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United Technologies settles for $283M

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HARTFORD, Conn., June 7 (UPI) -- United Technologies Corp. will pay $283 million to the U.S. Department of Defense to settle an old accounting dispute.

The agreement ends the previously reported litigation over Pratt & Whitney's cost accounting for engine parts on commercial engine collaboration programs from 1984-2004, UTC said Wednesday.

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The disagreement concerned the allocation of overhead costs between commercial and government programs. Since Jan. 1, 2005, Pratt & Whitney has used an alternative method for allocating overhead costs, which is based on the value added by Pratt & Whitney in the manufacturing process. This methodology has been approved by the government.

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