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DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES (Tables)
 6 Months Ended
Jun. 30, 2019
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Derivative Financial Instruments Recognized in Condensed Consolidated Balance Sheet
The fair value of derivative financial instruments recognized in the Consolidated Balance Sheets follows:
 
Notional
amount
 
Other
 current
assets
 
Other
noncurrent
assets
 
Other
current
liabilities
 
Other
noncurrent
liabilities
 
Type of
hedge
 
Term
June 30, 2019
 
 
 
 
 
 
 
 
 
 
 
 
 
Derivatives designated as hedges
 
 
 
 
 
 
 
 
 
 
 
 
 
Fixed-to-floating interest rate
 swaps
$
2,225

 
$
—

 
$
59

 
$
—

 
$
1

 
Fair value
 
18 months to 16 years
Forward starting floating-to-fixed
 interest rate swaps
300

 
—

 
—

 
—

 
30

 
Cash flow
 
34 years
Currency exchange contracts
1,132

 
9

 
—

 
9

 
12

 
Cash flow
 
1 to 36 months
Commodity contracts
12

 
—

 
—

 
—

 
—

 
Cash flow
 
1 to 7 months
Total
 
 
$
9

 
$
59

 
$
9

 
$
43

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Derivatives not designated as
 hedges
 
 
 
 
 
 
 
 
 
 
 
 
 
Currency exchange contracts
$
4,718

 
$
35

 
 
 
$
18

 
 
 
 
 
1 to 12 months
Commodity contracts
4

 
—

 
 
 
—

 
 
 
 
 
1 month
Total
 
 
$
35

 


 
$
18

 


 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
December 31, 2018
 
 
 
 
 
 
 
 
 
 
 
 
 
Derivatives designated as hedges
 
 
 
 
 
 
 
 
 
 
 
 
 
Fixed-to-floating interest rate
 swaps
$
2,550

 
$
—

 
$
22

 
$
1

 
$
26

 
Fair value
 
3 months to 16 years
Forward starting floating-to-fixed
 interest rate swaps
100

 
—

 
—

 
—

 
3

 
Cash flow
 
34 years
Currency exchange contracts
951

 
19

 
2

 
11

 
8

 
Cash flow
 
1 to 36 months
Total
 
 
$
19

 
$
24

 
$
12

 
$
37

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Derivatives not designated as
 hedges
 
 
 
 
 
 
 
 
 
 
 
 
 
Currency exchange contracts
$
3,886

 
$
40

 
 
 
$
20

 
 
 
 
 
1 to 12 months
Total
 
 
$
40

 


 
$
20

 


 
 
 
 
Schedule of Notional Amounts of Outstanding Derivative Positions
As of June 30, 2019, the volume of outstanding commodity contracts that were entered into to hedge forecasted transactions:
 
 
June 30, 2019
 
 
Commodity
 
(millions of pounds)
 
Term
Copper
 
5

 
1 to 7 months
Schedule Of Derivative Instruments Recorded In Balance Sheet
The following amounts were recorded on the consolidated balance sheet related to fixed-to-floating interest rate swaps:
 
Carrying amount of the hedged assets (liabilities)
 
Cumulative amount of fair value hedging adjustment included in the carrying amount of the hedged asset (liabilities) (a)
Location on Consolidated Balance Sheet
June 30, 2019
 
June 30, 2019
Long-term debt
$
(2,838
)
 
$
(100
)
(a) At June 30, 2019, these amounts include the cumulative liability amount of fair value hedging adjustments remaining for which the hedge accounting has been discontinued of $42.
Schedule of Impact of Hedging Activities to Consolidated Statement of Income
The impact of hedging activities to the Consolidated Statement of Income are as follow:
 
Three months ended June 30, 2019
 
Net Sales
 
Cost of products sold
 
Interest expense - net
Amounts from Consolidated Statement of Income
$
5,533

 
$
3,697

 
$
63

 
 
 
 
 
 
Gain (loss) on derivatives designated as cash flow hedges
 
 
 
 
 
Currency exchange contracts
 
 
 
 
 
Hedged item
$
2

 
$
(4
)
 
$
—

Derivative designated as hedging instrument
(2
)
 
4

 
—

 
 
 
 
 
 
Commodity contracts
 
 
 
 
 
Hedged item
$
—

 
$
—

 
$
—

Derivative designated as hedging instrument
—

 
—

 
—

 
 
 
 
 
 
Gain (loss) on derivatives designated as fair value hedges
 
 
 
 
 
Fixed-to-floating interest rate swaps
 
 
 
 
 
Hedged item
$
—

 
$
—

 
$
(40
)
Derivative designated as hedging instrument
—

 
—

 
40


 
Six months ended June 30, 2019
 
Net Sales
 
Cost of products sold
 
Interest expense - net
Amounts from Consolidated Statement of Income
$
10,838

 
$
7,270

 
$
129

 
 
 
 
 
 
Gain (loss) on derivatives designated as cash flow hedges
 
 
 
 
 
Currency exchange contracts
 
 
 
 
 
Hedged item
$
5

 
$
(9
)
 
$
—

Derivative designated as hedging instrument
(5
)
 
9

 
—

 
 
 
 
 
 
Commodity contracts
 
 
 
 
 
Hedged item
$
—

 
$
—

 
$
—

Derivative designated as hedging instrument
—

 
—

 
—

 
 
 
 
 
 
Gain (loss) on derivatives designated as fair value hedges
 
 
 
 
 
Fixed-to-floating interest rate swaps
 
 
 
 
 
Hedged item
$
—

 
$
—

 
$
(63
)
Derivative designated as hedging instrument
—

 
—

 
63
Amounts Recognized in Net Income
The impact of derivatives not designated as hedges to the Consolidated Statement of Income are as follow:
 
Gain (loss) recognized in Consolidated Statement of Income
 
Consolidated Statement of Income classification
 
Three months ended
June 30
 
 
 
2019
 
 
Gain (loss) on derivatives not designated as hedges
 
 
 
Currency exchange contracts
$
8

 
Other income - net
Commodity Contracts
(1
)
 
Cost of products sold
Total
$
7

 
 
 
 
 
 
 
Gain (loss) recognized in Consolidated Statement of Income
 
Consolidated Statement of Income classification
 
Six months ended
June 30
 
 
 
2019
 
 
Gain (loss) on derivatives not designated as hedges
 
 
 
Currency exchange contracts
$
48

 
Other income - net
Commodity Contracts
—

 
Cost of products sold
Total
$
48

 
 
Amounts Recognized in Accumulated Other Comprehensive Loss
The impact of derivative and non-derivative instruments designated as hedges to the Consolidated Statement of Income and Comprehensive Income follow:
 
Gain (loss) recognized in
other comprehensive
(loss) income
 
Location of gain (loss)
reclassified from
Accumulated other
comprehensive loss
 
Gain (loss) reclassified
from Accumulated other
comprehensive loss
 
Three months ended
June 30
 
 
 
Three months ended
June 30
 
2019
 
2018
 
 
 
2019
 
2018
Derivatives designated as
   cash flow hedges
 
 
 
 
 
 
 
 
 
Forward starting floating-to-fixed
 interest rate swaps
$
(18
)
 
$
—

 
Interest expense - net
 
$
—

 
$
—

Currency exchange contracts
(10
)
 
(15
)
 
Cost of products sold
 
2

 
(4
)
Commodity contracts
(2
)
 
—

 
Cost of products sold
 
—

 
—

Non-derivative designated as net
   investment hedges
 
 
 
 
 
 
 
 
 
Foreign currency denominated debt
—

 
41

 
Other income - net
 
—

 
—

Total
$
(30
)
 
$
26

 
 
 
$
2

 
$
(4
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Gain (loss) recognized in
other comprehensive
(loss) income
 
Location of gain (loss)
reclassified from
Accumulated other
comprehensive loss
 
Gain (loss) reclassified
from Accumulated other
comprehensive loss
 
Six months ended
June 30
 
 
 
Six months ended
June 30
 
2019
 
2018
 
 
 
2019
 
2018
Derivatives designated as cash
flow hedges
 
 
 
 
 
 
 
 
 
Forward starting floating-to-fixed
interest rate swaps
$
(27
)
 
$
—

 
Interest expense - net
 
$
—

 
$
—

Currency exchange contracts
(10
)
 
(2
)
 
Cost of products sold
 
4

 
(8
)
Commodity contracts
—

 
—

 
Cost of products sold
 
—

 
—

Non-derivative designated as net
   investment hedges
 
 
 
 
 
 
 
 
 
Foreign currency denominated debt
12

 
17

 
Other income - net
 
—

 
—

Total
$
(25
)

$
15




$
4


$
(8
)