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Derivatives and Hedging | 9 Months Ended
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Sep. 30, 2016
Derivative Instruments and Hedging Activities Disclosure [Abstract] |
Derivatives and Hedging | Derivatives and Hedging The Company is exposed to market risks, including changes in foreign currency exchange rates and interest rates. To manage the risk related to these exposures, the Company enters into various derivative instruments that reduce these risks by creating offsetting exposures. The Company does not enter into derivative transactions for trading or speculative purposes. Foreign Exchange Risk Management The Company is exposed to foreign exchange risk when it earns revenues, pays expenses, enters into monetary intercompany transfers denominated in a currency that differs from its functional currency, or enters into other transactions that are denominated in a currency other than its functional currency. The Company uses foreign exchange derivatives, typically forward contracts, options and cross currency swaps, to reduce its overall exposure to the effects of currency fluctuations on cash flows. These exposures are hedged, on average, for less than two years. These derivatives are accounted for as hedges, and changes in fair value are recorded each period in Other comprehensive income (loss) in the Condensed Consolidated Statements of Comprehensive Income. The Company also uses foreign exchange derivatives, typically forward contracts and options, to economically hedge the currency exposure of the Company's global liquidity profile, including monetary assets or liabilities that are denominated in a non-functional currency of an entity, typically on a rolling 30 day basis, but may be for up to one year in the future. These derivatives are not accounted for as hedges, and changes in fair value are recorded each period in Other income in the Condensed Consolidated Statements of Income. The notional and fair values of derivative instruments are as follows (in millions):
| Notional Amount |  | Derivative Assets (1) |  | Derivative Liabilities (2)
| September 30, 2016 |  | December 31, 2015 |  | September 30, 2016 |  | December 31, 2015 |  | September 30, 2016 |  | December 31, 2015
Foreign exchange contracts: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Accounted for as hedges | $ | 794 |  |  | $ | 778 |  |  | $ | 15 |  |  | $ | 32 |  |  | $ | 9 |  |  | $ | 18 |
Not accounted for as hedges (3) | 209 |  |  | 280 |  |  | — |  |  | — |  |  | — |  |  | — |
Total | $ | 1,003 |  |  | $ | 1,058 |  |  | $ | 15 |  |  | $ | 32 |  |  | $ | 9 |  |  | $ | 18 |
(1) | Included within Other current assets ($5 million at September 30, 2016 and $15 million at December 31, 2015) or Other non-current assets ($10 million at September 30, 2016 and $17 million at December 31, 2015).
(2) | Included within Other current liabilities ($5 million at September 30, 2016 and $13 million at December 31, 2015) or Other non-current liabilities ($4 million at September 30, 2016 and $5 million at December 31, 2015).
(3) | These contracts typically are for 30 day durations are executed close to the last day of the most recent reporting month, thereby resulting in nominal fair values at the balance sheet date.
Offsetting of financial assets and derivatives assets are as follows (in millions):
| Gross Amounts of Recognized Assets |  | Gross Amounts Offset in the Statement of Financial Position |  | Net Amounts of Assets Presented in the Statement of Financial Position (1)
Derivatives accounted for as hedges: | September 30, 2016 |  | December 31, 2015 |  | September 30, 2016 |  | December 31, 2015 |  | September 30, 2016 |  | December 31, 2015
Foreign exchange contracts | $ | 15 |  |  | $ | 32 |  |  | $ | (1 | ) |  | $ | (13 | ) |  | $ | 14 |  |  | $ | 19 |
(1) Included within Other current assets ($4 million at September 30, 2016 and $6 million at December 31, 2015) or Other non-current assets ($10 million at September 30, 2016 and $13 million at December 31, 2015). Offsetting of financial liabilities and derivative liabilities are as follows (in millions):
|  | Gross Amounts of Recognized Liabilities |  | Gross Amounts Offset in the Statement of Financial Position |  | Net Amounts of Liabilities Presented in the Statement of Financial Position (1)
Derivatives accounted for as hedges: |  | September 30, 2016 |  | December 31, 2015 |  | September 30, 2016 |  | December 31, 2015 |  | September 30, 2016 |  | December 31, 2015
Foreign exchange contracts |  | $ | 9 |  |  | $ | 18 |  |  | $ | (1 | ) |  | $ | (13 | ) |  | $ | 8 |  |  | $ | 5 |
(1) Included within Other current liabilities ($4 million at September 30, 2016 and $4 million at December 31, 2015) or Other non-current liabilities ($4 million at September 30, 2016 and $1 million at December 31, 2015). The amounts of derivative gains (losses) recognized in the Condensed Consolidated Financial Statements for the three and nine months ended September 30, 2016 and 2015 are as follows (in millions):
Cash Flow Hedge - Foreign Exchange Contracts |  | Location of future reclassification from Accumulated Other Comprehensive Loss |  | Gain (Loss) Recognized in Accumulated Other Comprehensive Loss:
Three months ended September 30, |  | Compensation and Benefits |  | Other General Expenses |  | Interest Expense |  | Other Income (Expense) |  | Total
2016 |  | $ | 10 |  |  | $ | (4 | ) |  | $ | — |  |  | $ | (7 | ) |  | $ | (1 | )
2015 |  | (8 | ) |  | (2 | ) |  | — |  |  | (4 | ) |  | (14 | )
Cash Flow Hedge - Foreign Exchange Contracts |  | Location of future reclassification from Accumulated Other Comprehensive Loss |  | Gain (Loss) Recognized in Accumulated Other Comprehensive Loss:
Nine months ended September 30, |  | Compensation and Benefits |  | Other General Expenses |  | Interest Expense |  | Other Income (Expense) |  | Total
2016 |  | $ | 8 |  |  | $ | (9 | ) |  | $ | — |  |  | $ | (18 | ) |  | $ | (19 | )
2015 |  | (2 | ) |  | (1 | ) |  | — |  |  | 2 |  |  | (1 | )
Cash Flow Hedge - Foreign Exchange Contracts |  | Gain (Loss) Reclassified from Accumulated Other Comprehensive Loss into Income (Effective Portion):
Three months ended September 30, |  | Compensation and Benefits |  | Other General Expenses |  | Interest Expense |  | Other Income |  | Total
2016 |  | $ | 1 |  |  | $ | (1 | ) |  | $ | — |  |  | $ | (2 | ) |  | $ | (2 | )
2015 |  | 2 |  |  | — |  |  | (2 | ) |  | — |  |  | — |
Cash Flow Hedge - Foreign Exchange Contracts |  | Gain (Loss) Reclassified from Accumulated Other Comprehensive Loss into Income (Effective Portion):
Nine months ended September 30, |  | Compensation and Benefits |  | Other General Expenses |  | Interest Expense |  | Other Income |  | Total
2016 |  | $ | 2 |  |  | $ | (2 | ) |  | $ | (1 | ) |  | $ | (5 | ) |  | $ | (6 | )
2015 |  | 3 |  |  | (1 | ) |  | (6 | ) |  | (3 | ) |  | (7 | )
The Company estimates that approximately $11 million of pretax losses currently included within Accumulated other comprehensive loss will be reclassified into earnings in the next twelve months. The amount of gain (loss) recognized in income on the ineffective portion of derivatives for the three and nine months ended September 30, 2016 and 2015 was insignificant. During the three and nine months ended September 30, 2016, the Company recorded a gain of $2 million and $1 million, respectively, in Other income for foreign exchange derivatives not designated or qualifying as hedges. During the three and nine months ended September 30, 2015, the Company recorded a gain of $15 million and $6 million, respectively, in Other income for foreign exchange derivatives not designated or qualifying as hedges. Net Investments in Foreign Operations Risk Management The Company uses non-derivative financial instruments to protect the value of its investments in a number of foreign subsidiaries. Beginning in June 2016, the Company designated its Euro-denominated commercial paper issuances as a non-derivative hedge of a net investment in its European operations. The change in the carrying value of the designated portion of the Euro-denominated commercial paper due to changes in foreign currency exchange rates is recorded in Foreign currency translation adjustment, a component of Accumulated other comprehensive income (loss), offsetting the foreign currency translation adjustment of the hedged net investments that is also recorded in Accumulated other comprehensive income (loss). Any ineffective portions of net investment hedges are reclassified from Accumulated other comprehensive income (loss) into earnings during the period of change. As of September 30, 2016, the Company has €217 million ($244 million at September 30, 2016 exchange rates) of outstanding Euro-denominated commercial paper designated as a hedge of its net investment in its European operations. The weighted average commercial paper outstanding for the three months ended September 30, 2016 was €217 million and since inception of the hedge was €177 million. As of September 30, 2016, the associated gain recognized in Accumulated other comprehensive income (loss) related to the net investment hedge was $1 million. The Company did not reclassify any deferred gains or losses related to net investment hedges from Accumulated other comprehensive income (loss) to earnings during the three and nine months ended September 30, 2016. In addition, the Company did not have any ineffectiveness related to net investment hedges during the three and nine ended September 30, 2016.

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- 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://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 30 -Section 45 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6441202&loc=d3e80720-113993 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 4C -URI http://asc.fasb.org/extlink&oid=64837297&loc=SL5624171-113959 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=64837297&loc=d3e41620-113959 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 4B -URI http://asc.fasb.org/extlink&oid=64837297&loc=SL5624163-113959 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=64837297&loc=SL5579240-113959 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 4D -URI http://asc.fasb.org/extlink&oid=64837297&loc=SL5624177-113959 Reference 7: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 30 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=35736893&loc=d3e80784-113994 Reference 8: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 5 -URI http://asc.fasb.org/extlink&oid=64837297&loc=d3e41641-113959 Reference 9: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 1A -URI http://asc.fasb.org/extlink&oid=64837297&loc=SL5579245-113959 Reference 10: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 4H -URI http://asc.fasb.org/extlink&oid=64837297&loc=SL5624258-113959 Reference 11: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 30 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=35736893&loc=d3e80748-113994 Reference 12: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 4K -URI http://asc.fasb.org/extlink&oid=64837297&loc=SL5708775-113959 Reference 13: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 4J -URI http://asc.fasb.org/extlink&oid=64837297&loc=SL5708773-113959 Reference 14: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 4A -URI http://asc.fasb.org/extlink&oid=64837297&loc=SL5618551-113959 Reference 15: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 1B -URI http://asc.fasb.org/extlink&oid=64837297&loc=SL5580258-113959 Reference 16: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 4E -URI http://asc.fasb.org/extlink&oid=64837297&loc=SL5624181-113959 Reference 17: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 25 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6886632&loc=d3e76258-113986 Reference 18: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 10 -Section 50 -Paragraph 4 -URI http://asc.fasb.org/extlink&oid=64837297&loc=d3e41638-113959 Reference 19: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08.(n)) -URI http://asc.fasb.org/extlink&oid=26873400&loc=d3e23780-122690 + Details
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