Fair Value Measurements (Tables)

3 Months Ended

Mar. 31, 2015

Fair Value Disclosures [Abstract]

Assets and liabilities measured on a recurring basis at fair value

Assets and liabilities measured on a recurring basis at fair value, primarily related to Financial Products, included in our Consolidated Statement of Financial Position as of March 31, 2015 and December 31, 2014 are summarized below:

	March 31, 2015
(Millions of dollars)	Level 1		Level 2		Level 3		Total Assets / Liabilities, at Fair Value
Assets
Available-for-sale securities
Government debt
U.S. treasury bonds	$	10	$	—	$	—	$	10
Other U.S. and non-U.S. government bonds	—		98		—		98
Corporate bonds
Corporate bonds	—		662		—		662
Asset-backed securities	—		103		—		103
Mortgage-backed debt securities
U.S. governmental agency	—		281		—		281
Residential	—		14		—		14
Commercial	—		64		—		64
Equity securities
Large capitalization value	256		—		—		256
Smaller company growth	47		—		—		47
Total available-for-sale securities	313		1,222		—		1,535
Total Assets	$	313	$	1,222	$	—	$	1,535
Liabilities
Derivative financial instruments, net	—		97		—		97
Guarantees	$	—	$	—	$	13	$	13
Total Liabilities	$	—	$	97	$	13	$	110

	December 31, 2014
(Millions of dollars)	Level 1		Level 2		Level 3		Total Assets / Liabilities, at Fair Value
Assets
Available-for-sale securities
Government debt
U.S. treasury bonds	$	10	$	—	$	—	$	10
Other U.S. and non-U.S. government bonds	—		94		—		94
Corporate bonds
Corporate bonds	—		693		—		693
Asset-backed securities	—		105		—		105
Mortgage-backed debt securities
U.S. governmental agency	—		294		—		294
Residential	—		15		—		15
Commercial	—		67		—		67
Equity securities
Large capitalization value	233		—		—		233
Smaller company growth	43		—		—		43
Total available-for-sale securities	286		1,268		—		1,554
Total Assets	$	286	$	1,268	$	—	$	1,554
Liabilities
Derivative financial instruments, net	—		86		—		86
Guarantees	$	—	$	—	$	12	$	12
Total Liabilities	$	—	$	86	$	12	$	98

Roll-forward of liabilities measured at fair value using Level 3 inputs

Below are roll-forwards of liabilities measured at fair value using Level 3 inputs for the three months ended March 31, 2015 and 2014.  These instruments were valued using pricing models that, in management’s judgment, reflect the assumptions of a marketplace participant.

(Millions of dollars)	Guarantees
Balance at December 31, 2014	$	12
Issuance of guarantees	1
Expiration of guarantees	—
Balance at March 31, 2015	$	13
Balance at December 31, 2013	$	13
Issuance of guarantees	—
Expiration of guarantees	—
Balance at March 31, 2014	$	13

Fair values of financial instruments

Please refer to the table below for the fair values of our financial instruments.

	Fair Value of Financial Instruments
	March 31, 2015				December 31, 2014
(Millions of dollars)	Carrying Amount		Fair Value		Carrying Amount		Fair Value		Fair Value Levels	Reference
Assets
Cash and short-term investments	$	7,563	$	7,563	$	7,341	$	7,341	1
Restricted cash and short-term investments	58		58		62		62		1
Available-for-sale securities	1,535		1,535		1,554		1,554		1 & 2	Note 8
Finance receivables – net (excluding finance leases 1)	16,036		15,884		16,426		16,159		3	Note 16
Wholesale inventory receivables – net (excluding finance leases 1)	1,802		1,724		1,774		1,700		3	Note 16
Interest rate swaps – net	71		71		71		71		2	Note 4
Liabilities
Short-term borrowings	5,267		5,267		4,708		4,708		1
Long-term debt (including amounts due within one year)
Machinery, Energy & Transportation	10,008		12,044		10,003		11,973		2
Financial Products	23,500		24,107		24,574		25,103		2
Foreign currency contracts – net	153		153		143		143		2	Note 4
Commodity contracts – net	15		15		14		14		2	Note 4
Guarantees	13		13		12		12		3	Note 10

¹  Total excluded items have a net carrying value at March 31, 2015 and December 31, 2014 of $7,097 million and $7,638 million, respectively.