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Financial Instruments

6 Months Ended

Apr. 30, 2021

Investments, All Other Investments [Abstract]

Financial Instruments

Financial Instruments

Cash Equivalents and Available-for-Sale Debt Investments

Cash equivalents and available-for-sale debt investments were as follows:

			As of April 30, 2021																		As of October 31, 2020
			Cost						Gross Unrealized Gain												Fair Value						Cost						Gross Unrealized Gain												Fair Value
			In millions
Cash Equivalents:
Time deposits			$	893					$	—											$	893					$	939					$	—											$	939
Money market funds			1,955						—												1,955						1,167						—												1,167
Total cash equivalents			2,848						—												2,848						2,106						—												2,106
Available-for-Sale Debt Investments:
Foreign bonds			112						15												127						108						17												125
Other debt securities			17						1												18						20						1												21
Total available-for-sale debt investments			129						16												145						128						18												146
Total cash equivalents and available-for-sale debt investments			$	2,977					$	16											$	2,993					$	2,234					$	18											$	2,252

As of April 30, 2021 and October 31, 2020, the carrying amount of cash equivalents approximated fair value due to the short period of time to maturity. Time deposits were primarily issued by institutions outside of the U.S. as of April 30, 2021 and October 31, 2020. The estimated fair value of the available-for-sale debt investments may not be representative of values that will be realized in the future.

Contractual maturities of available-for-sale debt investments were as follows:

			April 30, 2021
			Amortized Cost						Fair Value
			In millions
Due in more than five years			129						145
			$	129					$	145

Non-marketable equity investments in privately held companies are included in Long-term financing receivables and other assets in the Condensed Consolidated Balance Sheets. These non-marketable equity investments are carried either at fair value or under the measurement alternative.

The carrying amount of those non-marketable equity investments accounted for under the measurement alternative amounted to $278 million and $295 million as of April 30, 2021 and October 31, 2020, respectively. During the three and six months ended April 30, 2021, the Company recorded an unrealized gain of $25 million on these investments.

The carrying amount of those non-marketable equity investments accounted for under the fair value option amounted to $92 million as of April 30, 2021. During the three and six months ended April 30, 2021, the Company recorded an unrealized gain of $34 million on these investments.

Investments in equity securities that are accounted for using the equity method are included in Investments in equity interests in the Condensed Consolidated Balance Sheets. These amounted to $2.2 billion as of April 30, 2021 and October 31, 2020.

Fair Value of Derivative Instruments in the Condensed Consolidated Balance Sheets

The gross notional and fair value of derivative instruments in the Condensed Consolidated Balance Sheets were as follows:

			As of April 30, 2021																														As of October 31, 2020
									Fair Value																														Fair Value
			Outstanding Gross Notional						Other Current Assets						Long-Term Financing Receivables and Other Assets						Other Accrued Liabilities						Long-Term Other Liabilities						Outstanding Gross Notional						Other Current Assets						Long-Term Financing Receivables and Other Assets						Other Accrued Liabilities						Long-Term Other Liabilities
			In millions
Derivatives designated as hedging instruments
Fair value hedges:
Interest rate contracts			$	3,850					$	—					$	150					$	—					$	—					$	3,850					$	—					$	220					$	—					$	—
Cash flow hedges:
Foreign currency contracts			7,843						48						28						118						97						7,652						75						85						95						38
Interest rate contracts			—						—						—						—						—						500						—						—						2						—
Net investment hedges:
Foreign currency contracts			1,812						20						18						25						27						1,804						34						44						11						9
Total derivatives designated as hedging instruments			13,505						68						196						143						124						13,806						109						349						108						47
Derivatives not designated as hedging instruments
Foreign currency contracts			6,683						29						8						29						3						6,157						43						9						35						1
Other derivatives			108						2						—						—						—						105						—						—						3						—
Total derivatives not designated as hedging instruments			6,791						31						8						29						3						6,262						43						9						38						1
Total derivatives			$	20,296					$	99					$	204					$	172					$	127					$	20,068					$	152					$	358					$	146					$	48

Offsetting of Derivative Instruments

The Company recognizes all derivative instruments on a gross basis in the Condensed Consolidated Balance Sheets. The Company's derivative instruments are subject to master netting arrangements and collateral security arrangements. The Company does not offset the fair value of its derivative instruments against the fair value of cash collateral posted under collateral security agreements. The information related to the potential effect of the Company's use of the master netting agreements and collateral security agreements were as follows:

			As of April 30, 2021
			In the Condensed Consolidated Balance Sheets
			(i)						(ii)						(iii) = (i)–(ii)						(iv)						(v)									(vi) = (iii)–(iv)–(v)
																					Gross Amounts Not Offset
			Gross Amount Recognized						Gross Amount Offset						Net Amount Presented						Derivatives						Financial Collateral									Net Amount
			In millions
Derivative assets			$	303					$	—					$	303					$	177					$	82		(1)						$	44
Derivative liabilities			$	299					$	—					$	299					$	177					$	150		(2)						$	(28)

			As of October 31, 2020
			In the Condensed Consolidated Balance Sheets
			(i)						(ii)						(iii) = (i)–(ii)						(iv)						(v)									(vi) = (iii)–(iv)–(v)
																					Gross Amounts Not Offset
			Gross Amount Recognized						Gross Amount Offset						Net Amount Presented						Derivatives						Financial Collateral									Net Amount
			In millions
Derivative assets			$	510					$	—					$	510					$	137					$	321		(1)						$	52
Derivative liabilities			$	194					$	—					$	194					$	137					$	55		(2)						$	2

(1)Represents the cash collateral posted by counterparties as of the respective reporting date for the Company's asset position, net of derivative amounts that could be offset, as of, generally, two business days prior to the respective reporting date.

(2)Represents the collateral posted by the Company in cash or through the re-use of counterparty cash collateral as of the respective reporting date for the Company's liability position, net of derivative amounts that could be offset, as of, generally, two business days prior to the respective reporting date. As of April 30, 2021, of the $150 million of collateral posted, $70 million was in cash and $80 million was through re-use of counterparty collateral. As of October 31, 2020, $55 million of collateral posted was entirely by way of re-use of counterparty collateral.

The amounts recorded on the Condensed Consolidated Balance Sheets related to cumulative basis adjustments for fair value hedges were as follows:

			Carrying amount of the hedged assets/ (liabilities)												Cumulative amount of fair value hedging adjustment included in the carrying amount of the hedged assets/ (liabilities)
			As of												As of
			April 30, 2021						October 31, 2020						April 30, 2021						October 31, 2020
			In millions												In millions
Long-term debt			$	(3,990)					$	(4,059)					$	(150)					$	(220)

The pre-tax effect of derivative instruments in cash flow and net investment hedging relationships recognized in Other Comprehensive Income ("OCI") were as follows:

			Gains (Losses) Recognized in OCI on Derivatives
			Three months ended April 30, 2021						Three months ended April 30, 2020						Six months ended April 30, 2021						Six months ended April 30, 2020
			In millions
Derivatives in Cash Flow Hedging relationship
Foreign exchange contracts			$	45					$	301					$	(284)					$	377
Interest rate contracts			—						(5)						—						(6)
Derivatives in Net Investment Hedging relationship
Foreign exchange contracts			(3)						112						(77)						133
Total			$	42					$	408					$	(361)					$	504

As of April 30, 2021, the Company expects to reclassify an estimated net accumulated other comprehensive loss of approximately $14 million, net of taxes, to earnings in the next twelve months along with the earnings effects of the related forecasted transactions associated with cash flow hedges.

Effect of Derivative Instruments on the Condensed Consolidated Statements of Earnings

The pre-tax effect of derivative instruments on the Condensed Consolidated Statements of Earnings were as follows:

			Gains (Losses) Recognized in Income
			Three months ended April 30, 2021												Three months ended April 30, 2020												Six months ended April 30, 2021												Six months ended April 30, 2020
			Net revenue						Interest and other, net						Net revenue						Interest and other, net						Net revenue						Interest and other, net						Net revenue						Interest and other, net
			In millions
Total amounts of income and expense line items presented in the Condensed Consolidated Statements of Earnings in which the effects of fair value hedges, cash flow hedges and derivatives not designated as hedging instruments are recorded			$	6,700					$	(11)					$	6,009					$	(68)					$	13,533					$	(55)					$	12,958					$	(87)
Gains (losses) on derivatives in fair value hedging relationships
Interest rate contracts
Hedged items			$	—					$	52					$	—					$	(156)					$	—					$	70					$	—					$	(185)
Derivatives designated as hedging instruments			—						(52)						—						156						—						(70)						—						185
Gains (losses) on derivatives in cash flow hedging relationships
Foreign exchange contracts
Amount of gains (losses) reclassified from accumulated other comprehensive income into income			(35)						16						48						166						(99)						(197)						74						209
Interest rate contracts
Amount of gains (losses) reclassified from accumulated other comprehensive income into income			—						(1)						—						—						—						(2)						—						—
Gains (losses) on derivatives not designated as hedging instruments
Foreign exchange contracts			—						13						—						99						—						(28)						—						45
Other derivatives			—						3						—						8						—						4						—						5
Total gains (losses)			$	(35)					$	31					$	48					$	273					$	(99)					$	(223)					$	74					$	259

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- Definition

The entire disclosure for financial instruments. This disclosure includes, but is not limited to, fair value measurements of short and long term marketable securities, international currencies forward contracts, and auction rate securities. Financial instruments may include hedging and non-hedging currency exchange instruments, derivatives, securitizations and securities available for sale at fair value. Also included are investment results, realized and unrealized gains and losses as well as impairments and risk management disclosures.

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