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Financial Instruments | 9 Months Ended
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Sep. 30, 2020
Derivative Instruments and Hedging Activities Disclosure [Abstract] |
Derivative Financial Instruments [Text Block] | Financial InstrumentsWe enter into derivative instruments primarily for risk management purposes, including derivatives designated as hedging instruments under the Derivatives and Hedging (Topic 815) of the FASB ASC and those utilized as economic hedges. We operate internationally and, in the normal course of business, are exposed to fluctuations in interest rates, foreign exchange rates and commodity prices. These fluctuations can increase the costs of financing, investing and operating the business. We have used derivative instruments, including swaps, forward contracts and options, to manage certain foreign currency, interest rate and commodity price exposures. The aggregate notional amount of our outstanding foreign currency hedges was $12.8 billion and $13.0 billion at September 30, 2020 and December 31, 2019, respectively. The following table summarizes the fair value and presentation in the Condensed Consolidated Balance Sheet for derivative instruments as of September 30, 2020 and December 31, 2019:
(dollars in millions) | Balance Sheet Location | September 30, 2020 |  | December 31, 2019
Derivatives designated as hedging instruments: |  |  |  |
Foreign exchange contracts | Other assets, current | $ | 29 |  |  | $ | 23 |
| Accrued liabilities | (198) |  |  | (166) |
Derivatives not designated as hedging instruments: |  |  |  |
Foreign exchange contracts | Other assets, current | $ | 25 |  |  | $ | 23 |
| Accrued liabilities | (57) |  |  | (116) |
The effect of cash flow hedging relationships on Accumulated other comprehensive income (loss) and on the Condensed Consolidated Statement of Operations for the quarters and nine months ended September 30, 2020 and 2019 are presented in the table below. The losses are attributable to foreign exchange contract activity and are generally recorded as a component of Product sales when reclassified from Accumulated other comprehensive income (loss).
| Quarter Ended September 30, |  |  |  | Nine Months Ended September 30, |  |
(dollars in millions) | 2020 |  | 2019 |  | 2020 |  | 2019
(Loss) gain recorded in Accumulated other comprehensive loss | $ | 117 |  |  | $ | (153) |  |  | $ | (98) |  |  | $ | (125) |
Loss reclassified from Accumulated other comprehensive loss into Product sales | 37 |  |  | 20 |  |  | 93 |  |  | 40 |
The Company utilizes the critical terms match method in assessing derivatives for hedge effectiveness. Accordingly, the hedged items and derivatives designated as hedging instruments are highly effective. As of September 30, 2020, we ha ve €500 million o f euro-denominated long-term debt outstanding, which qualifies as a net investment hedge against our investments in European businesses. As of September 30, 2020, the net investment hedge is deemed to be effective. Assuming current market conditions continue, $45 million of pr e-tax losses is e xpected to be reclassified from Accumulated other comprehensive loss into Product sales to reflect the fixed prices obtained from foreign exchange hedging within the next 12 months. At September 30, 2020, all derivative contracts accounted for as cash flow hedges will m ature by January 2028. The effect of derivatives not designated as hedging instruments within Other income (expense), net, on the Condensed Consolidated Statement of Operations was as follows:
| Quarter Ended September 30, |  |  |  | Nine Months Ended September 30, |  |
(dollars in millions) | 2020 |  | 2019 |  | 2020 |  | 2019
Foreign exchange contracts | $ | (4) |  |  | $ | 11 |  |  | $ | (33) |  |  | $ | 71 |

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- References No definition available. + Details
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- Definition The entire disclosure for derivative instruments and hedging activities including, but not limited to, risk management strategies, non-hedging derivative instruments, assets, liabilities, revenue and expenses, and methodologies and assumptions used in determining the amounts. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -URI http://asc.fasb.org/topic&trid=2229140 + Details
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