Income Tax (Tables)

6 Months Ended

Jun. 30, 2013

Income Tax Disclosure [Abstract]

Income Tax Disclosure Table

Income before taxes which was subject to US and non-US income taxes was as follows:

	(Stated in millions)
	Second Quarter				Six Months
	2013		2012		2013		2012
United States	$	510	$	553	$	931	$	1,123
Outside United States		2,163		1,226		3,360		2,283
	$	2,673	$	1,779	$	4,291	$	3,406

Components of Net Deferred Tax Assets

The components of net deferred tax assets (liabilities) were as follows:

	(Stated in millions)
	Jun. 30, 2013			Dec. 31, 2012
Postretirement benefits, net	$	522		$	543
Intangible assets		(1,484	)		(1,490	)
Investments in non-US subsidiaries		(317	)		(317	)
Other, net		123			114
	$	(1,156	)	$	(1,150	)

Components of Consolidated Income Taxes

The components of consolidated Taxes on income were as follows:

	(Stated in millions)
	Second Quarter						Six Months
	2013			2012			2013			2012
Current:
United States—Federal	$	203		$	171		$	319		$	361
United States—State		20			18			35			35
Outside United States		298			263			546			466
	$	521		$	452		$	900		$	862
Deferred:
United States—Federal	$	(42	)	$	9		$	(24	)	$	(24	)
United States—State		(3	)		1			(3	)		(2	)
Outside United States		(7	)		(27	)		2			(7	)
Valuation allowance		(20	)		4			(20	)		4
	$	(72	)	$	(13	)	$	(45	)	$	(29	)
	$	449		$	439		$	855		$	833

Reconciliation of US Statutory Federal Tax Rate

A reconciliation of the US statutory federal tax rate of 35% to the consolidated effective income tax rate follows:

	Second Quarter						Six Months
	2013			2012			2013			2012
US federal statutory rate		35	%		35	%		35	%		35	%
US state income taxes		—			1			1			1
Non-US income taxed at different rates		(12	)		(11	)		(12	)		(11	)
Charges (See Note 2)		(6	)		—			(4	)		—
Other		—			—			—			(1	)
Effective income tax rate		17	%		25	%		20	%		24	%