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v3.23.1

Fair Value Measurements and Financial Instruments (Tables) | 3 Months Ended
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Mar. 31, 2023
Fair Value Disclosures [Abstract] |
Schedule of Assets and Liabilities Measured at Fair Value on Recurring Basis | The following table presents the balances of assets and liabilities measured at fair value on a recurring basis as of March 31, 2023:
(dollars in millions) | Level 1(1) |  | Level 2(2) |  | Level 3(3) |  | Total
Assets: |  |  |  |  |  |  |
Prepaid expenses and other: |  |  |  |  |  |  |
Fixed income securities | $ | — |  |  | $ | 59 |  |  | $ | — |  |  | $ | 59 |
Cross currency swaps | — |  |  | 47 |  |  | — |  |  | 47 |
Foreign exchange forwards | — |  |  | 2 |  |  | — |  |  | 2 |
Interest rate caps | — |  |  | 58 |  |  | — |  |  | 58 |
Other assets: |  |  |  |  |  |  |
Fixed income securities | — |  |  | 292 |  |  | — |  |  | 292 |
Cross currency swaps | — |  |  | 252 |  |  | — |  |  | 252 |
Interest rate caps | — |  |  | 16 |  |  | — |  |  | 16 |
Total | $ | — |  |  | $ | 726 |  |  | $ | — |  |  | $ | 726 |
Liabilities: |  |  |  |  |  |  |
Other current liabilities: |  |  |  |  |  |  |
Interest rate swaps | $ | — |  |  | $ | 862 |  |  | $ | — |  |  | $ | 862 |
Cross currency swaps | — |  |  | 325 |  |  | — |  |  | 325 |
Foreign exchange forwards | — |  |  | 2 |  |  | — |  |  | 2 |
Interest rate caps | — |  |  | 58 |  |  | — |  |  | 58 |
Contingent consideration | — |  |  | — |  |  | 218 |  |  | 218 |
Other liabilities: |  |  |  |  |  |  |
Interest rate swaps | — |  |  | 3,030 |  |  | — |  |  | 3,030 |
Cross currency swaps | — |  |  | 3,216 |  |  | — |  |  | 3,216 |
Interest rate caps | — |  |  | 16 |  |  | — |  |  | 16 |
Total | $ | — |  |  | $ | 7,509 |  |  | $ | 218 |  |  | $ | 7,727 |
(1)Quoted prices in active markets for identical assets or liabilities. (2)Observable inputs other than quoted prices in active markets for identical assets and liabilities. (3)Unobservable pricing inputs in the market. The following table presents the balances of assets and liabilities measured at fair value on a recurring basis as of December 31, 2022:
(dollars in millions) | Level 1(1) |  | Level 2(2) |  | Level 3(3) |  | Total
Assets: |  |  |  |  |  |  |
Prepaid expenses and other: |  |  |  |  |  |  |
Fixed income securities | $ | — |  |  | $ | 37 |  |  | $ | — |  |  | $ | 37 |
Cross currency swaps | — |  |  | 42 |  |  | — |  |  | 42 |
Foreign exchange forwards | — |  |  | 6 |  |  | — |  |  | 6 |
Interest rate caps | — |  |  | 63 |  |  | — |  |  | 63 |
Other assets: |  |  |  |  |  |  |
Fixed income securities | — |  |  | 349 |  |  | — |  |  | 349 |
Cross currency swaps | — |  |  | 263 |  |  | — |  |  | 263 |
Interest rate caps | — |  |  | 30 |  |  | — |  |  | 30 |
Total | $ | — |  |  | $ | 790 |  |  | $ | — |  |  | $ | 790 |
Liabilities: |  |  |  |  |  |  |
Other current liabilities: |  |  |  |  |  |  |
Interest rate swaps | $ | — |  |  | $ | 731 |  |  | $ | — |  |  | $ | 731 |
Cross currency swaps | — |  |  | 346 |  |  | — |  |  | 346 |
Interest rate caps | — |  |  | 63 |  |  | — |  |  | 63 |
Foreign exchange forwards | — |  |  | 1 |  |  | — |  |  | 1 |
Contingent consideration | — |  |  | — |  |  | 274 |  |  | 274 |
Other liabilities: |  |  |  |  |  |  |
Interest rate swaps | — |  |  | 3,902 |  |  | — |  |  | 3,902 |
Cross currency swaps | — |  |  | 3,295 |  |  | — |  |  | 3,295 |
Interest rate caps | — |  |  | 30 |  |  | — |  |  | 30 |
Contingent consideration | — |  |  | — |  |  | 43 |  |  | 43 |
Total | $ | — |  |  | $ | 8,368 |  |  | $ | 317 |  |  | $ | 8,685 |
(1)Quoted prices in active markets for identical assets or liabilities. (2)Observable inputs other than quoted prices in active markets for identical assets and liabilities. (3)Unobservable pricing inputs in the market.
Schedule of Fair Value of Short-Term and Long-Term Debt, Excluding Capital Leases | The fair value of our short-term and long-term debt, excluding finance leases, was as follows:
|  |  | Fair Value
(dollars in millions) | Carrying Amount |  | Level 1 |  | Level 2 |  | Level 3 |  | Total
At December 31, 2022 | $ | 148,906 |  |  | $ | 84,385 |  |  | $ | 54,656 |  |  | $ | — |  |  | $ | 139,041 |
At March 31, 2023 | 150,971 |  |  | 86,908 |  |  | 58,014 |  |  | — |  |  | 144,922 |
Notional Amounts of Outstanding Derivative Instruments | The following table sets forth the notional amounts of our outstanding derivative instruments:
| At March 31, |  | At December 31,
(dollars in millions) | 2023 |  | 2022
Interest rate swaps | $ | 26,071 |  |  | $ | 26,071 |
Cross currency swaps | 34,138 |  |  | 34,976 |
Foreign exchange forwards | 980 |  |  | 920 |
Schedule Of Derivative Instruments Activity | The following tables summarize the activities of our designated derivatives:
| Three Months Ended |  |
| March 31, |  |
(dollars in millions) | 2023 |  | 2022 |  |  |  |
Interest Rate Swaps: |  |  |  |  |  |  |
Notional value entered into | $ | — |  |  | $ | 6,655 |  |  |  |  |
Notional value settled | — |  |  | 863 |  |  |  |  |
Pre-tax loss recognized in Interest expense | (1) |  |  | — |  |  |  |  |
Cross Currency Swaps: |  |  |  |  |  |  |
Notional value entered into | — |  |  | — |  |  |  |  |
Notional value settled | 838 |  |  | — |  |  |  |  |
Pre-tax loss recognized in Other comprehensive income (loss) (1) | N/A |  | (430) |  |  |  |  |
Pre-tax gain on cross currency swaps recognized in Interest expense | 355 |  |  | N/A |  |  |  |
Pre-tax loss on hedged debt recognized in Interest expense | (355) |  |  | N/A |  |  |  |
Excluded components recognized in Other comprehensive income (loss) | (378) |  |  | N/A |  |  |  |
Initial value of the excluded component amortized into Interest expense | 27 |  |  | N/A |  |  |  |
Forward Starting Interest Rate Swaps: |  |  |  |  |  |  |
Notional value entered into | — |  |  | — |  |  |  |  |
Notional value settled | — |  |  | 400 |  |  |  |  |
Pre-tax gain recognized in Other comprehensive income (loss) | — |  |  | 128 |  |  |  |  |
N/A - not applicable (1) Represents amounts recorded under the cash flow hedge model. These instruments were re-designated as fair value hedges on March 31, 2022.
| Three Months Ended
| March 31,
(dollars in millions) | 2023 |  | 2022
Other, net Cash Flows from Operating Activities: |  |  |
Cash received for settlement of interest rate swaps | $ | — |  |  | $ | 40 |
Cash paid for settlement of forward starting interest rate swaps | — |  |  | (76) |
Other, net Cash Flows from Financing Activities: |  |  |
Cash paid for settlement of cross currency swaps | (117) |  |  | — |
The following table summarizes the activity of our derivatives not designated in hedging relationships:
| Three Months Ended |
| March 31, |
(dollars in millions) | 2023 |  | 2022 |  |  |  |
Foreign Exchange Forwards: |  |  |  |  |  |  |
Notional value entered into | $ | 2,655 |  |  | $ | 2,646 |  |  |  |  |
Notional value settled | 2,595 |  |  | 2,603 |  |  |  |  |
Pre-tax gain (loss) recognized in Other income (expense), net | 10 |  |  | (28) |  |  |  |  |
Swaptions: |  |  |  |  |  |  |
Notional value sold | — |  |  | 1,000 |  |  |  |  |
Notional value settled | — |  |  | 1,000 |  |  |  |  |
Pre-tax loss recognized in Interest expense | — |  |  | (33) |  |  |  |  |
Schedule of Cumulative Basis Adjustments for Fair Value hedges | The following table displays the amounts recorded in Long-term debt in our condensed consolidated balance sheets related to cumulative basis adjustments for fair value hedges. The cumulative amounts exclude cumulative basis adjustments related to foreign exchange risk.
| At March 31, |  | At December 31,
(dollars in millions) | 2023 |  | 2022
Carrying amount of hedged liabilities | $ | 22,467 |  |  | $ | 21,741 |
Cumulative amount of fair value hedging adjustment included in the carrying amount of the hedged liabilities | (3,771) |  |  | (4,512) |
Cumulative amount of fair value hedging adjustment remaining for which hedge accounting has been discontinued | 466 |  |  | 488 |

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- Definition 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 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -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 + Details
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