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Document and Entity Information - shares shares in Millions	9 Months Ended
Document and Entity Information - shares shares in Millions	Sep. 30, 2010	Oct. 20, 2010
Document and Entity Information [Abstract]
Entity Registrant Name	ITT CORP
Entity Central Index Key	0000216228
Document Type	10-Q
Document Period End Date	Sep. 30, 2010
Amendment Flag	false
Document Fiscal Year Focus	2010
Document Fiscal Period Focus	Q3
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	Yes
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		183.6

Consolidated Condensed Income Statements (Unaudited) - USD ($) shares in Millions, $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2010	Sep. 30, 2009	Sep. 30, 2010	Sep. 30, 2009
Consolidated Condensed Income Statements [Abstract]
Product revenue	$ 2,052	$ 2,036	$ 6,133	$ 6,131
Service revenue	591	604	1,827	1,734
Total revenue	2,643	2,640	7,960	7,865
Cost of product revenue	1,357	1,349	4,085	4,158
Cost of service revenue	518	531	1,608	1,518
Total cost of revenue	1,875	1,880	5,693	5,676
Gross profit	768	760	2,267	2,189
Selling, general and administrative expenses	396	381	1,149	1,147
Research and development expenses	60	58	183	168
Asbestos-related costs, net	341	223	368	224
Restructuring and asset impairment charges, net	3	9	30	40
Operating (loss) income	(32)	89	537	610
Interest expense	26	25	74	74
Interest income	3	14	14	22
Miscellaneous (income) expense, net	(7)	3	1	9
(Loss) income from continuing operations before income tax expense	(48)	75	476	549
Income tax (benefit) expense	(60)	11	94	101
Income from continuing operations	12	64	382	448
Income (loss) from discontinued operations, including income tax benefit of $1, $4, $6 and $3, respectively	133	(5)	147	(3)
Net income	$ 145	$ 59	$ 529	$ 445
Basic Earnings (Loss) Per Share:
Continuing operations	$ 0.07	$ 0.35	$ 2.08	$ 2.46
Discontinued operations	0.72	(0.03)	0.8	(0.02)
Net income	0.79	0.32	2.88	2.44
Diluted Earnings (Loss) Per Share:
Continuing operations	0.07	0.35	2.06	2.44
Discontinued operations	0.71	(0.03)	0.8	(0.02)
Net income	$ 0.78	$ 0.32	$ 2.86	$ 2.42
Weighted average common shares - basic	184.1	182.7	183.8	182.4
Weighted average common shares - diluted	185.3	184.3	185.2	183.7
Cash dividends declared per common share	$ 0.25	$ 0.2125	$ 0.75	$ 0.6375

Consolidated Condensed Income Statements (Unaudited) (Parenthetical) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2010	Sep. 30, 2009	Sep. 30, 2010	Sep. 30, 2009
Consolidated Condensed Income Statements [Abstract]
Tax expense (benefit) from discontinued operations	$ 1	$ 4	$ 6	$ 3

Consolidated Condensed Balance Sheets (Unaudited) - USD ($)
$ in Millions

Sep. 30, 2010

Dec. 31, 2009

Assets:

Cash and cash equivalents

$ 912

$ 1,216

Receivables, net

1,911

1,754

Inventories, net

942

802

Deferred income taxes

231

232

Other current assets

262

206

Assets of discontinued operations

141

Total current assets

4,258

4,351

Plant, property and equipment, net

1,149

1,050

Deferred income taxes

816

583

Goodwill

4,271

3,788

Other intangible assets, net

783

501

Asbestos-related assets

905

604

Other non-current assets

278

252

Total non-current assets

8,202

6,778

Total assets

12,460

11,129

Liabilities:

Accounts payable

1,269

1,273

Accrued expenses

1,074

1,020

Accrued taxes

103

Short-term debt and current maturities of long-term debt

279

Postretirement benefits

Deferred income taxes

Liabilities of discontinued operations

Total current liabilities

2,792

2,624

Postretirement benefits

1,763

1,788

Long-term debt

1,364

1,431

Asbestos-related liabilities

1,512

867

Other non-current liabilities

700

541

Total non-current liabilities

5,339

4,627

Total liabilities

8,131

7,251

Shareholders' Equity:

Common stock: Authorized - 500 shares, $1 par value per share (206.9 shares issued), Outstanding - 183.6 shares and 182.9 shares, respectively

^[1]

183

181

Retained earnings

5,168

4,737

Accumulated other comprehensive (loss) income:

Postretirement benefits

(1,342)

(1,388)

Cumulative translation adjustments

309

336

Unrealized gain on investment securities

Total accumulated other comprehensive loss

(1,022)

(1,040)

Total shareholders' equity

4,329

3,878

Total liabilities and shareholders' equity

$ 12,460

$ 11,129

[1]	Shares outstanding include unvested restricted common stock of 1.0 and 1.3 at September 30, 2010 and December 31, 2009, respectively.

Consolidated Condensed Balance Sheets (Unaudited) (Parenthetical) - USD ($) shares in Millions	Sep. 30, 2010	Dec. 31, 2009
Shareholders' Equity:
Common stock, shares authorized	500.0	500.0
Common stock, par value	$ 1	$ 1
Common Stock, shares issued	206.9	206.9
Common stock, shares outstanding	183.6	182.9
Common stock, unvested restricted common stock included in shares outstanding	1.0	1.3

Consolidated Condensed Statements of Cash Flows (Unaudited) - USD ($) $ in Millions	9 Months Ended
	Sep. 30, 2010	Sep. 30, 2009
Operating Activities
Net income	$ 529	$ 445
Less: Income (loss) from discontinued operations	147	(3)
Income from continuing operations	382	448
Adjustments to income from continuing operations:
Depreciation and amortization	214	214
Stock-based compensation	23	23
Asbestos-related costs, net	368	224
Restructuring and asset impairment charges, net	30	40
Payments for restructuring	(50)	(62)
Contributions to pension plans	(13)	(52)
Change in receivables	(105)	178
Change in inventories	(40)	12
Change in accounts payable	27	9
Change in accrued expenses	13	64
Change in accrued and deferred taxes	(209)	(33)
Change in other assets	(4)	(92)
Change in other liabilities	5	59
Other, net	13	16
Net Cash - Operating Activities	654	1,048
Investing Activities
Capital expenditures	(174)	(140)
Acquisitions, net of cash acquired	(994)	(34)
Proceeds from sale of assets and businesses	250	13
Other, net	1	0
Net Cash - Investing Activities	(917)	(161)
Financing Activities
Short-term debt, net	206	(1,435)
Long-term debt repaid	(71)	(21)
Long-term debt issued	1	992
Proceeds from issuance of common stock	17	5
Dividends paid	(176)	(109)
Tax impact from stock-based compensation	3	0
Other, net	4	4
Net Cash - Financing Activities	(16)	(564)
Exchange rate effects on cash and cash equivalents	(27)	53
Net cash from discontinued operations	2	7
Net change in cash and cash equivalents	(304)	383
Cash and cash equivalents - beginning of period	1,216	965
Cash and cash equivalents - end of period	912	1,348
Cash paid during the period for:
Interest	46	46
Income taxes	$ 289	$ 135

Basis of Presentation (Unaudited)

9 Months Ended

Sep. 30, 2010

Basis of Presentation [Abstract]

Basis of Presentation


1)	Basis of Presentation

The unaudited consolidated condensed financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (SEC) and, in the opinion of management, reflect all adjustments (which include normal recurring adjustments) necessary for a fair presentation of the financial position, results of operations, and cash flows for the periods presented. Certain information and note disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted pursuant to such SEC rules. Unless the context otherwise indicates, references herein to “ITT,” “the Company,” and such words as “we,” “us,” and “our” include ITT Corporation and its subsidiaries. We believe that the disclosures made are adequate to make the information presented not misleading. We consistently applied the accounting policies described in ITT’s 2009 Annual Report on Form 10-K (2009 Annual Report) in preparing these unaudited financial statements. The preparation of these financial statements requires management to make certain estimates and assumptions that affect the amounts reported, and such estimates could differ from actual results. These financial statements should be read in conjunction with the financial statements and notes thereto included in our 2009 Annual Report. Certain prior year amounts have been reclassified to conform to current year presentation.

ITT’s 2010 and 2009 quarterly financial periods end on the Saturday closest to the last day of the quarter, except for the last quarterly period of the fiscal year, which ends on December 31st. For ease of presentation, the quarterly financial statements included herein are described as ending on the last day of the calendar quarter.

New Accounting Pronouncements (Unaudited)

9 Months Ended

Sep. 30, 2010

New Accounting Pronouncements [Abstract]

New Accounting Pronouncements


2)	New Accounting Pronouncements

Pronouncements Not Yet Adopted

In October 2009, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2009-13, which amended the accounting for revenue arrangements that contain multiple elements. The objective of this amendment is to address the accounting for multiple-deliverable arrangements to enable vendors to account for products or services (deliverables) separately rather than as a combined unit. The amendments establish a hierarchy for determining the selling price of a deliverable and will allow for the separation of products and services in more instances than previously permitted. The guidance provided within ASU 2009-13 is effective for new or materially modified arrangements in fiscal years beginning on or after June 15, 2010 and allows for either prospective or retrospective application, with early adoption permitted. We currently plan on adopting the provisions of this ASU on January 1, 2011 and are in the process of evaluating the impact that adoption will have on our consolidated financial statements.

In October 2009, the FASB issued ASU No. 2009-14, which amended the accounting requirements for software revenue recognition. The objective of this update is to address the accounting for revenue arrangements that contain tangible products and software. Specifically, products that contain software that is “more than incidental” to the product as a whole will be removed from the scope of the software revenue recognition literature. The amendments align the accounting for these revenue transaction types with the amendments described under ASU 2009-13 above. The guidance provided within ASU 2009-14 is effective for new or materially modified arrangements in fiscal years beginning on or after June 15, 2010 and allows for either prospective or retrospective application, with early adoption permitted. We currently plan on adopting the provisions of this ASU on January 1, 2011 and are in the process of evaluating the impact that adoption will have on our consolidated financial statements.

In April 2010, the FASB issued ASU No. 2010-17, which establishes authoritative guidance permitting use of the milestone method of revenue recognition for research or development arrangements that contain payment provisions or consideration contingent on the achievement of specified events. This guidance is effective for milestones achieved in fiscal years beginning on or after June 15, 2010 and allows for either prospective or retrospective application, with early adoption permitted. We currently plan on adopting the provisions of this ASU on January 1, 2011 and are in the process of evaluating the impact that adoption will have on our consolidated financial statements.

Recently Adopted Accounting Pronouncements

In June 2009, the FASB amended the accounting and disclosure requirements related to the consolidation of variable interest entities (VIE(s)). The amendments include replacing the quantitative-based risks and rewards calculation for determining which enterprise, if any, has a controlling financial interest in VIE(s) with an approach focused on identifying which enterprise has the power to direct the activities of VIE(s) that most significantly impact the entity’s economic performance and (1) the obligation to absorb losses of the entity or (2) the right to receive benefits from the entity. In addition, the amendments require an ongoing assessment of whether an enterprise is the primary beneficiary of the VIE(s) and requires additional disclosures about an enterprise’s involvement in VIE(s). The adoption of these amendments on January 1, 2010 did not have a material impact on our consolidated financial statements.

Acquisitions (Unaudited)

9 Months Ended

Sep. 30, 2010

Acquisitions [Abstract]

Acquisitions


3)	Acquisitions

During the first nine months of 2010 we spent an aggregate of $994, net of cash acquired, primarily on the acquisitions of Nova Analytics Corporation (Nova) and Godwin Pumps of America, Inc. and Godwin Holdings Limited (collectively referred to as Godwin). The results of operations and cash flows from our 2010 acquisitions have been included in our consolidated financial statements prospectively from their date of acquisition. We do not consider any of our 2010 acquisitions to be material to our consolidated financial statements either individually or in the aggregate. Provided below is additional information related to the Nova and Godwin acquisitions.

During the first nine months of 2009, we spent $34, net of cash acquired, primarily on the acquisition of Laing GmbH which is reported within our Fluid Technology segment (Fluid segment). Our acquisitions in the first nine months of 2009 are not considered material individually or in the aggregate.

Nova Analytics

On March 23, 2010, we acquired 100% of the outstanding stock of Nova, a manufacturer of premium quality laboratory, field, portable and on-line analytical instruments used in water and wastewater, environmental, medical, and food and beverage applications, for a purchase price of $385, net of cash acquired. During the third quarter of 2010, we finalized the Nova purchase price with the completion of a working capital adjustment. Nova provides us with brands, technologies, distribution and aftermarket content in the analytical instrumentation market. The addition of Nova broadens the solutions our Fluid segment offers customers in key markets such as municipal water and wastewater, industrial processing, and food and beverage.

The purchase price for Nova was allocated to the net tangible and intangible assets acquired and liabilities assumed based on their preliminary fair values as of March 23, 2010. The excess of the purchase price over the preliminary assets acquired and liabilities assumed was recorded as goodwill. The purchase price allocation is preliminary and our estimates and assumptions are subject to change within the measurement period (up to one year from the acquisition date). The primary areas of the purchase price allocation that are not yet finalized relate to the valuation of intangible assets acquired, as well as the fair values of certain environmental matters, income taxes, and residual goodwill. We expect to obtain the information necessary to finalize the fair value of the net assets acquired at the acquisition date during the measurement period.

Of the $385 purchase price, the aggregate preliminary fair value of distributor relationships was $112, trademarks was $42 and proprietary technology was $10. Other assets acquired and liabilities assumed as part of the acquisition were $67 primarily related to working capital balances and $78 primarily related to deferred tax liabilities, respectively. The excess of the purchase price over the preliminary fair value of net assets acquired was $232 (which is not expected to be deductible for income tax purposes). The goodwill arising from the acquisition consists largely of the planned expansion of the Nova footprint to new geographic markets, synergies and economies of scale. All of the goodwill has been assigned to the Fluid segment.

Godwin Pumps

On August 3, 2010, we acquired 100% of the privately-held stock of Godwin for a preliminary purchase price of $580, net of cash acquired, which is subject to a net worth adjustment to be finalized within 120 days from the acquisition date. Godwin is a supplier and servicer of automatic self-priming and on-demand pumping solutions serving the global industrial, construction, mining, municipal, oil and gas dewatering markets. The addition of Godwin’s specialized products and skills to our Fluid segment’s broad submersible pump portfolio and global sales and distribution network provides significant geographic expansion opportunities.

The purchase price for Godwin was allocated to the net tangible and intangible assets acquired and liabilities assumed based on their preliminary fair values as of August 3, 2010. The excess of the purchase price over the preliminary net assets acquired was recorded as goodwill. The purchase price allocation is preliminary and our estimates and assumptions are subject to change within the measurement period (up to one year from the acquisition date). The primary areas of the purchase price allocation that are not yet finalized relate to the fair values of certain tangible assets acquired and liabilities assumed, the valuation of intangible assets acquired, income taxes and residual goodwill. We expect to obtain the information necessary to finalize the fair value of the net assets acquired at the acquisition date during the measurement period.

Of the $580 purchase price, the aggregate fair value of customer relationships was $107, trademarks was $46 and proprietary technology was $14. Other assets acquired as part of the acquisition were $190, primarily including rental equipment, inventory, and trade receivables. Liabilities assumed as part of the acquisition were $29. The excess of the purchase price over the fair value of net assets acquired was $252, a significant portion of which is expected to be deductible for income tax purposes. The goodwill arising from the acquisition is primarily related to the planned geographic expansion of Godwin’s operations. All of the goodwill has been assigned to the Fluid segment.

Discontinued Operations (Unaudited)

9 Months Ended

Sep. 30, 2010

Discontinued Operations [Abstract]

Discontinued Operations


4)	Discontinued Operations

During the second quarter of 2010 our Board of Directors provided approval to pursue the sale of CAS, Inc. (CAS), a component of our Defense & Information Solutions business segment (Defense segment) engaging in systems engineering and technical assistance (SETA) for the U.S. Government. The sale of CAS was completed on September 8, 2010, resulting in the recognition of a $130 after-tax gain reported as a component of income from discontinued operations within our Consolidated Condensed Income Statements. This transaction resulted in a tax benefit of $4 primarily due to the difference in the book and tax bases of CAS. Subsequent to this divestiture, we do not have any significant continuing involvement in the operations of CAS, nor do we expect significant continuing cash flows from CAS. Accordingly, the financial position and results of operations from CAS are reported as a discontinued operation for the periods presented. The following table provides third-party revenue and operating income provided by CAS included within discontinued operations.


	Three Months Ended				Nine Months Ended
	September 30				September 30
	2010		2009		2010		2009

Revenue (third party)	$	46	$	59	$	160	$	170
Operating income	$	4	$	3	$	13	$	11

Assets and liabilities of CAS reported as discontinued operations within our Consolidated Condensed Balance Sheet are presented in the table below.


	December 31,
	2009

Receivables, net	$	43
Plant, property and equipment, net		1
Goodwill		76
Other intangible assets, net		18
Deferred income taxes		2
Other assets		1

Total assets of discontinued operations	$	141

Accounts payable	$	19
Accrued expenses		17
Deferred income taxes		8

Total liabilities of discontinued operations	$	44

Restructuring and Asset Impairment Charges (Unaudited)

9 Months Ended

Sep. 30, 2010

Restructuring and Asset Impairment Charges [Abstract]

Restructuring and Asset Impairment Charges


5)	Restructuring and Asset Impairment Charges

Third Quarter 2010 Restructuring Activities

During the third quarter of 2010, we recorded a net restructuring charge of $3, reflecting costs of $1 related to new actions and $4 related to prior actions, as well as the reversal of $2 of restructuring accruals that management determined would not be required. The charges associated with actions announced during the third quarter of 2010 are associated with strategic logistical initiatives within our Motion & Flow Control business segment (Motion & Flow segment) and primarily relate to asset impairment costs. This initiative includes the planned closure of one facility scheduled to be completed within the next six months. Planned position eliminations for actions announced during the quarter totaled 53, including 18 factory workers and 35 office workers.

The charges recognized during the quarter related to prior actions primarily relate to severance costs as we continue our ongoing realignment efforts within our Defense segment.


	Third Quarter 2010 Actions
	Costs of		Planned		Prior Actions
	Third Quarter		Position		Additional		Reversal of
	Actions		Eliminations		Costs		Accruals

Defense	$	—		—	$	3	$	(2	)
Fluid		—		—		1		—
Motion & Flow		1		53		—		—

	$	1		53	$	4	$	(2	)

First Nine Months 2010 Restructuring Activities

During the first nine months of 2010, we recorded a net restructuring charge of $30, reflecting costs of $28 related to new actions and $6 related to prior actions, as well as the reversal of $4 of restructuring accruals that management determined would not be required. The charges associated with actions announced during the first nine months of 2010 are primarily for employee severance associated with the strategic realignment of our Defense segment which was introduced during the first quarter of 2010.

The Defense realignment action, which is expected to be completed by year end 2010, will enable better product portfolio integration, encouraging a more coordinated market approach and reduced operational redundancies. As part of the strategic realignment of the Defense segment, the previous organizational structure, consisting of seven divisions, was consolidated into three larger divisions. The Defense realignment action included the planned closure of 3 facilities, one of which was closed during the third quarter and the remaining two are expected to close during the fourth quarter of 2010.

In addition to the Defense segment realignment, we incurred severance restructuring costs within our Fluid segment, primarily associated with initiatives focused on our European sales and logistics functions.

Planned position eliminations for actions announced during the period totaled 785, including 236 factory workers, 526 office workers and 23 management employees. In addition to these planned position eliminations, we announced the elimination of an additional 51 positions within our Fluid segment during 2010 that related to actions initiated in the fourth quarter of 2009.


	2010 Actions
	Costs of		Planned		Prior Actions
	Nine Months		Position		Additional		Reversal of
	Actions		Eliminations		Costs		Accruals

Defense	$	22		643	$	—	$	(2	)
Fluid		5		89		5		(1	)
Motion & Flow		1		53		1		(1	)

	$	28		785	$	6	$	(4	)

Third Quarter 2009 Restructuring Activities

During the third quarter of 2009, we recorded a net restructuring charge of $9, reflecting costs of $7 related to new actions and $3 related to prior actions, as well as the reversal of $1 of restructuring accruals that management determined would not be required. The charges associated with actions announced during the third quarter of 2009 primarily represent severance costs associated with headcount reductions within the Fluid and Motion & Flow segments. Planned position eliminations relating to third quarter 2009 actions totaled 171, including 68 factory workers, 98 office workers and 5 management employees. The costs recognized during the quarter for previous actions primarily reflect additional severance costs.


	Third Quarter 2009 Actions										Prior
			Lease						Planned		Actions
			Cancellation &		Asset				Position		Additional		Reversal of
	Severance		Other Costs		Impairments		Total		Eliminations		Costs		Accruals

Defense	$	—	$	1	$	1	$	2		32	$	—	$	—
Fluid		3		1		—		4		89		2		(1	)
Motion & Flow		1		—		—		1		50		1		—

	$	4	$	2	$	1	$	7		171	$	3	$	(1	)

Nine Months 2009 Restructuring Activities

During the first nine months of 2009, we recorded a net restructuring charge of $40 reflecting costs of $32 related to new actions and $9 related to prior years’ plans, as well as the reversal of $1 of restructuring accruals that management determined would not be required. The charges associated with actions announced during the first nine months of 2009 primarily represent severance costs associated with reductions in headcount within the Fluid and Motion & Flow segments. Planned position eliminations relating to this period totaled 702, including 290 factory workers, 390 office workers and 22 management employees. The costs recognized during the first nine months of 2009 related to prior years’ plans primarily reflect additional severance and lease cancellation costs.


	2009 Actions
			Other										Prior
			Employee		Lease						Planned		Years’ Plans
			Related		Cancellation &		Asset				Position		Additional		Reversal of
	Severance		Costs		Other Costs		Impairments		Total		Eliminations		Costs		Accruals

Defense	$	1	$	—	$	1	$	1	$	3		71	$	3	$	—
Fluid		18		—		2		—		20		347		4		(1	)
Motion & Flow		7		1		—		—		8		273		2		—
Corporate and Other		1		—		—		—		1		11		—		—

	$	27	$	1	$	3	$	1	$	32		702	$	9	$	(1	)

Restructuring Accrual and Planned Headcount Reductions

The restructuring accrual as of September 30, 2010 was $30, presented on our Consolidated Condensed Balance Sheet within accrued expenses, which includes $28 for accrued severance and $2 for accrued facility carrying and other costs. The following table displays a rollforward of the restructuring accruals by business segment for the nine months ended September 30, 2010.


							Motion
	Defense			Fluid			& Flow			Total

Balance December 31, 2009	$	4		$	18		$	31		$	53
Additional charges for prior years’ plans		—			5			1			6
Cash payments related to prior years’ plans		(1	)		(16	)		(18	)		(35	)
Charges for 2010 actions		22			5			1			28
Cash payments related to 2010 actions		(11	)		(4	)		—			(15	)
Reversals of prior charges		(2	)		(1	)		(1	)		(4	)
Foreign exchange translation and other		—			(1	)		(2	)		(3	)

Balance September 30, 2010	$	12		$	6		$	12		$	30

The following table displays a rollforward of employee positions eliminated associated with restructuring activities through September 30, 2010. We expect the remaining planned headcount reductions as of September 30, 2010 will be substantially completed by the end of 2010.


Planned reductions as of December 31, 2009	407
Additional planned reductions, January 1 — September 30, 2010	836
Actual reductions, January 1 — September 30, 2010	(1,035	)

Planned reductions as of September 30, 2010	208

Income Taxes (Unaudited)

9 Months Ended

Sep. 30, 2010

Income Taxes [Abstract]

Income Taxes


6)	Income Taxes

Effective Tax Rate

For the quarter ended September 30, 2010 we recorded an income tax benefit of $60, compared to an income tax expense of $11 for the comparable prior year period. This fluctuation is primarily attributable to an additional tax benefit of $46 related to an increase in asbestos-related costs of $118. Our third quarter 2010 income tax also reflects a $27 benefit from the reversal of valuation allowances on certain capital loss carryforwards as it became more likely than not that these deferred tax assets would be realized.

Income tax expense was $94 for the nine months ended September 30, 2010, resulting in an effective tax rate of 19.7%, compared to income tax expense of $101 and an effective tax rate of 18.4% for the comparable prior year period. In addition to the items impacting the third quarter 2010 income tax expense mentioned above, the year-to-date 2010 effective tax rate was also impacted by a $15 reversal of uncertain tax positions due to the completion of a tax audit, partially offset by a $12 discrete income tax charge associated with the ratification of the U.S. Patient Protection and Affordable Care Act (the Healthcare Reform Act). Effective January 1, 2013, the Healthcare Reform Act eliminates the tax deduction for benefits related to subsidies received for prescription drug benefits provided under retiree healthcare benefit plans that were determined to be actuarially equivalent to Medicare Part D.

The effective tax rate for the nine months ended September 30, 2009 was primarily impacted by the restructuring of certain international legal entities, which reduced our income tax provision by $58. This reduction was based on a determination that the excess investment for financial reporting purposes over the tax basis in certain foreign subsidiaries will be indefinitely reinvested and the associated deferred tax liability would no longer be required.

Uncertain Tax Positions

We recognize a tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. As of September 30, 2010 and December 31, 2009, we had $188 and $171, respectively, of total uncertain tax positions recorded. The amount of uncertain tax positions that would affect the effective tax rate is $81 and $89, as of September 30, 2010 and December 31, 2009, respectively. We do not believe that the total amount of uncertain tax positions will significantly change within twelve months of the reporting date.

We classify interest relating to tax matters as a component of interest expense and tax penalties as a component of income tax expense in our Consolidated Condensed Income Statement. We have accrued $20 and $23 for payment of interest and penalties as of September 30, 2010 and December 31, 2009, respectively.

Earnings Per Share (Unaudited)

9 Months Ended

Sep. 30, 2010

Earnings Per Share [Abstract]

Earnings Per Share


7)	Earnings Per Share

A reconciliation of the data used in the calculation of basic and diluted earnings per share computations for income from continuing operations is as follows:


	Three Months Ended				Nine Months Ended
	September 30				September 30
	2010		2009		2010		2009

Income from continuing operations	$	12	$	64	$	382	$	448

Weighted average common shares outstanding		182.5		181.2		182.2		180.9
Add: Weighted average restricted stock awards outstanding^(a)		1.6		1.5		1.6		1.5

Basic weighted average common shares outstanding		184.1		182.7		183.8		182.4
Add: Dilutive impact of stock options		1.2		1.6		1.4		1.3

Diluted weighted average common shares outstanding		185.3		184.3		185.2		183.7

Basic earnings per share	$	0.07	$	0.35	$	2.08	$	2.46

Diluted earnings per share	$	0.07	$	0.35	$	2.06	$	2.44

Anti-dilutive stock options		2.2		1.7		2.1		4.0
Weighted average exercise price of anti-dilutive stock options	$	54.30	$	54.45	$	54.42	$	49.21


^(a)		Restricted stock awards containing rights to non-forfeitable dividends which participate in undistributed earnings with common shareholders are considered participating securities for purposes of computing earnings per share.

Comprehensive Income (Unaudited)

9 Months Ended

Sep. 30, 2010

Comprehensive Income [Abstract]

Comprehensive Income


8)	Comprehensive Income


	Three Months Ended September 30
	2010									2009
				Tax								Tax
	Pre-Tax			(Expense)			Net-of-Tax			Pre-Tax		(Expense)			Net-of-Tax
	Amount			Benefit			Amount			Amount		Benefit			Amount

Net income							$	145							$	59
Other comprehensive income:
Net foreign currency translation adjustments	$	184		$	—			184		$	96	$	—			96
Changes in postretirement benefit plans		24			(9	)		15			16		(6	)		10
Net change in unrealized gain on investment securities:
Unrealized holding gains arising during period		1			—			1			—		—			—
Less: Reclassification adjustment for realized gains		7			(3	)		4			—		—			—

Net change in unrealized gain on investment securities		(6	)		3			(3	)		—		—			—
Other comprehensive income	$	202		$	(6	)		196		$	112	$	(6	)		106

Comprehensive income							$	341							$	165


	Nine Months Ended September 30
	2010									2009
				Tax								Tax
	Pre-Tax			(Expense)			Net-of-Tax			Pre-Tax		(Expense)			Net-of-Tax
	Amount			Benefit			Amount			Amount		Benefit			Amount

Net income							$	529							$	445
Other comprehensive income (loss):
Net foreign currency translation adjustments	$	(27	)	$	—			(27	)	$	144	$	—			144
Changes in postretirement benefit plans		73			(27	)		46			48		(18	)		30
Net change in unrealized gain on investment securities:
Unrealized holding gains arising during period		5			(2	)		3			—		—			—
Less: Reclassification adjustment for realized gains		7			(3	)		4			—		—			—

Net change in unrealized gain on investment securities		(2	)		1			(1	)		—		—			—
Other comprehensive income (loss)	$	44		$	(26	)		18		$	192	$	(18	)		174

Comprehensive income							$	547							$	619

Receivables, Net (Unaudited)

9 Months Ended

Sep. 30, 2010

Receivables, Net [Abstract]

Receivables, Net


9)	Receivables, Net


	September 30,			December 31,
	2010			2009

Trade	$	1,522		$	1,379
Unbilled contract receivables		380			373
Other		59			56

Receivables, gross		1,961			1,808
Less: allowance for doubtful accounts and cash discounts		(50	)		(54	)

Receivables, net	$	1,911		$	1,754

Unbilled contract receivables represent revenue recognized on long-term contracts that arise based on performance attainment which, though appropriately recognized, cannot be billed as of the balance sheet date. We expect to bill and collect substantially all of the September 30, 2010 unbilled contract receivables during the next twelve months as scheduled performance milestones are completed or units are delivered.

Our outstanding trade accounts receivable balance from the U.S. Government was $382 and $327 as of September 30, 2010 and December 31, 2009, respectively.

Inventories, Net (Unaudited)

9 Months Ended

Sep. 30, 2010

Inventories, Net [Abstract]

Inventories, Net


10)	Inventories, Net


	September 30,			December 31,
	2010			2009

Finished goods	$	230		$	176
Work in process		112			57
Raw materials		350			253

		692			486

Inventoried costs related to long-term contracts		342			391
Less: progress payments		(92	)		(75	)

Inventoried costs related to long-term contracts, net		250			316

Inventories, net	$	942		$	802

Plant, Property and Equipment, Net (Unaudited)

9 Months Ended

Sep. 30, 2010

Plant, Property and Equipment, Net [Abstract]

Plant, Property and Equipment, Net


11)	Plant, Property and Equipment, Net


	September 30,			December 31,
	2010			2009

Land and improvements	$	59		$	57
Buildings and improvements		637			609
Machinery and equipment		1,764			1,688
Equipment held for lease or rental		127			72
Furniture, fixtures and office equipment		228			220
Construction work in progress		154			157
Other		27			22

		2,996			2,825
Less: accumulated depreciation and amortization		(1,847	)		(1,775	)

Plant, property and equipment, net	$	1,149		$	1,050

Goodwill and Other Intangible Assets, Net (Unaudited)

9 Months Ended

Sep. 30, 2010

Goodwill and Other Intangible Assets, Net [Abstract]

Goodwill and Other Intangible Assets, Net


12)	Goodwill and Other Intangible Assets, Net

Changes in the carrying amount of goodwill for the nine months ended September 30, 2010 by business segment are as follows:


						Motion			Corporate
	Defense		Fluid			& Flow			and Other		Total

Balance as of January 1, 2010	$	2,132	$	1,165		$	486		$	5	$	3,788
Goodwill acquired during the period		3		491			—			—		494
Foreign currency translation		—		(7	)		(4	)		—		(11	)

Balance as of September 30, 2010	$	2,135	$	1,649		$	482		$	5	$	4,271

Goodwill disposed during the period	$	76	$	—		$	—		$	—	$	76

Goodwill disposed during the period relates to the sale of CAS on September 8, 2010. See Note 4, “Discontinued Operations” for further information.

Information regarding other intangible assets is as follows:


	September 30, 2010							December 31, 2009
	Gross					Other		Gross					Other
	Carrying		Accumulated			Intangibles		Carrying		Accumulated			Intangibles
	Amount		Amortization			Net		Amount		Amortization			Net

Finite-lived intangibles:
Distributor and customer relationships	$	853	$	(291	)	$	562	$	625	$	(236	)	$	389
Proprietary technology		89		(29	)		60		66		(24	)		42
Trademarks		36		(10	)		26		35		(8	)		27
Patents and other		49		(22	)		27		45		(20	)		25
Indefinite-lived intangibles:
Brands and trademarks		108		—			108		18		—			18

Other intangible assets, net	$	1,135	$	(352	)	$	783	$	789	$	(288	)	$	501

Intangible assets related to the acquisition of Nova included $112 of distributor relationships, $42 of trademarks and $10 of proprietary technology. The distributor relationships are expected to be amortized over a weighted average period of 19 years and the proprietary technology is expected to be amortized over a weighted average period of 11 years from the date of acquisition. The trademarks have been assigned an indefinite life.

Intangible assets related to the acquisition of Godwin included $107 of customer relationships, $46 of trademarks and $14 of proprietary technology. The customer relationships are expected to be amortized over a weighted average period of 10 years and the proprietary technology is expected to be amortized over a weighted average period of 16 years from the date of acquisition. The trademarks have been assigned an indefinite life.

Amortization expense related to finite-lived intangible assets for the nine months ended September 30, 2010 and 2009 was $64 and $76, respectively. We expect to incur amortization expense of $22 over the remaining three months of 2010.

Estimated amortization expense for finite-lived intangible assets for each of the five succeeding years is as follows:


2011	2012	2013	2014	2015

$85	$76	$59	$54	$50

Other Non-Current Assets (Unaudited)

9 Months Ended

Sep. 30, 2010

Other Non-Current Assets [Abstract]

Other Non-Current Assets


13)	Other Non-Current Assets


	September 30,		December 31,
	2010		2009

Other employee benefit-related assets	$	101	$	87
Capitalized software costs		88		65
Long-term third party receivables, net		42		44
Equity and cost method investments		4		28
Pension assets and prepaid benefit plan costs		17		16
Other		26		12

Other non-current assets	$	278	$	252

Debt (Unaudited)

9 Months Ended

Sep. 30, 2010

Debt [Abstract]

Debt


14)	Debt


	September 30,			December 31,
	2010			2009

Commercial paper	$	258		$	55
Short-term loans		11			10
Current maturities of long-term debt and other		10			10

Short-term debt and current maturities of long-term debt		279			75

Non-current maturities of long-term debt		1,322			1,392
Non-current capital leases		4			4
Deferred gain on interest rate swaps		46			50
Unamortized discounts and debt issuance costs		(8	)		(15	)

Long-term debt		1,364			1,431

Total debt	$	1,643		$	1,506

The fair value of total debt, excluding the deferred gain on interest rate swaps, was $1,803 and $1,547 as of September 30, 2010 and December 31, 2009, respectively.

In August 2010, we replaced the $1.75 billion November 2005 Credit Facility with a new three-year $1.5 billion revolving credit agreement (August 2010 Credit Facility). The interest rate for borrowings under the August 2010 Credit Facility is generally based on the London Interbank Offered Rate (LIBOR), plus a spread, which reflects the Company’s debt rating. The commitment fee on the August 2010 Credit Facility is 0.225% of the total commitment. The provisions of the August 2010 Credit Facility require that we maintain an interest coverage ratio, as defined, of 3.5 times. At September 30, 2010, our interest coverage ratio was in excess of the minimum requirements.

During the second quarter of 2010, we called $69 of face value debentures due in 2011. We recognized $3 of net expense related to this early retirement.

Other Non-Current Liabilities (Unaudited)

9 Months Ended

Sep. 30, 2010

Other Non-Current Liabilities [Abstract]

Other Non-Current Liabilities


15)	Other Non-Current Liabilities


	September 30,		December 31,
	2010		2009

Deferred income taxes and other tax-related accruals	$	336	$	174
Environmental		125		128
Compensation and other employee-related benefits		119		123
Product liability, guarantees and other legal matters		72		63
Other		48		53

Other non-current liabilities	$	700	$	541

Employee Benefit Plans (Unaudited)

9 Months Ended

Sep. 30, 2010

Employee Benefit Plans [Abstract]

Employee Benefit Plans


16)	Employee Benefit Plans

Components of net periodic benefit cost for the three and nine months ended September 30, 2010 and 2009 were as follows:


	Three Months Ended September 30												Nine Months Ended September 30
	Pension						Other Benefits						Pension						Other Benefits
	2010			2009			2010			2009			2010			2009			2010			2009

Service cost	$	31		$	24		$	1		$	2		$	93		$	75		$	5		$	6
Interest cost		84			84			10			11			251			247			30			32
Expected return on plan assets		(110	)		(108	)		(5	)		(5	)		(329	)		(325	)		(16	)		(14	)
Amortization of prior service cost (credit)		1			1			—			1			3			3			(1	)		3
Amortization of actuarial loss		21			14			2			4			63			35			8			11

Total net periodic benefit cost	$	27		$	15		$	8		$	13		$	81		$	35		$	26		$	38

Amounts recognized in the Consolidated Condensed Balance Sheets as of September 30, 2010 and December 31, 2009 consist of:


	Pension						Other Benefits
	2010			2009			2010			2009

Other non-current assets	$	17		$	16		$	—		$	—
Current liabilities		(24	)		(24	)		(49	)		(49	)
Non-current liabilities		(1,367	)		(1,384	)		(396	)		(404	)

	$	(1,374	)	$	(1,392	)	$	(445	)	$	(453	)

We contributed approximately $7 and $13 to our various plans during the three and nine months ended September 30, 2010, respectively. Additional contributions ranging between $3 and $5 are expected during the remainder of 2010.

Long-Term Incentive Employee Compensation (Unaudited)

9 Months Ended

Sep. 30, 2010

Long-Term Incentive Employee Compensation [Abstract]

Long-Term Incentive Employee Compensation


17)	Long-Term Incentive Employee Compensation

Our long-term incentive awards program (LTIP) comprises three components: non-qualified stock options (NQO), restricted stock, and a total shareholder return target cash award (TSR). We account for substantially all NQOs and restricted stock as equity-based compensation awards. Awards granted under the TSR are cash settled obligations and accounted for as liabilities that are remeasured through settlement. Long-term incentive employee compensation costs are primarily recorded within selling, general & administrative expenses and are reduced by an estimated forfeiture rate. These costs impacted our consolidated results of operations as follows:


	Three Months					Nine Months
	Ended September 30					Ended September 30
	2010			2009		2010			2009

Compensation costs on equity-based awards	$	7		$	8	$	23		$	24
Compensation (benefit) costs on liability-based awards		(7	)		5		(7	)		7

Total compensation costs, pre-tax	$	—		$	13	$	16		$	31

Future tax benefit	$	—		$	4	$	4		$	10

At September 30, 2010, there was $50 of total estimated unrecognized compensation cost related to unvested NQOs and restricted stock. This cost is expected to be recognized ratably over a weighted-average period of 1.9 years. Total estimated unrecognized compensation cost projected to be incurred for the TSR based on performance measurements as of September 30, 2010 was $6 and is expected to be recognized over a weighted average period of 1.6 years. Actual performance measurements in future periods may differ from current estimates and positively or negatively impact the total compensation cost to be recognized as well as create volatility between periods. Payments totaling $18 were made during the first quarter of 2010 to settle the outstanding obligation associated with the 2007 TSR award grants.

Commitments and Contingencies (Unaudited)

9 Months Ended

Sep. 30, 2010

Commitments and Contingencies [Abstract]

Commitments and Contingencies


18)	Commitments and Contingencies

From time to time we are involved in legal proceedings that are incidental to the operation of our businesses. Some of these proceedings allege damages relating to asbestos liabilities, environmental liabilities, intellectual property matters, copyright infringement, personal injury claims, employment and pension matters, government contract issues and commercial or contractual disputes, sometimes related to acquisitions or divestitures. We will continue to vigorously defend against all claims. Although the ultimate outcome of any legal matter cannot be predicted with certainty, based on present information including our assessment of the merits of the particular claim, as well as our current reserves and insurance coverage, we do not expect that such legal proceedings will have any material adverse impact on our cash flow, results of operations, or financial condition on a consolidated basis in the foreseeable future, unless otherwise noted below.

Asbestos Matters

Background:

ITT, including its subsidiary Goulds Pumps, Inc. (Goulds), has been joined as a defendant with numerous other companies in product liability lawsuits alleging personal injury due to asbestos exposure. These claims allege that certain products sold by us or our subsidiaries prior to 1985 contained a part manufactured by a third party, e.g., a gasket, which contained asbestos. To the extent these third-party parts may have contained asbestos, it was encapsulated in the gasket (or other) material and was non-friable. In certain other cases, it is alleged that former ITT companies were distributors for other manufacturers’ products that may have contained asbestos.

As of September 30, 2010, there were 103,939 open claims against ITT filed in various state and federal courts alleging injury as a result of exposure to asbestos. Activity related to these asserted asbestos claims during the period was as follows:


	2010			2009

Pending claims^(a) — January 1		104,679			103,006
New claims^(b)		4,748			2,608
Settlements		(708	)		(774	)
Dismissals		(5,271	)		(1,927	)
Adjustment^(c)		491			3,208

Pending claims^(a) — September 30		103,939			106,121


^(a)		We had previously indicated that 34,869 claims related to maritime actions, almost all of which were filed in the United States District Court for the Northern District of Ohio, were not included in the count of asserted claims because the Company believed they would not be litigated. In August 2010, these cases were dismissed.

^(b)		In September 2010, ITT executed an amended cost sharing agreement related to a business we disposed of a number of years ago. The amended agreement provides for a sharing of costs for claims resolved between 2010 and 2019 naming ITT or the entity which acquired the disposed business. Excluded from the table above are 882 pending claims associated with the amended cost sharing agreement that were not filed against ITT.

^(c)		Reflects an adjustment to increase the number of open claims as a result of transitioning claims data from our primary insurance companies to an internal database.

Frequently, plaintiffs are unable to identify any ITT or Goulds product as a source of asbestos exposure. In addition, in a large majority of the 103,939 pending claims against the Company, the plaintiffs are unable to demonstrate any injury. Many of those claims have been placed on inactive dockets (including 41,328 claims in Mississippi). Our experience to date is that a substantial portion of resolved claims have been dismissed without payment by the Company. As a result, management believes that a large majority of the 103,939 open claims have little or no value. The average cost per resolved claim for the nine months ended September 30, 2010 and 2009 was $15.1 thousand and $11.3 thousand, respectively. Because claims are sometimes dismissed in large groups, the average cost per resolved claim as well as the number of open claims can fluctuate significantly from period to period.

Beginning in the third quarter of 2009, the Company recorded an undiscounted asbestos liability, including legal fees, for costs that the Company is estimated to incur to resolve all pending claims, as well as unasserted claims estimated to be filed over the next 10 years. Prior to the third quarter of 2009, we recognized a liability only in respect of pending claims. While it was probable that we would incur additional costs for future claims to be filed against the Company, a liability for potential future claims was not reasonably estimable. See Note 19 “Commitments and Contingencies,” in the Notes to Consolidated Financial Statements within our 2009 Annual Report for further information about the factors leading to the development of an estimate of the liability for potential future claims in the third quarter of 2009.

The Company has also recorded an asbestos asset, comprised predominantly of an insurance asset and expected recoveries from other responsible parties. The asbestos asset represents our best estimate of probable recoveries from third parties for pending claims, as well as unasserted claims to be filed over the next 10 years. The timing and amount of reimbursements will vary due to differing policy terms and certain gaps in coverage as a result of possible insurer insolvencies.

The methodology used to estimate our total liability for pending and unasserted future asbestos claims relies upon and includes the following key factors:


	•	interpretation of a widely accepted forecast of the population likely to have been occupationally exposed to asbestos;

	•	widely accepted epidemiological studies estimating the number of people likely to develop mesothelioma and lung cancer from exposure to asbestos;

	•	the Company’s historical experience with the filing of non-malignant claims against it and the historical relationship between non-malignant and malignant claims filed against the Company;

	•	analysis of the number of likely asbestos personal injury claims to be filed against the Company based on such epidemiological and historical data and the Company’s most recent claims experience history;

	•	an analysis of the Company’s pending cases, by disease type;

	•	an analysis of the Company’s most recent history to determine the average settlement and resolution value of claims, by disease type;

	•	an analysis of the Company’s defense costs in relation to its settlement costs and resolved claims;

	•	an adjustment for inflation in the future average settlement value of claims and defense costs; and

	•	an analysis of the time over which the Company is likely to resolve asbestos claims.

Our methodology determines a point estimate based upon our assessment of the value of each underlying assumption, rather than a range of estimates of reasonably possible outcomes. Projecting future asbestos costs is subject to numerous variables and uncertainties that are inherently difficult to predict. In addition to the uncertainties surrounding the key factors discussed above, other factors include the long latency period prior to the manifestation of the asbestos-related disease, costs of medical treatment, the impact of bankruptcies of other companies that are co-defendants, uncertainties surrounding the litigation process from jurisdiction to jurisdiction and from case to case, and the impact of potential legislative or judicial changes. Furthermore, any predictions with respect to the variables impacting the estimate of the asbestos liability are subject to even greater uncertainty as the projection period lengthens. In light of the uncertainties and variables inherent in the long-term projection of the Company’s total asbestos liability, although it is probable that the Company will incur additional costs for asbestos claims filed beyond the next 10 years, we do not believe there is a reasonable basis for estimating those costs at this time. As part of our ongoing review of asbestos claims, each quarter we reassess the projected liability of unasserted asbestos claims to be filed over the next 10 years based upon the trends we are experiencing in those factors to which the liability is most sensitive, maintaining a rolling 10-year projection. In the third quarter each year, we conduct a detailed study with the assistance of outside consultants to review and update as appropriate the underlying assumptions used in our liability and asset estimates. Additionally, we periodically reassess the time horizon over which a reasonable estimate of unasserted claims can be projected.

See Note 19 within our 2009 Annual Report for further information about the methodology used to estimate our total liability for pending and unasserted future asbestos claims and our estimate of probable recoveries related to those liabilities.

Third Quarter 2010 Charge:

In the third quarter of 2010, we conducted our annual detailed study with the assistance of outside consultants to review and update the underlying assumptions used in our liability and asset estimates. During this study, the underlying assumptions were updated based on our actual experience since our last detailed review in the third quarter of 2009, a reassessment of the appropriate reference period of years of experience used in determining each assumption and our expectations regarding future conditions, including inflation. Based on the results of this study, we increased our estimated undiscounted asbestos liability, including legal fees, by $691, reflecting costs that the Company is estimated to incur to resolve all pending claims, as well as unasserted claims estimated to be filed over the next 10 years. The increase in our estimated liability is a result of several developments, including higher settlement costs and significantly increased activity in several higher-cost jurisdictions, increasing the number of cases to be adjudicated and the expected legal costs.

Further, in the third quarter of 2010, the Company recorded a $372 increase in its asbestos-related assets based on the results of this study. These assets are comprised of an insurance asset, as well as receivables from other responsible parties. See discontinued operations discussion below for further information about receivables from parties other than insurers.

The third quarter 2010 and 2009 net asbestos charges are summarized as follows:


	2010						2009
	Pre-tax			After-tax			Pre-tax		After-tax

Continuing operations	$	341		$	211		$	223	$	139
Discontinued operations		(10	)		(6	)		13		8

Total	$	331		$	205		$	236	$	147

The charge recorded in 2010 reflects an updated assessment of pending and estimated future claims, while the 2009 charge was the result of both the initial recognition of the claims expected to be incurred over the following 10 years, as well as an updated assessment of pending claims.

Third Quarter 2010 Changes in Financial Position:

The Company’s estimated asbestos exposure, net of expected recoveries from insurers and other responsible parties, for the resolution of all pending and estimated unasserted asbestos claims to be filed within the next 10 years was $618 as of September 30, 2010 and $267 as of December 31, 2009. The following table provides a rollforward of the estimated total asbestos liability and related assets for the nine months ended September 30, 2010 and 2009.


	2010									2009
	Liability			Asset			Net			Liability			Asset			Net

Balance as of January 1	$	933		$	666		$	267		$	228		$	201		$	27
Changes in estimate during the period:
Continuing operations		570			202			368			642			419			223
Discontinued operations		170			180			(10	)		72			58			14
Net cash activity		(34	)		(27	)		(7	)		(25	)		(19	)		(6	)
Other adjustments		(11	)		(11	)		—			—			—			—

Balance as of September 30	$	1,628		$	1,010		$	618		$	917		$	659		$	258

The total asbestos liability and related assets as of September 30, 2010 and December 31, 2009 includes $116 and $66 presented within accrued expenses and $105 and $62 presented within other current assets on our Consolidated Condensed Balance Sheets, respectively.

The underlying asbestos liability and corresponding asset are based upon current, known information. However, future events affecting the key factors and other variables for either the asbestos liability or the asbestos asset could cause the actual costs or recoveries to be higher or lower than currently estimated, which could have a material effect on our financial statements. Due to these uncertainties, as well as our inability to reasonably estimate any additional asbestos liability for claims filed beyond the next 10 years, it is not possible to predict the ultimate outcome of the cost of resolving the pending and all unasserted asbestos claims. We believe it is possible that future events affecting the key factors and other variables within the next 10 years, as well as the cost of asbestos claims filed beyond the next 10 years, net of expected recoveries, could have a material adverse effect on our financial position and on the results of operations or cash flows for a particular period.

Discontinued Operations:

At September 30, 2010 and December 31, 2009, $246 and $75 of the liability and $244 and $64 of the asset related to a business which we disposed of a number of years ago that is reported as a discontinued operation. The increase in the liability and asset resulted from an amended cost sharing agreement executed in September 2010 with the entity that acquired the disposed business. The amended agreement provided for a sharing of the claims settled between 2010 and 2019 naming ITT or the entity which acquired the disposed business. In the future years, the liability for sharing the claims gradually transitions away from ITT such that ITT will have no responsibility for claims in 9 to 10 years. Under the prior cost sharing agreement, costs were shared equally. The amended cost sharing agreement also provides for the sharing of certain insurance policies. Prior to executing the amended cost sharing agreement in September 2010, we recorded a liability for this discontinued operation based on pending claims and unasserted claims estimated to be filed over the next 10 years against ITT. As part of amending the cost sharing agreement, for the first time, ITT was provided with the key data necessary to estimate the exposure related to the shared pending and future claims. The estimate of the additional liability and asset recorded as a result of the amended cost sharing agreement were calculated in a manner consistent with the approach used to estimate ITT’s stand-alone asbestos liabilities and assets.

Future Cash Flows:

We have estimated that we will be able to recover 62% of the asbestos costs (defense and settlement costs) for pending claims as well as unasserted claims to be filed over the next 10 years from our insurers or other responsible parties. However, because there are gaps in our insurance coverage, reflecting the insolvency of certain insurers and prior insurance settlements, and we expect that certain policies from some of our insurers will exhaust within the next 10 years, the recovery percentage is expected to decline for potential additional asbestos liabilities. Insurance coverage in the tenth year of our estimate of the asbestos claims liability is currently projected to be approximately 25%. Future recoverability rates may also be impacted by other factors, such as future insurance settlements, insolvencies and judicial determinations relevant to our coverage program, which are difficult to predict. Subject to the qualifications regarding uncertainties previously described, it is expected that future annual cash payments, net of recoveries related to pending claims and unasserted claims to be filed within the next 10 years, will extend through approximately 2022 due to the time lag between the filing of a claim and its resolution. These annual net cash outflows are projected to average $25 over the next five years, as compared to approximately $10 to $15 in the past three years, and increase to an average of approximately $50 to $60 over the remainder of the projection period.

Environmental

In the ordinary course of business, we are subject to federal, state, local, and foreign environmental laws and regulations. We are responsible, or are alleged to be responsible, for ongoing environmental investigation and remediation of sites in various countries. These sites are in various stages of investigation and/or remediation and in many of these proceedings our liability is considered de minimis. We have received notification from the U.S. Environmental Protection Agency, and from similar state and foreign environmental agencies, that a number of sites formerly or currently owned and/or operated by ITT, and other properties or water supplies that may be or have been impacted from those operations, contain disposed or recycled materials or wastes and require environmental investigation and/or remediation. These sites include instances where we have been identified as a potentially responsible party under federal and state environmental laws and regulations.

Accruals for environmental matters are recorded on a site by site basis when it is probable that a liability has been incurred and the amount of the liability can be reasonably estimated, based on current law and existing technologies. Our accrued liabilities for these environmental matters represent the best estimates related to the investigation and remediation of environmental media such as water, soil, soil vapor, air and structures, as well as related legal fees. These estimates, and related accruals, are reviewed periodically and updated for progress of investigation and remediation efforts and changes in facts and legal circumstances. Liabilities for these environmental expenditures are recorded on an undiscounted basis.

It is difficult to estimate the final costs of investigation and remediation due to various factors, including incomplete information regarding particular sites and other potentially responsible parties, uncertainty regarding the extent of investigation or remediation and our share, if any, of liability for such conditions, the selection of alternative remedial approaches, and changes in environmental standards and regulatory requirements. In our opinion, the total amount accrued is appropriate based on existing facts and circumstances. We do not anticipate these liabilities will have a material adverse effect on our consolidated financial position, results of operations or cash flows.

The following table illustrates the activity related to our accrued liabilities for these environmental matters.


	2010			2009

Beginning balance January 1	$	140		$	135
Change in estimates for pre-existing accruals, foreign exchange and other		7			17
Payments		(11	)		(11	)

Ending balance September 30	$	136		$	141

The following table illustrates the reasonably possible low- and high-end range of estimated liability, and number of active sites for these environmental matters.


	September 30,		December 31,
	2010		2009

Low-end range	$	123	$	113
High-end range	$	262	$	249
Number of active environmental investigation and remediation sites		99		98

Other Matters

The Company is involved in coverage litigation with various insurers seeking recovery of costs incurred in connection with certain environmental and product liabilities. In a suit filed in 1991, ITT Corporation, et al. v. Pacific Indemnity Corporation et al, Sup. Ct., Los Angeles County, we are seeking recovery of costs related to environmental losses. Discovery, procedural matters, changes in California law, and various appeals have prolonged this case. For several years, the case was on appeal before the California Court of Appeals from a decision by the California Superior Court dismissing certain claims made by ITT. The case is now back before the Superior Court and the parties are engaged in further discovery.

On February 13, 2003, we commenced an action, Cannon Electric, Inc. v. Affiliated FM Ins. Co., Sup. Ct., Los Angeles County, seeking recovery of costs related to asbestos product liability losses described above. During this coverage litigation, we entered into coverage-in-place settlement agreements with ACE, Wausau and Utica Mutual dated April 2004, September 2004, and February 2007, respectively. These agreements provide specific coverage for the Company’s legacy asbestos liabilities. We are prepared to pursue legal remedies against the remaining defendants where reasonable negotiations are not productive.

ITT provides an indemnity to U.S. Silica Company for silica personal injury suits filed prior to September 12, 2005 against our former subsidiary Pennsylvania Glass Sand (PGS). ITT sold the stock of PGS to U.S. Silica Company in 1985. Over the past several years, the majority of the silica cases involving PGS have been dismissed without payment. Currently there are fewer than 4,000 cases pending against PGS. The Company expects that the majority of the remaining cases will also be dismissed. Our indemnity had been paid in part by our historic product liability carrier, however, in September 2005, the carrier communicated to us that it would no longer provide insurance for these claims. On October 4, 2005, we filed a suit against the insurer, ITT v. Pacific Employers Insurance Co., CA No. 05CV 5223, in the Superior Court for Los Angeles, CA, seeking defense costs and indemnity from the insurance carrier for PGS product liabilities. In April 2007, the Court granted our motion for summary judgment on the carrier’s duty to defend the silica cases; however, that decision was overturned on appeal. The matter was returned to the Superior Court in part for determination of several factual issues. We will continue to seek past and future defense costs for these cases from this carrier. We believe that these matters will not have a material adverse effect on our consolidated financial position, results of operations or cash flows. All silica-related costs, net of expected insurance recoveries, are shared pursuant to the Distribution Agreement. Further information on the Distribution Agreement is provided within the “Business — Company History and Certain Relationships” section of our 2009 Annual Report on Form 10-K.

On March 27, 2007, we reached a settlement relating to an investigation of our ITT Night Vision Division’s compliance with the International Traffic in Arms Regulations (ITAR) pursuant to which we pled guilty to two violations based on the export of defense articles without a license and the omission of material facts in required export reports. We were assessed a total of $50 in fines, forfeitures and penalties. We also entered into a Deferred Prosecution Agreement with the U.S. Government which deferred action regarding a third count of violations related to ITAR pending our implementation of a remedial action plan, including the appointment of an independent monitor. ITT was also assessed a deferred prosecution monetary penalty of $50 which ITT will reduce for monies spent over the five years following the date of the Plea Agreement, to accelerate and further the development and fielding of advanced night vision technology. On October 11, 2007, ITT and the Department of Defense finalized an Administrative Compliance Agreement wherein we agreed to take certain remedial actions including implementing compliance programs and appointing an independent monitor for the oversight of our compliance programs. On December 28, 2007, we finalized a Consent Agreement with the Department of State wherein we agreed to undertake certain remedial actions, including appointment of a Special Compliance Official. The Company continues to perform under the terms of the agreements. On February 22, 2010, the Department of State issued a notice that it terminated the ineligible status and statutory debarment which it had previously imposed on the Company on April 11, 2007, 75 Fed. Reg. 7650 (2010). Management believes that these matters will not have a material adverse effect on our consolidated financial position, results of operations or cash flows.

On April 17, 2007, ITT’s Board of Directors received a letter on behalf of a shareholder requesting that the Board take appropriate action against the employees responsible for the violations at our Night Vision facility described above, which were disclosed on a Current Report on Form 8-K filed with the SEC on March 30, 2007. The Board of Directors appointed a Special Litigation Committee to evaluate the request. The Special Litigation Committee conducted its investigation with the assistance of independent counsel and concluded that no legal actions should be brought by ITT.

During 2007 and 2008, the Company received notice of four shareholder derivative actions each filed in the U.S. District Court for the Southern District of New York, known variously as, Sylvia Piven trustee under trust agreement dated April 3, 1973 f/b/o Sylvia B. Piven, derivatively on behalf of ITT Corporation v. Steven R. Loranger et al. and ITT Corporation (the Piven action), Norman Levy, derivatively on behalf of ITT Industries, Inc. v. Steven R. Loranger et al. and ITT Industries, Inc., Anthony Reale v. Steven R. Loranger et al. and ITT Company [sic] (Reale Action), and Robert Wilkinson v. Steven R. Loranger et al. and ITT Corporation. The cases alleged that ITT’s Board of Directors breached their fiduciary duties by failing to properly oversee ITT’s compliance programs at its Night Vision business. The Complaints sought compensatory and punitive damages for ITT from its Directors, the removal of the Directors, and the election of new directors. Three cases were consolidated into one action, In Re ITT Corporation Derivative Litigation, CA No. 07-CV-2878 (CS) (the Levy complaint was dropped on consolidation). On motion by the Company, the Piven and Wilkinson actions were dismissed. The Defendants filed a Motion to Terminate the Reale Action based on the Special Litigation Committee’s report referenced above. In a September 8, 2009 order, the Court denied the Defendants’ motion. The Defendants then filed a Motion for Reconsideration or, in the alternative, requested that the matter be certified to the Indiana Supreme Court for its interpretation of the Indiana Business Code. On June 28, 2010, the Indiana Supreme Court issued a decision on the certified question agreeing with the Defendants’ interpretation of the Indiana Business Code. The Defendants again filed a Motion to Terminate which the court granted on July 20, 2010. The matter is now concluded.

Guarantees, Indemnities and Warranties (Unaudited)

9 Months Ended

Sep. 30, 2010

Guarantees, Indemnities and Warranties [Abstract]

Guarantees, Indemnities and Warranties


19)	Guarantees, Indemnities and Warranties

Guarantees & Indemnities

Since ITT’s incorporation in 1920, we have acquired and disposed of numerous entities. The related acquisition and disposition agreements contain various representation and warranty clauses and may provide indemnities for a misrepresentation or breach of the representations and warranties by either party. The indemnities address a variety of subjects; the term and monetary amounts of each such indemnity are defined in the specific agreements and may be affected by various conditions and external factors. Many of the indemnities have expired either by operation of law or as a result of the terms of the agreement. We do not have a liability recorded for these indemnifications and are not aware of any claims or other information that would give rise to material payments under such indemnities.

In December 2007, we entered into a sale leaseback agreement for our corporate aircraft, with the aircraft leased to ITT under a five-year operating lease. We have provided a residual value guarantee to the lessor for the future value of the aircraft with a maximum payment of $42. At expiration of the lease, however, if the fair value of the aircraft is less than $50, payment under the residual value guarantee would be equal to the difference between the fair value of the aircraft at expiration of the lease and $50, provided that such payment shall not exceed $42. At September 30, 2010, the projected fair value of the aircraft at expiration of the lease is estimated to be $22 less than the guaranteed amount. As this estimated loss exceeds the $5 gain we realized and deferred from the sale of the aircraft as a loss contingency, we have recorded an additional accrual of $17 in the third quarter of 2010 in our Consolidated Condensed Financial Statements.

We have a number of guarantees outstanding at September 30, 2010, for which we have not recorded material amounts either individually or in the aggregate. These guarantees may be affected by various conditions and external forces, some of which could require that payments be made under such guarantees. We do not believe such payments would have a material adverse impact on the financial position, results of operations or cash flows on a consolidated basis.

Product Warranties

We provide warranty for numerous products, the terms of which vary widely. In general, we provide warranty on our products against defect and specific non-performance. In the automotive businesses, liability for product defects could extend beyond the selling price of the product and could be significant if the defect interrupts production or results in a recall. Changes in our product warranty accrual for the nine months ended September 30, 2010 and 2009 were as follows:


	2010			2009

Beginning balance January 1	$	67		$	57
Accruals for product warranties issued in the period		32			21
Changes in pre-existing warranties and estimates		13			(4	)
Payments		(29	)		(19	)
Foreign currency translation		—			1

Ending balance September 30	$	83		$	56

Business Segment Information (Unaudited)

9 Months Ended

Sep. 30, 2010

Business Segment Information [Abstract]

Business Segment Information


20)	Business Segment Information

The Company’s business segments are reported on the same basis used internally for evaluating performance and for allocating resources. Our three reporting segments are referred to as: Defense & Information Solutions (Defense segment), Fluid Technology (Fluid segment), and Motion & Flow Control (Motion & Flow segment). Corporate and Other consists of corporate office expenses including compensation, benefits, occupancy, depreciation, and other administrative costs, as well as charges related to certain matters, such as asbestos and environmental liabilities, that are managed at a corporate level and are not included in the business segments’ results when evaluating performance or allocating resources. Assets of the business segments exclude general corporate assets, which principally consist of cash, deferred tax assets, insurance receivables, property, plant and equipment, and other assets.


	Three Months Ended September 30, 2010
							Motion &			Corporate
	Defense			Fluid			Flow			and Other			Eliminations			Total

Product revenue	$	810		$	887		$	358		$	—		$	(3	)	$	2,052
Service revenue		556			33			2			—			—			591

Total revenue	$	1,366		$	920		$	360		$	—		$	(3	)	$	2,643

Operating income (loss)	$	178		$	116		$	45		$	(371	)	$	—		$	(32	)
Operating margin		13.0	%		12.6	%		12.5	%		—			—			(1.2	)%
Total assets	$	4,133		$	4,066		$	1,361		$	2,900		$	—		$	12,460


	Three Months Ended September 30, 2009
							Motion &			Corporate
	Defense			Fluid			Flow			and Other			Eliminations			Total

Product revenue	$	938		$	795		$	305		$	—		$	(2	)	$	2,036
Service revenue		571			31			2			—			—			604

Total revenue	$	1,509		$	826		$	307		$	—		$	(2	)	$	2,640

Operating income (loss)	$	200		$	108		$	40		$	(259	)	$	—		$	89
Operating margin		13.3	%		13.1	%		13.0	%		—			—			3.4	%
Total assets^(a)	$	4,153		$	2,930		$	1,323		$	2,723		$	—		$	11,129


	Nine Months Ended September 30, 2010
							Motion &			Corporate
	Defense			Fluid			Flow			and Other			Eliminations			Total

Product revenue	$	2,538		$	2,503		$	1,101		$	—		$	(9	)	$	6,133
Service revenue		1,724			96			7			—			—			1,827

Total revenue	$	4,262		$	2,599		$	1,108		$	—		$	(9	)	$	7,960

Operating income (loss)	$	513		$	337		$	143		$	(456	)	$	—		$	537
Operating margin		12.0	%		13.0	%		12.9	%		—			—			6.7	%
Total assets	$	4,133		$	4,066		$	1,361		$	2,900		$	—		$	12,460


	Nine Months Ended September 30, 2009
							Motion &			Corporate
	Defense			Fluid			Flow			and Other			Eliminations			Total

Product revenue	$	2,885		$	2,336		$	915		$	—		$	(5	)	$	6,131
Service revenue		1,625			103			6			—			—			1,734

Total revenue	$	4,510		$	2,439		$	921		$	—		$	(5	)	$	7,865

Operating income (loss)	$	557		$	288		$	101		$	(336	)	$	—		$	610
Operating margin		12.4	%		11.8	%		11.0	%		—			—			7.8	%
Total assets^(a)	$	4,153		$	2,930		$	1,323		$	2,723		$	—		$	11,129


^(a)		As of December 31, 2009

New Accounting Pronouncements (Pronouncements) (Unaudited)	9 Months Ended
	Sep. 30, 2010
Pronouncements Not Yet Adopted
New Accounting Pronouncements, Not Yet Adopted, ASU 2009-13	In October 2009, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2009-13, which amended the accounting for revenue arrangements that contain multiple elements. The objective of this amendment is to address the accounting for multiple-deliverable arrangements to enable vendors to account for products or services (deliverables) separately rather than as a combined unit. The amendments establish a hierarchy for determining the selling price of a deliverable and will allow for the separation of products and services in more instances than previously permitted. The guidance provided within ASU 2009-13 is effective for new or materially modified arrangements in fiscal years beginning on or after June 15, 2010 and allows for either prospective or retrospective application, with early adoption permitted. We currently plan on adopting the provisions of this ASU on January 1, 2011 and are in the process of evaluating the impact that adoption will have on our consolidated financial statements.
New Accounting Pronouncements, Not Yet Adopted, ASU 2009-14	In October 2009, the FASB issued ASU No. 2009-14, which amended the accounting requirements for software revenue recognition. The objective of this update is to address the accounting for revenue arrangements that contain tangible products and software. Specifically, products that contain software that is “more than incidental” to the product as a whole will be removed from the scope of the software revenue recognition literature. The amendments align the accounting for these revenue transaction types with the amendments described under ASU 2009-13 above. The guidance provided within ASU 2009-14 is effective for new or materially modified arrangements in fiscal years beginning on or after June 15, 2010 and allows for either prospective or retrospective application, with early adoption permitted. We currently plan on adopting the provisions of this ASU on January 1, 2011 and are in the process of evaluating the impact that adoption will have on our consolidated financial statements.
New Accounting Pronouncements, Not Yet Adopted, ASU 2010-17	In April 2010, the FASB issued ASU No. 2010-17, which establishes authoritative guidance permitting use of the milestone method of revenue recognition for research or development arrangements that contain payment provisions or consideration contingent on the achievement of specified events. This guidance is effective for milestones achieved in fiscal years beginning on or after June 15, 2010 and allows for either prospective or retrospective application, with early adoption permitted. We currently plan on adopting the provisions of this ASU on January 1, 2011 and are in the process of evaluating the impact that adoption will have on our consolidated financial statements.
Recently Adopted Accounting Pronouncements
New Accounting Pronouncements, Adopted, Amendment to Variable Interest Entity Accounting and Disclosure Requirements	In June 2009, the FASB amended the accounting and disclosure requirements related to the consolidation of variable interest entities (VIE(s)). The amendments include replacing the quantitative-based risks and rewards calculation for determining which enterprise, if any, has a controlling financial interest in VIE(s) with an approach focused on identifying which enterprise has the power to direct the activities of VIE(s) that most significantly impact the entity’s economic performance and (1) the obligation to absorb losses of the entity or (2) the right to receive benefits from the entity. In addition, the amendments require an ongoing assessment of whether an enterprise is the primary beneficiary of the VIE(s) and requires additional disclosures about an enterprise’s involvement in VIE(s). The adoption of these amendments on January 1, 2010 did not have a material impact on our consolidated financial statements.

Discontinued Operations (Tables) (Unaudited)

9 Months Ended

Sep. 30, 2010

Discontinued Operations (Tables) [Abstract]

Schedule of disposal groups, including discontinued operations and assets and liabilities reported as held for sale


	Three Months Ended				Nine Months Ended
	September 30				September 30
	2010		2009		2010		2009

Revenue (third party)	$	46	$	59	$	160	$	170
Operating income	$	4	$	3	$	13	$	11

Assets and liabilities of CAS reported as discontinued operations within our Consolidated Condensed Balance Sheet are presented in the table below.


	December 31,
	2009

Receivables, net	$	43
Plant, property and equipment, net		1
Goodwill		76
Other intangible assets, net		18
Deferred income taxes		2
Other assets		1

Total assets of discontinued operations	$	141

Accounts payable	$	19
Accrued expenses		17
Deferred income taxes		8

Total liabilities of discontinued operations	$	44

Restructuring and Asset Impairment Charges (Tables) (Unaudited)

9 Months Ended

Sep. 30, 2010

Restructuring and Asset Impairment Charges (Tables) [Abstract]

Restructuring Activities

The charges recognized during the quarter related to prior actions primarily relate to severance costs as we continue our ongoing realignment efforts within our Defense segment.


	Third Quarter 2010 Actions
	Costs of		Planned		Prior Actions
	Third Quarter		Position		Additional		Reversal of
	Actions		Eliminations		Costs		Accruals

Defense	$	—		—	$	3	$	(2	)
Fluid		—		—		1		—
Motion & Flow		1		53		—		—

	$	1		53	$	4	$	(2	)

First Nine Months 2010 Restructuring Activities


	2010 Actions
	Costs of		Planned		Prior Actions
	Nine Months		Position		Additional		Reversal of
	Actions		Eliminations		Costs		Accruals

Defense	$	22		643	$	—	$	(2	)
Fluid		5		89		5		(1	)
Motion & Flow		1		53		1		(1	)

	$	28		785	$	6	$	(4	)

Third Quarter 2009 Restructuring Activities


	Third Quarter 2009 Actions										Prior
			Lease						Planned		Actions
			Cancellation &		Asset				Position		Additional		Reversal of
	Severance		Other Costs		Impairments		Total		Eliminations		Costs		Accruals

Defense	$	—	$	1	$	1	$	2		32	$	—	$	—
Fluid		3		1		—		4		89		2		(1	)
Motion & Flow		1		—		—		1		50		1		—

	$	4	$	2	$	1	$	7		171	$	3	$	(1	)

Nine Months 2009 Restructuring Activities


	2009 Actions
			Other										Prior
			Employee		Lease						Planned		Years’ Plans
			Related		Cancellation &		Asset				Position		Additional		Reversal of
	Severance		Costs		Other Costs		Impairments		Total		Eliminations		Costs		Accruals

Defense	$	1	$	—	$	1	$	1	$	3		71	$	3	$	—
Fluid		18		—		2		—		20		347		4		(1	)
Motion & Flow		7		1		—		—		8		273		2		—
Corporate and Other		1		—		—		—		1		11		—		—

	$	27	$	1	$	3	$	1	$	32		702	$	9	$	(1	)

Restructuring Accruals


							Motion
	Defense			Fluid			& Flow			Total

Balance December 31, 2009	$	4		$	18		$	31		$	53
Additional charges for prior years’ plans		—			5			1			6
Cash payments related to prior years’ plans		(1	)		(16	)		(18	)		(35	)
Charges for 2010 actions		22			5			1			28
Cash payments related to 2010 actions		(11	)		(4	)		—			(15	)
Reversals of prior charges		(2	)		(1	)		(1	)		(4	)
Foreign exchange translation and other		—			(1	)		(2	)		(3	)

Balance September 30, 2010	$	12		$	6		$	12		$	30

Planned Headcount Reductions


Planned reductions as of December 31, 2009	407
Additional planned reductions, January 1 — September 30, 2010	836
Actual reductions, January 1 — September 30, 2010	(1,035	)

Planned reductions as of September 30, 2010	208

Earnings Per Share (Tables) (Unaudited)

9 Months Ended

Sep. 30, 2010

Earning Per Share (Tables) [Abstract]

Earnings Per Share


	Three Months Ended				Nine Months Ended
	September 30				September 30
	2010		2009		2010		2009

Income from continuing operations	$	12	$	64	$	382	$	448

Weighted average common shares outstanding		182.5		181.2		182.2		180.9
Add: Weighted average restricted stock awards outstanding^(a)		1.6		1.5		1.6		1.5

Basic weighted average common shares outstanding		184.1		182.7		183.8		182.4
Add: Dilutive impact of stock options		1.2		1.6		1.4		1.3

Diluted weighted average common shares outstanding		185.3		184.3		185.2		183.7

Basic earnings per share	$	0.07	$	0.35	$	2.08	$	2.46

Diluted earnings per share	$	0.07	$	0.35	$	2.06	$	2.44

Anti-dilutive stock options		2.2		1.7		2.1		4.0
Weighted average exercise price of anti-dilutive stock options	$	54.30	$	54.45	$	54.42	$	49.21


^(a)		Restricted stock awards containing rights to non-forfeitable dividends which participate in undistributed earnings with common shareholders are considered participating securities for purposes of computing earnings per share.

Comprehensive Income (Tables) (Unaudited)

9 Months Ended

Sep. 30, 2010

Comprehensive Income (Tables) [Abstract]

Comprehensive Income


	Three Months Ended September 30
	2010									2009
				Tax								Tax
	Pre-Tax			(Expense)			Net-of-Tax			Pre-Tax		(Expense)			Net-of-Tax
	Amount			Benefit			Amount			Amount		Benefit			Amount

Net income							$	145							$	59
Other comprehensive income:
Net foreign currency translation adjustments	$	184		$	—			184		$	96	$	—			96
Changes in postretirement benefit plans		24			(9	)		15			16		(6	)		10
Net change in unrealized gain on investment securities:
Unrealized holding gains arising during period		1			—			1			—		—			—
Less: Reclassification adjustment for realized gains		7			(3	)		4			—		—			—

Net change in unrealized gain on investment securities		(6	)		3			(3	)		—		—			—
Other comprehensive income	$	202		$	(6	)		196		$	112	$	(6	)		106

Comprehensive income							$	341							$	165


	Nine Months Ended September 30
	2010									2009
				Tax								Tax
	Pre-Tax			(Expense)			Net-of-Tax			Pre-Tax		(Expense)			Net-of-Tax
	Amount			Benefit			Amount			Amount		Benefit			Amount

Net income							$	529							$	445
Other comprehensive income (loss):
Net foreign currency translation adjustments	$	(27	)	$	—			(27	)	$	144	$	—			144
Changes in postretirement benefit plans		73			(27	)		46			48		(18	)		30
Net change in unrealized gain on investment securities:
Unrealized holding gains arising during period		5			(2	)		3			—		—			—
Less: Reclassification adjustment for realized gains		7			(3	)		4			—		—			—

Net change in unrealized gain on investment securities		(2	)		1			(1	)		—		—			—
Other comprehensive income (loss)	$	44		$	(26	)		18		$	192	$	(18	)		174

Comprehensive income							$	547							$	619

Receivables, Net (Tables) (Unaudited)

9 Months Ended

Sep. 30, 2010

Receivables, Net (Tables) [Abstract]

Receivables, Net


	September 30,			December 31,
	2010			2009

Trade	$	1,522		$	1,379
Unbilled contract receivables		380			373
Other		59			56

Receivables, gross		1,961			1,808
Less: allowance for doubtful accounts and cash discounts		(50	)		(54	)

Receivables, net	$	1,911		$	1,754

Inventories, Net (Tables) (Unaudited)

9 Months Ended

Sep. 30, 2010

Inventories, Net (Tables) [Abstract]

Inventories, Net


	September 30,			December 31,
	2010			2009

Finished goods	$	230		$	176
Work in process		112			57
Raw materials		350			253

		692			486

Inventoried costs related to long-term contracts		342			391
Less: progress payments		(92	)		(75	)

Inventoried costs related to long-term contracts, net		250			316

Inventories, net	$	942		$	802

Plant, Property and Equipment, Net (Tables) (Unaudited)

9 Months Ended

Sep. 30, 2010

Plant, Property and Equipment, Net [Abstract]

Plant, Property and Equipment, Net


	September 30,			December 31,
	2010			2009

Land and improvements	$	59		$	57
Buildings and improvements		637			609
Machinery and equipment		1,764			1,688
Equipment held for lease or rental		127			72
Furniture, fixtures and office equipment		228			220
Construction work in progress		154			157
Other		27			22

		2,996			2,825
Less: accumulated depreciation and amortization		(1,847	)		(1,775	)

Plant, property and equipment, net	$	1,149		$	1,050

Goodwill and Other Intangible Assets, Net (Tables) (Unaudited)

9 Months Ended

Sep. 30, 2010

Goodwill and Other Intangible Assets, Net (Tables) [Abstract]

Changes in the carrying amount of goodwill

Changes in the carrying amount of goodwill for the nine months ended September 30, 2010 by business segment are as follows:


						Motion			Corporate
	Defense		Fluid			& Flow			and Other		Total

Balance as of January 1, 2010	$	2,132	$	1,165		$	486		$	5	$	3,788
Goodwill acquired during the period		3		491			—			—		494
Foreign currency translation		—		(7	)		(4	)		—		(11	)

Balance as of September 30, 2010	$	2,135	$	1,649		$	482		$	5	$	4,271

Goodwill disposed during the period	$	76	$	—		$	—		$	—	$	76

Other intangible assets

Information regarding other intangible assets is as follows:


	September 30, 2010							December 31, 2009
	Gross					Other		Gross					Other
	Carrying		Accumulated			Intangibles		Carrying		Accumulated			Intangibles
	Amount		Amortization			Net		Amount		Amortization			Net

Finite-lived intangibles:
Distributor and customer relationships	$	853	$	(291	)	$	562	$	625	$	(236	)	$	389
Proprietary technology		89		(29	)		60		66		(24	)		42
Trademarks		36		(10	)		26		35		(8	)		27
Patents and other		49		(22	)		27		45		(20	)		25
Indefinite-lived intangibles:
Brands and trademarks		108		—			108		18		—			18

Other intangible assets, net	$	1,135	$	(352	)	$	783	$	789	$	(288	)	$	501

Estimated amortization expense related to intangible assets

Estimated amortization expense for finite-lived intangible assets for each of the five succeeding years is as follows:


2011	2012	2013	2014	2015

$85	$76	$59	$54	$50

Other Non-Current Assets (Tables) (Unaudited)

9 Months Ended

Sep. 30, 2010

Other Non-Current Assets (Tables) [Abstract]

Other Non-Current Assets


	September 30,		December 31,
	2010		2009

Other employee benefit-related assets	$	101	$	87
Capitalized software costs		88		65
Long-term third party receivables, net		42		44
Equity and cost method investments		4		28
Pension assets and prepaid benefit plan costs		17		16
Other		26		12

Other non-current assets	$	278	$	252

Debt (Tables) (Unaudited)

9 Months Ended

Sep. 30, 2010

Debt (Tables) [Abstract]

Debt


	September 30,			December 31,
	2010			2009

Commercial paper	$	258		$	55
Short-term loans		11			10
Current maturities of long-term debt and other		10			10

Short-term debt and current maturities of long-term debt		279			75

Non-current maturities of long-term debt		1,322			1,392
Non-current capital leases		4			4
Deferred gain on interest rate swaps		46			50
Unamortized discounts and debt issuance costs		(8	)		(15	)

Long-term debt		1,364			1,431

Total debt	$	1,643		$	1,506

Other Non-Current Liabilities (Tables) (Unaudited)

9 Months Ended

Sep. 30, 2010

Other Non-Current Liabilities (Tables) [Abstract]

Other Non-Current Liabilities


	September 30,		December 31,
	2010		2009

Deferred income taxes and other tax-related accruals	$	336	$	174
Environmental		125		128
Compensation and other employee-related benefits		119		123
Product liability, guarantees and other legal matters		72		63
Other		48		53

Other non-current liabilities	$	700	$	541

Employee Benefit Plans (Tables) (Unaudited)

9 Months Ended

Sep. 30, 2010

Employee Benefit Plans (Tables) [Abstract]

Net periodic benefit cost

Components of net periodic benefit cost for the three and nine months ended September 30, 2010 and 2009 were as follows:


	Three Months Ended September 30												Nine Months Ended September 30
	Pension						Other Benefits						Pension						Other Benefits
	2010			2009			2010			2009			2010			2009			2010			2009

Service cost	$	31		$	24		$	1		$	2		$	93		$	75		$	5		$	6
Interest cost		84			84			10			11			251			247			30			32
Expected return on plan assets		(110	)		(108	)		(5	)		(5	)		(329	)		(325	)		(16	)		(14	)
Amortization of prior service cost (credit)		1			1			—			1			3			3			(1	)		3
Amortization of actuarial loss		21			14			2			4			63			35			8			11

Total net periodic benefit cost	$	27		$	15		$	8		$	13		$	81		$	35		$	26		$	38

Postretirement benefit amounts recognized within balance sheet

Amounts recognized in the Consolidated Condensed Balance Sheets as of September 30, 2010 and December 31, 2009 consist of:


	Pension						Other Benefits
	2010			2009			2010			2009

Other non-current assets	$	17		$	16		$	—		$	—
Current liabilities		(24	)		(24	)		(49	)		(49	)
Non-current liabilities		(1,367	)		(1,384	)		(396	)		(404	)

	$	(1,374	)	$	(1,392	)	$	(445	)	$	(453	)

Long-Term Incentive Employee Compensation (Tables) (Unaudited)

9 Months Ended

Sep. 30, 2010

Long-Term Incentive Employee Compensation (Tables) [Abstract]

Long-Term Incentive Employee Compensation


	Three Months					Nine Months
	Ended September 30					Ended September 30
	2010			2009		2010			2009

Compensation costs on equity-based awards	$	7		$	8	$	23		$	24
Compensation (benefit) costs on liability-based awards		(7	)		5		(7	)		7

Total compensation costs, pre-tax	$	—		$	13	$	16		$	31

Future tax benefit	$	—		$	4	$	4		$	10

Commitments and Contingencies (Tables) (Unaudited)

9 Months Ended

Sep. 30, 2010

Commitments and Contingencies (Tables) [Abstract]

Roll forward of asbestos claims


	2010			2009

Pending claims^(a) — January 1		104,679			103,006
New claims^(b)		4,748			2,608
Settlements		(708	)		(774	)
Dismissals		(5,271	)		(1,927	)
Adjustment^(c)		491			3,208

Pending claims^(a) — September 30		103,939			106,121


^(a)		We had previously indicated that 34,869 claims related to maritime actions, almost all of which were filed in the United States District Court for the Northern District of Ohio, were not included in the count of asserted claims because the Company believed they would not be litigated. In August 2010, these cases were dismissed.

^(b)		In September 2010, ITT executed an amended cost sharing agreement related to a business we disposed of a number of years ago. The amended agreement provides for a sharing of costs for claims resolved between 2010 and 2019 naming ITT or the entity which acquired the disposed business. Excluded from the table above are 882 pending claims associated with the amended cost sharing agreement that were not filed against ITT.

^(c)		Reflects an adjustment to increase the number of open claims as a result of transitioning claims data from our primary insurance companies to an internal database.

Net asbestos charges


	2010						2009
	Pre-tax			After-tax			Pre-tax		After-tax

Continuing operations	$	341		$	211		$	223	$	139
Discontinued operations		(10	)		(6	)		13		8

Total	$	331		$	205		$	236	$	147

Roll forward of asbestos liability and related assets


	2010									2009
	Liability			Asset			Net			Liability			Asset			Net

Balance as of January 1	$	933		$	666		$	267		$	228		$	201		$	27
Changes in estimate during the period:
Continuing operations		570			202			368			642			419			223
Discontinued operations		170			180			(10	)		72			58			14
Net cash activity		(34	)		(27	)		(7	)		(25	)		(19	)		(6	)
Other adjustments		(11	)		(11	)		—			—			—			—

Balance as of September 30	$	1,628		$	1,010		$	618		$	917		$	659		$	258

Roll forward of accrued environmental liabilities

The following table illustrates the activity related to our accrued liabilities for these environmental matters.


	2010			2009

Beginning balance January 1	$	140		$	135
Change in estimates for pre-existing accruals, foreign exchange and other		7			17
Payments		(11	)		(11	)

Ending balance September 30	$	136		$	141

Range of environmental liability and number of active sites for environmental matters

The following table illustrates the reasonably possible low- and high-end range of estimated liability, and number of active sites for these environmental matters.


	September 30,		December 31,
	2010		2009

Low-end range	$	123	$	113
High-end range	$	262	$	249
Number of active environmental investigation and remediation sites		99		98

Guarantees,Indemnities and Warranties (Tables) (Unaudited)

9 Months Ended

Sep. 30, 2010

Guarantees, Indemnities and Warranties (Tables) [Abstract]

Changes in product warranty accrual


	2010			2009

Beginning balance January 1	$	67		$	57
Accruals for product warranties issued in the period		32			21
Changes in pre-existing warranties and estimates		13			(4	)
Payments		(29	)		(19	)
Foreign currency translation		—			1

Ending balance September 30	$	83		$	56

Business Segment Information (Tables) (Unaudited)

9 Months Ended

Sep. 30, 2010

Business Segment Information (Tables) [Abstract]

Business Segment Information


	Three Months Ended September 30, 2010
							Motion &			Corporate
	Defense			Fluid			Flow			and Other			Eliminations			Total

Product revenue	$	810		$	887		$	358		$	—		$	(3	)	$	2,052
Service revenue		556			33			2			—			—			591

Total revenue	$	1,366		$	920		$	360		$	—		$	(3	)	$	2,643

Operating income (loss)	$	178		$	116		$	45		$	(371	)	$	—		$	(32	)
Operating margin		13.0	%		12.6	%		12.5	%		—			—			(1.2	)%
Total assets	$	4,133		$	4,066		$	1,361		$	2,900		$	—		$	12,460


	Three Months Ended September 30, 2009
							Motion &			Corporate
	Defense			Fluid			Flow			and Other			Eliminations			Total

Product revenue	$	938		$	795		$	305		$	—		$	(2	)	$	2,036
Service revenue		571			31			2			—			—			604

Total revenue	$	1,509		$	826		$	307		$	—		$	(2	)	$	2,640

Operating income (loss)	$	200		$	108		$	40		$	(259	)	$	—		$	89
Operating margin		13.3	%		13.1	%		13.0	%		—			—			3.4	%
Total assets^(a)	$	4,153		$	2,930		$	1,323		$	2,723		$	—		$	11,129


	Nine Months Ended September 30, 2010
							Motion &			Corporate
	Defense			Fluid			Flow			and Other			Eliminations			Total

Product revenue	$	2,538		$	2,503		$	1,101		$	—		$	(9	)	$	6,133
Service revenue		1,724			96			7			—			—			1,827

Total revenue	$	4,262		$	2,599		$	1,108		$	—		$	(9	)	$	7,960

Operating income (loss)	$	513		$	337		$	143		$	(456	)	$	—		$	537
Operating margin		12.0	%		13.0	%		12.9	%		—			—			6.7	%
Total assets	$	4,133		$	4,066		$	1,361		$	2,900		$	—		$	12,460


	Nine Months Ended September 30, 2009
							Motion &			Corporate
	Defense			Fluid			Flow			and Other			Eliminations			Total

Product revenue	$	2,885		$	2,336		$	915		$	—		$	(5	)	$	6,131
Service revenue		1,625			103			6			—			—			1,734

Total revenue	$	4,510		$	2,439		$	921		$	—		$	(5	)	$	7,865

Operating income (loss)	$	557		$	288		$	101		$	(336	)	$	—		$	610
Operating margin		12.4	%		11.8	%		11.0	%		—			—			7.8	%
Total assets^(a)	$	4,153		$	2,930		$	1,323		$	2,723		$	—		$	11,129


^(a)		As of December 31, 2009

Acquisitions (Details) (Unaudited) - Nova Analytics [Member] - USD ($) $ in Millions	3 Months Ended
	Sep. 30, 2010	Mar. 23, 2010
Acquisitions (Textuals) [Abstract]
Purchase price of net of cash acquired		$ 385
Acquired percentage		100.00%
Additional payment on Purchase Price allocation related to certain working capital Balances	less than $1
Aggregate Fair Value of Other Assets Acquired		$ 67
Aggregate Fair Value of Liabilities Assumed		78
Goodwill Acquired on Acquisition		232
Proprietary technology [Member]
Acquisitions (Textuals) [Abstract]
Aggregate fair value of finite-lived intangibles		10
Distributor and customer relationships [Member]
Acquisitions (Textuals) [Abstract]
Aggregate fair value of finite-lived intangibles		112
Trademarks [Member]
Acquisitions (Textuals) [Abstract]
Aggregate fair value of finite-lived intangibles		$ 42

Acquisitions (Details 1) (Unaudited) - USD ($) $ in Millions	9 Months Ended
	Sep. 30, 2010	Sep. 30, 2009
Acquisitions (Textuals) [Abstract]
Payments to acquire businesses, net of cash acquired	$ 994	$ 34
Laing GmbH [Member]
Acquisitions (Textuals) [Abstract]
Payments to acquire businesses, net of cash acquired		$ 34

Acquisitions (Details 2) (Unaudited) - Godwin Pumps [Member] $ in Millions	Aug. 03, 2010 USD ($)
Acquisitions (Textuals) [Abstract]
Purchase price of net of cash acquired	$ 580
Acquired percentage	100.00%
Aggregate Fair Value of Other Assets Acquired	$ 190
Aggregate Fair Value of Liabilities Assumed	29
Goodwill Acquired on Acquisition	252
Proprietary technology [Member]
Acquisitions (Textuals) [Abstract]
Aggregate fair value of finite-lived intangibles	14
Distributor and customer relationships [Member]
Acquisitions (Textuals) [Abstract]
Aggregate fair value of finite-lived intangibles	107
Trademarks [Member]
Acquisitions (Textuals) [Abstract]
Aggregate fair value of finite-lived intangibles	$ 46

Discontinued Operations (Details) (Unaudited) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2010	Sep. 30, 2009	Sep. 30, 2010	Sep. 30, 2009	Dec. 31, 2009
Defense Segment component classified as held for sale and reported as discontinued operations
Revenue (third party)	$ 46	$ 59	$ 160	$ 170
Operating income	$ 4	$ 3	13	$ 11
Assets and liabilities reported as held for sale
Receivables, net					$ 43
Plant, property and equipment, net					1
Goodwill					76
Other intangible assets, net					18
Deferred income taxes					2
Other assets					1
Total assets of discontinued operations					141
Accounts payable					19
Accrued expenses					17
Deferred income taxes					8
Total liabilities of discontinued operations					$ 44
Discontinued Operations (Textuals) [Abstract]
Recognition of afert-tax gain/ (loss)			130
Tax benefit on gain on sale of discontinued operation			$ 4

Restructuring and Asset Impairment Charges (Details) (Unaudited) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2010 USD ($)	Sep. 30, 2009 USD ($)	Sep. 30, 2010 USD ($)	Sep. 30, 2009 USD ($)
Restructuring Activities
Severance		$ 4		$ 27
Other Employee Related Costs				1
Lease Cancellation & Other Costs		2		3
Asset Write-offs		1		1
Total		$ 7		$ 32
Costs of Nine Months Actions			$ 28
Costs of Third Quarter Actions	$ 1
Planned Position Eliminations	53	171	785	702
Prior Years' Plans Additional Costs	$ 4	$ 3	$ 6	$ 9
Reversal of Accruals	(2)	(1)	(4)	(1)
Defense [Member]
Restructuring Activities
Severance		0		1
Other Employee Related Costs				0
Lease Cancellation & Other Costs		1		1
Asset Write-offs		1		1
Total		$ 2		$ 3
Costs of Nine Months Actions			$ 22
Costs of Third Quarter Actions	$ 0
Planned Position Eliminations	0	32	643	71
Prior Years' Plans Additional Costs	$ 3	$ 0	$ 0	$ 3
Reversal of Accruals	(2)	0	(2)	0
Fluid [Member]
Restructuring Activities
Severance		3		18
Other Employee Related Costs				0
Lease Cancellation & Other Costs		1		2
Asset Write-offs		0		0
Total		$ 4		$ 20
Costs of Nine Months Actions			$ 5
Costs of Third Quarter Actions	$ 0
Planned Position Eliminations	0	89	89	347
Prior Years' Plans Additional Costs	$ 1	$ 2	$ 5	$ 4
Reversal of Accruals	0	(1)	(1)	(1)
Motion and Flow [Member]
Restructuring Activities
Severance		1		7
Other Employee Related Costs				1
Lease Cancellation & Other Costs		0		0
Asset Write-offs		0		0
Total		$ 1		$ 8
Costs of Nine Months Actions			$ 1
Costs of Third Quarter Actions	$ 1
Planned Position Eliminations	53	50	53	273
Prior Years' Plans Additional Costs	$ 0	$ 1	$ 1	$ 2
Reversal of Accruals	$ 0	$ 0	$ (1)	0
Corporate and Other [Member]
Restructuring Activities
Severance				1
Other Employee Related Costs				0
Lease Cancellation & Other Costs				0
Asset Write-offs				0
Total				$ 1
Planned Position Eliminations				11
Prior Years' Plans Additional Costs				$ 0
Reversal of Accruals				$ 0

Restructuring and Asset Impairment Charges (Details 1) (Unaudited) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2010	Sep. 30, 2009	Sep. 30, 2010	Sep. 30, 2009
Rollforward of the restructuring accruals
Beginning Balance			$ 53
Additional charges for prior years' plans	$ 4	$ 3	6	$ 9
Cash payments related to prior years' plans			(35)
Charges for 2010 actions			28
Cash payments related to 2010 actions			(15)
Reversals of prior charges	(2)	(1)	(4)	(1)
Foreign exchange translation and other			(3)
Ending Balance	30		30
Defense [Member]
Rollforward of the restructuring accruals
Beginning Balance			4
Additional charges for prior years' plans	3	0	0	3
Cash payments related to prior years' plans			(1)
Charges for 2010 actions			22
Cash payments related to 2010 actions			(11)
Reversals of prior charges	(2)	0	(2)	0
Foreign exchange translation and other			0
Ending Balance	12		12
Fluid [Member]
Rollforward of the restructuring accruals
Beginning Balance			18
Additional charges for prior years' plans	1	2	5	4
Cash payments related to prior years' plans			(16)
Charges for 2010 actions			5
Cash payments related to 2010 actions			(4)
Reversals of prior charges	0	(1)	(1)	(1)
Foreign exchange translation and other			(1)
Ending Balance	6		6
Motion and Flow [Member]
Rollforward of the restructuring accruals
Beginning Balance			31
Additional charges for prior years' plans	0	1	1	2
Cash payments related to prior years' plans			(18)
Charges for 2010 actions			1
Cash payments related to 2010 actions			0
Reversals of prior charges	0	$ 0	(1)	$ 0
Foreign exchange translation and other			(2)
Ending Balance	$ 12		$ 12

Restructuring and Asset Impairment Charges (Details 2) (Unaudited)	9 Months Ended
	Sep. 30, 2010
Rollforward of employee positions eliminated associated with restructuring activities
Planned reductions as of December 31, 2009	407
Additional planned reductions, January 1 - September 30, 2010	836
Actual reductions, January 1 - September 30, 2010	(1,035)
Planned reductions as of September 30, 2010	208

Restructuring and Asset Impairment Charges (Details Textual) (Unaudited) $ in Millions	3 Months Ended			9 Months Ended
	Dec. 31, 2010	Sep. 30, 2010 USD ($)	Sep. 30, 2009 USD ($)	Sep. 30, 2010 USD ($)	Sep. 30, 2009 USD ($)
Planned Position Eliminations (Textuals) [Abstract]
Planned Position Eliminations		53	171	785	702
Restructuring and Asset Impairment Charges (Textuals) [Abstract]
Restructuring charges related to current period actions		$ 1	$ 7	$ 28	$ 32
Restructuring charges related to prior period actions		4	3	6	9
Restructuring charge, Reversal of restructuring accruals		2	1	4	1
Net restructuring charge Total		3	$ 9	30	$ 40
Restructuring accrual for accrued severance		28		28
Restructuring accrual for accrued facility carrying and other costs		2		2
Restructuring accrual accrued expenses		$ 30		$ 30
Number of divison before restructuring of Defense Segment				7
Number of divison after restructuring of Defense segment				3
Number of facilities closed	2	1
Factory Workers [Member]
Planned Position Eliminations (Textuals) [Abstract]
Planned Position Eliminations		18	68	236	290
Office Workers [Member]
Planned Position Eliminations (Textuals) [Abstract]
Planned Position Eliminations		35	98	526	390
Management Employees [Member]
Planned Position Eliminations (Textuals) [Abstract]
Planned Position Eliminations			5	23	22
Fluid [Member]
Planned Position Eliminations (Textuals) [Abstract]
Planned Position Eliminations Associated with Restructuring Activities Initiated in a Prior Period				51

Income Taxes (Details) (Unaudited) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
Income Taxes (Details) (Unaudited) - USD ($) $ in Millions	Sep. 30, 2010	Sep. 30, 2009	Sep. 30, 2010	Sep. 30, 2009	Dec. 31, 2009
Income Taxes (Textuals) [Abstract]
Income tax expense (benefit)	$ (60)	$ 11	$ 94	$ 101
Additional tax benefit related to an increase in asbestos-related charges	46
Increase in asbestos related cost	118
Reversal of valuation allowance	27
Effective tax rate			19.70%	18.40%
Discrete income tax benefit (charge)			$ (12)	$ 58
Total uncertain tax positions	188		188		$ 171
Uncertain tax positions (ETR impact)	81		81		89
Accrued tax-related interest and penalties	20		$ 20		$ 23
Reversal amount of uncertain tax positions	$ 15

Earnings Per Share (Details) (Unaudited) - USD ($)
$ / shares in Units, shares in Millions

3 Months Ended

9 Months Ended

Sep. 30, 2010

Sep. 30, 2009

Sep. 30, 2010

Sep. 30, 2009

Earnings Per Share

Income from continuing operations

$ 12,000,000

$ 64,000,000

$ 382,000,000

$ 448,000,000

Weighted average common shares outstanding

182.5

181.2

182.2

180.9

Add: Weighted average restricted stock awards outstanding

^[1]

1.6

1.5

1.6

1.5

Basic weighted average common shares outstanding

184.1

182.7

183.8

182.4

Add: Dilutive impact of stock options

1.2

1.6

1.4

1.3

Diluted weighted average common shares outstanding

185.3

184.3

185.2

183.7

Basic earnings per share

$ 0.07

$ 0.35

$ 2.08

$ 2.46

Diluted earnings per share

$ 0.07

$ 0.35

$ 2.06

$ 2.44

Anti-dilutive stock options

2.2

1.7

2.1

4.0

Weighted average exercise price of anti-dilutive stock options

$ 54.3

$ 54.45

$ 54.42

$ 49.21

[1]	Restricted stock awards containing rights to non-forfeitable dividends which participate in undistributed earnings with common shareholders are considered participating securities for purposes of computing earnings per share.

Comprehensive Income (Details) (Unaudited) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2010	Sep. 30, 2009	Sep. 30, 2010	Sep. 30, 2009
Comprehensive Income
Net income	$ 145.0	$ 59.0	$ 529.0	$ 445.0
Other comprehensive income (loss):
Net foreign currency translation adjustments, pre-tax	184.0	96.0	(27.0)	144.0
Net foreign currency translation adjustments, tax expense (benefit)	0.0	0.0	0.0	0.0
Net foreign currency translation adjustments, net of tax	184.0	96.0	(27.0)	144.0
Changes in postretirement benefit plans, pre-tax	24.0	16.0	73.0	48.0
Changes in postretirement benefit plans, tax expense (benefit)	(9.0)	6.0	(27.0)	18.0
Changes in postretirement benefit plans, net of tax	15.0	10.0	46.0	30.0
Net change in unrealized gain (loss) on investment securities:
Unrealized holding gains arising during period, pre-tax	1.0	0.0	5.0	0.0
Unrealized holding gains arising during period, tax expense (benefit)	0.0	0.0	(2.0)	0.0
Unrealized holding gains arising during period, net of tax	1.0	0.0	3.0	0.0
Less: Reclassification adjustment for realized gains, pre-tax	7.0	0.0	7.0	0.0
Less: Reclassification adjustment for realized gains, tax expense (benefit)	(3.0)	0.0	(3.0)	0.0
Less: Reclassification adjustment for realized gains, net of tax	4.0	0.0	4.0	0.0
Net change in unrealized gain (loss) on investment securities, pre-tax	(6.0)	0.0	(2.0)	0.0
Net change in unrealized gain (loss) on investment securities, tax expense (benefit)	3.0	0.0	1.0	0.0
Net change in unrealized gain (loss) on investment securities, net of tax	(3.0)	0.0	(1.0)	0.0
Other comprehensive income (loss), pre-tax	202.0	112.0	44.0	192.0
Other comprehensive income (loss), tax expense (benefit)	(6.0)	6.0	(26.0)	18.0
Other comprehensive income (loss), net of tax	196.0	106.0	18.0	174.0
Comprehensive income	$ 341.0	$ 165.0	$ 547.0	$ 619.0

Receivables, Net (Details) (Unaudited) - USD ($) $ in Millions	Sep. 30, 2010	Dec. 31, 2009
Receivables, Net
Trade	$ 1,522	$ 1,379
Unbilled contract receivables	380	373
Other	59	56
Receivables, gross	1,961	1,808
Less: allowance for doubtful accounts and cash discounts	(50)	(54)
Receivables, net	1,911	1,754
Government [Member]
Receivables, Net (Textuals) [Abstract]
Outstanding accounts receivable balance from the U.S. Government	$ 382	$ 327

Inventories, Net (Details) (Unaudited) - USD ($) $ in Millions	Sep. 30, 2010	Dec. 31, 2009
Inventories, Net
Finished goods	$ 230	$ 176
Work in process	112	57
Raw materials	350	253
Inventory Gross Total	692	486
Inventoried costs related to long-term contracts	342	391
Less: progress payments	(92)	(75)
Inventoried costs related to long-term contracts, net	250	316
Inventories, net	$ 942	$ 802

Plant, Property and Equipment, Net (Details) (Unaudited) - USD ($) $ in Millions	Sep. 30, 2010	Dec. 31, 2009
Plant, Property and Equipment, Net
Land and improvements	$ 59	$ 57
Buildings and improvements	637	609
Machinery and equipment	1,764	1,688
Equipment held for lease or rental	127	72
Furniture, fixtures and office equipment	228	220
Construction work in progress	154	157
Other	27	22
Plant, property and equipment, gross	2,996	2,825
Less: accumulated depreciation and amortization	(1,847)	(1,775)
Plant, property and equipment, net	$ 1,149	$ 1,050

Goodwill and Other Intangible Assets, Net (Details) (Unaudited) $ in Millions	9 Months Ended
	Sep. 30, 2010 USD ($)
Changes in Carrying Amount of Goodwill
Beginning Balance	$ 3,788
Goodwill acquired during the period	494
Foreign currency translation	(11)
Ending Balance	4,271
Goodwill disposed during the period	76
Defense [Member]
Changes in Carrying Amount of Goodwill
Beginning Balance	2,132
Goodwill acquired during the period	3
Foreign currency translation	0
Ending Balance	2,135
Goodwill disposed during the period	76
Fluid [Member]
Changes in Carrying Amount of Goodwill
Beginning Balance	1,165
Goodwill acquired during the period	491
Foreign currency translation	(7)
Ending Balance	1,649
Goodwill disposed during the period	0
Motion and Flow [Member]
Changes in Carrying Amount of Goodwill
Beginning Balance	486
Goodwill acquired during the period	0
Foreign currency translation	(4)
Ending Balance	482
Goodwill disposed during the period	0
Corporate and Other [Member]
Changes in Carrying Amount of Goodwill
Beginning Balance	5
Goodwill acquired during the period	0
Foreign currency translation	0
Ending Balance	5
Goodwill disposed during the period	$ 0

Goodwill and Other Intangible Assets, Net (Details 1) (Unaudited) $ in Millions	9 Months Ended
	Sep. 30, 2010 USD ($)	Sep. 30, 2009 USD ($)	Dec. 31, 2009 USD ($)
Carrying Amount of Other Intangible Assets
Other intangible assets, Gross carrying amount	$ 1,135		$ 789
Other intangible assets, Accumulated amortization	(352)		(288)
Other intangible assets, net	783		501
Goodwill and Other Intangible Assets, Net (Textuals) [Abstract]
Amortization expense related to finite-lived intangible assets	64	$ 76
Expected amortization expense related to intangible assets	22
Estimated amortization expense related to intangible assets
2011	85
2012	76
2013	59
2014	54
2015	50
Distributor and customer relationships [Member]
Carrying Amount of Other Intangible Assets
Gross Carrying Amount	853		625
Accumulated Amortization	(291)		(236)
Other Intangibles Net	562		389
Distributor and customer relationships [Member] \| Godwin Acquisition [Member]
Goodwill and Other Intangible Assets, Net (Textuals) [Abstract]
Finite-lived intangible assets acquired	$ 107
Weighted average period (in years)	10
Proprietary technology [Member]
Carrying Amount of Other Intangible Assets
Gross Carrying Amount	$ 89		66
Accumulated Amortization	(29)		(24)
Other Intangibles Net	60		42
Proprietary technology [Member] \| Godwin Acquisition [Member]
Goodwill and Other Intangible Assets, Net (Textuals) [Abstract]
Finite-lived intangible assets acquired	$ 14
Weighted average period (in years)	16
Patents and other [Member]
Carrying Amount of Other Intangible Assets
Gross Carrying Amount	$ 49		45
Accumulated Amortization	(22)		(20)
Other Intangibles Net	27		25
Trademarks [Member]
Carrying Amount of Other Intangible Assets
Gross Carrying Amount	36		35
Accumulated Amortization	(10)		(8)
Other Intangibles Net	26		27
Brands and Trademarks [Member]
Carrying Amount of Other Intangible Assets
Gross Carrying Amount	108		18
Accumulated Amortization	0		0
Other intangible assets, net	108		$ 18
Brands and Trademarks [Member] \| Godwin Acquisition [Member]
Goodwill and Other Intangible Assets, Net (Textuals) [Abstract]
Finite-lived intangible assets acquired	46
Nova Analytics [Member] \| Distributor and customer relationships [Member]
Goodwill and Other Intangible Assets, Net (Textuals) [Abstract]
Finite-lived intangible assets acquired	$ 112
Weighted average period (in years)	19
Nova Analytics [Member] \| Proprietary technology [Member]
Goodwill and Other Intangible Assets, Net (Textuals) [Abstract]
Finite-lived intangible assets acquired	$ 10
Weighted average period (in years)	11
Nova Analytics [Member] \| Brands and Trademarks [Member]
Goodwill and Other Intangible Assets, Net (Textuals) [Abstract]
Indefinite-lived intangible assets acquired	$ 42

Other Non-Current Assets (Details) (Unaudited) - USD ($) $ in Millions	Sep. 30, 2010	Dec. 31, 2009
Other Non-Current Assets
Other employee benefit-related assets	$ 101	$ 87
Capitalized software costs	88	65
Long-term third party receivables, net	42	44
Equity and cost method investments	4	28
Pension assets and prepaid benefit plan costs	17	16
Other	26	12
Other non-current assets	$ 278	$ 252

Debt (Details) (Unaudited) $ in Millions	1 Months Ended	3 Months Ended	9 Months Ended
Debt (Details) (Unaudited) $ in Millions	Aug. 31, 2010 USD ($)	Jun. 30, 2010 USD ($)	Sep. 30, 2010 USD ($)	Dec. 31, 2009 USD ($)
Debt
Commercial paper			$ 258	$ 55
Short-term loans			11	10
Current maturities of long-term debt and other			10	10
Short-term debt and current maturities of long-term debt			279	75
Non-current maturities of long-term debt			1,322	1,392
Non-current capital leases			4	4
Deferred gain on interest rate swaps			46	50
Unamortized discounts and debt issuance costs			(8)	(15)
Long-term debt			1,364	1,431
Total debt			1,643	1,506
Debt (Textuals) [Abstract]
Fair value of total debt, excluding the deferred gain on interest rate swaps			$ 1,803	$ 1,547
Commitment Fee on revolving credit agreements	0.225% of total commitment
Face value of debentures called off due in 2011		$ 69
Line of credit facility interest coverage ratio			3.5
Recognition of net expense related to early retirement of debt		$ 3
Line of credit facility One [Member]
Debt (Textuals) [Abstract]
Three-year revolving credit agreement, aggregate principal amount	$ 1,500
Line of credit facility Two [Member]
Debt (Textuals) [Abstract]
Three-year revolving credit agreement, aggregate principal amount	$ 1,750

Other Non-Current Liabilities (Details) (Unaudited) - USD ($) $ in Millions	Sep. 30, 2010	Dec. 31, 2009
Other Non-Current Liabilities
Deferred income taxes and other tax-related accurals	$ 336	$ 174
Environmental	125	128
Compensation and other employee-related benefits	119	123
Product liability, guarantees and other legal matters	72	63
Other	48	53
Other non-current liabilities	$ 700	$ 541

Employee Benefit Plans (Details) (Unaudited) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2010	Sep. 30, 2009	Sep. 30, 2010	Sep. 30, 2009	Dec. 31, 2009
Postretirement benefit amounts recognized within balance sheet
Other non-current assets	$ 17		$ 17		$ 16
Pension [Member]
Net periodic benefit cost
Service cost	31	$ 24	93	$ 75
Interest cost	84	84	251	247
Expected return on plan assets	(110)	(108)	(329)	(325)
Amortization of prior service cost (credit)	1	1	3	3
Amortization of actuarial loss	21	14	63	35
Total net periodic benefit cost	27	15	81	35
Postretirement benefit amounts recognized within balance sheet
Other non-current assets	17		17		16
Current liabilities	(24)		(24)		(24)
Non-current liabilities	(1,367)		(1,367)		(1,384)
Total	(1,374)		(1,374)		(1,392)
Other Benefits [Member]
Net periodic benefit cost
Service cost	1	2	5	6
Interest cost	10	11	30	32
Expected return on plan assets	(5)	(5)	(16)	(14)
Amortization of prior service cost (credit)	0	1	(1)	3
Amortization of actuarial loss	2	4	8	11
Total net periodic benefit cost	8	$ 13	26	$ 38
Postretirement benefit amounts recognized within balance sheet
Other non-current assets	0		0		0
Current liabilities	(49)		(49)		(49)
Non-current liabilities	(396)		(396)		(404)
Total	$ (445)		$ (445)		$ (453)

Employee Benefit Plans (Details Textual) (Unaudited) $ in Millions	3 Months Ended	9 Months Ended
	Sep. 30, 2010 USD ($)	Sep. 30, 2010 USD ($)
Defined Benefit Pension Plans and Defined Benefit Postretirement Plans Disclosure (Textuals) [Abstract]
Contribution to various plans	$ 7	$ 13
Additional employer contributions expected in the remaining employer year, minimum	3	3
Additional employer contributions expected in the remaining employer year, maximum	$ 5	$ 5

Long-Term Incentive Employee Compensation (Details) (Unaudited) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2010 USD ($)	Sep. 30, 2009 USD ($)	Sep. 30, 2010 USD ($)	Sep. 30, 2009 USD ($)	Mar. 31, 2010 USD ($)
Long-Term Incentive Employee Compensation
Compensation costs on equity-based awards	$ 7.0	$ 8.0	$ 23.0	$ 24.0
Compensation (benefit) costs on liability-based awards	(7.0)	5.0	(7.0)	7.0
Total compensation costs, pre-tax	0.0	13.0	16.0	31.0
Future tax benefit	0.0	$ 4.0	4.0	$ 10.0
Long-Term Incentive Employee Compensation (Textuals) [Abstract]
Total unrecognized compensation cost related to unvested Non-qualified stock options and restricted stock	50.0		$ 50.0
Weighted-average period to recognize Non-qualified stock options and restricted stock compensation cost (years)			1.9
Total unrecognized compensation cost related to Total shareholder return award plan	$ 6.0		$ 6.0
Weighted-average period to recognize Total shareholder return award plan cost (years)			1.6
Cash payments to settle Total Shareholder Return award plan					$ 18.0

Commitments and Contingencies (Details) (Unaudited)

3 Months Ended

9 Months Ended

Sep. 30, 2010

USD ($)

Sep. 30, 2009

USD ($)

Sep. 30, 2010

USD ($)

Sep. 30, 2009

USD ($)

Sep. 30, 2010

USD ($)

Dec. 31, 2009

USD ($)

Activity related to asbestos claims

Pending claims, Beginning balance

^[1]

104,679

103,006

New claims

^[2]

4,748

2,608

Settlements

(708)

(774)

Dismissals

(5,271)

(1,927)

Adjustment

^[3]

491

3,208

Pending claims, Ending balance

^[1]

103,939

106,121

103,939

106,121

Net asbestos charges

Continuing operations, pre-tax

$ 341,000,000

$ 223,000,000

Continuing operations, after-tax

211,000,000

139,000,000

Discontinued operations, pre-tax

(10,000,000)

13,000,000

Discontinued operations, after-tax

(6,000,000)

8,000,000

Total, pre-tax

331,000,000

236,000,000

Total, after-tax

205,000,000

147,000,000

Beginning balance

$ 267,000,000

$ 27,000,000

Changes in accruals during the period continuing operation, Liability

570,000,000

642,000,000

Changes in accruals during the period continuing operations, Assets

202,000,000

419,000,000

Changes in accruals during period discontinued operations, Liability

170,000,000

72,000,000

Changes in accruals during period discontinued operations, Assets

180,000,000

58,000,000

Changes in accruals during period continuing operations, net

368,000,000

223,000,000

Changes in accruals during period Discontinued operations, net

(10,000,000)

14,000,000

Net cash activity

(7,000,000)

(6,000,000)

Other adjustments

Ending balance

$ 618,000,000

$ 258,000,000

$ 618,000,000

$ 258,000,000

Commitments and Contingencies (Textuals) [Abstract]

Number of claims related to maritime actions excluded from total claims

34,869

Loss Contingency, Pending Claims, Number

^[1]

103,939

106,121

104,679

103,006

103,939

104,679

Claims not filed against ITT

882

Number of claims in Mississippi placed on inactive dockets

41,328

Average payment per resolved claim

$ 15,100

$ 11,300

Asbestos liability period for unasserted claims

Next 10 years

Increase in total undiscounted asbestos liability including legal fees

$ 691,000,000

Increase in asbestos-related assets

$ 372,000,000

Initial recognition of claims expected to be incurred

over the next 10 years

Change in asbestos-related accruals recognized within continuing operations

$ 0

Change in asbestos-related accruals recognized within discontinued operations

$ 0

Total asbestos liability, current

$ 116,000,000

$ 66,000,000

Total asbestos asset, current

105,000,000

62,000,000

Assets of disposal group including discontinued operation

141,000,000

Liability of disposal group including discontinued operation

44,000,000

Estimated percentage of insurance which covers Asbestos costs

62.00%

Insurance coverage projected in year 10

0.25

Estimated future cash flows on next five years

average $25

Asbestos cash flows during past three years

approximately $10 - $15

Estimated asbestos cash flows 2016-2020

approximately $50 to $60

Estimated asbestos exposure, net of expected recoveries from insurers and other responsible parties

618,000,000

267,000,000

Total transition away period for liabiltiy sharing of claims related to discontinued operations

9 to 10 years

Extended period for future cash flows net of recoveries related to pending claims an unasserted claims to be filed

Through approximately 2022

Asset [Member]

Beginning Balance, Asset

$ 666,000,000

201,000,000

Net cash activity, Asset

(27,000,000)

(19,000,000)

Other adjustments

(11,000,000)

Ending balance

1,010,000,000

$ 659,000,000

1,010,000,000

659,000,000

Liability [Member]

Beginning Balance, Liability

933,000,000

228,000,000

Net cash activity, Liability

(34,000,000)

(25,000,000)

Other adjustments

(11,000,000)

Ending Balance, Liability

$ 1,628,000,000

$ 917,000,000

$ 1,628,000,000

$ 917,000,000

Absestos [Member]

Commitments and Contingencies (Textuals) [Abstract]

Assets of disposal group including discontinued operation

246,000,000

75,000,000

Liability of disposal group including discontinued operation

$ 244,000,000

$ 64,000,000

[1]	We had previously indicated that 34,869 claims related to maritime actions, almost all of which were filed in the United States District Court for the Northern District of Ohio were not included in the total because the Company believed they would not be litigated. These cases have now been dismissed by the Court.
[2]	In September 2010, ITT executed an amended cost sharing agreement related to a business we disposed of a number of years ago. The amended agreement provides for a sharing of costs for claims resolved between 2010 and 2019 naming ITT or the entity which acquired the disposed business. Excluding from the table above are 882 pending claims associated with the amended cost sharing agreement that were not filed against ITT.
[3]	Reflects an adjustment to increase the number of open claims as a result of transitioning claims data from our primary insurance companies to an internal database.

Commitments and Contingencies (Details 1) (Unaudited) $ in Millions	9 Months Ended
	Sep. 30, 2010 USD ($)	Sep. 30, 2009 USD ($)	Dec. 31, 2009 USD ($)
Activity related to accrued environmental liabilities
Accrued environmental liabilities, Beginning balance	$ 140	$ 135
Change in estimates for pre-existing accruals, foreign exchange and other payments	7	17
Payments	(11)	(11)
Accrued environmental liabilities, Ending balance	136	$ 141
Range of liability and number of active sites for environmental matters
Low-end range	123		$ 113
High-end range	$ 262		$ 249
Number of active environmental investigation and remediation sites	99		98

Commitments and Contingencies (Details 2) (Unaudited) $ in Millions	9 Months Ended
	Sep. 30, 2010 USD ($)	Mar. 27, 2007
Commitments and Contingencies (Textuals) [Abstract]
Number of Cases pending against PGS	Fewer than 4000
Night Vision ITAR Violation Settlement; Fines, Forfeitures and Penalties	$ 50
Night Vision ITAR Violation Settlement; Deferred Prosecution Monetary Penalty	$ 50
Number of Itar Violations the Company Pled Guilty To		2

Guarantees, Indemnities and Warranties (Details) (Unaudited) - USD ($) $ in Millions	9 Months Ended
	Sep. 30, 2010	Sep. 30, 2009
Changes in product warranty accrual
Product Warranty Accrual, Beginning Balance	$ 67	$ 57
Accruals for product warranties issued in the period	32	21
Changes in pre-existing warranties and estimates	13	(4)
Payments	(29)	(19)
Foreign currency translation	0	1
Product Warranty Accrual, Ending Balance	83	$ 56
Guarantees, Indemnities and Warranties (Textuals) [Abstract]
Maximum Payment to the Lessor for Residual Value Guarantee on Future Value of the Leased Aircraft	42
Less than Guaranteed Amount of Exposure to Current Projected Under Residual Value Guarantee	(22)
Realized and Deferred Gain on Sale Leaseback of Corporate Aircraft	5
Guaranteed fair value of asset at the expiration of lease	$ 50
Payment under residual value guarantee of lease	Difference between the fair value of the aircraft and $50 million
Maximum payment under residual value guarantee of lease	$ 42
Accrual recorded in Consolidated Condensed Financial Statements for residual value guarantee of aircraft	$ 17