Form 10-K - Union Pacific

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Board of Directors and Shareholders of Union Pacific Corporation: We have audited the internal control over financial reporting of Union Pacific Corporation and Subsidiary Companies (the Corporation) as of December 31, 2011, based on criteria established in Internal Control — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. The Corporation's management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Annual Report on Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the Corporation's internal control over financial reporting based on our audit. We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. A company’s internal control over financial reporting is a process designed by, or under the supervision of, the company’s principal executive and principal financial officers, or persons performing similar functions, and effected by the company’s board of directors, management, and other personnel to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. Because of the inherent limitations of internal control over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may not be prevented or detected on a timely basis. Also, projections of any evaluation of the effectiveness of the internal control over financial reporting to future periods are subject to the risk that the controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. In our opinion, the Corporation maintained, in all material respects, effective internal control over financial reporting as of December 31, 2011, based on the criteria established in Internal Control — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated financial statements and financial statement schedule as of and for the year ended December 31, 2011 of the Corporation and our report dated February 3, 2012 expressed an unqualified opinion on those financial statements and financial statement schedule. Omaha, Nebraska February 3, 2012 86
Item 9B. Other Information None. PART III Item 10. Directors, Executive Officers, and Corporate Governance (a) Directors of Registrant. Information as to the names, ages, positions and offices with UPC, terms of office, periods of service, business experience during the past five years and certain other directorships held by each director or person nominated to become a director of UPC is set forth in the Election of Directors segment of the Proxy Statement and is incorporated herein by reference. Information concerning our Audit Committee and the independence of its members, along with information about the audit committee financial expert(s) serving on the Audit Committee, is set forth in the Audit Committee segment of the Proxy Statement and is incorporated herein by reference. (b) Executive Officers of Registrant. Information concerning the executive officers of UPC and its subsidiaries is presented in Part I of this report under Executive Officers of the Registrant and Principal Executive Officers of Subsidiaries. (c) Section 16(a) Compliance. Information concerning compliance with Section 16(a) of the Securities Exchange Act of 1934 is set forth in the Section 16(a) Beneficial Ownership Reporting Compliance segment of the Proxy Statement and is incorporated herein by reference. (d) Code of Ethics for Chief Executive Officer and Senior Financial Officers of Registrant. The Board of Directors of UPC has adopted the UPC Code of Ethics for the Chief Executive Officer and Senior Financial Officers (the Code). A copy of the Code may be found on the Internet at our website www.up.com/investors/governance. We intend to disclose any amendments to the Code or any waiver from a provision of the Code on our website. Item 11. Executive Compensation Information concerning compensation received by our directors and our named executive officers is presented in the Compensation Discussion and Analysis, Summary Compensation Table, Grants of Plan- Based Awards in Fiscal Year 2011, Outstanding Equity Awards at 2011 Fiscal Year-End, Option Exercises and Stock Vested in Fiscal Year 2011, Pension Benefits at 2011 Fiscal Year-End, Nonqualified Deferred Compensation at 2011 Fiscal Year-End, Potential Payments Upon Termination or Change in Control and Director Compensation in Fiscal Year 2011 segments of the Proxy Statement and is incorporated herein by reference. Additional information regarding compensation of directors, including Board committee members, is set forth in the By-Laws of UPC and the Stock Unit Grant and Deferred Compensation Plan for the Board of Directors, both of which are included as exhibits to this report. Information regarding the Compensation and Benefits Committee is set forth in the Compensation Committee Interlocks and Insider Participation and Compensation Committee Report segments of the Proxy Statement and is incorporated herein by reference. 87
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(Mark One) [X] UNITED STATES SECURI
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February 3, 2012 Fellow Shareholder
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PART I Item 1. Business GENERAL Uni
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goods, lumber and other miscellaneo
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Partnership Against Terrorism, a pa
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and liquidity. Additionally, any fu
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that meet our specifications. Rail
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Annual Lifts Top 10 Intermodal Term
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including sites on the Superfund Na
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Executive Officers of the Registran
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Five-Year Performance Comparison -
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Item 7. Management’s Discussion a
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Positive Train Control - In respons
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Agricultural Products - Fuel surcha
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Intermodal - Fuel surcharge gains,
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Purchased Services and Materials -
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2011, effectively handling the 3% i
Page 35 and 36: LIQUIDITY AND CAPITAL RESOURCES As
Page 37 and 38: Credit Facilities - During the seco
Page 39 and 40: The following table lists the outst
Page 41 and 42: Amount of Commitment Expiration per
Page 43 and 44: estimated, we have recorded a liabi
Page 45 and 46: compensation of claimants; and ther
Page 47 and 48: For retirements of depreciable rail
Page 49 and 50: information. To the extent circumst
Page 51 and 52: REPORT OF INDEPENDENT REGISTERED PU
Page 53 and 54: CONSOLIDATED STATEMENTS OF FINANCIA
Page 55 and 56: CONSOLIDATED STATEMENTS OF CHANGES
Page 57 and 58: Investments - Investments represent
Page 59 and 60: does not change the items which mus
Page 61 and 62: Retention Awards - The fair value o
Page 63 and 64: Amounts recognized in the statement
Page 65 and 66: Assumed health care cost trend rate
Page 67 and 68: multiples to private company cash f
Page 69 and 70: Other Retirement Programs 401(k)/Th
Page 71 and 72: A reconciliation of changes in unre
Page 73 and 74: Receivables Securitization Facility
Page 75 and 76: which all items with similar charac
Page 77 and 78: hedges using the short-cut method;
Page 79 and 80: dividends to our shareholders. The
Page 81 and 82: 17. Commitments and Contingencies A
Page 83 and 84: environmental remediation. Current
Page 85: MANAGEMENT’S ANNUAL REPORT ON INT
Page 89 and 90: Item 15. Exhibits, Financial Statem
Page 91 and 92: SCHEDULE II - VALUATION AND QUALIFY
Page 93 and 94: 3(b) 4(a) 4(b) 4(c) By-Laws of UPC,
Page 95 and 96: 10(v) 10(w) 10(x) 10(y) 10(z) 10(aa
Page 97 and 98: Exhibit 21 SIGNIFICANT SUBSIDIARIES
Page 99 and 100: Exhibit 24 UNION PACIFIC CORPORATIO
Page 101 and 102: Exhibit 31(b) CERTIFICATION OF PRIN
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Form 10-K - Union Pacific

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