Table of Contents 2. Summary of Significant Accounting Policies Consolidated Statements of Cash Flows Principles of Consolidation— The Consolidated Financial Statements include the accounts of the Company and its majority-owned subsidiaries in which minority shareholders hold no substantive participating rights. Intercompany transactions and balances have been eliminated. The Company’s share of the net earnings of 20% to 50% owned companies, for which it has the ability to exercise significance influence over operating and financial policies (but not control), are included in “Earnings from unconsolidated entities, net of taxes” in the Consolidated Statements of Operations. Foreign Currency Translations and Transactions— Assets and liabilities of foreign affiliates are translated at the exchange rates in effect at the balance sheet date. Income, expenses and cash flows are translated at average exchange rates during the year. The Company recognized transaction losses of $21, losses of $21 and gains of $19 for the years ended December 31, 2018, 2017 and 2016, respectively, which are included as a component of “Net income (loss).” In addition, gains or losses related to the Company’s intercompany loans payable and receivable denominated in a foreign currency other than the subsidiary’s functional currency that are deemed to be permanently invested are remeasured to cumulative translation and recorded in “Accumulated other comprehensive loss” in the Consolidated Balance Sheets. The effect of translation is included in “Accumulated other comprehensive loss.” Use of Estimates— The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and also the disclosure of contingent assets and liabilities at the date of the financial statements. In addition, it requires management to make estimates and assumptions that affect the reported amounts of revenues and expenses during the reporting period. The most significant estimates that are included in the financial statements are environmental remediation liabilities, legal liabilities, deferred tax assets and liabilities and related valuation allowances, income tax accruals, pension and postretirement assets and liabilities, valuation allowances for accounts receivable and inventories, general insurance liabilities, asset impairments and fair values of assets acquired and liabilities assumed in business acquisitions. Actual results could differ from these estimates. Cash and Cash Equivalents —At December 31, 2018 and 2017, the Company had interest-bearing time deposits and other cash equivalent investments of $16 and $9, respectively. The Company’s restricted cash balances of $15 and $18 as of December 31, 2018 and 2017, respectively represent deposits to secure certain bank guarantees issued to third parties to guarantee potential obligations of the Company primarily related to the completion of tax audits and environmental liabilities. These balances will remain restricted as long as the underlying exposures exist and are included in the Consolidated Balance Sheets as a component of “Cash and cash equivalents.” Following the adoption of ASU 2016-18:  Statement of Cash Flows (Topic 230) Restricted Cash , the Company includes restricted cash in the cash and cash equivalents balance of the Consolidated Statements of Cash Flows. The following table includes the restricted cash changes as a result of the adoption of ASU 2016-18 in the Consolidated Statements of Cash Flows for the year ended December 2017 and 2016: 139 For the year ended December 31, 2017 Previous Accounting Method Effect of Accounting Change As Reported Cash flows used in investing activities Change in restricted cash $ 1 $ (1) $ — Net cash used in investing activities (74 ) (1 ) (75 ) Effect of exchange rates on cash and cash equivalents 4 2 6 Change in cash and cash equivalents (58) 1 (57) Cash, cash equivalents and restricted cash at beginning of period 96 17 113 Cash, cash equivalents and restricted cash at end of period $ 38 $ 18 $ 56