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FAIR VALUE MEASUREMENTS AND FINANCIAL INSTRUMENTS (Tables)

9 Months Ended

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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Tabular disclosure of the fair value measurement of liabilities using significant unobservable inputs (Level 3), a reconciliation of the beginning and ending balances, separately presenting changes attributable to the following: (1) total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings (or changes in net assets), and gains or losses recognized in other comprehensive income (loss) and a description of where those gains or losses included in earnings (or changes in net assets) are reported in the statement of income (or activities); (2) purchases, sales, issues, and settlements (each type disclosed separately); and (3) transfers in and transfers out of Level 3 (for example, transfers due to changes in the observability of significant inputs) by class of liability.

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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.

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Tabular disclosure of gains and losses on derivative instruments included in an entity's trading activities.

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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).

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Tabular disclosure for net investment hedges of (a) the location and amount of gains and losses reported in the statement of financial performance and (b) the location and fair value amounts of the instruments reported in the statement of financial position.

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