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FAIR VALUE MEASUREMENTS AND FINANCIAL INSTRUMENTS (Tables) | 9 Months Ended
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Sep. 30, 2022
Fair Value Disclosures [Abstract] |
Schedule of components and classification of financial assets and liabilities measured at fair value | The following fair value hierarchy table presents the components and classification of the Company’s financial assets and liabilities measured at fair value on a recurring basis:
|  | September 30, 2022 |  | December 31, 2021
(in millions) |  | Carrying Value |  | Level 1 |  | Level 2 |  | Level 3 |  | Carrying Value |  | Level 1 |  | Level 2 |  | Level 3
Assets: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Cash equivalents |  | $ | 24 |  |  | $ | 13 |  |  | $ | 11 |  |  | $ | — |  |  | $ | 76 |  |  | $ | 58 |  |  | $ | 18 |  |  | $ | — |
Restricted cash and other settlement deposits |  | $ | 11 |  |  | $ | 11 |  |  | $ | — |  |  | $ | — |  |  | $ | 1,537 |  |  | $ | 1,537 |  |  | $ | — |  |  | $ | — |
Foreign currency exchange contracts |  | $ | 3 |  |  | $ | — |  |  | $ | 3 |  |  | $ | — |  |  | $ | 1 |  |  | $ | — |  |  | $ | 1 |  |  | $ | — |
Cross-currency swaps |  | $ | 14 |  |  | $ | — |  |  | $ | 14 |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |
Liabilities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Acquisition-related contingent consideration |  | $ | 224 |  |  | $ | — |  |  | $ | — |  |  | $ | 224 |  |  | $ | 241 |  |  | $ | — |  |  | $ | — |  |  | $ | 241 |
Foreign currency exchange contracts |  | $ | 6 |  |  | $ | — |  |  | $ | 6 |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |
Schedule of assets and liabilities associated with derivatives, included in the Consolidated Balance Sheets | The assets and liabilities associated with Bausch + Lomb’s cross-currency swaps as included in the Consolidated Balance Sheet as of September 30, 2022 are as follows:
(in millions) |  |
Other non-current assets |  | $ | 11 |
Prepaid expenses and other current assets |  | $ | 3 |
Net fair value |  | $ | 14 |
The assets and liabilities associated with the Company’s foreign exchange contracts as included in the Consolidated Balance Sheets as of September 30, 2022 and December 31, 2021 are as follows:
(in millions) | September 30, 2022 |  | December 31, 2021
Accrued and other current liabilities | $ | (6) |  |  | $ | — |
Prepaid expenses and other current assets | $ | 3 |  |  | $ | 1 |
Net fair value | $ | (3) |  |  | $ | 1 |
Schedule of effect of hedging instruments on financial statements | The following table presents the effect of hedging instruments on the Consolidated Statements of Comprehensive Income (Loss) and the Consolidated Statements of Operations for the three and nine months ended September 30, 2022 and 2021:
|  | Three Months Ended September 30, | Nine Months Ended September 30,
(in millions) |  | 2022 |  | 2021 | 2022 |  | 2021
Gain recognized in Other comprehensive loss |  | $ | 11 |  |  | $ | 28 |  | $ | 11 |  |  | $ | 57 |
Gain excluded from assessment of hedge effectiveness |  | $ | 3 |  |  | $ | 6 |  | $ | 3 |  |  | $ | 17 |
Location of gain of excluded component |  | Interest Expense | Interest Expense
Schedule of foreign exchange contracts on the Consolidated Statements of Operations and Consolidated Statements of Cash Flows | The following table presents the effect of the Company’s foreign exchange contracts on the Consolidated Statements of Operations and the Consolidated Statements of Cash Flows for the three and nine months ended September 30, 2022 and 2021:
| Three Months Ended September 30, |  | Nine Months Ended September 30,
(in millions) | 2022 |  | 2021 |  | 2022 |  | 2021
Gain (loss) related to changes in fair value | $ | 7 |  |  | $ | 2 |  |  | $ | (3) |  |  | $ | 7 |
Loss related to settlements | $ | (18) |  |  | $ | (5) |  |  | $ | (21) |  |  | $ | (14) |
Schedule of reconciliation of contingent consideration obligations measured on a recurring basis using significant unobservable inputs (Level 3) | The following table presents a reconciliation of contingent consideration obligations measured on a recurring basis using significant unobservable inputs (Level 3) for the nine months ended September 30, 2022 and 2021:
|  | September 30,
(in millions) |  | 2022 |  | 2021
Balance, beginning of period |  |  |  | $ | 241 |  |  |  |  | $ | 328 |
Adjustments to Acquisition-related contingent consideration: |  |  |  |  |  |  |  |
Accretion for the time value of money |  | $ | 12 |  |  |  |  | $ | 12 |  |  |
Fair value adjustments due to changes in estimates of other future payments |  | (10) |  |  |  |  | (4) |  |  |
Acquisition-related contingent consideration |  |  |  | 2 |  |  |  |  | 8 |
Payments/Settlements |  |  |  | (19) |  |  |  |  | (93) |
Foreign currency translation adjustment included in other comprehensive loss |  |  |  | — |  |  |  |  | 1 |
Balance, end of period |  |  |  | 224 |  |  |  |  | 244 |
Current portion included in Accrued and other current liabilities |  |  |  | 35 |  |  |  |  | 37 |
Non-current portion |  |  |  | $ | 189 |  |  |  |  | $ | 207 |

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- Definition Tabular disclosure of assets and liabilities, including [financial] instruments measured at fair value that are classified in stockholders' equity, if any, that are measured at fair value on a recurring basis. The disclosures contemplated herein include the fair value measurements at the reporting date by the level within the fair value hierarchy in which the fair value measurements in their entirety fall, segregating fair value measurements using quoted prices in active markets for identical assets (Level 1), significant other observable inputs (Level 2), and significant unobservable inputs (Level 3). + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 820 -SubTopic 10 -Section 50 -Paragraph 2 -Subparagraph (b) -URI https://asc.fasb.org/extlink&oid=126976982&loc=d3e19207-110258 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 820 -SubTopic 10 -Section 50 -Paragraph 2 -Subparagraph (a) -URI https://asc.fasb.org/extlink&oid=126976982&loc=d3e19207-110258 + Details
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