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Financial Instruments, Derivatives and Fair Value Measures (Tables)

9 Months Ended

Sep. 30, 2022

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Summary of the amounts and location of certain derivative financial instruments

The following table summarizes the amounts and location of certain derivative financial instruments as of September 30, 2022 and December 31, 2021:

						Fair Value - Assets																		Fair Value - Liabilities
(in millions)						September 30, 2022						Dec. 31, 2021						Balance Sheet Caption						September 30, 2022						Dec. 31, 2021						Balance Sheet Caption
Interest rate swaps designated as fair value hedges						$	—					$	87					Deferred income taxes and other assets						$	166					$	—					Post-employment obligations, deferred income taxes and other long-term liabilities
Foreign currency forward exchange contracts:
Hedging instruments						760						222						Prepaid expenses and other receivables						66						65						Other accrued liabilities
Others not designated as hedges						148						70						Prepaid expenses and other receivables						141						32						Other accrued liabilities
Debt designated as a hedge of net investment in a foreign subsidiary						—						—						n/a						413						521						Long-term debt
						$	908					$	379											$	786					$	618

Schedule of derivatives gain (loss) in OCI and earnings

The following table summarizes the activity for foreign currency forward exchange contracts designated as cash flow hedges and certain other derivative financial instruments, as well as the amounts and location of income (expense) and gain (loss) reclassified into income for the three and nine months ended September 30, 2022 and 2021.

						Gain (loss) Recognized in Other Comprehensive Income (loss)																								Income (expense) and Gain (loss) Reclassified into Income
						Three Months Ended September 30												Nine Months Ended September 30												Three Months Ended September 30												Nine Months Ended September 30
(in millions)						2022						2021						2022						2021						2022						2021						2022						2021						Income Statement Caption
Foreign currency forward exchange contracts designated as cash flow hedges						$	350					$	96					$	442					$	142					$	79					$	(92)					$	149					$	(207)					Cost of products sold
Debt designated as a hedge of net investment in a foreign subsidiary						24						4						108						41						—						—						—						—						n/a
Interest rate swaps designated as fair value hedges						n/a						n/a						n/a						n/a						(85)						(14)						(253)						(81)						Interest expense

Schedule of carrying values and fair values of certain financial instruments

The carrying values and fair values of certain financial instruments as of September 30, 2022 and December 31, 2021 are shown in the following table. The carrying values of all other financial instruments approximate their estimated fair values. The counterparties to financial instruments consist of select major international financial institutions. Abbott does not expect any losses from non-performance by these counterparties.

						September 30, 2022												December 31, 2021
(in millions)						Carrying Value						Fair Value						Carrying Value						Fair Value
Long-term Investment Securities:
Equity securities						$	604					$	604					$	748					$	748
Other						160						160						68						68
Total Long-term Debt						(16,414)						(15,821)						(18,050)						(21,152)
Foreign Currency Forward Exchange Contracts:
Receivable position						908						908						292						292
(Payable) position						(207)						(207)						(97)						(97)
Interest Rate Hedge Contracts:
Receivable position						—						—						87						87
(Payable) position						(166)						(166)						—						—

Schedule of assets and liabilities measured at fair value on a recurring basis

The following table summarizes the bases used to measure certain assets and liabilities at fair value on a recurring basis in the balance sheet:

												Basis of Fair Value Measurement
(in millions)						Outstanding Balances						Quoted Prices in Active Markets						Significant Other Observable Inputs						Significant Unobservable Inputs
September 30, 2022:
Equity securities						$	293					$	293					$	—					$	—
Foreign currency forward exchange contracts						908						—						908						—
Total Assets						$	1,201					$	293					$	908					$	—
Fair value of hedged long-term debt						$	2,685					$	—					$	2,685					$	—
Interest rate swap derivative financial instruments						166						—						166						—
Foreign currency forward exchange contracts						207						—						207						—
Contingent consideration related to business combinations						138						—						—						138
Total Liabilities						$	3,196					$	—					$	3,058					$	138
December 31, 2021:
Equity securities						$	402					$	402					$	—					$	—
Interest rate swap derivative financial instruments						87						—						87						—
Foreign currency forward exchange contracts						292						—						292						—
Total Assets						$	781					$	402					$	379					$	—
Fair value of hedged long-term debt						$	2,926					$	—					$	2,926					$	—
Foreign currency forward exchange contracts						97						—						97						—
Contingent consideration related to business combinations						130						—						—						130
Total Liabilities						$	3,153					$	—					$	3,023					$	130

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Tabular disclosure of the fair value of financial instruments, including financial assets and financial liabilities, and the measurements of those instruments, assets, and liabilities.

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-Publisher FASB
-Name Accounting Standards Codification
-Topic 825
-SubTopic 10
-Section 50
-Paragraph 11
-URI https://asc.fasb.org/extlink&oid=123594938&loc=d3e13467-108611

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Tabular disclosure of the location and amount of derivative instruments and nonderivative instruments designated as hedging instruments reported before netting adjustments, and the amount of gain (loss) on derivative instruments and nonderivative instruments designated and qualified as hedging instruments.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 815
-SubTopic 10
-Section 50
-Paragraph 4E
-URI https://asc.fasb.org/extlink&oid=125515794&loc=SL5624181-113959

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Tabular disclosure of the location and fair value amounts of derivative instruments (and nonderivative instruments that are designated and qualify as hedging instruments) reported in the statement of financial position.

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-Publisher FASB
-Name Accounting Standards Codification
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-SubTopic 10
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Tabular disclosure of assets and liabilities, including [financial] instruments measured at fair value that are classified in stockholders' equity, if any, that are measured at fair value on a recurring basis. The disclosures contemplated herein include the fair value measurements at the reporting date by the level within the fair value hierarchy in which the fair value measurements in their entirety fall, segregating fair value measurements using quoted prices in active markets for identical assets (Level 1), significant other observable inputs (Level 2), and significant unobservable inputs (Level 3).

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 820
-SubTopic 10
-Section 50
-Paragraph 2
-Subparagraph (b)
-URI https://asc.fasb.org/extlink&oid=126976982&loc=d3e19207-110258

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-Publisher FASB
-Name Accounting Standards Codification
-Topic 820
-SubTopic 10
-Section 50
-Paragraph 2
-Subparagraph (a)
-URI https://asc.fasb.org/extlink&oid=126976982&loc=d3e19207-110258

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