XML 26 R12.htm IDEA: XBRL DOCUMENT
v3.22.2.2

Financial Instruments | 9 Months Ended
--- | ---
Sep. 30, 2022
Derivative Instruments and Hedging Activities Disclosure [Abstract] |
Financial Instruments | Financial Instruments We enter into derivative financial instruments to mitigate the potential impact of certain market risks, including foreign currency exchange rate risk. We use various types of derivative financial instruments, including forward contracts, options and swaps. We do not enter into or hold derivative financial instruments for trading or speculative purposes. Our investment in ABI, whose functional currency is the Euro, exposes us to foreign currency exchange risk on the carrying value of our investment. To manage this risk, we may designate certain foreign exchange contracts, including cross-currency swap contracts and forward contracts (collectively, “foreign currency contracts”), and Euro denominated unsecured long-term notes (“foreign currency denominated debt”) as net investment hedges of our investment in ABI. In May 2021, all outstanding foreign currency contracts matured and, at September 30, 2022 and December 31, 2021, we had no outstanding foreign currency contracts. When we have foreign currency contracts in effect, counterparties are domestic and international financial institutions. Under these contracts, we are exposed to potential losses in the event of non-performance by these counterparties. We manage our credit risk by entering into transactions with counterparties that have investment grade credit ratings, limiting the amount of exposure we have with each counterparty and monitoring the financial condition of each counterparty. The counterparty agreements contain provisions that require us to maintain an investment grade credit rating. In the event our credit rating falls below investment grade, counterparties to our foreign currency contracts can require us to post collateral. The following table provides the aggregate carrying value and fair value of our total long-term debt:
(in millions) | September 30, 2022 |  | December 31, 2021
Carrying value | $ | 26,291 |  |  | $ | 28,044 |
Fair value | 21,614 |  |  | 30,459 |
Foreign currency denominated debt included in long-term debt above: |  |  |
Carrying value | 4,156 |  |  | 4,817 |
Fair value | 3,780 |  |  | 5,114 |
Our estimate of the fair value of our total long-term debt is based on observable market information derived from a third-party pricing source and is classified in Level 2 of the fair value hierarchy. The decrease in the fair value of our long-term debt was primarily driven by (i) rising interest rates in 2022, (ii) the August 2022 $1.1 billion repayment at maturity of senior unsecured notes and (iii) changes in Euro denominated debt resulting from the strengthening of the U.S. dollar versus the Euro during the first nine months of 2022. Net Investment Hedging The pre-tax effects of our net investment hedges on accumulated other comprehensive losses and our condensed consolidated statements of earnings (losses) were as follows:
|  | (Gain) Loss Recognized in Accumulated Other Comprehensive Losses |  | (Gain) Loss Recognized in Net Earnings (Losses) |  | (Gain) Loss Recognized in Accumulated Other Comprehensive Losses |  |
|  | For the Nine Months Ended September 30, |  | For the Three Months Ended September 30,
(in millions) |  | 2022 |  | 2021 |  | 2022 |  | 2021 |  | 2022 |  | 2021 |  |  |  |
Foreign currency contracts |  | $ | — |  |  | $ | (16) |  |  | $ | — |  |  | $ | (7) |  |  | $ | — |  |  | $ | — |  |  |  |  |
Foreign currency denominated debt |  | (664) |  |  | (270) |  |  | — |  |  | — |  |  | (289) |  |  | (118) |  |  |  |  |
Total |  | $ | (664) |  |  | $ | (286) |  |  | $ | — |  |  | $ | (7) |  |  | $ | (289) |  |  | $ | (118) |  |  |  |  |
We recognized changes in the fair value of the foreign currency contracts and in the carrying value of the foreign currency denominated debt due to changes in the Euro to U.S. dollar exchange rate in accumulated other comprehensive losses related to ABI. We recognized gains on the foreign currency contracts arising from components excluded from effectiveness testing in interest and other debt expense, net in our condensed consolidated statements of earnings (losses) based on an amortization approach.

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 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 https://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 https://asc.fasb.org/extlink&oid=126731327&loc=d3e90205-114008 + Details
Name: | us-gaap_DerivativeInstrumentsAndHedgingActivitiesDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration