United Parcel Service, Inc. Annual report pursuant to Section 13 and 15(d)

Annual report pursuant to Section 13 and 15(d)

SHAREOWNERS' EQUITY (Tables)

SHAREOWNERS' EQUITY (Tables)

12 Months Ended

Dec. 31, 2011

Roll-forward of Common Stock, Additional Paid-in Capital, and Retained Earnings Accounts

The following is a rollforward of our common stock, additional paid-in capital, and retained earnings accounts (in millions, except per share amounts):


	2011						2010						2009
	Shares			Dollars			Shares			Dollars			Shares			Dollars
Class A Common Stock
Balance at beginning of year		258		$	3			285		$	3			314		$	3
Common stock purchases		(7	)		—			(6	)		—			(10	)		—
Stock award plans		7			—			6			—			5			—
Common stock issuances		3			—			3			—			4			—
Conversions of class A to class B common stock		(21	)		—			(30	)		—			(28	)		—

Class A shares issued at end of year		240		$	3			258		$	3			285		$	3

Class B Common Stock
Balance at beginning of year		735		$	7			711		$	7			684		$	7
Common stock purchases		(31	)		—			(6	)		—			(1	)		—
Conversions of class A to class B common stock		21			—			30			—			28			—

Class B shares issued at end of year		725		$	7			735		$	7			711		$	7

Additional Paid-In Capital
Balance at beginning of year				$	—					$	2					$	—
Stock award plans					388						398						381
Common stock purchases					(475	)					(649	)					(569	)
Common stock issuances					287						249						190
Option Premiums Paid					(200	)					—						—

Balance at end of year				$	—					$	—					$	2

Retained Earnings
Balance at beginning of year				$	10,604					$	9,335					$	9,186
Net income attributable to controlling interests					3,804						3,338						1,968
Dividends ($2.08, $1.88 and $1.80 per share)					(2,086	)					(1,909	)					(1,819	)
Common stock purchases					(2,194	)					(160	)					—

Balance at end of year				$	10,128					$	10,604					$	9,335

Activity in Accumulated Other Comprehensive Income (Loss)

The activity in AOCI is as follows (in millions):


	2011			2010			2009
Foreign currency translation gain (loss):
Balance at beginning of year	$	(68	)	$	37		$	(38	)
Aggregate adjustment for the year (net of tax effect of $11, $(34), and $(27))		(92	)		(105	)		75

Balance at end of year		(160	)		(68	)		37

Unrealized gain (loss) on marketable securities, net of tax:
Balance at beginning of year		12			(27	)		(60	)
Current period changes in fair value (net of tax effect of $11, $17, and $3)		18			30			25
Reclassification to earnings (net of tax effect of $(14), $6, and $5)		(24	)		9			8

Balance at end of year		6			12			(27	)

Unrealized gain (loss) on cash flow hedges, net of tax:
Balance at beginning of year		(239	)		(200	)		(107	)
Current period changes in fair value (net of tax effect of $(16), $(4), and $4)		(26	)		(7	)		6
Reclassification to earnings (net of tax effect of $37, $(19) and $(60))		61			(32	)		(99	)

Balance at end of year		(204	)		(239	)		(200	)

Unrecognized pension and postretirement benefit costs, net of tax:
Balance at beginning of year		(2,340	)		(1,527	)		(2,211	)
Reclassification to earnings (net of tax effect of $378, $150 and $197)		628			245			329
Net actuarial gain (loss) and prior service cost resulting from remeasurements of plan assets and liabilities (net of tax effect of $(622), $(633), and $219)		(1,033	)		(1,058	)		355

Balance at end of year		(2,745	)		(2,340	)		(1,527	)

Accumulated other comprehensive income (loss) at end of year	$	(3,103	)	$	(2,635	)	$	(1,717	)

Activity in Deferred Compensation Program

Activity in the deferred compensation program for the years ended December 31, 2011, 2010, and 2009 is as follows (in millions):


	2011						2010						2009
	Shares			Dollars			Shares			Dollars			Shares			Dollars
Deferred Compensation Obligations
Balance at beginning of year				$	103					$	108					$	121
Reinvested dividends					4						4						3
Options exercise deferrals					—						1						—
Benefit payments					(19	)					(10	)					(16	)

Balance at end of year				$	88					$	103					$	108

Treasury Stock
Balance at beginning of year		(2	)	$	(103	)		(2	)	$	(108	)		(2	)	$	(121	)
Reinvested dividends		—			(4	)		—			(4	)		—			(3	)
Options exercise deferrals		—			—			—			(1	)		—			—
Benefit payments		—			19			—			10			—			16

Balance at end of year		(2	)	$	(88	)		(2	)	$	(103	)		(2	)	$	(108	)

The activity related to our noncontrolling interests is presented below (in millions):


	2011		2010
Noncontrolling Interests
Balance at beginning of period	$	68	$	66
Acquired noncontrolling interests		5		2
Dividends attributable to noncontrolling interests		—		—
Net income attributable to noncontrolling interests		—		—

Balance at end of period	$	73	$	68

- Definition

Tabular disclosure of an equity-based arrangement (such as stock or unit options and stock or unit awards) with an individual employee, which is generally an employment contract between the entity and a selected officer or key employee containing a promise by the employer to pay certain equity-based awards at future dates, sometimes including a period after retirement, upon compliance with stipulated requirements. This type of arrangement is distinguished from broader based employee benefit plans as it is usually tailored to the employee. Disclosure also typically includes the amount of related compensation expense recognized during the reporting period, the number of shares or units issued during the period under such arrangements, and the carrying amount as of the balance sheet date of the related liability.

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