Raytheon 2011 Annual Report Download - page 104
Download and view the complete annual report
Please find page 104 of the 2011 Raytheon annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.-
1 -
2
-
3
-
4
-
5
-
6
-
7
-
8
-
9
-
10
-
11
-
12
-
13
-
14
-
15
-
16
-
17
-
18
-
19
-
20
-
21
-
22
-
23
-
24
-
25
-
26
-
27
-
28
-
29
-
30
-
31
-
32
-
33
-
34
-
35
-
36
-
37
-
38
-
39
-
40
-
41
-
42
-
43
-
44
-
45
-
46
-
47
-
48
-
49
-
50
-
51
-
52
-
53
-
54
-
55
-
56
-
57
-
58
-
59
-
60
-
61
-
62
-
63
-
64
-
65
-
66
-
67
-
68
-
69
-
70
-
71
-
72
-
73
-
74
-
75
-
76
-
77
-
78
-
79
-
80
-
81
-
82
-
83
-
84
-
85
-
86
-
87
-
88
-
89
-
90
-
91
-
92
-
93
-
94 -
95 -
96 -
97 -
98 -
99 -
100 -
101 -
102 -
103 -
104 -
105 -
106 -
107 -
108 -
109 -
110 -
111 -
112 -
113 -
114 -
115
-
116
-
117
-
118
-
119
-
120
-
121
-
122
-
123
-
124
-
125
-
126
-
127
-
128
-
129
-
130
-
131
-
132
-
133
-
134
-
135
-
136
-
137
-
138
-
139
-
140
 |
 |
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
96
Note 11: Commitments and Contingencies
At December 31, 2011, we had commitments under long-term leases requiring annual rentals on a net lease basis as follows:
(In millions)
2012
2013
2014
2015
2016
Thereafter
$ 229
186
154
129
107
386
Rent expense was $271 million, $307 million and $290 million in 2011, 2010 and 2009, respectively. In the normal course
of business, we lease equipment, office buildings and other facilities under leases that include standard escalation clauses for
adjusting rent payments to reflect changes in price indices, as well as renewal options.
At December 31, 2011, we had commitments under agreements to outsource a portion of our information technology function,
which have no minimum annual payments.
Insurance is purchased from third parties to cover aggregate liability exposure up to $2 billion.
Environmental Matters—We are involved in various stages of investigation and cleanup related to remediation of various
environmental sites. Our estimate of the liability of total environmental remediation costs includes the use of a discount rate
and takes into account that a portion of these costs is eligible for future recovery through the pricing of our products and
services to the U.S. Government. We consider such recovery probable based on government contracting regulations and our
long history of receiving reimbursement for such costs and accordingly have recorded the estimated future recovery of these
costs from the U.S. Government within contracts in process. Our estimates regarding remediation costs to be incurred were
as follows at December 31:
(In millions, except percentages)
Total remediation costs—undiscounted
Weighted average risk-free rate
Total remediation costs—discounted
Recoverable portion
2011
$ 227
5.6%
$ 152
105
2010
$ 225
5.6%
$ 152
107
We also lease certain government-owned properties and are generally not liable for remediation of preexisting environmental
contamination at these sites; as a result, we generally do not reflect the provision for these costs in our consolidated financial
statements.
Due to the complexity of environmental laws and regulations, the varying costs and effectiveness of alternative cleanup
methods and technologies, the uncertainty of insurance coverage and the unresolved extent of our responsibility, it is difficult
to determine the ultimate outcome of environmental matters; however, we do not expect any additional liability to have a
material adverse effect on our financial position, results of operations or liquidity.
Environmental remediation costs expected to be incurred are:
(In millions)
2012
2013
2014
2015
2016
Thereafter
$ 48
26
16
13
12
112