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Financial Instruments (Tables) | 9 Months Ended
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Sep. 30, 2017
Derivative Instruments and Hedging Activities Disclosure [Abstract] |
Summary of Interest Rate Swaps Held | At September 30, 2017, the Company was a party to 26 pay-floating, receive-fixed interest rate swap contracts designated as fair value hedges of fixed-rate notes in which the notional amounts match the amount of the hedged fixed-rate notes as detailed in the table below.
($ in millions) | September 30, 2017
Debt Instrument | Par Value of Debt |  | Number of Interest Rate Swaps Held |  | Total Swap Notional Amount
1.30% notes due 2018 | $ | 1,000 |  |  | 4 |  |  | $ | 1,000 |
5.00% notes due 2019 | 1,250 |  |  | 3 |  |  | 550 |
1.85% notes due 2020 | 1,250 |  |  | 5 |  |  | 1,250 |
3.875% notes due 2021 | 1,150 |  |  | 5 |  |  | 1,150 |
2.40% notes due 2022 | 1,000 |  |  | 4 |  |  | 1,000 |
2.35% notes due 2022 | 1,250 |  |  | 5 |  |  | 1,250 |
Fair Value of Derivatives on a Gross Basis Segregated between those Derivatives that are Designated as Hedging Instruments and those that are Not Designated as Hedging Instruments | Presented in the table below is the fair value of derivatives on a gross basis segregated between those derivatives that are designated as hedging instruments and those that are not designated as hedging instruments:
|  | September 30, 2017 |  | December 31, 2016
|  | Fair Value of Derivative |  | U.S. Dollar Notional |  | Fair Value of Derivative |  | U.S. Dollar Notional
($ in millions) | Balance Sheet Caption | Asset |  | Liability |  | Asset |  | Liability |
Derivatives Designated as Hedging Instruments |  |  |  |  |  |  |  |  |  |  |  |
Interest rate swap contracts | Other assets | $ | 15 |  |  | $ | — |  |  | $ | 2,700 |  |  | $ | 20 |  |  | $ | — |  |  | $ | 2,700 |
Interest rate swap contracts | Accrued and other current liabilities | — |  |  | 3 |  |  | 1,000 |  |  | — |  |  | — |  |  | — |
Interest rate swap contracts | Other noncurrent liabilities | — |  |  | 23 |  |  | 2,500 |  |  | — |  |  | 29 |  |  | 3,500 |
Foreign exchange contracts | Other current assets | 83 |  |  | — |  |  | 4,385 |  |  | 616 |  |  | — |  |  | 6,063 |
Foreign exchange contracts | Other assets | 46 |  |  | — |  |  | 1,979 |  |  | 129 |  |  | — |  |  | 2,075 |
Foreign exchange contracts | Accrued and other current liabilities | — |  |  | 88 |  |  | 1,574 |  |  | — |  |  | 1 |  |  | 48 |
Foreign exchange contracts | Other noncurrent liabilities | — |  |  | 1 |  |  | 25 |  |  | — |  |  | 1 |  |  | 12 |
|  | $ | 144 |  |  | $ | 115 |  |  | $ | 14,163 |  |  | $ | 765 |  |  | $ | 31 |  |  | $ | 14,398 |
Derivatives Not Designated as Hedging Instruments |  |  |  |  |  |  |  |  |  |  |  |
Foreign exchange contracts | Other current assets | $ | 77 |  |  | $ | — |  |  | $ | 3,927 |  |  | $ | 230 |  |  | $ | — |  |  | $ | 8,210 |
Foreign exchange contracts | Accrued and other current liabilities | — |  |  | 112 |  |  | 6,383 |  |  | — |  |  | 103 |  |  | 2,931 |
|  | $ | 77 |  |  | $ | 112 |  |  | $ | 10,310 |  |  | $ | 230 |  |  | $ | 103 |  |  | $ | 11,141 |
|  | $ | 221 |  |  | $ | 227 |  |  | $ | 24,473 |  |  | $ | 995 |  |  | $ | 134 |  |  | $ | 25,539 |
Information on Derivative Positions Subject to Master Netting Arrangements as if they were Presented on a Net Basis | The following table provides information on the Company’s derivative positions subject to these master netting arrangements as if they were presented on a net basis, allowing for the right of offset by counterparty and cash collateral exchanged per the master agreements and related credit support annexes:
| September 30, 2017 |  | December 31, 2016
($ in millions) | Asset |  | Liability |  | Asset |  | Liability
Gross amounts recognized in the consolidated balance sheet | $ | 221 |  |  | $ | 227 |  |  | $ | 995 |  |  | $ | 134 |
Gross amount subject to offset in master netting arrangements not offset in the consolidated balance sheet | (137 | ) |  | (137 | ) |  | (131 | ) |  | (131 | )
Cash collateral received | (8 | ) |  | — |  |  | (529 | ) |  | — |
Net amounts | $ | 76 |  |  | $ | 90 |  |  | $ | 335 |  |  | $ | 3 |
Location and Pretax Gain or Loss Amounts for Derivatives | The table below provides information on the location and pretax gain or loss amounts for derivatives that are: (i) designated in a fair value hedging relationship, (ii) designated in a foreign currency cash flow hedging relationship and (iii) not designated in a hedging relationship:
| Three Months Ended September 30, |  | Nine Months Ended September 30,
($ in millions) | 2017 |  | 2016 |  | 2017 |  | 2016
Derivatives designated in a fair value hedging relationship |  |  |  |  |  |  |
Interest rate swap contracts |  |  |  |  |  |  |
Amount of loss (gain) recognized in Other (income) expense, net on derivatives (1) | $ | 8 |  |  | $ | 59 |  |  | $ | 2 |  |  | $ | (139 | )
Amount of (gain) loss recognized in Other (income) expense, net on hedged item (1) | (9 | ) |  | (60 | ) |  | (5 | ) |  | 135 |
Derivatives designated in foreign currency cash flow hedging relationships |  |  |  |  |  |  |
Foreign exchange contracts |  |  |  |  |  |  |
Amount of gain reclassified from AOCI to Sales | (13 | ) |  | (44 | ) |  | (157 | ) |  | (251 | )
Amount of loss recognized in OCI on derivatives | 88 |  |  | 69 |  |  | 520 |  |  | 311 |
Derivatives not designated in a hedging relationship |  |  |  |  |  |  |
Foreign exchange contracts |  |  |  |  |  |  |
Amount of loss (gain) recognized in Other (income) expense, net on derivatives (2) | 119 |  |  | 29 |  |  | 70 |  |  | (87 | )
(1) There was $1 million of ineffectiveness on the hedge during both the third quarter of 2017 and 2016, and $3 million and $4 million, respectively, of ineffectiveness on the hedge during the first nine months of 2017 and 2016, respectively. (2) These derivative contracts mitigate changes in the value of remeasured foreign currency denominated monetary assets and liabilities attributable to changes in foreign currency exchange rates.
Information on Available-for-sale Investments | Information on investments in debt and equity securities is as follows:
| September 30, 2017 |  | December 31, 2016
| Fair Value |  | Amortized Cost |  | Gross Unrealized |  | Fair Value |  | Amortized Cost |  | Gross Unrealized
($ in millions) | Gains |  | Losses |  | Gains |  | Losses
Corporate notes and bonds | $ | 10,259 |  |  | $ | 10,242 |  |  | $ | 31 |  |  | $ | (14 | ) |  | $ | 10,577 |  |  | $ | 10,601 |  |  | $ | 15 |  |  | $ | (39 | )
U.S. government and agency securities | 1,924 |  |  | 1,934 |  |  | — |  |  | (10 | ) |  | 2,232 |  |  | 2,244 |  |  | 1 |  |  | (13 | )
Asset-backed securities | 1,473 |  |  | 1,473 |  |  | 2 |  |  | (2 | ) |  | 1,376 |  |  | 1,380 |  |  | 1 |  |  | (5 | )
Mortgage-backed securities | 704 |  |  | 708 |  |  | 1 |  |  | (5 | ) |  | 796 |  |  | 801 |  |  | 1 |  |  | (6 | )
Commercial paper | 695 |  |  | 695 |  |  | — |  |  | — |  |  | 4,330 |  |  | 4,330 |  |  | — |  |  | — |
Foreign government bonds | 640 |  |  | 642 |  |  | — |  |  | (2 | ) |  | 519 |  |  | 521 |  |  | — |  |  | (2 | )
Equity securities | 539 |  |  | 309 |  |  | 233 |  |  | (3 | ) |  | 349 |  |  | 281 |  |  | 71 |  |  | (3 | )
| $ | 16,234 |  |  | $ | 16,003 |  |  | $ | 267 |  |  | $ | (36 | ) |  | $ | 20,179 |  |  | $ | 20,158 |  |  | $ | 89 |  |  | $ | (68 | )
Financial Assets and Liabilities Measured at Fair Value on a Recurring Basis | Financial assets and liabilities measured at fair value on a recurring basis are summarized below:
| Fair Value Measurements Using |  | Fair Value Measurements Using
| Quoted Prices In Active Markets for Identical Assets (Level 1) |  | Significant Other Observable Inputs (Level 2) |  | Significant Unobservable Inputs (Level 3) |  | Total |  | Quoted Prices In Active Markets for Identical Assets (Level 1) |  | Significant Other Observable Inputs (Level 2) |  | Significant Unobservable Inputs (Level 3) |  | Total
($ in millions) | September 30, 2017 |  | December 31, 2016
Assets |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Investments |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Corporate notes and bonds | $ | — |  |  | $ | 10,110 |  |  | $ | — |  |  | $ | 10,110 |  |  | $ | — |  |  | $ | 10,389 |  |  | $ | — |  |  | $ | 10,389 |
U.S. government and agency securities | 68 |  |  | 1,622 |  |  | — |  |  | 1,690 |  |  | 29 |  |  | 1,890 |  |  | — |  |  | 1,919 |
Asset-backed securities (1) | — |  |  | 1,395 |  |  | — |  |  | 1,395 |  |  | — |  |  | 1,257 |  |  | — |  |  | 1,257 |
Commercial paper | — |  |  | 695 |  |  | — |  |  | 695 |  |  | — |  |  | 4,330 |  |  | — |  |  | 4,330 |
Foreign government bonds | — |  |  | 639 |  |  | — |  |  | 639 |  |  | — |  |  | 518 |  |  | — |  |  | 518 |
Mortgage-backed securities (1) | — |  |  | 603 |  |  | — |  |  | 603 |  |  | — |  |  | 628 |  |  | — |  |  | 628 |
Equity securities | 368 |  |  | — |  |  | — |  |  | 368 |  |  | 201 |  |  | — |  |  | — |  |  | 201 |
| 436 |  |  | 15,064 |  |  | — |  |  | 15,500 |  |  | 230 |  |  | 19,012 |  |  | — |  |  | 19,242 |
Other assets (2) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
U.S. government and agency securities | — |  |  | 234 |  |  | — |  |  | 234 |  |  | — |  |  | 313 |  |  | — |  |  | 313 |
Corporate notes and bonds | — |  |  | 149 |  |  | — |  |  | 149 |  |  | — |  |  | 188 |  |  | — |  |  | 188 |
Mortgage-backed securities (1) | — |  |  | 101 |  |  | — |  |  | 101 |  |  | — |  |  | 168 |  |  | — |  |  | 168 |
Asset-backed securities (1) | — |  |  | 78 |  |  | — |  |  | 78 |  |  | — |  |  | 119 |  |  | — |  |  | 119 |
Foreign government bonds | — |  |  | 1 |  |  | — |  |  | 1 |  |  | — |  |  | 1 |  |  | — |  |  | 1 |
Equity securities | 171 |  |  | — |  |  | — |  |  | 171 |  |  | 148 |  |  | — |  |  | — |  |  | 148 |
| 171 |  |  | 563 |  |  | — |  |  | 734 |  |  | 148 |  |  | 789 |  |  | — |  |  | 937 |
Derivative assets (3) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Purchased currency options | — |  |  | 119 |  |  | — |  |  | 119 |  |  | — |  |  | 644 |  |  | — |  |  | 644 |
Forward exchange contracts | — |  |  | 87 |  |  | — |  |  | 87 |  |  | — |  |  | 331 |  |  | — |  |  | 331 |
Interest rate swaps | — |  |  | 15 |  |  | — |  |  | 15 |  |  | — |  |  | 20 |  |  | — |  |  | 20 |
| — |  |  | 221 |  |  | — |  |  | 221 |  |  | — |  |  | 995 |  |  | — |  |  | 995 |
Total assets | $ | 607 |  |  | $ | 15,848 |  |  | $ | — |  |  | $ | 16,455 |  |  | $ | 378 |  |  | $ | 20,796 |  |  | $ | — |  |  | $ | 21,174 |
Liabilities |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Other liabilities |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Contingent consideration | $ | — |  |  | $ | — |  |  | $ | 945 |  |  | $ | 945 |  |  | $ | — |  |  | $ | — |  |  | $ | 891 |  |  | $ | 891 |
Derivative liabilities (3) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Forward exchange contracts | — |  |  | 201 |  |  | — |  |  | 201 |  |  | — |  |  | 93 |  |  | — |  |  | 93 |
Interest rate swaps | — |  |  | 26 |  |  | — |  |  | 26 |  |  | — |  |  | 29 |  |  | — |  |  | 29 |
Written currency options | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 12 |  |  | — |  |  | 12 |
| — |  |  | 227 |  |  | — |  |  | 227 |  |  | — |  |  | 134 |  |  | — |  |  | 134 |
Total liabilities | $ | — |  |  | $ | 227 |  |  | $ | 945 |  |  | $ | 1,172 |  |  | $ | — |  |  | $ | 134 |  |  | $ | 891 |  |  | $ | 1,025 |
(1) | Primarily all of the asset-backed securities are highly-rated (Standard & Poor’s rating of AAA and Moody’s Investors Service rating of Aaa), secured primarily by auto loan, credit card and student loan receivables, with weighted-average lives of primarily 5 years or less. Mortgage-backed securities represent AAA-rated securities issued or unconditionally guaranteed as to payment of principal and interest by U.S. government agencies.
(2) | Investments included in other assets are restricted for the payment of benefits under employee benefit plans.
(3) | The fair value determination of derivatives includes the impact of the credit risk of counterparties to the derivatives and the Company’s own credit risk, the effects of which were not significant.
Information About the Changes in Liabilities for Contingent Consideration | Summarized information about the changes in liabilities for contingent consideration is as follows:
| Nine Months Ended September 30,
($ in millions) | 2017 |  | 2016
Fair value January 1 | $ | 891 |  |  | $ | 590 |
Changes in fair value (1) | 151 |  |  | 29 |
Additions | 3 |  |  | 300 |
Payments | (100 | ) |  | (25 | )
Fair value September 30 (2) | $ | 945 |  |  | $ | 894 |
(1) Recorded in Research and development expenses, Materials and production costs and Other (income) expense, net. Includes cumulative translation adjustments. (2) Includes $234 million recorded as a current liability for amounts expected to be paid within the next 12 months.

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