Invest and Deliver - GE 2006 Annual Report Letter to InvestorsInvest and DeliverGovernanceCitizenshipFinancials
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Notes to Consolidated Financial StatementsNote 23: Shareowners’ Equity
 
 
 
 
(In millions) 2006   2005   2004  
COMMON STOCK ISSUED  
$ 669
   
$ 669
   
$ 669
 
ACCUMULATED NONOWNER CHANGES OTHER THAN EARNINGS                  
Balance at January 1  
$ 3,137
   
$ 8,156
   
$ 4,079
 
Investment securities — net of deferred taxes of $111, $(307) and $503   297     (231 )   677  
Currency translation adjustments — net of deferred taxes of $(1,417), $646 and $(1,314)   3,776     (4,315 )   3,936  
Cash flow hedges — net of deferred taxes of $75, $493 and $75   599     724     203  
Benefit plans — net of deferred taxes of $(2,533), $(159) and $(184)(a)   (3,532 )   (217 )   (421 )
Reclassification adjustments                  
Investment securities — net of deferred taxes of $(279), $(100) and $(142)   (520 )   (206 )   (265 )
Currency translation adjustments   (127 )   (3 )   —  
Cash flow hedges — net of deferred taxes of $(60), $(494) and $(55)   (376 )   (771 )   (53 )
Balance at December 31(b)(c)  
$ 3,254
   
$ 3,137
   
$ 8,156
 
OTHER CAPITAL                  
Balance at January 1  
$ 25,227
   
$ 24,265
   
$ 17,497
 
Gains on treasury stock dispositions and other(d)   259     962     4,615  
Issuance of subsidiary shares(d)(e)   —     —     2,153  
Balance at December 31  
$ 25,486
   
$ 25,227
   
$ 24,265
 
RETAINED EARNINGS                  
Balance at January 1  
$ 97,644
   
$ 90,580
   
$ 82,014
 
Net earnings   20,829     16,711     17,160  
Dividends(d)   (10,675 )   (9,647 )   (8,594 )
Balance at December 31  
$ 107,798
   
$ 97,644
   
$ 90,580
 
COMMON STOCK HELD IN TREASURY                  
Balance at January 1  
$ (17,326
)  
$ (12,762
)  
$ (24,597
)
Purchases(d)   (10,512 )   (6,868 )   (1,892 )
Dispositions(d)(f)   2,945     2,304     13,727  
Balance at December 31  
$ (24,893
)  
$ (17,326
)  
$ (12,762
)
TOTAL EQUITY                  
Balance at December 31  
$ 112,314
   
$ 109,351
   
$ 110,908
 
(a) The 2006 change includes transition effect related to adoption of SFAS 158 of $(3,819) million, net of taxes of $(2,715) million. See note 1 for further information regarding SFAS 158.
(b) Included accumulated nonowner changes related to discontinued operations of $(9) million, $652 million and $1,878 million at December 31, 2006, 2005 and 2004, respectively.
(c) At December 31, 2006, included reductions of equity of $838 million related to hedges of our investments in financial services subsidiaries that have functional currencies other than the U.S. dollar and $129 million related to cash flow hedges of forecasted transactions, of which we expect to transfer $120 million to earnings in 2007 along with the earnings effects of the related forecasted transaction.
(d) Total dividends and other transactions with shareowners reduced equity by $17,983 million in 2006 and $13,249 million in 2005; and increased equity by $10,009 million in 2004.
(e) Related to the 2004 combination of NBC with Vivendi Universal Entertainment LLLP (VUE) whereby 20% of NBC Universal’s common stock was issued to a subsidiary of Vivendi S.A. (Vivendi) as partial consideration for Vivendi’s interest in VUE.
(f) In 2004, included 341.7 million shares valued at $10,674 million issued in the Amersham acquisition, and 119.4 million shares valued at $3,765 million sold to partially fund the NBC and VUE combination.

At December 31, 2006 and 2005, the aggregate statutory capital and surplus of the insurance activities and discontinued insurance operations totaled $1.7 billion and $9.8 billion, respectively. Accounting practices prescribed by statutory authorities are used in preparing statutory statements.

In December 2004, our Board of Directors authorized a three-year, $15 billion share repurchase program, expanded that program in 2005 to $25 billion and extended it through 2008. Under this share repurchase program, on a book basis we repurchased 229.4 million shares for a total of $7.8 billion during 2006.

Common shares issued and outstanding are summarized in the following table.

Shares of GE common stock
December 31 (In thousands) 2006   2005   2004  
Issued   11,145,212     11,145,212     11,145,212  
In treasury   (867,839 )   (660,944 )   (558,854 )
Outstanding   10,277,373     10,484,268     10,586,358  

GE has 50 million authorized shares of preferred stock ($1.00 par value), but has not issued any such shares as of December 31, 2006.

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