XML 40 R27.htm IDEA: XBRL DOCUMENT
v3.19.2

Financial Instruments (Tables) | 6 Months Ended
--- | ---
Jun. 30, 2019
Derivative Instruments and Hedging Activities Disclosure [Abstract] |
Fair Value Measurement Inputs and Valuation Techniques | The fair values of the Fixed-price Preemptive Rights and warrant are estimated using Black-Scholes option-pricing models, adjusted for unobservable inputs, including probability factors and weighting of expected life, volatility levels and risk-free interest rates (which are classified in Level 3 of the fair value hierarchy) based on the following assumptions at:
|  | June 30, 2019 |  | March 8, 2019 |  | June 30, 2019 |  | March 8, 2019
|  | Fixed-price Preemptive Rights |  | Warrant
Expected life (1) |  | 2.01 years |  | 2.32 years |  | 3.69 years |  | 4 years
Expected volatility (2) |  | 88.98% |  | 93.02% |  | 88.98% |  | 93.02%
Risk-free interest rate (3)(4) |  | 1.46% |  | 1.61% |  | 1.40% |  | 1.67%
Expected dividend yield (5) |  | —% |  | —% |  | —% |  | —%
(1) Based on the weighted-average remaining expected life of the Fixed-price Preemptive Rights (with a range from approximately 2 years to 7 years at June 30, 2019 and March 8, 2019) and the March 8, 2023 expiration date of the warrant. (2) Based on a blend of historical volatility levels of the underlying equity security and peer companies. (3) Based on the implied yield currently available on Canadian Treasury zero coupon issues weighted for the remaining expected life of the Fixed-price Preemptive Rights. (4) Based on the implied yield currently available on Canadian Treasury zero coupon issues and the expected life of the warrant. (5) Based on Cronos’s expected dividend payments.
Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Input Reconciliation | The following table provides a reconciliation of the beginning and ending balance of the Fixed-price Preemptive Rights and warrant, which are classified in Level 3 of the fair value hierarchy:
|  | (in millions)
Balance at December 31, 2018 |  | $ | — |
Initial investment in Fixed-price Preemptive Rights and warrant |  | 1,736 |
Pre-tax earnings (losses) recognized in net earnings |  | (660 | )
Balance at June 30, 2019 |  | $ | 1,076 |
Schedule of Derivative Liabilities at Fair Value | The fair values of Altria’s derivative financial instruments on a gross basis included on the condensed consolidated balance sheets were as follows:
| Fair Value of Assets |  | Fair Value of Liabilities
| Balance Sheet Classification |  | June 30, 2019 |  | December 31, 2018 |  | Balance Sheet Classification | June 30, 2019 |  | December 31, 2018
Derivatives designated as hedging instruments: | (in millions)
Foreign currency contracts | Other current assets |  | $ | 45 |  |  | $ | 37 |  |  | Other accrued liabilities | $ | — |  |  | $ | — |
Foreign currency contracts | Other assets |  | — |  |  | 4 |  |  | Other liabilities | 16 |  |  | 4 |
Total |  | $ | 45 |  |  | $ | 41 |  |  |  | $ | 16 |  |  | $ | 4 |
Derivatives not designated as hedging instruments: |  |  |  |  |  |  |  |  |  |
Cronos warrant | Investments in equity securities |  | $ | 763 |  |  | $ | — |  |  |  |  |  |
Fixed-price Preemptive Rights | Investments in equity securities |  | 313 |  |  | — |  |  |  |  |  |
Total |  |  | $ | 1,076 |  |  | $ | — |  |  |  |  |  |
Total derivatives |  |  | $ | 1,121 |  |  | $ | 41 |  |  |  | $ | 16 |  |  | $ | 4 |
Pre-tax Effects of Net Investment Hedges on Accumulated Other Comprehensive Losses | The pre-tax effects of Altria’s net investment hedges on accumulated other comprehensive losses and the condensed consolidated statements of earnings were as follows:
|  | Gain (Loss) Recognized in Accumulated Other Comprehensive Losses |  | Gain (Loss) Recognized in Net Earnings (1) |  | Gain (Loss) Recognized in Accumulated Other Comprehensive Losses |  | Gain (Loss) Recognized in Net Earnings (1)
|  | For the Six Months Ended June 30, |  | For the Three Months Ended June 30,
|  | 2019 |  | 2018 |  | 2019 |  | 2018 |  | 2019 |  | 2018 |  | 2019 |  | 2018
|  | (in millions)
Foreign currency contracts |  | $ | 13 |  |  | $ | 39 |  |  | $ | 16 |  |  | $ | 16 |  |  | $ | (10 | ) |  | $ | 72 |  |  | $ | 7 |  |  | $ | 8 |
Foreign currency denominated debt |  | (32 | ) |  | — |  |  | — |  |  | — |  |  | (65 | ) |  | — |  |  | — |  |  | — |
Total |  | $ | (19 | ) |  | $ | 39 |  |  | $ | 16 |  |  | $ | 16 |  |  | $ | (75 | ) |  | $ | 72 |  |  | $ | 7 |  |  | $ | 8 |
(1) Related to amounts excluded from effectiveness testing.

X
- References No definition available. + Details
Name: | us-gaap_DerivativeInstrumentsAndHedgingActivitiesDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition Tabular disclosure of input and valuation technique used to measure fair value and change in valuation approach and technique for each separate class of asset and liability measured on recurring and nonrecurring basis. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 820 -SubTopic 10 -Section 50 -Paragraph 2 -Subparagraph (bbb) -URI http://asc.fasb.org/extlink&oid=117815213&loc=d3e19207-110258 + Details
Name: | us-gaap_FairValueAssetsAndLiabilitiesMeasuredOnRecurringAndNonrecurringBasisValuationTechniquesTableTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- Definition Tabular disclosure of financial instrument classified as a derivative asset (liability) after deduction of derivative liability (asset) using recurring unobservable inputs that reflect the entity's own assumption about the assumptions market participants would use in pricing. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 820 -SubTopic 10 -Section 50 -Paragraph 3 -Subparagraph (b) -URI http://asc.fasb.org/extlink&oid=117815213&loc=d3e19279-110258 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 820 -SubTopic 10 -Section 50 -Paragraph 2 -Subparagraph (c) -URI http://asc.fasb.org/extlink&oid=117815213&loc=d3e19207-110258 + Details
Name: | us-gaap_FairValueNetDerivativeAssetLiabilityMeasuredOnRecurringBasisUnobservableInputReconciliationTableTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- Definition 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 http://asc.fasb.org/extlink&oid=109980867&loc=SL5624181-113959 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 4A -Subparagraph (b) -URI http://asc.fasb.org/extlink&oid=109980867&loc=SL5618551-113959 Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 4C -URI http://asc.fasb.org/extlink&oid=109980867&loc=SL5624171-113959 + Details
Name: | us-gaap_ScheduleOfDerivativeInstrumentsGainLossInStatementOfFinancialPerformanceTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- Definition Tabular disclosure for net investment hedges of (a) the location and amount of gains and losses reported in the statement of financial performance and (b) the location and fair value amounts of the instruments reported in the statement of financial position. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 4C -Subparagraph (b) -URI http://asc.fasb.org/extlink&oid=109980867&loc=SL5624171-113959 + Details
Name: | us-gaap_ScheduleOfNetInvestmentHedgesStatementsOfFinancialPerformanceAndFinancialPositionLocationTableTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration