Financial Instruments, Derivatives and Fair Value Measures (Tables)

3 Months Ended

Mar. 31, 2014

Financial Instruments, Derivatives and Fair Value Measures

Summary of the amounts and location of certain derivative financial instruments

	Fair Value - Assets					Fair Value - Liabilities
(in millions)	March 31, 2014		Dec. 31, 2013		Balance Sheet Caption	March 31, 2014		Dec. 31, 2013		Balance Sheet Caption
Interest rate swaps designated as fair value hedges	$	98	$	87	Deferred income taxes and other assets	$	—	$	—	Post-employment obligations, deferred income taxes and other long-term liabilities
Foreign currency forward exchange contracts:
Hedging instruments	9		14		Prepaid expenses, deferred income taxes, and other receivables	—		—		Other accrued liabilities
Others not designated as hedges	40		70		Prepaid expenses, deferred income taxes, and other receivables	56		75		Other accrued liabilities
Debt designated as a hedge of net investment in a foreign subsidiary	—		—		n/a	516		505		Short-term borrowings
	$	147	$	171		$	572	$	580

Schedule of derivatives gain (loss) in OCI and earnings

	Gain (loss) Recognized in Other Comprehensive Income (loss)					Income (expense) and Gain (loss) Reclassified into Income
(in millions)	2014			2013		2014			2013		Income Statement Caption
Foreign currency forward exchange contracts designated as cash flow hedges	$	2		$	17	$	3		$	3	Cost of products sold
Debt designated as a hedge of net investment in a foreign subsidiary	(11		)	50		—			—		n/a
Interest rate swaps designated as fair value hedges	n/a			n/a		11			10		Interest expense
Foreign currency forward exchange contracts not designated as a hedge	n/a			n/a		(13		)	90		Net foreign exchange loss (gain)

Schedule of carrying values and fair values of certain financial instruments

	March 31, 2014						December 31, 2013
(in millions)	Carrying Value			Fair Value			Carrying Value			Fair Value
Long-term Investment Securities:
Equity securities	$	91		$	91		$	93		$	93
Other	31			26			26			24
Total Long-term Debt	(3,395		)	(3,918		)	(3,397		)	(3,930		)
Foreign Currency Forward Exchange Contracts:
Receivable position	49			49			84			84
(Payable) position	(56		)	(56		)	(75		)	(75		)
Interest Rate Hedge Contracts:
Receivable position	98			98			87			87

Schedule of assets and liabilities measured at fair value on a recurring basis

			Basis of Fair Value Measurement
(in millions)	Outstanding Balances		Quoted Prices in Active Markets		Significant Other Observable Inputs		Significant Unobservable Inputs
March 31, 2014:
Equity securities	$	24	$	24	$	—	$	—
Interest rate swap derivative financial instruments	98		—		98		—
Foreign currency forward exchange contracts	49		—		49		—
Total Assets	$	171	$	24	$	147	$	—
Fair value of hedged long-term debt	$	1,624	$	—	$	1,624	$	—
Foreign currency forward exchange contracts	56		—		56		—
Contingent consideration related to business combinations	72		—		—		72
Total Liabilities	$	1,752	$	—	$	1,680	$	72
December 31, 2013:
Equity securities	$	26	$	26	$	—	$	—
Interest rate swap derivative financial instruments	87		—		87		—
Foreign currency forward exchange contracts	84		—		84		—
Total Assets	$	197	$	26	$	171	$	—
Fair value of hedged long-term debt	$	1,623	$	—	$	1,623	$	—
Foreign currency forward exchange contracts	75		—		75		—
Contingent consideration related to business combinations	208		—		—		208
Total Liabilities	$	1,906	$	—	$	1,698	$	208