	44,345
Intercompany loans receivable		61,225	56,938
Other assets		787	336
Total assets		119,435	118,752
Current liabilities
Short-term debt		6	6
Current portion of long-term debt		1	6
Accounts payable		1,320	1,053
Intercompany accounts payable		1,431	1,836
Accrued compensation		262	223
Other current liabilities		1,000	957
Total current liabilities		4,020	4,081
Noncurrent liabilities
Long-term debt		8	8
Pension liabilities		802	888
Other postretirement benefits liabilities		76	71
Deferred income taxes		304	361
Intercompany loans payable		1,146	431
Other noncurrent liabilities		379	396
Total noncurrent liabilities		2,715	2,155
Shareholders’ equity
Eaton shareholders’ equity		112,663	112,478
Noncontrolling interests		37	38
Total equity		112,700	112,516
Total liabilities and equity		119,435	118,752
Eaton Corporation plc
Current assets
Cash		0	1		0		1
Short-term investments		0	0
Accounts receivable - net		0	0
Intercompany accounts receivable		8	5
Inventory		0	0
Prepaid expenses and other current assets		0	0
Total current assets		8	6
Property, plant and equipment - net		0	0
Other noncurrent assets
Goodwill		0	0
Other intangible assets		0	0
Deferred income taxes		0	0
Investment in subsidiaries		15,045	32,852
Intercompany loans receivable		3,122	0
Other assets		0	0
Total assets		18,175	32,858
Current liabilities
Short-term debt		0	0
Current portion of long-term debt		0	0
Accounts payable		0	1
Intercompany accounts payable		4	281
Accrued compensation		0	0
Other current liabilities		1	1
Total current liabilities		5	283
Noncurrent liabilities
Long-term debt		0	0
Pension liabilities		0	0
Other postretirement benefits liabilities		0	0
Deferred income taxes		0	0
Intercompany loans payable		917	17,621
Other noncurrent liabilities		0	0
Total noncurrent liabilities		917	17,621
Shareholders’ equity
Eaton shareholders’ equity		17,253	14,954
Noncontrolling interests		0	0
Total equity		17,253	14,954
Total liabilities and equity		18,175	32,858
Eaton Corporation
Current assets
Cash		183	92		26		177
Short-term investments		0	0
Accounts receivable - net		482	536
Intercompany accounts receivable		2,865	953
Inventory		473	443
Prepaid expenses and other current assets		229	77
Total current assets		4,232	2,101
Property, plant and equipment - net		835	857
Other noncurrent assets
Goodwill		1,307	1,362
Other intangible assets		138	169
Deferred income taxes		356	864
Investment in subsidiaries		15,439	20,200
Intercompany loans receivable		7,104	7,609
Other assets		748	490
Total assets		30,159	33,652
Current liabilities
Short-term debt		0	0
Current portion of long-term debt		542	1,250
Accounts payable		533	412
Intercompany accounts payable		4,920	3,332
Accrued compensation		128	98
Other current liabilities		564	590
Total current liabilities		6,687	5,682
Noncurrent liabilities
Long-term debt		6,180	5,767
Pension liabilities		341	610
Other postretirement benefits liabilities		192	198
Deferred income taxes		0	0
Intercompany loans payable		3,718	3,768
Other noncurrent liabilities		314	326
Total noncurrent liabilities		10,745	10,669
Shareholders’ equity
Eaton shareholders’ equity		12,727	17,301
Noncontrolling interests		0	0
Total equity		12,727	17,301
Total liabilities and equity		30,159	33,652
Consolidating adjustments
Current assets
Cash		0	0		$ 0		$ 0
Short-term investments		0	0
Accounts receivable - net		0	0
Intercompany accounts receivable		(10,760)	(8,579)
Inventory		(82)	(79)
Prepaid expenses and other current assets		28	25
Total current assets		(10,814)	(8,633)
Property, plant and equipment - net		0	0
Other noncurrent assets
Goodwill		0	0
Other intangible assets		0	0
Deferred income taxes		(324)	(772)
Investment in subsidiaries		(157,930)	(190,163)
Intercompany loans receivable		(74,186)	(66,608)
Other assets		0	0
Total assets		(243,254)	(266,176)
Current liabilities
Short-term debt		0	0
Current portion of long-term debt		0	0
Accounts payable		0	0
Intercompany accounts payable		(10,760)	(8,579)
Accrued compensation		0	0
Other current liabilities		(1)	(2)
Total current liabilities		(10,761)	(8,581)
Noncurrent liabilities
Long-term debt		3	0
Pension liabilities		0	0
Other postretirement benefits liabilities		0	0
Deferred income taxes		(324)	(772)
Intercompany loans payable		(74,186)	(66,608)
Other noncurrent liabilities		0	0
Total noncurrent liabilities		(74,507)	(67,380)
Shareholders’ equity
Eaton shareholders’ equity		(157,986)	(190,221)
Noncontrolling interests		0	6
Total equity		(157,986)	(190,215)
Total liabilities and equity		$ (243,254)	$ (266,176)

[1] *December 31, 2016 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

[2] *Year ended December 31, 2016 and 2015 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

[3] *Corporate identifiable assets in 2016 and 2015 have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14.

[4] *The balances at January 1, 2015 and the year ended December 31, 2015 and 2016 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

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Condensed Consolidating Financial Statements - Condensed Consolidating Statements of Cash Flows (Details) - USD ($) $ in Millions		12 Months Ended
		Dec. 31, 2017		Dec. 31, 2016		Dec. 31, 2015
Condensed Consolidating Statements of Cash Flows [Line Items]
Net cash provided by (used in) operating activities		$ 2,666		$ 2,570	[1]	$ 2,409	[1]
Investing activities
Capital expenditures for property, plant and equipment		(520)		(497)	[1]	(506)	[1]
Cash received from (paid for) acquisitions of businesses, net of cash acquired		0		1	[1]	(72)	[1]
Sales (purchases) of short-term investments - net		(298)		(40)	[1]	37	[1]
Investments in affiliates		0		0		0
Return of investments in affiliates		0		0
Loans to affiliates		0		0		0
Repayments of loans from affiliates		0		0		0
Proceeds from sale of business		607		0	[1]	1	[1]
Other - net		(6)		7	[1]	(35)	[1]
Net cash used in investing activities		(217)		(529)	[1]	(575)	[1]
Financing activities
Proceeds from borrowings		1,000		631	[1]	425	[1]
Payments on borrowings		(1,554)		(653)	[1]	(1,027)	[1]
Proceeds from borrowings from affiliates		0		0		0
Payments on borrowings from affiliates		0		0		0
Capital contributions from affiliates		0		0		0
Return of capital to affiliates		0		0
Other intercompany financing activities		0		0		0
Cash dividends paid		(1,068)		(1,037)	[1]	(1,026)	[1]
Cash dividends paid to affiliates		0				0
Exercise of employee stock options		66		74	[1]	52	[1]
Repurchase of shares		(850)		(730)	[1]	(682)	[1]
Employee taxes paid from shares withheld		(22)		(18)	[1]	(38)	[1]
Other - net		(14)		(5)	[1]	(9)	[1]
Net cash used in financing activities		(2,442)		(1,738)	[1]	(2,305)	[1]
Effect of currency on cash		11		(28)	[1]	(42)	[1]
Total increase (decrease) in cash		18		275	[1]	(513)	[1]
Cash at the beginning of the period	[1]	543	[2]	268		781
Cash at the end of the period		561		543	[1],[2]	268	[1]
Guarantors
Condensed Consolidating Statements of Cash Flows [Line Items]
Net cash provided by (used in) operating activities		(30)		(232)		(281)
Investing activities
Capital expenditures for property, plant and equipment		(110)		(114)		(146)
Cash received from (paid for) acquisitions of businesses, net of cash acquired		(92)		1		(36)
Sales (purchases) of short-term investments - net		0		2		(2)
Investments in affiliates		0		(120)		(1,176)
Return of investments in affiliates		(90)		(47)
Loans to affiliates		0		(655)		(39)
Repayments of loans from affiliates		46		0		359
Proceeds from sale of business		0				0
Other - net		9		41		47
Net cash used in investing activities		(57)		(798)		(993)
Financing activities
Proceeds from borrowings		0		610		0
Payments on borrowings		(297)		(233)		(301)
Proceeds from borrowings from affiliates		991		1,120		997
Payments on borrowings from affiliates		(353)		(1,844)		(1,282)
Capital contributions from affiliates		90		1,370		1,482
Return of capital to affiliates		0		0
Other intercompany financing activities		469		12		378
Cash dividends paid		0		0		0
Cash dividends paid to affiliates		(800)				0
Exercise of employee stock options		0		0		0
Repurchase of shares		0		0		0
Employee taxes paid from shares withheld		(5)		(3)		(6)
Other - net		(1)		(4)		0
Net cash used in financing activities		94		1,028		1,268
Effect of currency on cash		0		0		0
Total increase (decrease) in cash		7		(2)		(6)
Cash at the beginning of the period		5		7		13
Cash at the end of the period		12		5		7
Other subsidiaries
Condensed Consolidating Statements of Cash Flows [Line Items]
Net cash provided by (used in) operating activities		4,545		3,033		3,026
Investing activities
Capital expenditures for property, plant and equipment		(320)		(291)		(266)
Cash received from (paid for) acquisitions of businesses, net of cash acquired		92		0		(36)
Sales (purchases) of short-term investments - net		(298)		(42)		39
Investments in affiliates		(90)		(1,370)		(1,482)
Return of investments in affiliates		0		0
Loans to affiliates		(6,723)		(8,208)		(10,608)
Repayments of loans from affiliates		3,817		5,951		7,493
Proceeds from sale of business		269				1
Other - net		30		(25)		(32)
Net cash used in investing activities		(3,223)		(3,985)		(4,891)
Financing activities
Proceeds from borrowings		0		0		17
Payments on borrowings		(7)		(12)		(2)
Proceeds from borrowings from affiliates		441		106		332
Payments on borrowings from affiliates		(87)		(42)		(397)
Capital contributions from affiliates		190		1,370		1,482
Return of capital to affiliates		(90)		(47)
Other intercompany financing activities		(1,042)		(180)		140
Cash dividends paid		0		0		0
Cash dividends paid to affiliates		(809)				(4)
Exercise of employee stock options		0		0		0
Repurchase of shares		0		0		0
Employee taxes paid from shares withheld		(3)		(3)		(6)
Other - net		(5)		(2)		(10)
Net cash used in financing activities		(1,412)		1,190		1,552
Effect of currency on cash		11		(28)		(42)
Total increase (decrease) in cash		(79)		210		(355)
Cash at the beginning of the period		445		235		590
Cash at the end of the period		366		445		235
Eaton Corporation plc
Condensed Consolidating Statements of Cash Flows [Line Items]
Net cash provided by (used in) operating activities		258		(253)		(137)
Investing activities
Capital expenditures for property, plant and equipment		0		0		0
Cash received from (paid for) acquisitions of businesses, net of cash acquired		0		0		0
Sales (purchases) of short-term investments - net		0		0		0
Investments in affiliates		(190)		(1,250)		(1,482)
Return of investments in affiliates		0		0
Loans to affiliates		0		0		0
Repayments of loans from affiliates		0		0		0
Proceeds from sale of business		0				0
Other - net		0		0		0
Net cash used in investing activities		(190)		(1,250)		(1,482)
Financing activities
Proceeds from borrowings		0		0		0
Payments on borrowings		0		0		0
Proceeds from borrowings from affiliates		2,605		3,843		3,322
Payments on borrowings from affiliates		(822)		(646)		(48)
Capital contributions from affiliates		0		0		0
Return of capital to affiliates		0		0
Other intercompany financing activities		0		0		0
Cash dividends paid		(1,068)		(1,037)		(1,026)
Cash dividends paid to affiliates		0				0
Exercise of employee stock options		66		74		52
Repurchase of shares		(850)		(730)		(682)
Employee taxes paid from shares withheld		0		0		0
Other - net		0		0		0
Net cash used in financing activities		(69)		1,504		1,618
Effect of currency on cash		0		0		0
Total increase (decrease) in cash		(1)		1		(1)
Cash at the beginning of the period		1		0		1
Cash at the end of the period		0		1		0
Eaton Corporation
Condensed Consolidating Statements of Cash Flows [Line Items]
Net cash provided by (used in) operating activities		(498)		22		(195)
Investing activities
Capital expenditures for property, plant and equipment		(90)		(92)		(94)
Cash received from (paid for) acquisitions of businesses, net of cash acquired		0		0		0
Sales (purchases) of short-term investments - net		0		0		0
Investments in affiliates		0		0		0
Return of investments in affiliates		0		0
Loans to affiliates		(444)		(251)		(889)
Repayments of loans from affiliates		303		1,293		342
Proceeds from sale of business		338				0
Other - net		(45)		(9)		(50)
Net cash used in investing activities		62		941		(691)
Financing activities
Proceeds from borrowings		1,000		21		408
Payments on borrowings		(1,250)		(408)		(724)
Proceeds from borrowings from affiliates		3,130		4,045		6,885
Payments on borrowings from affiliates		(2,904)		(4,712)		(6,467)
Capital contributions from affiliates		0		0		1,176
Return of capital to affiliates		0		0
Other intercompany financing activities		573		168		(518)
Cash dividends paid		0		0		0
Cash dividends paid to affiliates		0				0
Exercise of employee stock options		0		0		0
Repurchase of shares		0		0		0
Employee taxes paid from shares withheld		(14)		(12)		(26)
Other - net		(8)		1		1
Net cash used in financing activities		527		(897)		735
Effect of currency on cash		0		0		0
Total increase (decrease) in cash		91		66		(151)
Cash at the beginning of the period		92		26		177
Cash at the end of the period		183		92		26
Consolidating adjustments
Condensed Consolidating Statements of Cash Flows [Line Items]
Net cash provided by (used in) operating activities		(1,609)		0		(4)
Investing activities
Capital expenditures for property, plant and equipment		0		0		0
Cash received from (paid for) acquisitions of businesses, net of cash acquired		0		0		0
Sales (purchases) of short-term investments - net		0		0		0
Investments in affiliates		280		2,740		4,140
Return of investments in affiliates		90		47
Loans to affiliates		7,167		9,114		11,536
Repayments of loans from affiliates		(4,166)		(7,244)		(8,194)
Proceeds from sale of business		0				0
Other - net		0		0		0
Net cash used in investing activities		3,191		4,563		7,482
Financing activities
Proceeds from borrowings		0		0		0
Payments on borrowings		0		0		0
Proceeds from borrowings from affiliates		(7,167)		(9,114)		(11,536)
Payments on borrowings from affiliates		4,166		7,244		8,194
Capital contributions from affiliates		(280)		(2,740)		(4,140)
Return of capital to affiliates		90		47
Other intercompany financing activities		0		0		0
Cash dividends paid		0		0		0
Cash dividends paid to affiliates		1,609				4
Exercise of employee stock options		0		0		0
Repurchase of shares		0		0		0
Employee taxes paid from shares withheld		0		0		0
Other - net		0		0		0
Net cash used in financing activities		(1,582)		(4,563)		(7,478)
Effect of currency on cash		0		0		0
Total increase (decrease) in cash		0		0		0
Cash at the beginning of the period		0		0		0
Cash at the end of the period		$ 0		$ 0		$ 0

[1] *Year ended December 31, 2016 and 2015 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.

[2] *December 31, 2016 amounts have been adjusted to reflect the change in inventory accounting method, as described in Notes 1 and 14 to the consolidated financial statements.