year.
 beginning 2013  ventures pay dividends quarterly basis.
 in 2013 , 2012 2011  received cash dividends of $ 92 million , $ 83 million and $ 78 million  respectively.
 in 2012 nantong venture completed expansion of acetate flake and acetate tow capacity each by 30000 tons.
 made contributions of $ 29 million from 2009 through 2012 related to capacity expansion in nantong.
 similar expansions ventures led to earnings growth increased dividends for company.
 according to euromonitor database services china estimated to 42% ( 42 % ) share of world's 2012 cigarette consumption.
 cigarette consumption in china expected to grow at rate of 1. 9% ( 1. 9 % ) per year from 2012 through 2017.
 combined ventures are leader in chinese domestic acetate production believe well positioned to supply chinese cigarette producers.
 ownership interest in each cellulose derivatives ventures exceeds 20% ( 20 % ) account for investments using cost method of accounting cannot exercise significant influence over entities due to local government investment influence entities limitations on involvement in day-to-day operations present inability of entities to provide timely financial information in accordance with generally accepted accounting principles in united states of america ( "us ).
 2022 other equity method investments infraservs.
 hold indirect ownership interests in several german infraserv groups own develop industrial parks provide on-site general administrative support to tenants.
 ownership interest in equity investments in infraserv affiliates are as follows : as of december 31 , 2013 ( in percentages ).
 research and development businesses are innovation-oriented conduct research and development activities to develop new  optimize existing production technologies develop commercially viable new products and applications.
consider amounts spent during each last three fiscal years on research and development activities to sufficient to execute current strategic initiatives.
 intellectual property attach importance to protecting our intellectual property , including through patents , trademarks , copyrights product designs in to preserve investment in research and development , manufacturing marketing.
 patents may cover processes , products , intermediate products product uses.
 also seek to register trademarks protecting brand names of company and products.
 protect intellectual property against infringement seek to register design protection where appropriate.
 patents.
 in most industrial countries , patent protection exists for new substances formulations, for certain unique applications production processes.
 , we do business in regions world where intellectual property protection may be limited difficult to enforce.
 maintain strict information security policies and procedures wherever do business.
 such information security policies procedures include data encryption  controls over disclosure safekeeping of confidential information employee awareness training.
 monitor competitive developments defend against infringements on intellectual property rights.
 trademarks.
aoplus ae , ae2  ae3 , ateva ae  avicor ae  britecoat ae  celanese ae  celanex ae  celcon ae  celfx 2122 , celstran ae  celvolit ae  clarifoil ae  compel ae  duroset ae  ecovae ae  factor ae  fortron ae  gur ae  hostaform ae  impet ae  mowilith ae  nutrinova ae  qorus 2122 , riteflex ae  sunett ae  tcx 2122, thermx ae  tufcor ae  vandar ae  vantage ae  vantageplus 2122 , vantage ae2  vectra ae  vinamul ae  vitaldose ae  zenite ae other branded products services in document are registered trademarks service marks owned licensed by celanese.
 not exhaustive comprehensive list of all registered trademarks service marks by celanese.
 fortron ae registered trademark of fortron industries llc.

| as of december 31 2013 ( in percentages )
--------------------------------- | -----------------------------------------
infraserv gmbh & co . gendorf kg  | 39
infraserv gmbh & co . knapsack kg | 27
infraserv gmbh & co . hoechst kg  | 32


to maturity at any time in whole or part at option of company at 201cmake-whole 201d redemption price.
 2017 notes issued at discount of $ 6 million amortized over ten-year term.
 company incurred approximately $ 4 million of debt issuance costs amortized over ten years.
 at december 31 , 2013  $ 2 million of unamortized debt issuance costs included in other assets on consolidated statement of financial condition.
 13.
 commitments and contingencies operating lease commitments company leases primary office spaces under agreements expire through 2035.
 future minimum commitments under operating leases are as follows : ( in millions ).
 rent expense and certain office equipment expense under agreements amounted to $ 137 million , $ 133 million and $ 154 million in 2013 , 2012 and 2011  respectively.
 investment commitments.
 at december 31 , 2013  company had $ 216 million of various capital commitments to fund sponsored investment funds including funds private equity funds real estate funds infrastructure funds  opportunistic funds distressed credit funds.
 amount excludes additional commitments by consolidated funds of funds to third-party funds third-party noncontrolling interest holders have legal obligation to fund commitments of funds.
 timing of funding of commitments unknown commitments callable on demand any time prior to expiration of commitment.
 unfunded commitments not recorded on consolidated statements of financial condition.
 commitments do not include potential future commitments approved by company not yet legally binding.
 company intends to make additional capital commitments to fund additional investment products for with clients.
 contingencies contingent payments.
 company acts as portfolio manager in credit default swap transactions has maximum potential exposure of $ 17 million under credit default swap between company and counterparty.
see note 7 , derivatives and hedging , for further discussion.
 contingent payments related to business acquisitions.
 in connection with credit suisse etf transaction  blackrock required to make contingent payments annually to credit suisse  subject to achieving specified thresholds during seven-year period  subsequent to acquisition date.
 in addition blackrock required to make contingent payments related to mgpa transaction during five-year period  subject to achieving specified thresholds subsequent to acquisition date.
 fair value of contingent payments at december 31 , 2013 not significant to consolidated statement of financial condition included in other liabilities.
 legal proceedings.
 to blackrock receives subpoenas or other requests for information from various.
 federal , state governmental domestic international regulatory authorities in connection with industry-wide other investigations or proceedings.
 blackrock 2019s policy to cooperate fully with such inquiries.
 company and certain subsidiaries named as defendants in various legal actions including arbitrations other litigation in connection with blackrock 2019s activities.
 certain blackrock- sponsored investment funds company manages subject to lawsuits potentially could harm investment returns of applicable fund or result in company liable to funds for resulting damages.
 management  after consultation with legal counsel does not anticipate aggregate liability  if arising out of regulatory matters or lawsuits will have material effect on blackrock 2019s results of operations , financial position  or cash flows.
 no assurance to such pending or threatened matters material effect on blackrock 2019s results of operations , financial position or cash flows in future reporting period.
 due to uncertainties surrounding outcome of these matters  management cannot reasonably estimate possible loss or range of loss from these matters.
indemnifications.
 in ordinary course of business or connection with acquisition agreements , blackrock enters into contracts it may agree to indemnify third parties in certain circumstances.
 terms of indemnities vary from contract to contract amount of indemnification liability cannot be determined or likelihood of liability is considered remote.
 no liability recorded on consolidated statement of financial condition.
 in connection with securities lending transactions blackrock issued indemnifications to securities lending clients against potential loss from borrower 2019s failure to fulfill obligations under securities lending agreement should value of collateral pledged by borrower at default be insufficient to cover borrower 2019s obligation under securities lending agreement.
 at december 31 , 2013  company indemnified clients for securities lending loan balances of approximately $ 118. 3 billion.
 company held as agent , cash and securities totaling $ 124. 6 billion as collateral for indemnified securities on loan at december 31 , 2013.
 fair value of indemnifications not material at december 31 , 2013.

year       | amount
---------- | ------
2014       | $ 135
2015       | 127
2016       | 110
2017       | 109
2018       | 106
thereafter | 699
total      | $ 1286


2011 compared to 2010 mst 2019s net sales 2011 decreased $ 311 million or 4% ( 4 % ) compared to 2010.
 decrease attributable to decreased volume $ 390 million for ship and aviation system programs ( primarily maritime patrol aircraft ptds ) $ 75 million for training and logistics solutions programs.
 partially offsetting decreases higher sales of $ 165 million from production on lcs program.
 mst 2019s operating profit for 2011 decreased $ 68 million  or 10% ( 10 % )  compared to 2010.
 decrease attributable to decreased operating profit $ 55 million increased reserves for contract cost matters on ship and aviation system programs including terminated presidential helicopter program ) $ 40 million due to lower volume increased reserves on training and logistics solutions.
 partially offsetting decreases higher operating profit of $ 30 million 2011 due to recognition of reserves on undersea systems programs 2010.
 adjustments not related to volume  including net profit rate adjustments approximately $ 55 million lower in 2011 compared to 2010.
 backlog backlog increased in 2012 2011 due to increased orders on ship and aviation system programs primarily mh-60 lcs ) partially offset decreased orders higher sales volume on integrated warfare systems and sensors programs primarily aegis ).
 backlog decreased slightly in 2011 2010 due to higher sales volume on integrated warfare systems and sensors programs.
 expect mst 2019s net sales to decline in 2013 low single digit percentage range compared to 2012 due to completion of ptds deliveries 2012 expected lower volume on training services programs.
 operating profit and margin expected to increase slightly from 2012 levels due to anticipated improved contract performance.
 space systems business segment engaged in research development  design engineering production of satellites  strategic defensive missile systems  space transportation systems.
 responsible for classified systems services support vital national security systems.
space systems 2019 major programs include space-based infrared system sbirs advanced extremely high frequency ( aehf ) system  mobile user objective system muos ) global positioning satellite ( gps ) iii system  geostationary operational environmental satellite r-series goes  trident ii d5 fleet ballistic missile  orion.
 operating results for space systems business segment include equity interests in united launch alliance ( ula )  expendable launch services for u. s.
 government  united space alliance ( usa )  processing activities for space shuttle program winding down following last space shuttle mission 2011 joint venture manages u. k. 2019s atomic weapons establishment program.
 space systems 2019 operating results included ( in millions ) :.
 2012 compared to 2011 space systems 2019 net sales for 2012 increased $ 186 million  or 2% ( 2 % ) compared to 2011.
 increase attributable to higher net sales of $ 150 million due to increased commercial satellite deliveries ( two commercial satellites delivered in 2012 compared to one 2011 ) $ 125 million from orion program due to higher volume increase in risk retirements approximately $ 70 million from increased volume on strategic and defensive missile programs.
 partially offsetting increases were lower net sales of approximately $ 105 million from government satellite programs primarily sbirs and muos ) decreased volume decline in risk retirements $ 55 million from nasa external tank program  ended with completion space shuttle program in 2011.

| 2012             | 2011             | 2010
------------------- | ---------------- | ---------------- | ----------------
net sales           | $ 8347           | $ 8161           | $ 8268
operating profit    | 1083             | 1063             | 1030
operating margins   | 13.0% ( 13.0 % ) | 13.0% ( 13.0 % ) | 12.5% ( 12.5 % )
backlog at year-end | 18100            | 16000            | 17800


table of contents adjustments may result from tax examinations.
 outcome of tax audits be predicted with certainty.
 if issues in company 2019s tax audits resolved not consistent with management 2019s expectations company could be required to adjust provision for income taxes in period resolution occurs.
 liquidity and capital resources table presents financial information and statistics of for years ended september 28 , 2013 , september 29 , 2012 september 24 , 2011 ( in millions ) company believes existing balances of cash cash equivalents marketable securities will be sufficient to satisfy working capital needs capital asset purchases outstanding commitments other liquidity requirements with existing operations over next 12 months.
 company anticipates cash for future dividends and share repurchase program will come from current domestic cash  cash generated from on-going.
 operating activities borrowings.
 as of september 28 , 2013 and september 29 , 2012 , $ 111. 3 billion and $ 82. 6 billion  respectively of company 2019s cash  cash equivalents marketable securities were held by foreign subsidiaries generally based in.
 dollar-denominated holdings.
 amounts held by foreign subsidiaries subject to.
 income taxation on repatriation.
 company 2019s marketable securities investment portfolio invested primarily in highly-rated securities investment policy limits credit exposure to any one issuer.
 policy requires investments to be investment grade with objective of minimizing potential risk of principal loss.
 during 2013  cash generated from operating activities of $ 53. 7 billion was result of $ 37. 0 billion of net income , non-cash adjustments to net income of $ 10. 2 billion increase in net change in operating assets and liabilities of $ 6. 5 billion.
 cash used in investing activities of $ 33.8 billion 2013 consisted primarily of net purchases sales maturities of marketable securities $ 24. 0 billion cash used to acquire property  plant equipment $ 8. 2 billion.
 cash used in financing activities 2013 consisted primarily cash repurchase common stock $ 22. 9 billion cash pay dividends dividend equivalent rights $ 10. 6 billion  partially offset by net proceeds from issuance long-term debt $ 16. 9 billion.
 2012  cash generated from operating activities $ 50. 9 billion result of $ 41. 7 billion net income non-cash adjustments to net income $ 9. 4 billion offset by decrease in net operating assets liabilities $ 299 million.
 cash used in investing activities 2012 $ 48. 2 billion consisted primarily net purchases sales maturities of marketable securities $ 38. 4 billion cash used to acquire property  plant equipment $ 8. 3 billion.
 cash used in financing activities 2012 $ 1. 7 billion consisted primarily cash pay dividends dividend equivalent rights $ 2. 5 billion.
 capital assets company 2019s capital expenditures were $ 7. 0 billion 2013 $ 499 million for retail store facilities $ 6. 5 billion for other capital expenditures including product tooling manufacturing process equipment other corporate facilities infrastructure.
 company 2019s actual cash payments for capital expenditures 2013 were $ 8. 2 billion.

| 2013               | 2012               | 2011
--------------------------------------------------- | ------------------ | ------------------ | ------------------
cash cash equivalents and marketable securities     | $ 146761           | $ 121251           | $ 81570
property plant and equipment net                    | $ 16597            | $ 15452            | $ 7777
long-term debt                                      | $ 16960            | $ 0                | $ 0
working capital                                     | $ 29628            | $ 19111            | $ 17018
cash generated by operating activities              | $ 53666            | $ 50856            | $ 37529
cash used in investing activities                   | $ -33774 ( 33774 ) | $ -48227 ( 48227 ) | $ -40419 ( 40419 )
cash generated/ ( used in ) by financing activities | $ -16379 ( 16379 ) | $ -1698 ( 1698 )   | $ 1444


stock performance graph : graph shows cumulative total shareholder return assuming investment $ 100  on december 31 , 2013 reinvestment of dividends thereafter in company 2019s common stock versus standard and poor 2019s s&p 500 retail index ( 201cs&p 500 retail index 201d ) standard and poor 2019s s&p 500 index ( 201cs&p 500 201d ).

company/index                 | december 31 , 2013 | december 31 , 2014 | december 31 , 2015 | december 31 , 2016 | december 31 , 2017 | december 31 , 2018
----------------------------- | ------------------ | ------------------ | ------------------ | ------------------ | ------------------ | ------------------
o 2019reilly automotive inc . | $ 100              | $ 150              | $ 197              | $ 216              | $ 187              | $ 268
s&p 500 retail index          | 100                | 110                | 137                | 143                | 184                | 208
s&p 500                       | $ 100              | $ 111              | $ 111              | $ 121              | $ 145              | $ 136


item 2.
 properties summary of significant locations at december 31 , 2011 shown in following table.
 all facilities leased except for 165000 square feet of our office in alpharetta , georgia.
 square footage amounts are net of space sublet or part of facility restructuring.
 all facilities used by trading and investing or balance sheet management segments  in addition corporate/other category.
 all other leased facilities with space less than 25000 square feet not listed by location.
 in addition to significant facilities we also lease all 28 e*trade branches, ranging space from approximately 2500 to 7000 square feet.
 believe facilities space adequate to meet needs in 2012.
 item 3.
 legal proceedings on october 27 , 2000  ajaxo , inc.
 ( 201cajaxo 201d ) filed complaint in superior court for state of california , county of santa clara.
 ajaxo sought damages and non-monetary relief for company 2019s alleged breach of non-disclosure agreement with ajaxo pertaining to certain wireless technology ajaxo offered damages and other relief against company for alleged misappropriation of ajaxo 2019s trade secrets.
 following jury trial judgment entered in 2003 in favor of ajaxo against company for $ 1. 3 million for breach of ajaxo non-disclosure agreement.
 jury found in favor of ajaxo claim for misappropriation of trade secrets trial court denied ajaxo 2019s requests for additional damages and relief.
 on december 21 , 2005  california court of appeal affirmed award against company for breach of nondisclosure agreement but remanded case to trial court for determining additional damages ajaxo may be entitled to result of jury 2019s previous finding in favor of ajaxo on claim against company for misappropriation of trade secrets.
company paid ajaxo full amount due on above judgment case remanded back to trial court on may 30 , 2008  jury returned verdict in favor of company denying all claims and demands for damages against company.
 following trial court 2019s filing of entry judgment in favor company on september 5 , 2008  ajaxo filed post-trial motions for vacating judgment requesting new trial.
 by order dated november 4 , 2008  trial court denied these motions.
 on december 2 , 2008  ajaxo filed notice of appeal with court of appeal of state of california for sixth district.
 oral argument on appeal heard on july 15 , 2010.
 august 30 , 2010  court of appeal affirmed trial court 2019s verdict in part reversed verdict in part remanding case.
 e*trade petitioned supreme court of california for review of court of appeal decision.
 december 16 , 2010  california supreme court denied company 2019s petition for review remanded for further proceedings to trial court.
 september 20 , 2011  trial court granted limited discovery at conference on november 4 , 2011  set motion schedule and trial date.
 trial continue on may 14 , 2012.
 company to defend itself vigorously.
 on october 2 , 2007  class action complaint alleging violations of federal securities laws filed in united states district court for southern district of new york against company then

location               | approximate square footage
---------------------- | --------------------------
alpharetta georgia     | 260000
arlington virginia     | 119000
jersey city new jersey | 107000
menlo park california  | 91000
sandy utah             | 66000
new york new york      | 39000
chicago illinois       | 25000


vertex pharmaceuticals incorporated notes to consolidated financial statements continued.
 significant revenue arrangements continued $ 7 million of development and commercialization milestone payments.
 kissei agreed to reimburse company for certain development costs including portion of costs for phase 2 trials of vx-702.
 research funding ended program in june 2000 company received full amount research funding specified under agreement.
 kissei has exclusive rights to develop commercialize vx-702 in japan certain far east countries co-exclusive rights in china  taiwan south korea.
 company retains exclusive marketing rights outside far east co-exclusive rights in china taiwan south korea.
 company will right to supply bulk drug material to kissei for sale in its territory receive royalties drug supply payments on future product sales .
 in 2006 , 2005 2004  approximately $ 6. 4 million , $ 7. 3 million $ 3. 5 million  recognized as revenue under agreement.
 $ 7. 3 million revenue recognized in 2005 includes $ 2. 5 million milestone paid upon kissei 2019s completion of regulatory filings preparation for phase 1 clinical development of vx-702 in japan.
.
 employee benefits company has 401 ( k ) retirement plan ( 201cvertex 401 ( k ) plan 201d ) all permanent employees eligible to participate.
 participants may contribute up to 60% ( 60 % ) of annual compensation to vertex 401 ( k ) plan subject to statutory limitations.
 company may declare discretionary matching contributions to vertex 401 ( k ) plan payable in form of vertex common stock.
 match paid in form of fully vested interests in vertex common stock fund.
 employees ability to transfer funds from company stock fund as choose.
company declared matching contributions to vertex 401 ( k ) plan follows ( in thousands ) : q.
 related party transactions as of december 31 , 2006 , 2005 2004 , company had loan outstanding to former officer company amount of $ 36000 , $ 36000 , $ 97000 , respectively initially advanced in april 2002.
 loan balance included in other assets on consolidated balance sheets.
 in 2001  company entered four year consulting agreement with director company for provision part-time consulting services over four years  at rate of $ 80000 per year commencing january 2002.
 consulting agreement terminated in january 2006.
.
 contingencies company has certain contingent liabilities arise in ordinary course of business activities.
 company accrues reserve for contingent liabilities when probable future expenditures be made such expenditures can be reasonably estimated.
 discretionary matching contributions during year ended december 31, $ 3341 $ 2894 $ 2492 shares issued during year ended december 31 , 91 215 239 shares issuable as of year ended december 31, 28 19 57

| 2006   | 2005   | 2004
----------------------------------------------------------------------- | ------ | ------ | ------
discretionary matching contributions during the year ended december 31, | $ 3341 | $ 2894 | $ 2492
shares issued during the year ended december 31,                        | 91     | 215    | 239
shares issuable as of the year ended december 31,                       | 28     | 19     | 57


cme invests contributions in assets mirror assumed investment choices.
 balances in plans subject to claims of general creditors exchange totaled $ 38. 7 million and $ 31. 8 million at december 31 , 2012 and 2011 respectively.
 value of plans recorded as asset in marketable securities in consolidated balance sheets, equal and offsetting liability.
 investment results of plans have no impact on net income as investment results recorded in equal amounts to both investment income and compensation and benefits expense.
 supplemental savings plan.
 cme maintains supplemental plan to provide benefits for employees impacted by statutory limits under provisions qualified pension and savings plan.
 employees in plan subject to vesting requirements of underlying qualified plans.
 deferred compensation plan.
 deferred compensation plan maintained by cme  eligible officers and members of board of directors may contribute percentage of compensation and defer income taxes until time of distribution.
 comex members 2019 retirement plan and benefits.
 comex maintains retirement and benefit plan under comex members 2019 recognition and retention plan ( mrrp ).
 plan provides benefits to certain members of comex division based on long-term membership participation limited to individuals comex division members prior to nymex 2019s acquisition of comex in 1994.
 no new participants permitted into plan after date acquisition.
 under terms mrrp company required to fund plan with minimum annual contribution of $ 0. 8 million until fully funded.
 benefits paid under mrrp based on reasonable actuarial assumptions based upon amounts available and expected to be available to pay benefits.
 total contributions to plan were $ 0. 8 million for each of 2010 through 2012.
 at december 31 , 2012 and 2011 , obligation for mrrp totaled $ 22. 7 million and $ 21. 6 million , respectively.
 assets with fair value of $ 18.4 million and $ 17. 7 million allocated to plan at december 31 , 2012 and 2011 , respectively included in marketable securities and cash cash equivalents in consolidated balance sheets.
 balances in plans subject to claims of general creditors of comex.
 13.
 commitments operating leases.
 cme group entered into various non-cancellable operating lease agreements most significant as : 2022 in april 2012  company sold two buildings in chicago at 141 w.
 jackson leased back portion of property.
 operating lease  initial lease term ending april 30, 2027, contains four consecutive renewal options for five years.
 2022 in january 2011  company entered operating lease for office space in london.
 initial lease term effective january 20 , 2011  terminates march 24 , 2026  option to terminate without penalty in january 2021.
 2022 in july 2008  company renegotiated operating lease for headquarters at 20 south wacker drive in chicago.
 lease  initial term ending november 30 , 2022 , contains two consecutive renewal options for seven and ten years contraction option allows company to reduce occupied space after november 30 , 2018.
 company may exercise lease expansion option in december 2017.
 2022 august 2006  company entered into operating lease for additional office space in chicago.
 initial lease term effective august 10 , 2006  terminates november 30 , 2023.
 lease contains two 5-year renewal options beginning in 2023.
 at december 31 , 2012 , future minimum payments under non-cancellable operating leases payable as follows ( in millions ) :.

2013       | $ 28.7
---------- | -------
2014       | 29.1
2015       | 28.9
2016       | 28.9
2017       | 29.3
thereafter | 152.9
total      | $ 297.8


included in other non-current liabilities company believes ultimate payment or settlement of these liabilities not occur within next twelve months.
 prior to adoption of these provisions these amounts were included in current income tax payable.
 company includes interest and penalties related to unrecognized tax benefits within provision for taxes in condensed consolidated statements of income no change in classification made upon adopting these provisions.
 condensed consolidated statements of income for fiscal year 2009 and fiscal year 2008 include $ 1. 7 million and $ 1. 3 million , respectively of interest and penalties related to these uncertain tax positions.
 due to complexity associated with tax uncertainties company cannot make reliable estimate period in expects to settle liabilities associated with these uncertain tax positions.
 following table summarizes changes in total amounts of uncertain tax positions for fiscal 2008 and fiscal 2009.
 fiscal year 2004 and 2005 irs examination during fourth quarter of fiscal 2007 irs completed field examination of company 2019s fiscal years 2004 and 2005.
 on january 2, 2008 irs issued report for fiscal 2004 and 2005  included proposed adjustments related to these two fiscal years.
 company recorded taxes and penalties related to certain these proposed adjustments.
 four items with additional potential total tax liability of $ 46 million.
 company concluded on discussions with tax advisors these four items not likely to result in additional tax liability.
 company not recorded additional tax liability for these items and appealing these proposed adjustments through normal processes for resolution of differences between irs and taxpayers.
 company initial meetings with appellate division of irs held during fiscal year 2009.
two unresolved matters are one-time issues pertain to section 965 of internal revenue code related to beneficial tax treatment of dividends from foreign owned companies under american jobs creation act.
 other matters pertain to computation of research and development ( r&d ) tax credits and profits earned from manufacturing activities outside united states.
 these latter two matters could impact taxes payable for fiscal 2004 and 2005 for subsequent years.
 fiscal year 2006 and 2007 irs examination during third quarter of fiscal 2009  irs completed field examination of company 2019s fiscal years 2006 and 2007.
 irs and company agreed on treatment of issues included in issue resolutions agreement related to 2006 and 2007 tax returns.
 no agreement reached on tax treatment of issues , including same r&d credit and foreign manufacturing issues related to fiscal 2004 and 2005 , pricing of intercompany sales ( transfer pricing ) deductibility of certain stock option compensation expenses.
 during third quarter of fiscal 2009  irs issued report for fiscal 2006 and fiscal 2007  included proposed adjustments related to these two fiscal years.
 company recorded taxes and penalties related to certain these proposed adjustments.
 four items with additional potential total tax liability of $ 195 million.
 company concluded  based on discussions with tax advisors these four items not likely to result in additional tax liability.
 company not recorded additional tax liability for these items appealing these proposed adjustments through normal processes for resolution of differences between irs and taxpayers.
 with exception of analog devices , inc.
 notes to consolidated financial statements 2014 ( continued )

balance november 3 2007                     | $ 9889
------------------------------------------- | -------
additions for tax positions of current year | 3861
balance november 1 2008                     | 13750
additions for tax positions of current year | 4411
balance october 31 2009                     | $ 18161


2015 , 2014 2013 , netherland , sewell & associates , inc.
 ( "nsai" ) prepared certification of prior year's reserves for alba field.
 nsai summary reports filed as exhibit to annual report on form 10-k.
 members nsai team have multiple years industry experience worked for large international oil and gas companies before joining nsai.
 senior technical advisor has over 35 years practical experience in petroleum geosciences 15 years experience in estimation and evaluation of reserves.
 second team member has over 10 years practical experience in petroleum engineering five years experience in estimation and evaluation of reserves.
 both are registered professional engineers in texas.
 ryder scott company ( "ryder scott" ) performed audits of prior years' reserves of fields in 2015 , 2014 2013.
 summary reports filed as exhibits to annual report on form 10-k.
 team lead for ryder scott has over 20 years industry experience worked for major international oil and gas company before joining ryder scott.
 member of spe  served on oil and gas reserves committee registered professional engineer in texas.
 changes in proved undeveloped reserves as of december 31 , 2015 , 603 mmboe of proved undeveloped reserves reported decrease of 125 mmboe from december 31 , 2014.
 following table shows changes in total proved undeveloped reserves for 2015 : ( mmboe ).
 revisions to previous estimates due to reductions to capital development program deferred proved undeveloped reserves beyond 5-year plan.
 total of 139 mmboe booked as extensions , discoveries or additions and revisions due to application of reliable technology.
 technologies included statistical analysis of production performance , decline curve analysis  pressure and rate transient analysis  reservoir simulation volumetric analysis.
observed statistical nature of production performance certain reservoir continuity quality within reliable technology areas sufficient proved developed locations establish reasonable certainty criteria for booking proved reserves.
 transfers from proved undeveloped to proved developed reserves included 47 mmboe in eagle ford  14 mmboe in bakken 5 mmboe in oklahoma resource basins due to development drilling completions.
 costs incurred in 2015 , 2014 2013 to development of proved undeveloped reserves were $ 1415 million , $ 3149 million and $ 2536 million.
 projects can remain in proved undeveloped reserves for extended periods in certain situations large development projects more than five years to complete or timing of when additional gas compression needed.
 of 603 mmboe of proved undeveloped reserves at december 31, 2015  26% ( 26 % ) of volume associated with projects included in proved reserves for more than five years.
 majority volume related to compression project in e. g.
 sanctioned by board of directors in 2004.
 during 2012  compression project received approval of e. g.
 government fabrication of new platform began in 2013 installation of platform at alba field occurred in january 2016.
 commissioning currently underway first production expected by mid-2016.
 proved undeveloped reserves for north gialo development  in libyan sahara desert booked for first time in 2010.
 development executed by operator encompasses multi-year drilling program including design  fabrication installation of extensive liquid handling gas recycling facilities.
 anecdotal evidence from similar development projects in region leads to expected project execution time frame of more than five years from time reserves initially booked.
 interruptions with civil and political unrest extended project duration.
operations interrupted in mid-2013 result of shutdown of es sider crude oil terminal , temporarily re-opened second half of 2014 , production remains shut-in through early 2016.
 operator committed to project 2019s completion continues to assign resources to execute project.
 conversion rate for proved undeveloped reserves to proved developed reserves for 2015 was 11% ( 11 % ).
 , excluding long-term projects in e. g.
 and libya , our 2015 conversion rate would be 15% ( 15 % ).
 our

beginning of year                          | 728
------------------------------------------ | ------------
revisions of previous estimates            | -223 ( 223 )
improved recovery                          | 1
purchases of reserves in place             | 1
extensions discoveries and other additions | 175
dispositions                               | 2014
transfers to proved developed              | -79 ( 79 )
end of year                                | 603


synopsys , inc.
 notes to consolidated financial statements 2014continued purchase price allocation.
 company allocated total purchase consideration of $ 316. 6 million ( including $ 4. 6 million related to stock awards assumed ) to assets acquired liabilities assumed based on fair values at acquisition dates including acquired identifiable intangible assets of $ 96. 7 million and ipr&d of $ 13. 2 million  total goodwill of $ 210. 1 million.
 acquisition-related costs  professional services severance costs contract terminations facilities closure costs totaling $ 13. 0 million expensed in consolidated statements of operations.
 goodwill resulted from company 2019s expectation sales growth cost synergies from integration of virage 2019s technology with company 2019s technology operations expansion of products and market reach.
 identifiable intangible assets consisted of technology , customer relationships  contract rights trademarks  valued using income method amortized over two to ten years.
 fair value of stock awards assumed.
 company assumed unvested restricted stock units ( ) stock appreciation rights ( ) with fair value of $ 21. 7 million.
 total consideration  $ 4. 6 million allocated to purchase consideration $ 17. 1 million allocated to future services expensed over remaining service periods straight-line.
 other fiscal 2010 acquisitions fiscal 2010 company completed seven other acquisitions for cash.
 allocated total purchase consideration of $ 221. 7 million to assets acquired liabilities assumed based on fair values at acquisition dates in total goodwill of $ 110. 8 million.
 acquired identifiable intangible assets totaling $ 92. 8 million amortized over useful lives one to ten years.
 acquisition-related costs totaling $ 10. 6 million expensed as incurred in consolidated statements of operations.
 purchase consideration for one included contingent consideration up to $ 10. 0 million payable upon achievement of technology milestones over three years.
 contingent consideration recorded as liability at estimated fair value determined based on net present value of estimated payments of $ 7. 8 million on acquisition date remeasured at fair value quarterly during three-year contingency period with changes in fair value recorded in company 2019s statements of operations.
 no contingent consideration liability as of end of fiscal 2012 relating to this acquisition.
 note 4.
 goodwill and intangible assets goodwill consists of following:.
 ) adjustments relate to changes in estimates for acquisitions closed in prior fiscal year for purchase price allocation preliminary, achievement of certain milestones for acquisition closed prior to fiscal 2010.

| ( in thousands )
-------------------------- | ----------------
balance at october 31 2010 | $ 1265843
additions                  | 30717
other adjustments ( 1 )    | -7274 ( 7274 )
balance at october 31 2011 | $ 1289286
additions                  | 687195
other adjustments ( 1 )    | 506
balance at october 31 2012 | $ 1976987


investment advisory revenues on other investment portfolios manage decreased $ 3. 6 million to $ 522. 2 million.
 average assets in portfolios were $ 142. 1 billion during 2008 , up slightly from $ 141. 4 billion in 2007.
 minor changes , each less than 1% ( 1 % )  attributable to declining equity market valuations and cash flows among separate account and sub-advised portfolios.
 net inflows , primarily from institutional investors were $ 13. 2 billion during 2008  including $ 1. 3 billion transferred from retirement funds to target-date trusts.
 decreases in market valuations net of income lowered assets under management in portfolios by $ 55. 3 billion during 2008.
 administrative fees increased $ 5. 8 million to $ 353. 9 million  primarily from increased costs of servicing activities for mutual funds and investors.
 changes in administrative fees offset by similar changes in related operating expenses services funds investors.
 largest expense , compensation and related costs  increased $ 18. 4 million or 2. 3% ( 2. 3 % ) from 2007.
 increase includes $ 37. 2 million in salaries from 8. 4% ( 8. 4 % ) increase in average staff count and increase of associates 2019 base salaries at year.
 at december 31 , 2008 employed 5385 associates , up 6. 0% ( 6. 0 % ) from end of 2007 primarily to add capabilities and support increased volume-related activities and growth.
 2008 slowed growth of associate base from.
 do not expect number of associates to increase in 2009.
 reduced annual bonuses $ 27. 6 million versus 2007 year in response to recent unfavorable financial market conditions negatively impacted operating results.
 balance of increase attributable to higher employee benefits and employment- related expenses including increase of $ 5.7 million in stock-based compensation.
 entering 2009  not increase salaries of highest paid associates.
 after higher spending first quarter of 2008 versus 2007  investor sentiment in uncertain volatile market environment caused to reduce advertising promotion spending for year down $ 3. 8 million from 2007.
 expect to reduce these expenditures for 2009 versus 2008  estimate spending first quarter of 2009 down about $ 5 million from fourth quarter 2008.
 vary level spending based on market conditions investor demand efforts to expand investor base in united states and abroad.
 occupancy and facility costs with depreciation expense increased $ 18 million or 12% ( 12 % ) compared to 2007.
 expanding renovating facilities to accommodate growth associates meet business demands.
 other operating expenses up $ 3. 3 million from 2007.
 increased spending $ 9. 8 million  primarily for professional fees information third-party services.
 reductions in travel charitable contributions partially offset increases.
 non-operating investment activity resulted in net loss of $ 52. 3 million in 2008 compared to net gain of $ 80. 4 million in 2007.
 change of $ 132. 7 million primarily attributable to losses recognized in 2008 on investments in sponsored mutual funds resulted from declines in financial market values year.
 recognized other temporary impairments of investments in sponsored mutual funds because of declines in fair value below cost for extended period.
 significant declines in fair value below cost occurred in 2008 generally attributable to adverse ongoing market conditions discussed in background section on page 18 of report.
 see discussion on page 24 of critical accounting policies for other than temporary impairments of available-for-sale securities.
 income from money market and bond fund holdings was $ 19. 3 million lower than 2007 due to lower interest rate environment of 2008.
lower interest rates led substantial capital appreciation our $ 40 million holding u. s.
 treasury notes sold december 2008 $ 2. 6 million gain.
 management 2019s discussion & analysis 21

| 2007       | 2008             | change
------------------------------------------------- | ---------- | ---------------- | ------------------
capital gain distributions received               | $ 22.1     | $ 5.6            | $ -16.5 ( 16.5 )
other than temporary impairments recognized       | -.3 ( .3 ) | -91.3 ( 91.3 )   | -91.0 ( 91.0 )
net gains ( losses ) realized on funddispositions | 5.5        | -4.5 ( 4.5 )     | -10.0 ( 10.0 )
net gain ( loss ) recognized on fund holdings     | $ 27.3     | $ -90.2 ( 90.2 ) | $ -117.5 ( 117.5 )


banking ).
 results of first step impairment test showed no indication of impairment in reporting units at periods except december 31 , 2008 company did not perform second step impairment test except for test as of december 31 , 2008.
 as of december 31 , 2008  was indication of impairment in north america consumer banking , latin america consumer banking and emea consumer banking reporting units second step of testing was performed on these reporting units.
 based on results second step testing company recorded a $ 9. 6 billion pretax ( $ 8. 7 billion after tax ) goodwill impairment charge in fourth quarter of 2008  representing entire amount of goodwill allocated to these reporting units.
 primary cause for goodwill impairment in reporting units was rapid deterioration in financial markets , global economic outlook particularly during period mid-november through year end 2008.
 this deterioration weakened near-term prospects for financial services industry.
 factors including increased possibility of further government intervention resulted in decline in company 2019s market capitalization from approximately $ 90 billion at july 1 , 2008 and approximately $ 74 billion at october 31 , 2008 to approximately $ 36 billion at december 31 , 2008.
 more significant fair-value adjustments in pro forma purchase price allocation in second step of testing were to fair-value loans and debt and made to identify and value identifiable intangibles.
 adjustments to measure assets  liabilities and intangibles were for measuring implied fair value of goodwill such adjustments not reflected in consolidated balance sheet.
 following table shows reporting units with goodwill balances and excess of fair value of allocated book value as of december 31 , 2008.
reporting unit ( $ in millions ) fair value as % ( % ) of allocated book value goodwill ( post-impairment ).
 no impairment noted in step one of our securities and banking reporting unit impairment test at october 31 , 2008 and december 31 , 2008 , goodwill in reporting unit may be sensitive to further deterioration in economic conditions.
 under market approach for valuing reporting unit earnings multiples and transaction multiples selected from multiples using data from guideline companies and acquisitions.
 selection of actual multiple considers operating performance and financial condition return on equity and net income growth of securities and banking compared to guideline companies acquisitions.
 for valuation under income approach  company utilized discount rate reflects risk and uncertainty related to projected cash flows selected 2013 as terminal year.
 2013 value derived assuming return to historical levels of core-business profitability for reporting unit  despite significant losses experienced in 2008.
 this assumption based on management 2019s view that recovery will occur based upon macro- economic factors recent u. s.
 government stimulus actions  restoring marketplace confidence improved risk-management practices industry-wide basis.
 company-specific actions recently announced realignment of businesses to optimize global businesses for future profitable growth will be factor in returning company 2019s core securities and banking business to historical levels.
 small deterioration in assumptions used in valuations , in discount rate and growth rate assumptions in net income projections could affect company 2019s impairment evaluation and results.
 if future differ adversely from management 2019s best estimate of key economic assumptions and associated cash flows to decrease by small margin company could potentially experience future material impairment charges with respect to goodwill remaining in our securities and banking reporting unit.
such charges by not negatively affect company 2019s tier 1 total regulatory capital ratios , tangible capital or company 2019s liquidity position.

reporting unit ( $ inmillions ) | fair value as a % (  % ) of allocated book value | goodwill ( post-impairment )
------------------------------- | ------------------------------------------------ | ----------------------------
north america cards             | 139% ( 139 % )                                   | 6765
international cards             | 218% ( 218 % )                                   | 4066
asia consumer banking           | 293% ( 293 % )                                   | 3106
securities & banking            | 109% ( 109 % )                                   | 9774
global transaction services     | 994% ( 994 % )                                   | 1570
north america gwm               | 386% ( 386 % )                                   | 1259
international gwm               | 171% ( 171 % )                                   | 592


table of contents valero energy corporation subsidiaries notes to consolidated financial statements continued ) commodity price risk exposed to market risks related to volatility in price of crude oil , refined products ( primarily gasoline distillate ) grain ( primarily corn )  natural gas used in our operations.
 to reduce impact of price volatility on results operations cash flows  use commodity derivative instruments  including futures , swaps  options.
 use futures markets for available liquidity provides greater flexibility in transacting hedging trading operations.
 use swaps to manage price exposure.
 positions in commodity derivative instruments monitored managed daily by risk control group ensure compliance with risk management policy approved by board of directors.
 for risk management purposes use fair value hedges , cash flow hedges  economic hedges.
 in addition to use derivative instruments to manage commodity price risk enter into certain commodity derivative instruments for trading purposes.
 objective for entering into each type of hedge or trading derivative described below.
 fair value hedges fair hedges used to hedge price volatility in certain refining inventories firm commitments to purchase inventories.
 level of activity for fair value hedges based on level operating inventories represents amount by inventories differ from previous year-end lifo inventory levels.
 as of december 31 , 2011 , had following outstanding commodity derivative instruments entered into to hedge crude oil refined product inventories commodity derivative instruments related to physical purchase of crude oil refined products at fixed price.
 information presents notional volume of outstanding contracts by type of instrument year of maturity ( volumes in thousands of barrels ).
 notional contract volumes by year of maturity derivative instrument 2012.

derivative instrument           | notional contract volumes by year of maturity 2012
------------------------------- | --------------------------------------------------
crude oil and refined products: |
futures 2013 long               | 15398
futures 2013 short              | 35708
physical contracts 2013 long    | 20310


item 1b.
 unresolved staff comments applicable.
 item 2.
 properties december 26, 2015 major facilities consisted : ( square feet in millions ) united states countries total owned facilities1.
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 30. 7 17. 2 47. 9 leased facilities2.
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 1 leases portions of land used for facilities expire varying dates through 2062.
 2 leases expire varying dates through 2030 include renewals option.
 principal executive offices located in u. s
 majority of wafer fabrication activities located in u. s
 completed construction of development fabrication facilities in oregon during 2014 maintain process technology lead.
 completed construction large-scale fabrication building in arizona 2013.
 portion new oregon arizona facilities not in use reserving new buildings for additional capacity future technologies.
 incremental construction equipment installation required ready facilities for use.
massachusetts fabrication facility was last manufacturing facility on 200mm wafers ceased production in q1 2015.
 outside u. s. have wafer fabrication facilities in ireland , israel  china.
 fabrication facility in ireland transitioned to 14nm process technology manufacturing continuing to ramp in 2016.
 second half of 2016  start using facility in dalian , china to expand manufacturing capacity in next-generation memory.
 assembly and test facilities located in malaysia , china  vietnam.
 sales and marketing offices worldwide located near major concentrations of customers.
 believe facilities described above suitable and adequate for present purposes productive capacity in facilities substantially utilized or plans to utilize it.
 do not identify or allocate assets by operating segment.
 for information on net property , plant and equipment by country  see 201cnote 26 : operating segments and geographic information 201d in part ii , item 8 of form 10-k.
 item 3.
 legal proceedings for discussion of legal proceedings  see 201cnote 25 : contingencies 201d in part ii, item 8 of form 10-k.
 item 4.
 mine safety disclosures not applicable.

( square feet in millions ) | unitedstates | othercountries | total
--------------------------- | ------------ | -------------- | -----
owned facilities1           | 30.7         | 17.2           | 47.9
leased facilities2          | 2.1          | 6.0            | 8.1
total facilities            | 32.8         | 23.2           | 56.0


properties , plants , and equipment.
 recorded at cost.
 depreciation recorded principally on straight-line method at rates based on estimated useful lives of assets.
 table details weighted-average useful lives of structures and machinery and equipment by reporting segment ( numbers in years ) :.
 gains or losses from sale of assets recorded in other income , net ( see policy below for assets classified held for sale and discontinued operations ).
 repairs and maintenance charged to expense as incurred.
 interest related to construction of qualifying assets capitalized as part of construction costs.
 properties , plants  equipment reviewed for impairment whenever events or changes in circumstances indicate carrying amount of assets ( asset group ) may not be recoverable.
 recoverability of assets determined by comparing estimated undiscounted net cash flows of operations related to assets asset group to carrying amount.
 impairment loss recognized when carrying amount of assets group ) exceeds estimated undiscounted net cash flows.
 amount of impairment loss recorded calculated as excess of carrying value of assets asset group ) over fair value with fair value determined using best information available generally is discounted cash flow ( dcf ) model.
 determination of what constitutes asset group  associated estimated undiscounted net cash flows  and estimated useful lives of assets require significant judgments.
 goodwill and other intangible assets.
 goodwill not amortized ; reviewed for impairment annually ( in fourth quarter ) or more frequently if indicators of impairment exist or if decision made to sell or exit business.
 significant amount of judgment involved in determining if indicator of impairment has occurred.
indicators may include deterioration in general economic conditions negative developments in equity and credit markets adverse changes in markets in entity operates increases in input costs negative effect on earnings and cash flows  or trend of negative or declining cash flows over multiple periods.
 fair value realized in actual transaction may differ from that used to evaluate impairment of goodwill.
 goodwill is allocated among and evaluated for impairment at reporting unit level , defined as operating segment or one level below operating segment.
 arconic has eight reporting units  four included in engineered products and solutions segment , three in transportation and construction solutions segment  remaining reporting unit is global rolled products segment.
 more than 70% ( 70 % ) of arconic 2019s total goodwill allocated to two reporting units : arconic fastening systems and rings ( afsr ) ( $ 2200 ) and arconic power and propulsion ( app ) ( $ 1647 ) businesses , both included in engineered products and solutions segment.
 these amounts include allocation of corporate 2019s goodwill.
 in november 2014  arconic acquired firth rixson ( note f )  recognized $ 1801 in goodwill.
 amount allocated between afsr and arconic forgings and extrusions ( afe ) reporting units part of engineered products and solutions segment.
 in march and july 2015  arconic acquired tital and rti  note f recognized $ 117 and $ 298  in goodwill.
 goodwill amount related to tital allocated to app reporting unit and amount related to rti allocated to arconic titanium and engineered products ( atep ) new arconic reporting unit consists solely of acquired rti business part of engineered products and solutions segment.
reviewing goodwill for impairment , entity option to first assess qualitative factors to determine whether existence of events or circumstances leads to determination more likely than not ( greater than 50% ( 50 % ) ) estimated fair value of reporting unit is less than its carrying amount.
 if entity elects to perform qualitative assessment and determines impairment more likely than not , entity required to perform the

segment                                   | structures | machinery and equipment
----------------------------------------- | ---------- | -----------------------
global rolled products                    | 31         | 21
engineered products and solutions         | 29         | 17
transportation and construction solutions | 27         | 19


.
 159 requires unrealized gains and losses on items for fair value option elected be reported in earnings at each reporting date.
 sfas no.
 159 effective for fiscal years after november 15, 2007 required to be adopted by company in first quarter of fiscal 2009.
 company evaluate application of sfas no.
 159 , management not believe adoption material impact on company 2019s financial condition or operating results.
 in september 2006 , fasb issued sfas no.
 157 , fair value measurements , defines fair value  provides framework for measuring fair value expands disclosures required for fair value measurements.
 sfas no.
 157 applies to other accounting pronouncements require fair value measurements ; not require new fair value measurements.
 sfas no.
 157 effective for fiscal years after november 15 , 2007 required to be adopted by company in first quarter of fiscal 2009.
 company will continue to evaluate application of sfas no.
 157 , management not believe adoption material impact on company 2019s financial condition or operating results.
 in june 2006 , fasb issued fasb interpretation no.
 ( 2018 2018fin 2019 2019 ) 48 , accounting for uncertainty in income taxes-an interpretation of fasb statement no.
 109.
 fin 48 clarifies accounting for uncertainty in income taxes by creating framework for how companies should recognize  measure present disclose in financial statements uncertain tax positions taken or expect to take in tax return.
 fin 48 effective for fiscal years after december 15 , 2006 required to be adopted by company in first quarter of fiscal 2008.
 company continue to evaluate application of fin 48 , management does not believe adoption will material impact on company 2019s financial condition or operating results.
liquidity capital resources table presents financial information statistics for last three fiscal years ( dollars in millions ) : september 29 , september 30  september 24 , 2007 2006 2005.
 as of september 29 , 2007  company had $ 15. 4 billion in cash  cash equivalents short-term investments increase of $ 5. 3 billion over same balance at end of september 30 , 2006.
 principal components of net increase were cash generated by operating activities $ 5. 5 billion , proceeds from issuance common stock plans $ 365 million excess tax benefits from stock-based compensation of $ 377 million.
 increases partially offset by payments for acquisitions of property  plant equipment of $ 735 million payments for acquisitions intangible assets of $ 251 million.
 company 2019s short-term investment portfolio primarily invested in highly rated liquid investments.
 as of september 29 , 2007 and september 30 , 2006 , $ 6. 5 billion and $ 4. 1 billion  respectively of company 2019s cash cash equivalents short-term investments held by foreign subsidiaries generally based in.
 dollar-denominated holdings.
 company believes existing balances of cash cash equivalents short-term investments will sufficient to satisfy working capital needs capital expenditures outstanding commitments other liquidity requirements existing operations over next 12 months.

| september 29 2007 | september 30 2006 | september 24 2005
------------------------------------------------ | ----------------- | ----------------- | -----------------
cash cash equivalents and short-term investments | $ 15386           | $ 10110           | $ 8261
accounts receivable net                          | $ 1637            | $ 1252            | $ 895
inventory                                        | $ 346             | $ 270             | $ 165
working capital                                  | $ 12657           | $ 8066            | $ 6813
annual operating cash flow                       | $ 5470            | $ 2220            | $ 2535


table of contents table discloses purchases of shares our common stock made by us or behalf during fourth quarter of 2017.
 period total number of shares purchased average price paid per share total number of shares not purchased as part of publicly announced plans or programs total number of shares purchased as part of publicly announced plans or programs approximate dollar value of shares yet be purchased under plans or programs b ).
 shares reported in column represent purchases settled in fourth quarter of 2017 relating to i our purchases of shares in open-market transactions to meet obligations under stock-based compensation plans ii ) purchases of shares from employees and non-employee directors in connection with exercise of stock options  vesting of restricted stock  other stock compensation transactions in terms stock-based compensation plans.
 on september 21 , 2016  board of directors authorized purchase of up to $ 2. 5 billion of outstanding common stock ( 2016 program ) with no expiration date.
 as of december 31 , 2017  had $ 1. 2 billion remaining available for purchase under 2016 program.
 on january 23 , 2018 board of directors authorized purchase of up to additional $ 2. 5 billion of outstanding common stock with no expiration date.

period        | total numberof sharespurchased | averageprice paidper share | total number ofshares notpurchased as part ofpublicly announcedplans or programs ( a ) | total number ofshares purchased aspart of publiclyannounced plans orprograms | approximate dollarvalue of shares thatmay yet be purchasedunder the plans orprograms ( b )
------------- | ------------------------------ | -------------------------- | -------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------
october 2017  | 515762                         | $ 77.15                    | 292145                                                                                | 223617                                                                       | $ 1.6 billion
november 2017 | 2186889                        | $ 81.21                    | 216415                                                                                | 1970474                                                                      | $ 1.4 billion
december 2017 | 2330263                        | $ 87.76                    | 798                                                                                | 2329465                                                                      | $ 1.2 billion
total         | 5032914                        | $ 83.83                    | 509358                                                                                | 4523556                                                                      | $ 1.2 billion


uncertain tax positions reconciliation of company 2019s beginning and ending amount of uncertain tax positions ( in millions ) :.
 company 2019s liability for uncertain tax positions as of december 31 , 2018, 2017 , and 2016  includes $ 228 million , $ 219 million  and $ 240 million , respectively related to amounts impact effective tax rate if recognized.
 possible unrecognized tax benefits may change in next twelve months ; company not expect change significant impact on consolidated statements of income or consolidated balance sheets.
 changes may be result of settlements of ongoing audits.
 estimate of range reasonably possible outcomes within twelve months cannot be made.
 company recognizes interest and penalties related to uncertain tax positions in provision for income taxes.
 company accrued potential interest and penalties of $ 22 million , $ 11 million , and $ 15 million in 2018 , 2017 , and 2016 ,.
 company recorded liability for interest and penalties of $ 77 million , $ 55 million , and $ 48 million as of december 31 , 2018 , 2017 , and 2016 ,.
 company and subsidiaries file income tax returns in respective jurisdictions.
 company concluded all.
 federal income tax matters for years through 2007.
.
 state and local income tax jurisdiction examinations concluded for years through 2005.
 company concluded income tax examinations in primary non-u.
 jurisdictions through 2010.
.
 shareholders 2019 equityq y distributable reserves as company incorporated in england and wales required under.
 law to have available 201cdistributable reserves to make share repurchases or pay dividends to shareholders.
 distributable reserves may be created through earnings of u.
parent company methods through reduction in share capital approved by courts of england and wales.
 distributable reserves not directly linked to.
 reported amount (. retained earnings ).
 as of december 31 , 2018 and 2017  company had distributable reserves in excess of $ 2. 2 billion and $ 1. 2 billion  respectively.
 ordinary shares has share repurchase program authorized by company 2019s board of directors ( 201crepurchase program 201d ).
 repurchase program established in april 2012 with $ 5. 0 billion in authorized repurchases increased by $ 5. 0 billion authorized repurchases in november 2014 and february 2017 for total of $ 15. 0 billion in repurchase authorizations.
 under repurchase program class a ordinary shares may be repurchased through open market or in privately negotiated transactions time to time based on prevailing market conditions funded from available capital.

| 2018       | 2017
------------------------------------------------------------ | ---------- | ----------
balance at january 1                                         | $ 280      | $ 278
additions based on tax positions related to the current year | 18         | 25
additions for tax positions of prior years                   | 10         | 12
reductions for tax positions of prior years                  | -24 ( 24 ) | -26 ( 26 )
settlements                                                  | 2014       | -6 ( 6 )
business combinations                                        | 1          | 2014
lapse of statute of limitations                              | -6 ( 6 )   | -7 ( 7 )
foreign currency translation                                 | 2014       | 4
balance at december 31                                       | $ 279      | $ 280


table reflects estimated effects on pension expense of changes in annual assumptions using 2012 estimated expense as a baseline.
 change in assumption ( a ) estimated increase to 2012 pension expense ( in millions ).
 ( a ) impact is effect of changing specified assumption while holding other assumptions constant.
 pension plan contribution requirements not sensitive to actuarial assumptions.
 investment performance most impact on contribution requirements and drive permitted contributions in future years.
 current law  including provisions pension protection act of 2006 sets limits to minimum and maximum contributions to plan.
 not expect to be required by law to make contributions to plan during 2012.
 maintain other defined benefit plans less significant effect on financial results including nonqualified supplemental retirement plans for certain employees.
 recourse and repurchase obligations as discussed in note 3 loan sale and servicing activities variable interest entities in consolidated financial statements 8 pnc has sold commercial mortgage and residential mortgage loans directly or indirectly in securitizations and whole-loan sale transactions with continuing involvement.
 form continuing involvement includes recourse and loan repurchase obligations associated with transferred assets in transactions.
 commercial mortgage loan recourse obligations we originate , close  and service certain multi-family commercial mortgage loans sold to fnma under fnma 2019s delegated underwriting and servicing program.
 participated in similar program with fhlmc.
 assume up to one-third risk of loss on unpaid principal balances through loss share arrangement.
 at december 31 , 2011 and december 31 , 2010 unpaid principal balance outstanding of loans sold as participant in these programs was $ 13. 0 billion and $ 13. 2 billion .
 potential maximum exposure under loss share arrangements was $ 4. 0 billion at december 31  2011 and 31  2010.
maintain reserve for estimated losses based on exposure.
 reserve for losses under programs totaled $ 47 million and $ 54 million as of december 31 , 2011 and december 31 , 2010  included in other liabilities on consolidated balance sheet.
 if payment required under programs contractual interest in collateral underlying mortgage loans on losses occurred value of collateral taken account in determining share of losses.
 exposure and activity associated with recourse obligations reported in corporate & institutional banking segment.
 residential mortgage loan and home equity repurchase obligations residential mortgage loans sold on non-recourse basis assume certain loan repurchase obligations associated with mortgage loans sold to investors.
 loan repurchase obligations primarily relate to situations where pnc alleged to breached origination covenants and representations warranties made to purchasers loans in purchase sale agreements.
 residential mortgage loans covered by loan repurchase obligations include first and second-lien mortgage loans sold through agency securitizations , non-agency securitizations  whole-loan sale transactions.
 discussed in note 3 notes to consolidated financial statements item 8 agency securitizations consist of mortgage loans sale transactions with fnma , fhlmc  government national mortgage association ( gnma ) program non-agency securitizations and whole-loan sale transactions consist of mortgage loans sale transactions with private investors.
 historical exposure activity associated with agency securitization repurchase obligations primarily related to transactions with fnma and fhlmc  indemnification and repurchase losses associated with federal housing agency ( fha ) and department of veterans affairs va ) -insured and uninsured loans pooled in gnma securitizations historically minimal.
repurchase obligation activity with residential mortgages reported in residential mortgage banking segment.
 pnc 2019s repurchase obligations include brokered home equity loans/lines sold to limited private investors in financial services industry by national city prior to our acquisition.
 pnc no longer engaged in brokered home equity lending business , exposure under loan repurchase obligations limited to repurchases of whole-loans sold in transactions.
 repurchase activity brokered home equity lines/loans reported in non-strategic assets portfolio segment.
 loan covenants representations warranties established through loan sale agreements with investors provide assurance pnc sold loans to pnc financial services group , inc.
 2013 form 10-k 69

change in assumption ( a )                                   | estimatedincrease to 2012pensionexpense ( in millions )
------------------------------------------------------------ | -------------------------------------------------------
.5% ( .5 % ) decrease in discount rate                       | $ 23
.5% ( .5 % ) decrease in expected long-term return on assets | $ 18
.5% ( .5 % ) increase in compensation rate                   | $ 2


december 31 , 2009  aon had domestic federal operating loss carryforwards $ 7 million expire 2010 to 2024  state operating loss carryforwards $ 513 million expire 2010 to 2028  foreign operating and capital loss carryforwards of $ 453 million and $ 252 million nearly all subject to indefinite carryforward.
 unrecognized tax benefits reconciliation of company 2019s beginning and ending amount unrecognized tax benefits ( in millions ) :.
 as of december 31 , 2009  $ 61 million unrecognized tax benefits would impact effective tax rate if recognized.
 aon not expect unrecognized tax positions to change significantly next twelve months.
 company recognizes penalties and interest related to unrecognized income tax benefits in provision for income taxes.
 aon accrued potential penalties of less than $ 1 million during 2009 , 2008 2007.
 aon accrued interest of $ 2 million during 2009 less than $ 1 million during 2008 and 2007.
 as of december 31 , 2009 and 2008  aon recorded liability for penalties of $ 5 million and $ 4 million  for interest of $ 18 million and $ 14 million , respectively.
 aon and subsidiaries file income tax returns in.
 federal jurisdiction various state and international jurisdictions.
 aon concluded all.
 federal income tax matters for years through 2006.
.
 state and local income tax jurisdiction examinations concluded for years through 2002.
 aon concluded income tax examinations in primary international jurisdictions through 2002.

| 2009       | 2008
------------------------------------------------------------ | ---------- | ----------
balance at january 1                                         | $ 86       | $ 70
additions based on tax positions related to the current year | 2          | 5
additions for tax positions of prior years                   | 5          | 12
reductions for tax positions of prior years                  | -11 ( 11 ) | -11 ( 11 )
settlements                                                  | -10 ( 10 ) | -4 ( 4 )
lapse of statute of limitations                              | -3 ( 3 )   | -1 ( 1 )
acquisitions                                                 | 6          | 21
foreign currency translation                                 | 2          | -6 ( 6 )
balance at december 31                                       | $ 77       | $ 86


2007 annual report 21 five-year stock performance graph graph illustrates cumulative total shareholder return on snap-on common stock since 2002  assuming dividends reinvested.
 graph compares snap-on 2019s performance to standard & poor 2019s 500 stock index ( 201cs&p 500 201d ) peer group.
 snap-on incorporated total shareholder return ( 1 ) 2002 2003 2004 2005 2006 2007 snap-on incorporated peer group s&p 500 fiscal year ended ( 2 ) snap-on incorporated peer group 3 ) s&p 500.
 assumes $ 100 invested december 31, 2002 dividends reinvested quarterly.
 2 company's fiscal year ends saturday closest to december 31 each year fiscal year end assumed december 31 for ease of calculation.
 3 peer group includes black & decker corporation , cooper industries, ltd. danaher corporation , emerson electric co. , fortune brands , inc. genuine parts company  newell rubbermaid inc. pentair , inc. spx corporation  stanley works w.
 grainger , inc.

fiscal year ended ( 2 ) | snap-on incorporated | peer group ( 3 ) | s&p 500
----------------------- | -------------------- | ---------------- | --------
december 31 2002        | $ 100.00             | $ 100.00         | $ 100.00
december 31 2003        | 118.80               | 126.16           | 128.68
december 31 2004        | 130.66               | 152.42           | 142.69
december 31 2005        | 146.97               | 157.97           | 149.70
december 31 2006        | 191.27               | 185.10           | 173.34
december 31 2007        | 198.05               | 216.19           | 182.87


company had capital loss carryforwards for federal income tax purposes of $ 4357 at december 31 , 2012 and 2011 ,.
 company recognized full valuation allowance for capital loss carryforwards because not believe these losses more likely not to be recovered.
 company files income tax returns in united states federal jurisdiction and various state and foreign jurisdictions.
 with few exceptions company no longer subject to.
 federal , state or local or non-u. income tax examinations by tax authorities for years before 2007.
 company has state income tax examinations in progress does not expect material adjustments to result.
 patient protection and affordable care act ( 201cppaca 201d ) became law on march 23, 2010  health care and education reconciliation act of 2010 became law on march 30, 2010  amendments to certain aspects of ppaca ( 201cacts 201d ).
 ppaca changes tax treatment of federal subsidies paid to sponsors of retiree health benefit plans benefit actuarially equivalent to benefits under medicare part d.
 acts make subsidy payments taxable in tax years after december 31 , 2012 company followed original accounting for underfunded status of other postretirement benefits for medicare part d adjustment and recorded reduction in deferred tax assets and increase in regulatory assets amounting to $ 6432.
 table summarizes changes in company 2019s gross liability , excluding interest and penalties for unrecognized tax benefits:.
 liability balance includes amounts reflected as other long-term liabilities in consolidated balance sheets totaling $ 74360 and $ 46961 as of december 31 , 2012 and 2011 .
 total balance in table does not include interest and penalties of $ 260 and $ 214 as of december 31 , 2012 and 2011  recorded as component of income tax expense.
majority increased tax position attributable to temporary differences.
 increase in 2012 current period tax positions related primarily to company 2019s change in tax accounting method filed in 2008 for repair maintenance costs on utility assets.
 company not anticipate material changes to unrecognized tax benefits next year.
 if company sustains positions at december 31 , 2012 and 2011 , unrecognized tax benefit of $ 7532 and $ 6644  respectively excluding interest penalties impact company 2019s effective tax rate.

balance at january 1 2011                              | $ 118314
------------------------------------------------------ | ----------------
increases in current period tax positions              | 46961
decreases in prior period measurement of tax positions | -6697 ( 6697 )
balance at december 31 2011                            | 158578
increases in current period tax positions              | 40620
decreases in prior period measurement of tax positions | -18205 ( 18205 )
balance at december 31 2012                            | $ 180993


recognized total losses expenses of $ 28. 6 million , including net loss on write-down to fair value assets other transaction fees of $ 27. 1 million within other expenses $ 1. 5 million of legal other fees.
 2022 professional fees outside services expense decreased in 2017 compared to 2016  due to higher legal regulatory fees 2016 related to business activities product offerings higher professional fees related to greater reliance on consultants for security systems enhancement work.
 overall decrease in operating expenses 2017 compared with 2016 partially offset by increases : 2022 licensing other fee sharing agreements expense increased due to higher expense from incentive payments transition of russell contract open interest  increased costs of revenue sharing agreements for certain licensed products.
 overall increase in 2017 partially offset by lower expense related to revenue sharing agreements for certain equity energy contracts due to lower volume for products compared to 2016.
 2022 compensation benefits expense increased higher average headcount in international locations normal cost of living adjustments.
 2016 compared with 2015 operating expenses increased by $ 54. 4 million in 2016 compared with 2015.
 following table shows estimated impact of key factors in net decrease in operating expenses.
 ( dollars in millions ) over-year change change as percentage of 2015 expenses.
 overall operating expenses increased in 2016 compared with 2015 due to reasons : 2022 in 2016 recognized total losses expenses of $ 28. 6 million  including net loss on write-down to fair value of assets certain other transaction fees of $ 27. 1 million within other expenses $ 1. 5 million of legal other fees result of sale leaseback of datacenter.
 2022 professional fees outside services expense increased in 2016 due to increase in legal regulatory efforts related to business activities product offerings increase in professional fees related to greater reliance on consultants for security systems enhancement work.
 2022 in 2016 recognized net loss of $ 24.5 million due to unfavorable change in exchange rates foreign cash balances compared net loss $ 11. 3 million in 2015.
 2022 licensing fee sharing agreements expense increased due to higher expense related revenue sharing agreements for certain equity energy contracts due to higher volume increase in license rates certain equity energy products.

( dollars in millions )                       | year-over-yearchange | change as apercentage of2015 expenses
--------------------------------------------- | -------------------- | -------------------------------------
loss on datacenter and related legal fees     | $ 28.6               | 2% ( 2 % )
professional fees and outside services        | 24.4                 | 2
foreign currency exchange rate fluctuation    | 13.2                 | 1
licensing and other fee agreements            | 12.0                 | 1
reorganization severance and retirement costs | -8.1 ( 8.1 )         | -1 ( 1 )
real estate taxes and fees                    | -10.0 ( 10.0 )       | -1 ( 1 )
other expenses net                            | -5.7 ( 5.7 )         | 2014
total                                         | $ 54.4               | 4% ( 4 % )


o 2019 r e i l l y a u t o m o t i v e 2 0 0 6 a n n u a l r e p o r t p a g e 38 $ 11080000 , years ended december 31 , 2006 , 2005 2004 , respectively.
 remaining unrecognized compensation cost related to unvested awards at december 31 , 2006  was $ 7702000 weighted-average period time over cost recognized is 3. 3 years.
 employee stock purchase plan company 2019s employee stock purchase plan permits eligible employees to purchase shares company 2019s common stock at 85% ( 85 % ) of fair market value.
 participants may authorize company to withhold up to 5% ( 5 % ) of annual salary participate plan.
 stock purchase plan authorizes up to 2600000 shares granted.
 year ended december 31 , 2006  company issued 165306 shares at average price of $ 27. 36 per share.
 year ended december 31 , 2005  company issued 161903 shares average price $ 27. 57 per share.
 year ended december 31 , 2004  company issued 187754 shares at average price of $ 20. 85 per share.
.
 123r requires compensation expense be recognized based on discount between grant date fair value and employee purchase price for shares sold to employees.
 year ended december 31 , 2006  company recorded $ 799000 of compensation cost related to employee share purchases corresponding income tax benefit of $ 295000.
 at december 31 , 2006  approximately 400000 shares reserved for future issuance.
 employee benefit plans company sponsors contributory profit sharing and savings plan covers all employees at least 21 years of age least six months of service.
company agreed to make matching contributions equal to 50% ( 50 % ) of first 2% ( 2 % ) each employee 2019s wages contributed 25% ( 25 % ) next 4% ( 4 % ) each employee 2019s wages contributed.
 company makes additional discretionary profit sharing contributions to plan annual basis as determined by board of directors.
 company 2019s matching and profit sharing contributions under plan funded in form of shares of company 2019s common stock.
 total of 4200000 shares of common stock authorized for issuance under plan.
 year ended december 31 , 2006  company recorded $ 6429000 compensation cost for contributions plan corresponding income tax benefit of $ 2372000.
 year ended december 31 , 2005  company recorded $ 6606000 compensation cost contributions corresponding income tax benefit of $ 2444000.
 year ended december 31 , 2004  company recorded $ 5278000 compensation cost contributions corresponding income tax benefit of $ 1969000.
 compensation cost recorded in 2006 includes matching contributions 2006 profit sharing contributions accrued in 2006 funded with issuance of shares common stock in 2007.
 company issued 204000 shares in 2006 to fund profit sharing matching contributions at average grant date fair value of $ 34. 34.
 company issued 210461 shares in 2005 fund profit sharing matching contributions at average grant date fair value of $ 25. 79.
 company issued 238828 shares in 2004 fund profit sharing matching contributions at average grant date fair value of $ 19. 36.
 portion of shares related to profit sharing contributions accrued in prior periods.
 at december 31 , 2006  approximately 1061000 shares reserved for future issuance under plan.
company has performance incentive plan for company 2019s senior management awards shares of restricted stock vest equally over three-year period held in escrow until vesting occurred.
 shares forfeited when employee ceases employment.
 total of 800000 shares of common stock authorized for issuance under this plan.
 shares awarded valued based on market price of company 2019s common stock on date of grant compensation cost recorded over vesting period.
 company recorded $ 416000 of compensation cost for plan for year ended december 31, 2006 recognized corresponding income tax benefit of $ 154000.
 company recorded $ 289000 of compensation cost for for year ended december 31, 2005 recognized income tax benefit of $ 107000.
 recorded $ 248000 of compensation cost for for year ended december 31, 2004 recognized income tax benefit of $ 93000.
 total fair value of shares vested at vest date ) for years ended december 31 , 2006 , 2005 and 2004 were $ 503000 , $ 524000 and $ 335000  respectively.
 remaining unrecognized compensation cost related to unvested awards at december 31 , 2006 was $ 536000.
 company awarded 18698 shares under plan in 2006 with average grant date fair value of $ 33. 12.
 awarded 14986 shares under plan in 2005 with average grant date fair value of $ 25. 41.
 awarded 15834 shares under plan in 2004 with average grant date fair value of $ 19. 05.
 compensation cost for shares awarded in 2006 recognized over three-year vesting period.
 changes in company 2019s restricted stock for year ended december 31 , 2006 were weighted- average grant date shares fair value.
 at december 31 , 2006 approximately 659000 shares reserved for future issuance under plan.
o t e s t o c o n s o l i d f n a n c i a l s t a t e m e n t s inued

| shares           | weighted-average grant date fair value
------------------------------ | ---------------- | --------------------------------------
non-vested at december 31 2005 | 15052            | $ 22.68
granted during the period      | 18698            | 33.12
vested during the period       | -15685 ( 15685 ) | 26.49
forfeited during the period    | -1774 ( 1774 )   | 27.94
non-vested at december 31 2006 | 16291            | $ 30.80


note 4 - goodwill and other intangible assets : goodwill company had approximately $ 93. 2 million and $ 94. 4 million of goodwill at december 30 , 2017 and december 31 , 2016 , respectively.
 changes in carrying amount of goodwill for years ended december 30 , 2017 and december 31 , 2016 are as follows ( in thousands ) :.
 goodwill is allocated to each identified reporting unit  defined as operating segment or one level below operating segment.
 goodwill not amortized but evaluated for impairment annually and whenever events changes circumstances indicate carrying value of goodwill may not be recoverable.
 company completes impairment evaluation by performing valuation analyses considering other publicly available market information appropriate.
 test to identify potential for goodwill impairment compares fair value of reporting unit with carrying value.
 impairment charge recorded to company 2019s operations for amount if carrying value exceeds fair value.
 in fourth quarter of fiscal 2017  company completed annual impairment testing of goodwill no impairment identified.
 company determined fair value of each reporting unit ( including goodwill ) was in excess of carrying value of respective reporting unit.
 conclusion fair value of each reporting unit determined based on market or income approach.
 under market approach fair value based on observed market data.
 other intangible assets company had approximately $ 31. 3 million of intangible assets other than goodwill at december 30 , 2017 and december 31 , 2016.
 intangible asset balance represents estimated fair value of petsense tradename  not subject to amortization has indefinite useful life expected to contribute cash flows beyond foreseeable horizon.
 intangible assets we evaluate for impairment annually and whenever events or changes in circumstances indicate carrying value may not be recoverable.
recognize impairment loss only if carrying amount not recoverable through discounted cash flows measure impairment loss based on difference between carrying value and fair value.
 in fourth quarter of fiscal 2017 , company completed annual impairment testing of intangible assets and no impairment identified.

| 2017           | 2016
---------------------------------------- | -------------- | -------
balance beginning of year                | $ 94417        | $ 10258
goodwill acquired as part of acquisition | 2014           | 84159
working capital settlement               | -1225 ( 1225 ) | 2014
impairment loss                          | 2014           | 2014
balance end of year                      | $ 93192        | $ 94417


jpmorgan chase & co. /2017 annual report 53 net interest income excluding cib 2019s markets businesses reviewing net interest income management reviews net interest income excluding from cib 2019s markets businesses assess performance firm 2019s lending investing asset-liability management deposit-raising activities.
 net interest income non-markets related net interest income.
 cib 2019s markets businesses fixed income markets equity markets.
 management believes disclosure of non-markets related net interest income provides investors analysts measure analyze non-markets-related business trends firm comparable measure to other financial institutions focused lending investing deposit-raising.
 data are non-gaap financial measures due to exclusion of markets related net interest income from cib.
 year ended december 31 , ( in millions  except rates ) 2017 2016 2015 net interest income 2013 managed basis $ 51410 $ 47292 $ 44620 less : cib markets net interest income 4630 6334 5298 net interest income excluding cib markets $ 46780 $ 40958 $ 39322 average interest-earning assets $ 2180592 $ 2101604 $ 2088242 less : average cib markets interest-earning assets 540835 520307 510292 average interest assets excluding cib markets $ 1639757 $ 1581297 $ 1577950 net interest yield on average interest-earning assets 2013 managed basis 2. 36% ( 2. 36 % ) 2. 25% ( 2. 25 % ) 2. 14% ( 2. 14 % ) net interest yield on average cib markets interest-earning assets ) 0. 86 1. 22 1. 04 net interest yield on average interest-earning assets excluding cib markets 2. 85% ( 2. 85 % ) 2. 59% ( 2. 59 % ) 2. 49% ( 2. 49 % ) interest includes effect of related hedges.
taxable-equivalent amounts used where applicable.
 reconciliation of net interest income reported and managed basis see reconciliation from firm 2019s reported.
 results to managed basis on page 52.
 amounts table differ from prior-period presentation to align with cib 2019s markets businesses.
 further information on cib 2019s markets businesses see page 65.
 calculation of certain.
 gaap and non-gaap financial measures.
 calculated : book value per share ( 201cbvps 201d ) common stockholders 2019 equity at period-end / common shares at period-end overhead ratio total noninterest expense / total net revenue return on assets ( 201croa 201d ) reported net income / total average assets return on common equity ( 201croe 201d ) net income* / average common stockholders 2019 equity return on tangible common equity ( 201crotce 201d ) net income* / average tangible common equity tangible book value per share ( 201ctbvps 201d ) tangible common equity at period-end / common shares period-end * represents net income applicable to common equity.
 jpmorgan chase & co. /2017 annual report 53 net interest income excluding cib 2019s markets businesses reviewing net interest income managed basis management reviews net interest income excluding income from cib 2019s markets businesses to assess performance of firm 2019s lending  investing deposit-raising activities.
 net interest income referred to as non-markets related net interest income.
 cib 2019s markets businesses are fixed income markets equity markets.
 management believes disclosure of non-markets related net interest income provides investors analysts measure to analyze non-markets-related business trends firm provides comparable measure to other financial institutions primarily focused on lending  investing deposit-raising activities.
data non-gaap financial measures due to exclusion of markets related net interest income from cib.
 year ended december 31  in millions except rates ) 2017 2016 2015 net interest income 2013 managed basis $ 51410 $ 47292 $ 44620 less : cib markets net interest income ) 4630 6334 5298 net interest income excluding cib markets $ 46780 $ 40958 $ 39322 average interest-earning assets $ 2180592 $ 2101604 $ 2088242 less : average cib markets interest-earning assets 540835 520307 510292 assets excluding cib markets $ 1639757 $ 1581297 $ 1577950 net interest yield on average interest-earning assets 2013 managed basis 2. 36% ( 2. 36 % ) 2. 25% ( 2. 25 % ) 2. 14% ( 2. 14 % ) net interest yield on average cib markets interest-earning assets ) 0. 86 1. 22 1. 04 net interest yield average interest-earning assets excluding cib markets 2. 85% ( 2. 85 % ) 2. 59% ( 2. 59 % ) 2. 49% ( 2. 49 % ) interest includes effect of related hedges.
 taxable-equivalent amounts used where applicable.
 reconciliation of net interest income reported managed basis see reconciliation firm 2019s reported.
 results to managed basis page 52.
 amounts table differ from prior-period presentation align with cib 2019s markets businesses.
 further information on cib 2019s markets businesses see page 65.
 calculation of.
 gaap non-gaap financial measures.
gaap non-gaap financial measures calculated book value per share 201cbvps 201d ) common stockholders 2019 equity period-end common shares period-end overhead ratio total noninterest expense total net revenue return on assets 201croa 201d ) reported net income average assets return on common equity ( 201croe 201d ) net income average common stockholders 2019 equity return tangible common equity 201crotce 201d ) net income* average tangible common equity book value per share 201ctbvps 201d ) tangible common equity period-end common shares period-end represents net income common equity

year ended december 31 ( in millions except rates )                         | 2017             | 2016             | 2015
--------------------------------------------------------------------------- | ---------------- | ---------------- | ----------------
net interest income 2013 managed basis ( a ) ( b )                          | $ 51410          | $ 47292          | $ 44620
less : cib markets net interest income ( c )                                | 4630             | 6334             | 5298
net interest income excluding cib markets ( a )                             | $ 46780          | $ 40958          | $ 39322
average interest-earning assets                                             | $ 2180592        | $ 2101604        | $ 2088242
less : average cib markets interest-earning assets ( c )                    | 540835           | 520307           | 510292
average interest-earning assets excluding cib markets                       | $ 1639757        | $ 1581297        | $ 1577950
net interest yield on average interest-earning assets 2013 managed basis    | 2.36% ( 2.36 % ) | 2.25% ( 2.25 % ) | 2.14% ( 2.14 % )
net interest yield on average cib markets interest-earning assets ( c )     | 0.86             | 1.22             | 1.04
net interest yield on average interest-earning assets excluding cib markets | 2.85% ( 2.85 % ) | 2.59% ( 2.59 % ) | 2.49% ( 2.49 % )