XML 50 R36.htm IDEA: XBRL DOCUMENT v3.2.0.727
Derivative Financial Instruments and Hedging Activities (Tables)
 6 Months Ended
Jun. 28, 2015
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Fair values and corresponding balance sheet captions of the Company's derivative instruments
The following table presents the fair values and corresponding balance sheet captions of the Company’s derivative instruments as of June 28, 2015 and December 28, 2014:
 
June 28, 2015
 
December 28, 2014
 
Foreign
Exchange
Contracts
 
Interest
Rate
Contracts
 
Cross-Currency Swap Contracts
 
Foreign
Exchange
Contracts
 
Interest
Rate
Contracts
 
Cross-Currency Swap Contracts
 
(In millions)
Assets:
 
 
 
 
 
 
 

 
 

 
 

Derivatives designated as hedging instruments:
 
 
 
 
 
 
 

 
 

 
 

Other receivables, net
$
26

 
$
—

 
$
—

 
$
43

 
$
—

 
$
—

Other non-current assets
—

 
—

 
551

 
3

 
2

 
357

 
26

 
—

 
551

 
46

 
2

 
357

Derivatives not designated as hedging instruments:
 
 
 
 
 
 
 

 
 

 
 

Other receivables, net
21

 
—

 
—

 
158

 
—

 
—

Other non-current assets
8

 
—

 
—

 
11

 
—

 
—

 
29

 
—

 
—

 
169

 
—

 
—

Total assets(a)
$
55

 
$
—

 
$
551

 
$
215

 
$
2

 
$
357

Liabilities:
 
 
 
 
 
 
 

 
 

 
 

Derivatives designated as hedging instruments:
 
 
 
 
 
 
 

 
 

 
 

Other payables
$
26

 
$
—

 
$
—

 
$
14

 
$
—

 
$
—

Other non-current liabilities
—

 
—

 
91

 
1

 
16

 
2

 
26

 
—

 
91

 
15

 
16

 
2

Derivatives not designated as hedging instruments:
 
 
 
 
 
 
 

 
 

 
 

Other payables
1

 
—

 
—

 
108

 
—

 
—

         Other non-current liabilities
—

 
12

 
—

 
—

 
—

 
—

 
1

 
12

 
—

 
108

 
—

 
—

Total liabilities(a)
$
27

 
$
12

 
$
91

 
$
123

 
$
16

 
$
2

_______________________________________
(a)
The Company’s derivative financial instruments are subject to master netting arrangements that allow for the offset of asset and liabilities in the event of default or early termination of the contract. The Company elects to record the gross assets and liabilities of its derivative financial instruments in the consolidated balance sheets. If the derivative financial instruments had been netted in the consolidated balance sheets, the asset and liability positions each would have been reduced by $130 million and $142 million at June 28, 2015 and December 28, 2014, respectively. No material amounts of collateral were received or posted on the Company’s derivative assets and liabilities as of June 28, 2015.
Effect of derivative instruments on the statement of income
The following tables present the pre-tax effect of derivative instruments on the condensed consolidated statements of income for the three and six months June 28, 2015 and June 29, 2014, respectively:
 
Second Quarter Ended
 
June 28, 2015
 
June 29, 2014
 
Foreign Exchange
Contracts
 
Interest Rate Contracts
 
Cross-Currency Swap Contracts
 
Foreign Exchange
Contracts
 
Interest Rate
Contracts
 
Cross-Currency Swap Contracts
 
(In millions)
Cash flow hedges:
 
 
 
 
 
 
 
 
 
 
 
(Losses)/gains recognized in other comprehensive income (effective portion)
$
(17
)
 
$
9

 
$
—

 
$
(26
)
 
$
(122
)
 
$
—

 
 
 
 
 
 
 
 
 
 
 
 
Net investment hedges:
 
 
 
 
 
 
 
 
 
 
 
(Losses)/gains recognized in other comprehensive income (effective portion)
$
—

 
$
—

 
$
(330
)
 
$
—

 
$
—

 
$
(71
)
Total (losses)/gains recognized in other comprehensive income (effective portion)
$
(17
)
 
$
9

 
$
(330
)
 
$
(26
)
 
$
(122
)
 
$
(71
)
 
 
 
 
 
 
 
 
 
 
 
 
Cash flow hedges:
 
 
 
 
 
 
 
 
 
 
 
Sales
$
(1
)
 
$
—

 
$
—

 
$
(1
)
 
$
—

 
$
—

Cost of products sold
11

 
—

 
—

 
4

 
—

 
—

Selling, general and administrative expenses
—

 
—

 
—

 
—

 
—

 
—

Other expense, net
—

 
—

 
—

 
—

 
—

 
—

Interest expense
—

 
(233
)
 
—

 
—

 
—

 
—

 
10

 
(233
)
 
—

 
3

 
—

 
—

 
 
 
 
 
 
 
 
 
 
 
 
Derivatives not designated as hedging instruments:
 
 
 
 
 
 
 
 
 
 
 
Unrealized gains/(losses) on derivative
instruments recognized in other expense, net
11

 
—

 
—

 
20

 
—

 
—

Realized (losses)/gains on derivative
instruments recognized in other expense, net
(27
)
 
—

 
—

 
(3
)
 
—

 
—

 
(16
)
 
—

 
—

 
17

 
—

 
—

Total amount recognized in statements of income
$
(6
)
 
$
(233
)
 
$
—

 
$
20

 
$
—

 
$
—

    
 
Six Months Ended
 
June 28, 2015
 
June 29, 2014
 
Foreign Exchange
Contracts
 
Interest Rate Contracts
 
Cross-Currency Swap Contracts
 
Foreign Exchange
Contracts
 
Interest Rate
Contracts
 
Cross-Currency Swap Contracts
 
(In millions)
Cash flow hedges:
 
 
 
 
 
 
 
 
 
 
 
(Losses)/gains recognized in other comprehensive income (effective portion)
$
(9
)
 
$
(111
)
 
$
—

 
$
(30
)
 
$
(208
)
 
$
—

 
 
 
 
 
 
 
 
 
 
 
 
Net investment hedges:
 
 
 
 
 
 
 
 
 
 
 
Gains/(losses) recognized in other comprehensive income (effective portion)
—

 
—

 
421

 
—

 
—

 
(259
)
Total (losses)/gains recognized in other comprehensive income (effective portion)
$
(9
)
 
$
(111
)
 
$
421

 
$
(30
)
 
$
(208
)
 
$
(259
)
 
 
 
 
 
 
 
 
 
 
 
 
Cash flow hedges:
 
 
 
 
 
 
 
 
 
 
 
Sales
$
(2
)
 
$
—

 
$
—

 
$
(1
)
 
$
—

 
$
—

Cost of products sold
16

 
—

 
—

 
9

 
—

 
—

Selling, general and administrative expenses
—

 
—

 
—

 
—

 
—

 
—

Other expense, net
1

 
—

 
—

 
1

 
—

 
—

Interest expense
—

 
(237
)
 
—

 
—

 
—

 
—

 
15

 
(237
)
 
—

 
9

 
—

 
—

 
 
 
 
 
 
 
 
 
 
 
 
Derivatives not designated as hedging instruments:
 
 
 
 
 
 
 
 
 
 
 
Unrealized gains/(losses) on derivative
instruments recognized in other expense, net
62

 
—

 
—

 
11

 
—

 
—

Realized (losses)/gains on derivative
instruments recognized in other expense, net
(29
)
 
11

 
—

 
(11
)
 
—

 
—

 
33

 
11

 
—

 
—

 
—

 
—

Total amount recognized in statements of income
$
48

 
$
(226
)
 
$
—

 
$
9

 
$
—

 
$
—