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Financial Instruments (Tables)

9 Months Ended

Dec. 27, 2014

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Company's outstanding derivative instruments on a gross basis as recorded on its consolidated balance sheets

The following table summarizes the Company's outstanding derivative instruments on a gross basis as recorded in its consolidated balance sheets as of December 27, 2014 and March 29, 2014:

		Notional Amounts								Derivative Assets												Derivative Liabilities
Derivative Instrument(a)		December 27, 2014				March 29, 2014				December 27, 2014						March 29, 2014						December 27, 2014						March 29, 2014
										Balance Sheet Line(b)		Fair Value				Balance Sheet Line(b)		Fair Value				Balance Sheet Line(b)		Fair Value				Balance Sheet Line(b)		Fair Value
		(millions)
Designated Hedges:
FC — Inventory purchases		$	398			$	476			(c)		$	33			(d)		$	2			AE		$	3			AE		$	5
FC — Other(e)		130				223				PP		12				—		—				AE		1				AE		2
Total Designated Hedges		$	528			$	699					$	45					$	2					$	4					$	7
Undesignated Hedges:
FC — Other(f)		$	468			$	280			(g)		$	32			(h)		$	6			AE		$	4			—		$	—
Total Hedges		$	996			$	979					$	77					$	8					$	8					$	7

^(a)  FC = Forward foreign currency exchange contracts.

^(b)  PP = Prepaid expenses and other current assets; AE = Accrued expenses and other current liabilities.

^(c)  $30 million included within prepaid expenses and other current assets and $3 million included within other non-current assets.

^(d)  $1 million included within prepaid expenses and other current assets and $1 million included within other non-current assets.

^(e)  Primarily includes designated hedges of foreign currency-denominated intercompany royalty payments, marketing contributions, and other operational exposures.

^(f)  Primarily includes undesignated hedges of foreign currency-denominated intercompany loans.

^(g)  $9 million included within prepaid expenses and other current assets and $23 million included within other non-current assets.

^(h)  $2 million included within prepaid expenses and other current assets and $4 million included within other non-current assets.

Offsetting Assets

The Company records and presents the fair values of all of its derivative assets and liabilities in its consolidated balance sheets on a gross basis, even though they are subject to master netting arrangements. However, if the Company were to offset and record the asset and liability balances of all of its forward foreign currency exchange contracts on a net basis in accordance with the terms of each of its master netting arrangements, spread across eight separate counterparties, the amounts presented in the consolidated balance sheets as of December 27, 2014 and March 29, 2014 would be adjusted from the current gross presentation as detailed in the following table:

		December 27, 2014												March 29, 2014
Derivative Instrument		Gross Amounts Presented in the Balance Sheet				Gross Amounts Not Offset in the Balance Sheet that are Subject to Master Netting Agreements				Net Amount				Gross Amounts Presented in the Balance Sheet				Gross Amounts Not Offset in the Balance Sheet that are Subject to Master Netting Agreements				Net Amount
		(millions)
FC — Derivative assets		$	77			$	(7	)		$	70			$	8			$	(1	)		$	7
FC — Derivative liabilities		$	8			$	(7	)		$	1			$	7			$	(1	)		$	6

Derivative gains (losses) recognized in AOCI

The following tables summarize the pretax impact of the effective portion of gains and losses from the Company's derivative instruments on its unaudited interim consolidated financial statements for the three-month and nine-month periods ended December 27, 2014 and December 28, 2013:

		Gains (Losses) Recognized in OCI
		Three Months Ended								Nine Months Ended
Derivative Instrument		December 27, 2014				December 28, 2013				December 27, 2014				December 28, 2013
						(millions)
Designated Cash Flow Hedges:
FC — Inventory purchases		$	11			$	(4	)		$	33			$	(12	)
FC — Other		12				3				21				2
Total Designated Hedges		$	23			$	(1	)		$	54			$	(10	)

Derivative gains (losses) reclassified from AOCI to earnings

		Gains (Losses) Reclassified from AOCI to Earnings																Location of Gains (Losses) Reclassified from AOCI to Earnings
		Three Months Ended								Nine Months Ended
Derivative Instrument		December 27, 2014				December 28, 2013				December 27, 2014				December 28, 2013
						(millions)
Designated Cash Flow Hedges:
FC — Inventory purchases		$	—			$	3			$	(2	)		$	9			Cost of goods sold
FC — Other		11				1				16				—				Foreign currency gains (losses)
		$	11			$	4			$	14			$	9

The following table presents reclassifications from AOCI to earnings for derivative financial instruments, by component:

		Three Months Ended								Nine Months Ended								Location of Gains (Losses) Reclassified from AOCI to Earnings
		December 27, 2014				December 28, 2013				December 27, 2014				December 28, 2013
		(millions)
Gains (losses) on derivative financial instruments(a):
FC — Inventory purchases		$	—			$	3			$	(2	)		$	9			Cost of goods sold
FC — Other		11				1				16				—				Foreign currency gains (losses)
Tax effect		(3		)		(1		)		(3		)		(2		)		Provision for income taxes
Net of tax		$	8			$	3			$	11			$	7

^(a)  FC = Forward foreign currency exchange contracts.

Schedule of other derivatives not designated as hedging instruments, location and amounts recognized in earnings

The following table summarizes the impact of gains and losses from the Company's undesignated hedge contracts on its unaudited interim consolidated financial statements for the three-month and nine-month periods ended December 27, 2014 and December 28, 2013:

		Gains (Losses) Recognized in Earnings																Location of Gains (Losses) Recognized in Earnings
		Three Months Ended								Nine Months Ended
Derivative Instrument		December 27, 2014				December 28, 2013				December 27, 2014				December 28, 2013
		(millions)
Undesignated Hedges:
FC — Other		$	18			$	3			$	24			$	21			Foreign currency gains (losses)
Total Undesignated Hedges		$	18			$	3			$	24			$	21

Company's short-term and non-current investments recorded in the consolidated balance sheets

The following table summarizes the Company's short-term and non-current investments recorded in its consolidated balance sheets as of December 27, 2014 and March 29, 2014:

		December 27, 2014												March 29, 2014
Type of Investment		Short-term				Non-current				Total				Short-term				Non-current				Total
										(millions)
Available-for-Sale:
Government bonds		$	—			$	—			$	—			$	1			$	—			$	1
Other		—				—				—				—				2				2
Total available-for-sale investments		$	—			$	—			$	—			$	1			$	2			$	3
Other:
Time deposits		$	644			$	—			$	644			$	487			$	—			$	487
Total Investments		$	644			$	—			$	644			$	488			$	2			$	490

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Tabular disclosure of derivative and other financial assets that are subject to offsetting, including master netting arrangements.

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-Publisher FASB

-Name Accounting Standards Codification

-Topic 210

-SubTopic 20

-Section 50

-Paragraph 4

-URI http://asc.fasb.org/extlink&oid=20225523&loc=SL20225877-175312



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-Publisher FASB

-Name Accounting Standards Codification

-Topic 815

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Tabular disclosure of the location and fair value amounts of derivative instruments (and nonderivative instruments that are designated and qualify as hedging instruments) reported in the statement of financial position.

+ References

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-Publisher FASB

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