Share-Based Compensation

9 Months Ended

Mar. 31, 2015

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Disclosure of Compensation Related Costs, Share-based Payments

Share-Based Compensation

Share-Based Compensation Plans

We maintain stock incentive plans (collectively, the “Plans”) for the benefit of certain of our officers, directors and employees.

The following tables provide total share-based compensation expense by type of award:

	Three Months Ended March 31
(in millions)	2015		2014
Restricted share unit expense	$	18	$	15
Employee stock option expense	6		6
Performance share unit expense	3		3
Total share-based compensation	$	27	$	24

	Nine Months Ended March 31
(in millions)	2015		2014
Restricted share unit expense	$	52	$	46
Employee stock option expense	16		16
Performance share unit expense	12		10
Total share-based compensation	$	80	$	72

The total tax benefit related to share-based compensation was $10 million and $8 million for the three months ended March 31, 2015 and 2014, respectively, and $28 million and $25 million for the nine months ended March 31, 2015 and 2014, respectively.

Stock Options

Employee stock options granted under the Plans generally vest in equal annual installments over three years and are exercisable for periods ranging from seven to ten years from the grant date. All stock options are exercisable at a price equal to the market value of the common shares underlying the option on the grant date.

The following table summarizes all stock option transactions under the Plans:

(in millions, except per share amounts)	Stock Options		Weighted-Average Exercise Price per Common Share
Outstanding at June 30, 2014	10		$	39.16
Granted	1		71.57
Exercised	(3	)	36.92
Canceled and forfeited	—		—
Outstanding at March 31, 2015	8		$	45.46
Exercisable at March 31, 2015	5		$	36.63

At March 31, 2015, the total pre-tax compensation cost, net of estimated forfeitures, related to nonvested stock options not yet recognized was $27 million, which is expected to be recognized over a weighted-average period of two years. The following table provides additional data related to stock option activity:

(in millions, except contractual lives)	March 31, 2015		June 30, 2014
Aggregate intrinsic value of outstanding options at period end	$	357	$	282
Aggregate intrinsic value of exercisable options at period end	$	245	$	185
Weighted-average remaining contractual life of outstanding options (in years)	6		6
Weighted-average remaining contractual life of exercisable options (in years)	5		4

Restricted Share Units

Restricted share units granted under the Plans generally vest in equal annual installments over three years. Restricted share units accrue cash dividend equivalents that are payable upon vesting of the awards.

The following table summarizes all transactions related to restricted share units under the Plans:

(in millions, except per share amounts)	Restricted Share Units		Weighted-Average Grant Date Fair Value per Share
Nonvested at June 30, 2014	3		$	45.65
Granted	1		71.97
Vested	(1	)	44.77
Canceled and forfeited	—		—
Nonvested at March 31, 2015	3		$	59.14

At March 31, 2015, the total pre-tax compensation cost, net of estimated forfeitures, related to nonvested restricted share units not yet recognized was $93 million, which is expected to be recognized over a weighted-average period of two years.

Performance Share Units

Performance share units vest over a three-year performance period based on achievement of specific performance goals. Based on the extent to which the targets are achieved, vested shares may range from zero to 200 percent of the target award amount. Performance share units accrue cash dividend equivalents that are payable upon vesting of the awards.

The following table summarizes all transactions related to performance share units under the Plans (based on target award amounts):

(in millions, except per share amounts)	Performance Share Units		Weighted-Average Grant Date Fair Value per Share
Nonvested at June 30, 2014	0.9		$	44.41
Granted	0.2		71.63
Vested (1)	(0.2	)	41.47
Canceled and forfeited	—		—
Nonvested at March 31, 2015	0.9		$	50.13

(1) Vested based on achievement of 120 percent of the target performance goal.

At March 31, 2015, the total pre-tax compensation cost, net of estimated forfeitures, related to nonvested performance share units not yet recognized was $17 million, which is expected to be recognized over a weighted-average period of two years.