Financial Instruments (Tables)

3 Months Ended

Mar. 31, 2014

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Fair Value of Foreign Exchange Contracts

The fair value of PMI’s foreign exchange contracts included in the condensed consolidated balance sheet as of March 31, 2014 and December 31, 2013, were as follows:

	Asset Derivatives					Liability Derivatives
		Fair Value					Fair Value
(in millions)	Balance Sheet Classification	At March 31, 2014		At December 31, 2013		Balance Sheet Classification	At March 31, 2014		At December 31, 2013
Foreign exchange contracts designated as hedging instruments	Other current assets	$	74	$	111	Other accrued liabilities	$	5	$	44
	Other assets	1		—		Other liabilities	45		46
Foreign exchange contracts not designated as hedging instruments	Other current assets	26		42		Other accrued liabilities	42		12
						Other liabilities	—		14
Total derivatives		$	101	$	153		$	92	$	116

Hedging Activities Effect on Condensed Consolidated Statements of Earnings and Other Comprehensive Earnings

Hedging activities, which represent movement in derivatives as well as the respective underlying transactions, had the following effect on PMI’s condensed consolidated statements of earnings and other comprehensive earnings for the three months ended March 31,2014 and 2013:

(in millions)	For the Three Months Ended March 31, 2014
Gain (Loss)	Cash Flow Hedges			Net Investment Hedges		Other Derivatives			Income Taxes			Total
Statement of Earnings:
Net revenues	$	15				$	—					$	15
Cost of sales	—					—						—
Marketing, administration and research costs	—					—						—
Operating income	15					—						15
Interest expense, net	(7		)			(2		)				(9		)
Earnings before income taxes	8					(2		)				6
Provision for income taxes	(1		)			—						(1		)
Net earnings attributable to PMI	$	7				$	(2	)				$	5
Other Comprehensive Earnings/(Losses):
Gains transferred to earnings	$	(8	)						$	1		$	(7	)
Recognized losses	(27		)						3			(24		)
Net impact on equity	$	(35	)						$	4		$	(31	)
Currency translation adjustments				$	25				$	(11	)	$	14

(in millions)	For the Three Months Ended March 31, 2013
Gain (Loss)	Cash Flow Hedges			Net Investment Hedges		Other Derivatives		Income Taxes			Total
Statement of Earnings:
Net revenues	$	41				$	—				$	41
Cost of sales	3					—					3
Marketing, administration and research costs	—					—					—
Operating income	44					—					44
Interest expense, net	(9		)			—					(9		)
Earnings before income taxes	35					—					35
Provision for income taxes	(4		)			—					(4		)
Net earnings attributable to PMI	$	31				$	—				$	31
Other Comprehensive Earnings/(Losses):
Gains transferred to earnings	$	(35	)					$	4		$	(31	)
Recognized gains	109							(13		)	96
Net impact on equity	$	74						$	(9	)	$	65
Currency translation adjustments				$	3			$	—		$	3

Pre-Tax Effect of Foreign Exchange Contracts Designated as Cash Flow Hedging Instruments

For the three months ended March 31,2014 and 2013, foreign exchange contracts that were designated as cash flow hedging instruments impacted the condensed consolidated statements of earnings and comprehensive earnings as follows:

(pre-tax, in millions)	For the Three Months Ended March 31,
Derivatives in Cash Flow Hedging Relationship	Statement of Earnings Classification of Gain/(Loss) Reclassified from Other Comprehensive Earnings/(Losses) into Earnings	Amount of Gain/(Loss) Reclassified from Other Comprehensive  Earnings/(Losses) into Earnings						Amount of Gain/(Loss) Recognized in Other Comprehensive Earnings/(Losses) on Derivatives
		2014			2013			2014			2013
Foreign exchange contracts								$	(27	)	$	109
	Net revenues	$	15		$	41
	Cost of sales	—			3
	Interest expense, net	(7		)	(9		)
Total		$	8		$	35		$	(27	)	$	109

Pre-Tax Effect of Foreign Exchange Contracts Designated as Net Investment Hedging Instruments

For the three months ended March 31,2014 and 2013, foreign exchange contracts that were designated as net investment hedging instruments impacted the condensed consolidated statements of earnings and comprehensive earnings as follows:

(pre-tax, in millions)	For the Three Months Ended March 31,
Derivatives in Net Investment Hedging Relationship	Statement of Earnings Classification of Gain/(Loss) Reclassified from Other Comprehensive Earnings/(Losses) into Earnings	Amount of Gain/(Loss) Reclassified from Other Comprehensive Earnings/(Losses) into Earnings				Amount of Gain/(Loss) Recognized in Other Comprehensive Earnings/(Losses) on Derivatives
		2014		2013		2014		2013
Foreign exchange contracts						$	25	$	3
	Interest expense, net	$	—	$	—

Pre-Tax Effect of Foreign Exchange Contracts Not Designated as Hedging Instruments

As a result, for the three months ended March 31,2014 and 2013, these items impacted the condensed consolidated statements of earnings as follows:

(pre-tax, in millions)	For the Three Months Ended March 31,
Derivatives not Designated    as Hedging Instruments	Statement of Earnings Classification of Gain/(Loss)	Amount of Gain/(Loss) Recognized in Earnings
			For the Three Months Ended March 31,
			2014			2013
Foreign exchange contracts
	Interest expense, net		$	(2	)	$	—

Hedging Activity Reported in Accumulated Other Comprehensive Earnings (Losses), Net of Income Taxes

Hedging activity affected accumulated other comprehensive losses, net of income taxes, as follows:

(in millions)	For the Three Months Ended March 31,
	2014			2013
Gain as of January 1,	$	63		$	92
Derivative (gains)/losses transferred to earnings	(7		)	(31		)
Change in fair value	(24		)	96
Gain as of March 31,	$	32		$	157