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Immaterial Corrections

12 Months Ended

Dec. 31, 2011

NOTE 23

Immaterial Corrections

During the fourth quarter of 2011, management concluded the previously issued consolidated financial statements required adjustments to reflect certain immaterial corrections. Prior to the distribution of Exelis and Xylem, the Company had evaluated and concluded that the identified amounts were not material to any of its previously issued financial statements. Although management believes the amounts, individually and in the aggregate, were, and continue to be, immaterial to prior periods, management concluded that the prior period corrections to the post-Distribution financial statements are appropriate.

The Company has revised amounts previously reported in the consolidated financial statements to reflect certain adjustments, primarily related to income taxes, cumulative translation adjustments, and other adjustments, related to previously unrecorded immaterial adjustments identified during the preparation of prior years’ financial statements.

As a result of these adjustments, basic and diluted earnings per share were adjusted by $0.07 and ($0.16) for 2010 and 2009, respectively, which includes $0.03 and ($0.09) in 2010 and 2009, respectively, related to discontinued operations. The impact of these adjustments are detailed in the tables below.

Income Statement as of December 31, 2010


YEAR ENDED DECEMBER 31, 2010	As Previously Reported with Reclassification For Discontinued Operations (Note 4)				Adjustments				As Adjusted and with Reclassification For Discontinued Operations
General and administrative expenses		$	179			$	(3	)		$	176
Operating loss			(187	)			3				(184	)
Loss from continuing operations before income tax expense			(279	)			3				(276	)
Loss from continuing operations			(135	)			3				(132	)
Income from discontinued operations			933				3				936
Net income		$	798			$	6			$	804

Income Statement as of December 31, 2009


YEAR ENDED DECEMBER 31, 2009	As Previously Reported with Reclassification For Discontinued Operations (Note 4)				Adjustments				As Adjusted and with Reclassification For Discontinued Operations
General and administrative expenses		$	195			$	6			$	201
Operating loss			(115	)			(6	)			(121	)
Loss from continuing operations before income tax expense			(202	)			(6	)			(208	)
Income tax expense			(98	)			1				(97	)
Loss from continuing operations			(104	)			(7	)			(111	)
Income from discontinued operations			748				(8	)			740
Net income		$	644			$	(15	)		$	629

Balance Sheet at December 31, 2010


DECEMBER 31, 2010	As Previously Reported with Reclassification For Discontinued Operations (Note 4)				Adjustments				As Adjusted and with Reclassification For Discontinued Operations
Assets
Current assets of discontinued operations		$	3,459			$	(2	)		$	3,457
Total current assets			4,426				(2	)			4,424
Deferred income taxes (noncurrent)			339				(19	)			320
Noncurrent assets of discontinued operations			5,871				(6	)			5,865
Total non-current assets			8,216				(25	)			8,191
Total assets			12,642				(27	)			12,615
Liabilities and Shareholders’ Equity
Accrued liabilities			408				(11	)			397
Current liabilities of discontinued operations			1,883				9				1,892
Total current liabilities			2,743				(2	)			2,741
Other non-current liabilities			322				3				325
Noncurrent liabilities of discontinued operations			1,902				15				1,917
Total noncurrent liabilities			5,395				18				5,413
Total liabilities			8,138				16				8,154
Shareholders’ Equity:
Retained earnings			5,499				(58	)			5,441
Postretirement benefit plans			(1,360	)			1				(1,359	)
Cumulative translation adjustments			262				14				276
Total shareholders’ equity			4,504				(43	)			4,461
Total liabilities and shareholders’ equity		$	12,642			$	(27	)		$	12,615

Certain of the adjustments described above, or portions thereof, relate to periods prior to 2010. The cumulative effect of those adjustments to retained earnings as of January 1, 2009 and December 31, 2009 is reflected as a change of $51 and $66, respectively.

Cash Flows

The adjustments had no effect on each of the subtotals within the Consolidated Statement of Cash Flows.