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Fair Value Disclosures
 9 Months Ended
Sep. 30, 2024
Fair Value Disclosures [Abstract]  
Fair Value Disclosures Fair Value Disclosures
Recurring Fair Value Measurements
The following table presents the Company’s non-pension financial assets and liabilities, which are measured at fair value on a recurring basis (in millions):
September 30, 2024December 31, 2023
Fair value Asset (Liability)Fair value Asset (Liability)
Level 1Level 2Level 3TotalLevel 1Level 2Level 3Total
Derivatives:
Assets$— $35 $— $35 $— $45 $— $45 
Liabilities— (151)— (151)— (165)— (165)
Investment securities, including mutual funds
3 — — 3 14 — — 14 

For publicly traded investment securities, including mutual funds, fair value is determined on the basis of quoted market prices and, accordingly, such investments are classified as Level 1. The Company determines the fair value of its derivative instruments using standard pricing models and market-based assumptions for all significant inputs, such as yield curves and quoted spot and forward exchange rates. Accordingly, the Company’s derivative instruments are classified as Level 2.
Financial Instruments

The Company’s financial instruments include cash and cash equivalents, accounts receivable, accounts payable, derivative instruments, notes payable and short and long-term debt. The carrying values for current financial assets and liabilities, including cash and cash equivalents, accounts receivable, accounts payable and short-term debt approximate fair value due to the short maturity of such instruments. The fair values of the Company’s debt and derivative instruments are disclosed in Footnote 8 and Footnote 9, respectively.

In 2019, the Company acquired an equity investment in a publicly traded Asian writing business, which is traded on an active exchange and therefore has a readily determinable fair value. During the third quarter of 2024, the Company sold all its equity interest in the open market for proceeds of approximately $11 million and recorded a loss of approximately $2 million within other expense, net in the Condensed Consolidated Statement of Operations for the three and nine months ended September 30, 2024.

Nonrecurring Fair Value Measurements

The Company’s nonfinancial assets, which are measured at fair value on a nonrecurring basis, include property, plant and equipment, goodwill, intangible assets and certain other assets.

The Company’s goodwill and indefinite-lived intangibles are fair valued using discounted cash flows. Goodwill impairment testing requires significant use of judgment and assumptions including the identification of reporting units; the assignment of assets and liabilities to reporting units; and the estimation of future cash flows, business growth rates, terminal values and discount rates. The testing of indefinite-lived intangibles under established guidelines for impairment also requires significant use of judgment and assumptions, such as the estimation of cash flow projections, terminal values, royalty rates, contributory cross charges, where applicable, and discount rates. Accordingly, these fair value measurements fall in Level 3 of the fair value hierarchy. These assets and certain liabilities are measured at fair value on a nonrecurring basis as part of the Company’s annual impairment testing and as circumstances require.

During the third quarter of 2024, indefinite-lived tradenames in the H&CS and L&D segments were recorded at fair value based upon the Company’s impairment testing. The most significant unobservable inputs (Level 3) used to estimate the fair values of the Company’s intangible assets are discount rates. The discount rates used in the measurements of the indefinite-lived tradenames were 11.0% and 7.5% for the H&CS and L&D indefinite-lived tradenames, respectively.

The Company fair valued the indefinite-lived tradenames within the H&CS and L&D segments at $301 million and $65 million, respectively, on a non-recurring basis in connection with triggering events that occurred during the third quarter of 2024. See Footnotes 1 and 6, for further information.