Cummins Inc. Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

OTHER COMPREHENSIVE INCOME (LOSS) (Tables)

OTHER COMPREHENSIVE INCOME (LOSS) (Tables)

6 Months Ended

Jun. 28, 2015

Changes in accumulated other comprehensive income (loss) by component

Following are the changes in accumulated other comprehensive income (loss) by component for the three and six months ended:



	Three months ended
In millions	Change in pensions and other postretirement defined benefit plans			Foreign currency translation adjustment			Unrealized gain (loss) on marketable securities			Unrealized gain (loss) on derivatives			Total attributable to Cummins Inc.			Noncontrolling interests			Total
Balance at March 30, 2014	$	(607	)	$	(155	)	$	6		$	1		$	(755	)
Other comprehensive income before reclassifications
Before tax amount	—			83			—			7			90			$	—		$	90
Tax (expense) benefit	—			(4		)	—			(2		)	(6		)	—			(6		)
After tax amount	—			79			—			5			84			—			84
Amounts reclassified from accumulated other comprehensive income⁽¹⁾⁽²⁾	10			—			(6		)	(2		)	2			(3		)	(1		)
Net current period other comprehensive income (loss)	10			79			(6		)	3			86			$	(3	)	$	83
Balance at June 29, 2014	$	(597	)	$	(76	)	$	—		$	4		$	(669	)

Balance at March 29, 2015	$	(656	)	$	(587	)	$	(1	)	$	(1	)	$	(1,245	)
Other comprehensive income before reclassifications
Before tax amount	—			153			—			9			162			$	(6	)	$	156
Tax (expense) benefit	—			(1		)	—			(2		)	(3		)	—			(3		)
After tax amount	—			152			—			7			159			(6		)	153
Amounts reclassified from accumulated other comprehensive income⁽¹⁾⁽²⁾	15			—			—			—			15			1			16
Net current period other comprehensive income (loss)	15			152			—			7			174			$	(5	)	$	169
Balance at June 28, 2015	$	(641	)	$	(435	)	$	(1	)	$	6		$	(1,071	)

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⁽¹⁾ Amounts are net of tax.

⁽²⁾ See reclassifications out of accumulated other comprehensive income (loss) disclosure below for further details.



	Six months ended
In millions	Change in pensions and other postretirement defined benefit plans			Foreign currency translation adjustment			Unrealized gain (loss) on marketable securities			Unrealized gain (loss) on derivatives			Total attributable to Cummins Inc.			Noncontrolling interests			Total
Balance at December 31, 2013	$	(611	)	$	(179	)	$	7		$	(1	)	$	(784	)
Other comprehensive income before reclassifications
Before tax amount	(7		)	107			(1		)	10			109			$	7		$	116
Tax (expense) benefit	1			(4		)	—			(3		)	(6		)	—			(6		)
After tax amount	(6		)	103			(1		)	7			103			7			110
Amounts reclassified from accumulated other comprehensive income⁽¹⁾⁽²⁾	20			—			(6		)	(2		)	12			(4		)	8
Net current period other comprehensive income (loss)	14			103			(7		)	5			115			$	3		$	118
Balance at June 29, 2014	$	(597	)	$	(76	)	$	—		$	4		$	(669	)

Balance at December 31, 2014	$	(669	)	$	(406	)	$	(1	)	$	(2	)	$	(1,078	)
Other comprehensive income before reclassifications
Before tax amount	(3		)	(51		)	1			10			(43		)	$	(2	)	$	(45	)
Tax (expense) benefit	1			22			—			(2		)	21			—			21
After tax amount	(2		)	(29		)	1			8			(22		)	(2		)	(24		)
Amounts reclassified from accumulated other comprehensive income⁽¹⁾⁽²⁾	30			—			(1		)	—			29			—			29
Net current period other comprehensive income (loss)	28			(29		)	—			8			7			$	(2	)	$	5
Balance at June 28, 2015	$	(641	)	$	(435	)	$	(1	)	$	6		$	(1,071	)

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⁽¹⁾ Amounts are net of tax.

⁽²⁾ See reclassifications out of accumulated other comprehensive income (loss) disclosure below for further details.

Schedule of reclassification out of accumulated other comprehensive income (loss) and related tax effects

Following are the items reclassified out of accumulated other comprehensive income (loss) and the related tax effects:



In millions	Three months ended						Six months ended
(Gain)/Loss Components	June 28, 2015			June 29, 2014			June 28, 2015			June 29, 2014			Statement of Income Location

Change in pension and other postretirement defined benefit plans
Recognized actuarial loss	$	21		$	14		$	43		$	29		⁽¹⁾
Tax effect	(6		)	(4		)	(13		)	(9		)	Income tax expense
Net change in pensions and other postretirement defined benefit plans	$	15		$	10		$	30		$	20

Realized (gain) loss on marketable securities	$	—		$	(12	)	$	(1	)	$	(13	)	Other income (expense), net
Tax effect	1			3			—			3			Income tax expense
Net realized (gain) loss on marketable securities	$	1		$	(9	)	$	(1	)	$	(10	)

Realized (gain) loss on derivatives
Foreign currency forward contracts	$	—		$	(3	)	$	—		$	(5	)	Net sales
Commodity swap contracts	—			1			—			3			Cost of sales
Total before taxes	—			(2		)	—			(2		)
Tax effect	—			—			—			—			Income tax expense
Net realized (gain) loss on derivatives	$	—		$	(2	)	$	—		$	(2	)

Total reclassifications for the period	$	16		$	(1	)	$	29		$	8

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⁽¹⁾ These accumulated other comprehensive income components are included in the computation of net periodic pension cost (see Note 3, ''PENSION AND OTHER POSTRETIREMENT BENEFITS'').