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Derivative Financial Instruments (Tables)
 3 Months Ended
Mar. 31, 2017
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Outstanding Foreign Currency Forward Contracts

The Company had the following outstanding foreign currency forward contracts that were entered into to hedge nonfunctional currency cash flows from forecasted revenues and expenses (in millions):

 

     Currency Denomination  
     March 31,      December 31,  

Foreign Currency

    2017      2016  

Norwegian Krone

    NOK      4,803      NOK      5,621  

Japanese Yen

    JPY      1,462      JPY      1,462  

U.S. Dollar

    USD      335      USD      321  

Euro

    EUR      94      EUR      279  

Danish Krone

    DKK      21      DKK      29  

British Pound Sterling

    GBP      16      GBP      1  

Singapore Dollar

    SGD      2      SGD      2  

The Company had the following outstanding foreign currency forward contracts that hedge the fair value of nonfunctional currency monetary accounts (in millions):

 

     Currency Denomination  
     March 31,      December 31,  

Foreign Currency

    2017      2016  

Russian Ruble

    RUB      1,747      RUB      1,893  

Norwegian Krone

    NOK      1,377      NOK      538  

Euro

    EUR      420      EUR      272  

U.S. Dollar

    USD      408      USD      457  

South African Rand

    ZAR      150      ZAR      150  

Danish Krone

    DKK      78      DKK      49  

Singapore Dollar

    SGD      7      SGD      7  

British Pound Sterling

    GBP      4      GBP      3  

Canadian Dollar

    CAD      1      CAD      1  
Derivative Instruments and their Balance Sheet Classifications

The Company has the following gross fair values of its derivative instruments and their balance sheet classifications:

 

   

Asset Derivatives

    

Liability Derivatives

  
        Fair Value         Fair Value  
   

Balance Sheet

Location

   March 31,
2017		     December 31,
2016		    

Balance Sheet

Location

   March 31,
2017		     December 31,
2016		  

Derivatives designated as hedging instruments under ASC Topic 815

            

Foreign exchange contracts

   Prepaid and other current assets   $ 3     $ 24     Accrued liabilities   $ 29     $ 37  

Foreign exchange contracts

   Other Assets     1       6     Other liabilities     2       11  
   

 

 

    

 

 

      

 

 

    

 

 

  

Total derivatives designated as hedging instruments under ASC Topic 815

     $ 4     $ 30       $ 31     $ 48  
   

 

 

    

 

 

      

 

 

    

 

 

  

Derivatives not designated as hedging instruments under ASC Topic 815

            

Foreign exchange contracts

   Prepaid and other current assets   $ 76     $ 32     Accrued liabilities   $ 24     $ 29  
   

 

 

    

 

 

      

 

 

    

 

 

  
           

Total derivatives not designated as hedging instruments under ASC Topic 815

     $ 76     $ 32       $ 24     $ 29  
   

 

 

    

 

 

      

 

 

    

 

 

  

Total derivatives

     $ 80     $ 62       $ 55     $ 77  
   

 

 

    

 

 

      

 

 

    

 

 

  
Effect of Derivative Instruments on Consolidated Statements of Income

The Effect of Derivative Instruments on the Consolidated Statements of Income

($ in millions)

 

Derivatives in ASC Topic 815
Cash Flow  Hedging
Relationships

   Amount of Gain (Loss)
Recognized in OCI on
Derivative (Effective Portion) (a)		    

Location of Gain (Loss)
Reclassified from
Accumulated OCI into
Income

(Effective Portion)

   Amount of Gain (Loss)
Reclassified from
Accumulated OCI into
Income (Effective Portion)		    

Location of Gain (Loss)
Recognized in Income on
Derivative (Ineffective
Portion and Amount
Excluded from
Effectiveness

Testing)

     Amount of Gain (Loss)
Recognized in Income on
Derivative (Ineffective
Portion and Amount
Excluded from
Effectiveness Testing) (b)		  
    Three Months Ended         Three Months Ended         Three Months Ended  
    March 31,         March 31,         March 31,  
    2017     2016         2017     2016         2017     2016  
      Revenue     5       1     Cost of revenue     15       (16 ) 

Foreign exchange contracts

     13       66     Cost of revenue     (11 )      (60 )    Other income (expense), net     8       (1 ) 
 

 

 

    

 

 

      

 

 

    

 

 

      

 

 

    

 

 

  

Total

     13       66         (6 )      (59 )        23       (17 ) 
 

 

 

    

 

 

      

 

 

    

 

 

      

 

 

    

 

 

  
               

 

Derivatives Not Designated as

Hedging Instruments under

ASC Topic 815

   

Location of Gain (Loss)

Recognized in Income

on Derivative

    Amount of Gain (Loss)
Recognized in Income on
Derivative		  
          Three Months Ended
March 31,		  
          2017      2016  

Foreign exchange contracts

    Other income (expense), net      9        14  
     

 

 

     

 

 

  

Total

         9        14  
     

 

 

     

 

 

  

 

(a) The Company expects that $8 million of the accumulated other comprehensive income (loss) will be reclassified into earnings within the next twelve months with an offset by gains from the underlying transactions resulting in no impact to earnings or cash flow.
(b) The amount of gain (loss) recognized in income represents $15 million and $(16) million related to the ineffective portion of the hedging relationships for the three months ended March 31, 2017 and 2016, respectively, and $8 million and $(1) million related to the amount excluded from the assessment of the hedge effectiveness for the three months ended March 31, 2017 and 2016, respectively.