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Financial Instruments (Tables)
 12 Months Ended
Dec. 31, 2015
Fair Value of Derivatives Instruments

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

 

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

Derivatives designated as accounting hedges:

            

Currency exchange contracts

    $ 20       $ 7       $ 69       $ 17   

Commodity contracts

      37         35         12         33   

Interest rate contracts

      12         57         13         42   
  

 

 

     

 

 

     

 

 

     

 

 

  
   $ 69       $ 99       $ 94       $ 92   
  

 

 

     

 

 

     

 

 

     

 

 

  

Derivatives not designated as accounting hedges:

            

Currency exchange contracts

    $ 61       $ 33       $ 735       $ 24   

Commodity contracts

      70         56         90         194   

Interest rate contracts

      43         28         59         39   
  

 

 

     

 

 

     

 

 

     

 

 

  
   $ 174       $ 117       $ 884       $ 257   
  

 

 

     

 

 

     

 

 

     

 

 

  

Total fair value

    $ 243       $ 216       $ 978       $ 349   
  

 

 

     

 

 

     

 

 

     

 

 

  
Notional Values of Derivative Instruments

The net notional values of our derivative instruments were:

 

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

Currency exchange contracts:

      

Intercompany loans and forecasted interest payments

    $ 4,148       $ 3,640   

Forecasted transactions

      1,094         6,681   

Commodity contracts

      732         1,569   

Interest rate contracts

      3,033         3,970   

Net investment hedge – euro notes

      4,345         3,932   

Net investment hedge – pound sterling notes

      1,404         545   

Net investment hedge – Swiss franc notes

      1,073         –   
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:

 

                                                                           
                          Location of
     For the Years Ended December 31,      Gain / (Loss)
     2015      2014      2013      Recognized in AOCI
            (in millions)              

Euro notes

    $ 268       $ 328       $ (50 )     Currency

Pound sterling notes

      42         39         (13 )     Translation

Swiss franc notes

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

Currency exchange contracts

    $ 41       $ –       $ 41       $ –   

Commodity contracts

      16         29         (13 )       –   

Interest rate contracts

      (30 )       –         (30 )       –   
  

 

 

     

 

 

     

 

 

     

 

 

  

Total derivatives

    $ 27       $ 29       $ (2 )     $ –   
  

 

 

     

 

 

     

 

 

     

 

 

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

Currency exchange contracts

    $ 763       $ –       $ 763       $ –   

Commodity contracts

      (125 )       (49 )       (76 )       –   

Interest rate contracts

      (9 )       –         (9 )       –   
  

 

 

     

 

 

     

 

 

     

 

 

  

Total derivatives

    $ 629       $ (49 )     $ 678       $ –   
  

 

 

     

 

 

     

 

 

     

 

 

  
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 Years Ended December 31,  
     2015      2014      2013  
     (in millions)  

Accumulated gain / (loss) at January 1

    $ (2 )     $ 117       $ (38 ) 

Transfer of realized losses / (gains) to earnings

      –         (40 )       53   

Unrealized gain / (loss) in fair value

      (43 )       (79 )       102   
  

 

 

     

 

 

     

 

 

  

Accumulated gain / (loss) at December 31

    $ (45 )     $ (2 )     $ 117   
  

 

 

     

 

 

     

 

 

  
Schedule of Effects of Derivative Instruments

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

 

     For the Years Ended December 31,  
     2015      2014      2013  
     (in millions )  

Currency exchange contracts – forecasted transactions

    $ 83       $ 26       $ (26 ) 

Commodity contracts

      (52 )       16         (23 ) 

Interest rate contracts

      (31 )       (2 )       (4 ) 
  

 

 

     

 

 

     

 

 

  

Total

    $ –       $  40       $  (53 ) 
  

 

 

     

 

 

     

 

 

  

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

 

     For the Years Ended December 31,  
     2015      2014      2013  
     (in millions)  

Currency exchange contracts – forecasted transactions

    $ 40       $ 82       $ (23 ) 

Commodity contracts

      (35 )       (2 )       3   

Interest rate contracts

      (48 )       (159 )       122   
  

 

 

     

 

 

     

 

 

  

Total

    $  (43 )     $ (79 )     $ 102   
  

 

 

     

 

 

     

 

 

  

Pre-tax gains / (losses) on ineffectiveness recognized in net earnings from continuing operations were:

 

     For the Years Ended December 31,  
     2015     2014     2013  
     (in millions)  

Commodity contracts

    $ (4 )    $ (10 )    $ 1   
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 Years Ended December 31,  
     2015      2014      2013  
            (in millions)         

Derivatives

    $ (1 )     $ 13       $ –   

Borrowings

      1         (13 )       –   
Economic Hedging  
Schedule of Effects of Derivative Instruments

Pre-tax gains / (losses) recorded in net earnings for economic hedges were:

 

                                                                           
     For the Years Ended December 31,     

Location of
Gain / (Loss)
Recognized

  
     2015      2014      2013      in Earnings  
     (in millions)         

Currency exchange contracts:

            

Intercompany loans and
forecasted interest payments

    $ 29       $ 4       $ 18        
 		 Interest and other
expense, net		   
  

Forecasted transactions

      29         29         65         Cost of sales   

Forecasted transactions

      435         610         9        
 		 Interest and other
expense, net		   
  

Forecasted transactions

      (12 )       (4 )       4        
 
 		 Selling, general
and administrative
expenses		   
  
  

Commodity contracts

      (38 )       (136 )       (40 )       Cost of sales   
  

 

 

     

 

 

     

 

 

     

Total

    $ 443       $ 503       $ 56