Raytheon 2011 Annual Report Download - page 107

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
99
(which includes the $80 million related to the drawdown on the letters of credit), clawback or other claims asserted by the
UKBA either in its March 2011 arbitration filing or its October 2011 reply. Due to the inherent uncertainties in litigation and
arbitration and the complexity and technical nature of actual and potential claims and counterclaims, it is reasonably possible
that the ultimate amount of any resolution of the termination could be less or greater than the amounts we have recorded. For
the same reasons, at this time, we are unable to estimate a range of the possible loss or recovery, if any, beyond the claim and
counterclaim amounts. If we fail to collect the receivable balances or are required to make payments against claims or other
losses asserted by the UKBA in excess of the amounts we have recorded, it could have a material adverse effect on our financial
position, results of operations or liquidity. Arbitration hearings are scheduled to commence in late 2012 and we expect to have
a decision in 2013.
In addition, various other claims and legal proceedings generally incidental to the normal course of business are pending or
threatened against us. We do not expect any additional liability from these proceedings to have a material adverse effect on
our financial position, results of operations or liquidity.
Product Warranty—We provide for product warranties in conjunction with certain product sales for which we recognize
revenue upon delivery.
Activity related to product warranty accruals was as follows:
(In millions)
Balance at December 31, 2008
Provisions for warranties
Warranty services provided
Balance at December 31, 2009
Provisions for warranties
Warranty services provided
Balance at December 31, 2010
Provisions for warranties
Warranty services provided
Balance at December 31, 2011
$ 39
7
(7)
39
14
(10)
43
4
(9)
$ 38
We account for warranty provision costs incurred under our long-term contracts using the cost-to-cost measure of progress
as contracts costs, as the estimation of these costs is integral in determining the price of the related long-term contracts. The
table above excludes these costs.
Note 12: Stockholders’ Equity
The changes in shares of our common stock outstanding were as follows:
(In millions)
Balance at December 31, 2008
Stock plans activity
Treasury stock repurchases
Balance at December 31, 2009
Warrants exercised
Stock plans activity
Treasury stock repurchases
Balance at December 31, 2010
Warrants exercised
Stock plans activity
Treasury stock repurchases
Balance at December 31, 2011
400.1
3.6
(25.8)
377.9
6.7
3.8
(29.0)
359.4
3.3
3.3
(27.1)
338.9