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Financial Instruments (Tables)
 3 Months Ended
Mar. 31, 2015
Fair Value of Derivatives Instruments

Derivative instruments were recorded at fair value in the consolidated balance sheets as follows:

 

                                                                           
     As of March 31, 2015      As of December 31, 2014  
     Asset
Derivatives		      Liability
Derivatives		      Asset
Derivatives		      Liability
Derivatives		  
     (in millions)  

Derivatives designated as
accounting hedges:

            

Currency exchange contracts

    $ 90       $ 33       $ 69       $ 17   

Commodity contracts

      1         57         12         33   

Interest rate contracts

      17         73         13         42   
  

 

 

     

 

 

     

 

 

     

 

 

  
$ 108    $ 163    $ 94    $ 92   
  

 

 

     

 

 

     

 

 

     

 

 

  

Derivatives not designated as
accounting hedges:

Currency exchange contracts

 $ 284    $ 77    $ 735    $ 24   

Commodity contracts

   107      156      90      194   

Interest rate contracts

   50      33      59      39   
  

 

 

     

 

 

     

 

 

     

 

 

  
$ 441    $ 266    $ 884    $ 257   
  

 

 

     

 

 

     

 

 

     

 

 

  

Total fair value

 $ 549    $ 429    $ 978    $ 349   
  

 

 

     

 

 

     

 

 

     

 

 

  
Notional Values of Derivative Instruments

The net notional values of our derivative instruments were:

 

                                     
     Notional Amount  
     As of March 31,      As of December 31,  
     2015      2014  
     (in millions)  

Currency exchange contracts:

      

Intercompany loans and forecasted interest payments

    $ 3,639       $ 3,640   

Forecasted transactions

      6,670         6,681   

Commodity contracts

      1,196         1,569   

Interest rate contracts

      3,037         3,970   

Net investment hedge – euro notes

      4,722         3,932   

Net investment hedge – pound sterling notes

      1,185         545   

Net investment hedge – Swiss franc notes

      694         –   
Hedges of Net Investments in International Operations

After-tax gains / (losses) related to hedges of net investments in international operations in the form of euro, pound sterling and Swiss franc-denominated debt were:

 

                                                        
     For the Three Months Ended
March 31,		      Location of
Gain / (Loss)
Recognized in
AOCI
     2015      2014     
     (in millions)       

Euro notes

    $ 314       $ (5 )     Currency

Pound sterling notes

      32         (4 )     Translation

Swiss franc notes

      (13 )       –       Adjustment
Derivative  
Schedule of Derivative Instruments Fair Value and Measurement Inputs

The fair values (asset / (liability)) of our derivative instruments were determined using:

 

                                                                           
     As of March 31, 2015  
     Total
Fair Value of Net
Asset / (Liability)		     Quoted Prices in
Active Markets
for Identical
Assets
(Level 1)		     Significant
Other Observable
Inputs (Level 2)		     Significant
Unobservable
Inputs
(Level 3)		  
     (in millions)  

Currency exchange contracts

    $ 264      $ –      $ 264      $ –   

Commodity contracts

      (105 )      (105 )      –        –   

Interest rate contracts

      (39 )      –        (39 )      –   
  

 

 

    

 

 

    

 

 

    

 

 

  

Total derivatives

 $ 120    $ (105 )  $ 225    $ –   
  

 

 

    

 

 

    

 

 

    

 

 

  
     As of December 31, 2014  
     Total
Fair Value of Net
Asset / (Liability)		     Quoted Prices in
Active Markets
for Identical
Assets
(Level 1)		     Significant
Other Observable
Inputs (Level 2)		     Significant
Unobservable
Inputs
(Level 3)		  
     (in millions)  

Currency exchange contracts

    $ 763      $ –      $ 763      $ –   

Commodity contracts

      (125 )      (49 )      (76 )      –   

Interest rate contracts

      (9 )      –        (9 )      –   
  

 

 

    

 

 

    

 

 

    

 

 

  

Total derivatives

 $ 629    $ (49 )  $ 678    $ –   
  

 

 

    

 

 

    

 

 

    

 

 

  
Fair Value Hedges  
Schedule of Effects of Derivative Instruments

Pre-tax gains / (losses) due to changes in fair value of our interest rate swaps and related hedged long-term debt were recorded in interest and other expense, net:

 

                                                        
     For the Three Months Ended
March 31,		      
     2015      2014      
     (in millions)      

Derivatives

    $ 4       $ –     

Borrowings

      (4 )       –     
Cash Flow Hedges  
Schedule of Cash Flow Hedges Effect on Accumulated Other Comprehensive Income, Net of Taxes

Cash flow hedge activity, net of taxes, within accumulated other comprehensive earnings / (losses) included:

 

                                     
    For the Three Months Ended  
  March 31,  
    2015     2014  
    (in millions)  

Accumulated gain / (loss) at beginning of period

   $ (2 )    $ 117   

Transfer of realized losses / (gains) in fair value to earnings

     (18 )      (1 ) 

Unrealized gain / (loss) in fair value

     (26 )      (34 ) 
 

 

 

    

 

 

  

Accumulated gain / (loss) at end of period

 $ (46 )  $ 82   
 

 

 

    

 

 

  
Schedule of Effects of Derivative Instruments

After-tax gains / (losses) reclassified from accumulated other comprehensive earnings / (losses) into net earnings were:

 

                                     
    For the Three Months Ended  
  March 31,  
    2015     2014  
    (in millions)  

Currency exchange contracts – forecasted transactions

   $ 46      $ (2 ) 

Commodity contracts

     (2 )      5   

Interest rate contracts

     (26 )      (2 ) 
 

 

 

    

 

 

  

Total

 $ 18    $ 1   
 

 

 

    

 

 

  

After-tax gains / (losses) recognized in other comprehensive earnings / (losses) were:

 

                                     
    For the Three Months Ended  
  March 31,  
    2015     2014  
    (in millions)  

Currency exchange contracts -forecasted transactions

   $ 49      $ 2   

Commodity contracts

     (38 )      11   

Interest rate contracts

     (37 )      (47 ) 
 

 

 

    

 

 

  

Total

 $ (26 )  $ (34 ) 
 

 

 

    

 

 

  
Economic Hedging  
Schedule of Effects of Derivative Instruments

Pre-tax gains / (losses) recorded in net earnings for economic hedges were:
                  Location of
     For the Three Months Ended     Gain / (Loss)
     March 31,     Recognized
     2015      2014     in Earnings
     (in millions)      

Currency exchange contracts:

        

Intercompany loans and forecasted
interest payments

    $ 7       $ (2 )    Interest and other
expense, net

Forecasted transactions

      (3 )       (10 )    Cost of sales

Forecasted transactions

      553         (5 )    Interest and other
expense, net

Forecasted transactions

      (11 )       (1 )    Selling, general and
administrative expenses

Interest rate contracts

      1         –      Interest and other
expense, net

Commodity contracts

      (41 )       38      Cost of sales
  

 

 

     

 

 

    

Total

 $ 506    $ 20