JCI's liquidation posture as of March 31, 2026 remains deeply negative, consistent with MFFAIS CLV of -$9.9B and OLV of -$1.4B. The balance sheet carries $38.4B in total assets against $24.8B in total liabilities (current $10.6B plus noncurrent $14.2B), with equity book value of $13.5B. Under liquidation haircuts, recoverable value collapses: cash $698M (100%), net AR $6.6B haircut to ~$6.1B at 92%, inventory $1.9B haircut to ~$1.2B at 60%, PP&E net $2.1B haircut to ~$1.3B at 60%, intangibles/goodwill $20.0B ($16.5B goodwill + $3.5B net intangibles) zeroed out. Capitalized contract costs ($520M) and other noncurrent assets ($5.1B, which includes restricted asbestos investments, pension assets, deferred taxes, and ROU assets) yield minimal liquidation value. Against this, all $24.8B in liabilities stand at face value, inclusive of $9.5B total debt, $3.3B deferred revenue, $386M asbestos gross liability, $175M environmental accrual, $438M self-insured liabilities, and $808M supplier finance obligations. The arithmetic produces a material negative recovery to equity. Since the prior filing (December 31, 2025), the current portion of long-term debt dropped sharply from $568M to $28M, indicating a maturity was paid down; long-term debt is essentially flat at $8.6B. Net debt improved from $9.2B to $8.8B, aided by cash increasing from $552M to $698M and operating cash generation of $1.3B in the half-year. Goodwill is stable at $16.5B but represents the single largest liquidation value destroyer on the asset side. The AFFF water systems settlement ($750M total, final $415M payment made December 2024) is fully discharged; however, more than 15,900 individual/mass AFFF personal injury cases remain in MDL with no disclosed reserve, constituting an unquantified off-balance-sheet liability. PFAS environmental accruals total $175M on-balance-sheet with a 20-year payment horizon disclosed. Self-insured liabilities rose $24M QoQ to $438M, driven by the noncurrent component increasing from $289M to $316M. Asbestos net liability widened from $48M to $62M as restricted investments supporting the program declined by $15M. Restructuring reserve drawdown continues with $144M charged in H1 FY2026 against a $400M total program. Filing does not separately tag pension funded status or the total operating lease liability in XBRL; these are disclosed in MD&A/footnotes only.
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