XML 26 R9.htm IDEA: XBRL DOCUMENT v2.4.0.6
Accrued Liabilities
 6 Months Ended
Jun. 30, 2012
Accrued Liabilities [Abstract]  
Accrued Liabilities
3. Accrued Liabilities

Accrued liabilities consist of (in millions):

 

                 
    June 30,     December 31,  
    2012     2011  

Customer prepayments and billings

   $ 755     $ 686  

Accrued vendor costs

     428       280  

Compensation

     321       468  

Warranty

     216       211  

Insurance

     105       103  

Taxes (non income)

     102       119  

Fair value of derivatives

     68       83  

Interest

     7       7  

Other

     419       419  
   

 

 

    

 

 

  

Total

   $ 2,421     $ 2,376  
   

 

 

    

 

 

  

Service and Product Warranties

The Company provides service and warranty policies on certain of its products. The Company accrues liabilities under service and warranty policies based upon specific claims and a review of historical warranty and service claim experience in accordance with Accounting Standards Codification (“ASC”) Topic 450 “Contingencies” (“ASC Topic 450”). Adjustments are made to accruals as claim data and historical experience change. In addition, the Company incurs discretionary costs to service its products in connection with product performance issues and accrues for them when they are encountered.

 

The changes in the carrying amount of service and product warranties are as follows (in millions):

 

         

Balance at December 31, 2011

   $ 211  
   

 

 

  

Net provisions for warranties issued during the year

     30  

Amounts incurred

     (26 ) 

Currency translation adjustments and other

     1  
   

 

 

  

Balance at June 30, 2012

   $ 216