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Assets and Liabilities Held For Sale and Discontinued Operations | 12 Months Ended
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Sep. 30, 2024
Discontinued Operations and Disposal Groups [Abstract] |
Assets and Liabilities Held For Sale and Discontinued Operations | ASSETS AND LIABILITIES HELD FOR SALE AND DISCONTINUED OPERATIONS In July 2024, the Company entered into a definitive agreement to sell its R&LC HVAC business, which includes the North America Ducted businesses and the global Residential joint venture with Hitachi, of which Johnson Controls owns 60% and Hitachi owns 40%, to Bosch Group for approximately $8.1 billion in cash with the Company’s portion of the aggregate consideration being approximately $6.7 billion, inclusive of an upfront royalty payment for the licensing of the York tradename. The transaction is expected to close in the fourth quarter of fiscal 2025, subject to required regulatory approvals and other customary closing conditions. The R&LC HVAC business, which was previously reported in the Global Products segment, meets the criteria to be classified as discontinued operations as it represents a strategic shift in the Company's operations and results in the exit of substantially all of its residential and light commercial HVAC businesses. As a result, results of the business are presented in discontinued operations for all periods presented. The Company determined that the assets and liabilities for the R&LC HVAC business met the held for sale criteria during the fourth quarter of 2024. Accordingly, the businesses' assets and liabilities were reclassified in the consolidated balance sheets at September 30, 2024 and 2023 to held for sale, and the Company ceased recording depreciation and amortization for the held for sale assets. The following table summarizes the results of the R&LC HVAC business which are reported as discontinued operations (in millions):
|  | Year Ended September 30, |
|  | 2024 |  | 2023 |  | 2022 |
Net sales |  | $ | 4,466 |  |  | $ | 4,462 |  |  | $ | 4,662 |  |
Cost of goods sold |  | 3,300 |  |  | 3,295 |  |  | 3,409 |  |
Gross profit |  | 1,166 |  |  | 1,167 |  |  | 1,253 |  |
Selling, general and administrative expenses |  | 761 |  |  | 794 |  |  | 867 |  |
Restructuring and impairment costs |  | 34 |  |  | 15 |  |  | 20 |  |
Net financing charges |  | 17 |  |  | 23 |  |  | 8 |  |
Equity income |  | 276 |  |  | 262 |  |  | 240 |  |
Income from discontinued operations before income taxes |  | 630 |  |  | 597 |  |  | 598 |  |
Provision for income taxes on discontinued operations |  | 141 |  |  | 145 |  |  | 169 |  |
Income from discontinued operations, net of tax |  | 489 |  |  | 452 |  |  | 429 |  |
Income from discontinued operations attributable to noncontrolling interest, net of tax |  | 191 |  |  | 165 |  |  | 176 |  |
Income from discontinued operations |  | $ | 298 |  |  | $ | 287 |  |  | $ | 253 |  |
The following table summarizes the assets and liabilities of the R&LC HVAC business which were classified as held for sale (in millions):
|  | September 30,
|  | 2024 |  | 2023
Cash |  | $ | 5 |  |  | $ | 7 |
Accounts receivable - net |  | 592 |  |  | 512 |
Inventories |  | 876 |  |  | 904 |
Other current assets |  | 122 |  |  | 129 |
Current assets held for sale |  | 1,595 |  |  | 1,552 |
Property, plant and equipment - net |  | 793 |  |  | 762 |
Goodwill |  | 1,182 |  |  | 1,164 |
Other intangible assets - net |  | 96 |  |  | 116 |
Investments in partially-owned affiliates |  | 949 |  |  | 905 |
Other noncurrent assets |  | 190 |  |  | 158 |
Noncurrent assets held for sale |  | 3,210 |  |  | 3,105 |
Total assets classified as held for sale |  | $ | 4,805 |  |  | $ | 4,657 |
Short-term debt |  | $ | — |  |  | $ | 24 |
Accounts payable |  | 917 |  |  | 770 |
Accrued compensation and benefits |  | 113 |  |  | 111 |
Deferred revenue |  | 84 |  |  | 73 |
Other current liabilities |  | 317 |  |  | 397 |
Current liabilities held for sale |  | 1,431 |  |  | 1,375 |
Pension and postretirement benefit obligations |  | 28 |  |  | 27 |
Other noncurrent liabilities |  | 377 |  |  | 380 |
Noncurrent liabilities held for sale |  | 405 |  |  | 407 |
Total liabilities classified as held for sale |  | $ | 1,836 |  |  | $ | 1,782 |
Assets and liabilities classified as held for sale are required to be recorded at the lower of carrying value or fair value less costs to sell. As of September 30, 2024, the estimated fair value less costs to sell of the held for sale businesses exceeded their carrying value, and therefore, no adjustment was necessary. During the year ended September 30, 2023, the Company recorded impairment charges for the Global Retail business of $438 million and the Building Solutions Asia Pacific segment of $60 million. The impairment charges were primarily due to reductions in the estimated fair values of the businesses to be disposed as a result of negotiations with potential buyers and were recorded within restructuring and impairment costs in the consolidated statements of income. During the third quarter of fiscal 2023, the Company concluded that its Global Retail business no longer met the criteria to be classified as held for sale, as it was no longer probable that it would be sold in the next 12 months. The net assets were reclassified to held and used at the lower of fair value or adjusted carrying value, and due to prior period impairment charges recorded, there was no impact to the consolidated statements of income as a result of this reclassification.

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- Definition The entire disclosure related to a disposal group. Includes, but is not limited to, a discontinued operation, disposal classified as held-for-sale or disposed of by means other than sale or disposal of an individually significant component. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 205 -SubTopic 20 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/205-20/tableOfContent Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 360 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/360/tableOfContent + Details
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