eXtensible Business Reporting Language
September 23, 2013
XBRL
Agenda
Who is UTC?
UTC quarterly close process
UTC’s XBRL experience and project approach to date
The facts versus the misconceptions
“What’s in it for me?”
The basics
The benefits
Conclusion
2
XBRL
Who is UTC?
3
XBRL
Who is UTC?
4
XBRL
Who is UTC?
5
XBRL
UTC 2012 Segment Sales
Sikorsky
12%
UTAS
Otis
21%
14%
29%
24%
CCS
Pratt &
Whitney
6
XBRL
UTC 2012 Sales by Geography
2012 consolidated net sales = $57.7 billion
Other
14%
United States
40%
Asia Pacific
20%
Europe
26%
7
XBRL
Product Diversity
Net sales by type and as a percent of total net sales
Military
Aerospace
& Space
Commercial
& Industrial
Aftermarket
21%
51%
43%
57%
28%
Commercial
Aerospace
Original
Equipment
Manufacturing
8
XBRL
Road to the quarterly close
7/1/13
Information
Technology
Holding
Company
Activity
Ongoing
Business
Activity
Accounting &
Reporting
Guidance
Day 1
up to
CARS
SBS
Services
Business
Process
Improvement
Technical
Accounting
Support for
Segments
10/26/13
9/30/13
Acquisition /
Divestiture
Activity
CARS
Day
CARS
+1 thru
+3
Post CARS +3
Information
Distribution
Government
Accounting
9
XBRL
Financial reporting process timeline
10/9/13
10Q Filing
CARS Day
Business Unit
Close Period
• Business Units
transfer data to UTC
• CFO Meeting
• Income Statement
• EPS
• One Timers
• FX Impact
• Restructuring
10/25/13
10/17/13 Disclosure
Committee – SEC Requirement
Pre Qtr end
Day 1
up to CARS
CARS Day
Analysis & Review
Pre-Close preparation
•New accounting standards
•Analyze transactions
•Support Businesses
•Maintain Financial Manual
•Provide Guidance
•Update deliverables
•Prepare Close calendar
•
•
•
•
•
Post CARS +3
CARS +1 thru +3
Cash flow
Balance sheet analysis
Income statement analysis
Disclosure Committee prep
Geographic data
Audit Committee
Mailing /
Teleconference
10/21/13
Earnings 10/22/13
Release
10
10
XBRL
Suppliers to customers
Base Unit Data
(~ 7,000 HFM Entities, & ~3,000 HFM Users)
Disclosure Committee
Business Unit
Consolidation
UTC Consolidation
External
Reporting
Customers
Shareowners
CEO
CFO
Investor Relations
Shareowners
11
XBRL
UTC’s XBRL experience
• Participant in SEC’s Voluntary Filers Program (VFP)
• First to furnish complete quarterly & annual financial
financials
• First company to subject furnishings to audit
• Member of XBRL, U.S. temporary Board of Directors,
Domain, Communications & Taxonomy Steering Committees,
Assurance Task Force and VFP Working Group
• Case studies, white papers, roundtables, articles & CiFIR
participation
• First to file financials with US GAAP taxonomy
12
XBRL
UTC’s XBRL approach
• No knowledge of/experience with XBRL when began
• All efforts done in-house by financial reporting group; no
involvement of Legal or IT
• Inexpensive to get started; quick learning curve
• Started with manageable effort; continued to build knowledge
off of prior experience
• Built internal processes from beginning
• Anxious to move application of process beyond SEC
reporting
• Used available resources liberally
13
XBRL
Facts versus misconceptions
• Costly?
No
• Technical/IT project?
No
• Significant commitment of time and resources?
No
• Easy to do?
Yes
• Resources available?
Yes
• Process & tools robust?
Yes
• Is there really a market demand?
Yes
• Doesn’t this just benefit the regulators?
No
14
XBRL
What’s in it for me?
• Consistency, accuracy, efficiency
• Enhanced ability to benchmark, analyze, validate, compare
and access data
• Potential for significant reduction to manual effort
• Systemic access to data in multiple systems and applications
• Common source for multiple reporting requirements
• Inexpensive solution that does not require major system
implementations
15
XBRL
Tags and taxonomies
Taxonomy A collection of standardized, machine readable
tags
Tags
Electronic identifiers (“barcodes”) that provide
information about a piece of financial information
Must “extend” or customize when standard tag
does not exist
“Bar Coding” for business
information
16
XBRL
Tags and taxonomies
UTC
Asset Balance
Sheet
FASB ASC
305
As of
December
31, 2012
4,819
Debit
balance
Cash
U.S.
Dollars
In millions
17
XBRL
XBRL Cloud
18
XBRL
Internal benefits
Supplemental Data
ERP
ERP
10-Q in
Word
HFM
10-Q in
HTML
ERP
Total Process
Time:
~ 845 Hours
Review
and Check
Review
and Check
10-Q in
XBRL
Edgar
19
XBRL
Internal benefits
ERP
WebFilings
ERP
10-Q in
HTML,
XBRL, PDF
HFM
ERP
Supplemental Data
Edgar
Total Process Time: ~ 700 Hours
20
XBRL
Other benefits: benchmarking & research
UTC Form 10-K
GE Form 10-K
Lockheed Form 10-K
Boeing Form 10-K
Honeywell Form 10-K
21
XBRL
Other benefits: government reporting
22
XBRL
Past as prelude to the future
1970’s
• SEC forms
filed in hard
copy
• Company
filings only
available in
hard copy
1983
1984
1992
1993
1996
• EDGAR
• EDGAR filing • Voluntary
• SEC begins • All domestic
System
pilot program EDGAR filing requiring
registrants
development
launched
program
direct
required to
begins
opened
EDGAR filing file via
EDGAR
• Filings via
direct
transmission,
diskette, or
magnetic
tape
23