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Derivative Instruments | 9 Months Ended
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Sep. 30, 2022
Derivative Instruments and Hedging Activities Disclosure [Abstract] |
Derivative Instruments | DERIVATIVE INSTRUMENTS We use operational and economic hedges, foreign currency exchange forward contracts, net investment hedges (both derivative and non-derivative financial instruments) and interest rate derivative instruments to manage the impact of currency exchange and interest rate fluctuations on earnings, cash flow and equity. We do not enter into derivative instruments for speculative purposes. We are exposed to potential credit loss in the event of nonperformance by our counterparties on our outstanding derivative instruments but do not anticipate nonperformance by any of our counterparties. Should a counterparty default, our maximum loss exposure is the asset balance of the instrument. We have not changed our hedging strategies, accounting practices or objectives from those disclosed in our Annual Report on Form 10-K for 2021. Foreign Currency Hedges
September 2022 | Cash Flow | Net Investment | Non-Designated | Total
Gross notional amount | $ | 923 |  | $ | 1,448 |  | $ | 3,137 |  | $ | 5,508 |
Maximum term in years |  |  |  | 4.1
Fair value: |  |  |  |
Other current assets | $ | 45 |  | $ | — |  | $ | 140 |  | $ | 185 |
Other noncurrent assets | 3 |  | 185 |  | — |  | 188 |
Other current liabilities | (7) |  | — |  | (10) |  | (17) |
Other noncurrent liabilities | (1) |  | — |  | — |  | (1) |
Total fair value | $ | 40 |  | $ | 185 |  | $ | 130 |  | $ | 355 |
December 2021 | Cash Flow | Net Investment | Non-Designated | Total
Gross notional amount | $ | 973 |  | $ | 2,266 |  | $ | 5,512 |  | $ | 8,751 |
Maximum term in years |  |  |  | 4.9
Fair value: |  |  |  |
Other current assets | $ | 15 |  | $ | 39 |  | $ | 92 |  | $ | 146 |
Other noncurrent assets | 1 |  | 65 |  | — |  | 66 |
Other current liabilities | (7) |  | — |  | (10) |  | (17) |
Total fair value | $ | 9 |  | $ | 104 |  | $ | 82 |  | $ | 195 |
We had €1.5 billion and €2.0 billion on September 30, 2022 and December 31, 2021 of certain foreign currency forward contracts designated as net investment hedges to hedge a portion of our investments in certain of our entities with functional currencies denominated in Euros. In addition to these derivative financial instruments designated as net investment hedges, we had €4.4 billion on September 30, 2022 and December 31, 2021 of senior unsecured notes designated as net investment hedges to selectively hedge portions of our investment in certain international subsidiaries. The currency effects of our Euro-denominated senior unsecured notes are reflected in AOCI within shareholders' equity where they offset gains and losses recorded on our net investment in international subsidiaries. In the nine months 2022 we settled certain foreign currency forward contracts designated as net investment hedges resulting in cash proceeds of $197. The amounts in AOCI related to settled net investment hedges will remain in AOCI until the hedged investment is either sold or substantially liquidated. On September 30, 2022 the total after tax gain (loss) in AOCI related to designated net investment hedges was $603. Net Currency Exchange Rate Gains (Losses)
Derivative |  | Three Months |  | Nine Months
instrument: | Recorded in: | 2022 | 2021 |  | 2022 | 2021
Cash Flow | Cost of sales | $ | 7 |  | $ | (4) |  |  | $ | 10 |  | $ | (9) |
Net Investment | Other income (expense), net | 8 |  | 8 |  |  | 30 |  | 25 |
Non-Designated | Other income (expense), net | (1) |  | (5) |  |  | 2 |  | (6) |
| Total | $ | 14 |  | $ | (1) |  |  | $ | 42 |  | $ | 10 |
Pretax gains (losses) on derivatives designated as cash flow hedges of $50 and net investment hedges of $34 recorded in AOCI are expected to be reclassified to cost of sales and other income (expense), net in earnings within 12 months as of September 30, 2022. This cash flow hedge reclassification is primarily due to the sale of inventory that includes previously hedged purchases. A component of the AOCI amounts related to net investment hedges is reclassified over the life of the hedge instruments as we elected to exclude the initial value of the component related to the spot-forward difference from the effectiveness assessment. Interest Rate Hedges Pretax gains of $5 recorded in AOCI related to other interest rate hedges closed in conjunction with debt issuances are expected to be reclassified to other income (expense), net in earnings within 12 months of September 30, 2022. The cash flow effect of interest rate hedges is recorded in cash flow from operations.

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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 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 40 -Section 50 -Paragraph 5 -Subparagraph (f) -URI http://asc.fasb.org/extlink&oid=123477628&loc=d3e90205-114008 + Details
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