Financial Instruments, Derivatives and Fair Value Measures (Tables)

9 Months Ended

Sep. 30, 2015

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)	Sept. 30, 2015		Dec. 31, 2014		Balance Sheet Caption	Sept. 30, 2015		Dec. 31, 2014		Balance Sheet Caption
Interest rate swaps designated as fair value hedges	$	172	$	101	Deferred income taxes and other assets	$	—	$	—	Post-employment obligations, deferred income taxes and other long-term liabilities
Foreign currency forward exchange contracts:
Hedging instruments	100		107		Prepaid expenses, deferred income taxes, and other receivables	20		—		Other accrued liabilities
Others not designated as hedges	107		150		Prepaid expenses, deferred income taxes, and other receivables	105		130		Other accrued liabilities
Debt designated as a hedge of net investment in a foreign subsidiary	—		—		n/a	442		445		Short-term borrowings
	$	379	$	358		$	567	$	575

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
	Three Months Ended Sept. 30					Nine Months Ended Sept. 30				Three Months Ended Sept. 30					Nine Months Ended Sept. 30					Income Statement
(in millions)	2015			2014		2015		2014		2015		2014			2015			2014		Caption
Foreign currency forward exchange contracts designated as cash flow hedges	$	41		$	58	$	89	$	56	$	33	$	2		$	80		$	7	Cost of products sold
Debt designated as a hedge of net investment in a foreign subsidiary	(11		)	38		3		20		n/a		n/a			n/a			n/a		n/a
Interest rate swaps designated as fair value hedges	n/a			n/a		n/a		n/a		85		(6		)	71			13		Interest expense
Foreign currency forward exchange contracts not designated as hedges	n/a			n/a		n/a		n/a		9		76			(92		)	50		Net foreign exchange loss (gain)

Schedule of carrying values and fair values of certain financial instruments

	September 30, 2015						December 31, 2014
(in millions)	Carrying Value			Fair Value			Carrying Value			Fair Value
Investment Securities:
Equity securities	$	3,038		$	3,038		$	212		$	212
Other	17			17			17			17
Total Long-term Debt	(5,985		)	(6,493		)	(3,463		)	(4,113		)
Foreign Currency Forward Exchange Contracts:
Receivable position	207			207			263			263
(Payable) position	(125		)	(125		)	(135		)	(135		)
Interest Rate Hedge Contracts:
Receivable position	172			172			101			101

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
September 30, 2015:
Equity securities	$	2,817	$	2,817	$	—	$	—
Interest rate swap derivative financial instruments	172		—		172		—
Foreign currency forward exchange contracts	207		—		207		—
Total Assets	$	3,196	$	2,817	$	379	$	—
Fair value of hedged long-term debt	$	4,196	$	—	$	4,196	$	—
Foreign currency forward exchange contracts	125		—		125		—
Contingent consideration related to business combinations	180		—		—		180
Total Liabilities	$	4,501	$	—	$	4,321	$	180
December 31, 2014:
Equity securities	$	9	$	9	$	—	$	—
Interest rate swap derivative financial instruments	101		—		101		—
Foreign currency forward exchange contracts	263		—		263		—
Total Assets	$	373	$	9	$	364	$	—
Fair value of hedged long-term debt	$	1,637	$	—	$	1,637	$	—
Foreign currency forward exchange contracts	135		—		135		—
Contingent consideration related to business combinations	243		—		—		243
Total Liabilities	$	2,015	$	—	$	1,772	$	243

Schedule summarizes the available-for-sale equity securities in an unrealized loss position

(in millions)	September 30, 2015		December 31, 2014
Fair value of securities in an unrealized loss position	$	2,812	$	6
Unrealized gross losses	797		—