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Equity Method Investments | 9 Months Ended
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Sep. 30, 2018
Equity Method Investments and Joint Ventures [Abstract] |
Equity Method Investments | Note 6. Equity Method Investments Our investments accounted for under the equity method of accounting totaled $7,006 million as of September 30, 2018 and $6,193 million as of December 31, 2017. Our largest investments are in Jacobs Douwe Egberts (“JDE”) and Keurig Dr Pepper Inc. (NYSE: "KDP”). JDE: As of September 30, 2018, we held a 26.5% voting interest, a 26.4% ownership interest and a 26.3% profit and dividend sharing interest in JDE. We recorded JDE equity earnings of $38 million in the third quarter of 2018 and $50 million in the third quarter of 2017 and $126 million in the first nine months of 2018 and $88 million in the first nine months of 2017. We also recorded $73 million of cash dividends received during the first quarter of 2018 and $49 million of cash dividends received during the first quarter of 2017. Keurig Dr Pepper Transaction: On July 9, 2018, Keurig Green Mountain, Inc. ("Keurig") closed on its definitive merger agreement with Dr Pepper Snapple Group, Inc., and formed KDP, a publicly traded company. Following the close of the transaction, our 24.2% investment in Keurig together with our shareholder loan receivable became a 13.8% investment in KDP. During the third quarter of 2018, we recorded a preliminary pre-tax gain of $757 million reported as a gain on equity method transaction and $184 million of deferred tax expense reported in the provision for income taxes (or $573 million after-tax gain) related to the change in our ownership interest while KDP finalizes the valuation for the transaction. We hold two director positions on the KDP board as well as additional governance rights. As we continue to have significant influence, we continue to account for our investment in KDP under the equity method, resulting in recognizing our share of their earnings within our earnings and our share of their dividends within our cash flows. In connection with this transaction, we changed our accounting principle to reflect our share of Keurig's historical and KDP's ongoing earnings on a one-quarter lag basis while we continue to record dividends when cash is received. We determined a lag was preferable as it enables us to continue to report our quarterly and annual results on a timely basis and to record our share of KDP’s ongoing results once KDP has publicly reported its results. This change in accounting principle was applied retrospectively to all periods. While our operating income did not change, equity method investment net earnings, net earnings and earnings per share have been adjusted to reflect the lag across all reported periods. The following tables show the primary line items on the condensed consolidated statements of earnings and comprehensive earnings and the condensed consolidated balance sheet that changed as a result of the lag. The condensed consolidated statements of cash flow and equity were also updated to reflect these changes.
| For the Three Months Ended September 30, 2017 |  | For the Nine Months Ended September 30, 2017
| As Reported |  | As Adjusted |  | As Reported |  | As Adjusted
| (in millions)
Statements of Earnings |  |  |  |  |  |  |
Equity method investment net earnings | $ | 103 |  |  | $ | 92 |  |  | $ | 236 |  |  | $ | 249 |
Net earnings | 993 |  |  | 982 |  |  | 2,126 |  |  | 2,139 |
Net earnings attributable to Mondelēz International | 992 |  |  | 981 |  |  | 2,120 |  |  | 2,133 |
Earnings per share attributable to Mondelēz International: |  |  |  |  |  |  |
Basic EPS | $ | 0.66 |  |  | $ | 0.65 |  |  | $ | 1.40 |  |  | $ | 1.41 |
Diluted EPS | $ | 0.65 |  |  | $ | 0.64 |  |  | $ | 1.38 |  |  | $ | 1.39 |
Statements of Other Comprehensive Earnings |  |  |  |  |  |  |
Currency translation adjustment | $ | 337 |  |  | $ | 325 |  |  | $ | 1,260 |  |  | $ | 1,242 |
Total other comprehensive earnings / (losses) | 308 |  |  | 296 |  |  | 1,229 |  |  | 1,211 |
Comprehensive earnings attributable to Mondelēz International | 1,292 |  |  | 1,269 |  |  | 3,325 |  |  | 3,320 |
| As of December 31, 2017
| As Reported |  | As Adjusted
| (in millions)
Balance Sheet |  |  |
Equity method investments | $ | 6,345 |  |  | $ | 6,193 |
Deferred income taxes | 3,376 |  |  | 3,341 |
Retained earnings | 22,749 |  |  | 22,631 |
Accumulated other comprehensive losses | (9,998 | ) |  | (9,997 | )
Total Mondelēz International shareholders' equity | 26,111 |  |  | 25,994 |
Total equity | 26,191 |  |  | 26,074 |
As of September 30, 2018, we continue to hold a 13.8% ownership interest in KDP. Our ownership interest in KDP may change over time due to stock-based compensation arrangements and other transactions by KDP. We recorded equity earnings of $21 million in the third quarter of 2018 and equity earnings, shareholder loan interest and cash dividends of $14 million, $6 million and $5 million in the third quarter of 2017. We recorded equity earnings, shareholder loan interest and cash dividends of $191 million, $12 million and $5 million in the first nine months of 2018 and $67 million, $18 million and $11 million in the first nine months of 2017.

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- Definition The entire disclosure for equity method investments and joint ventures. Equity method investments are investments that give the investor the ability to exercise significant influence over the operating and financial policies of an investee. Joint ventures are entities owned and operated by a small group of businesses as a separate and specific business or project for the mutual benefit of the members of the group. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 323 -URI http://asc.fasb.org/topic&trid=2196965 + Details
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