TRANSFERS OF FINANCIAL ASSETS

12 Months Ended

Dec. 31, 2011

Transfers and Servicing [Abstract]

Transfers and Servicing of Financial Assets [Text Block]

TRANSFERS OF FINANCIAL ASSETS

Sale of Trade Accounts Receivable in North America and Europe

The Company sells trade accounts receivable of select North America entities and qualifying trade accounts receivable of select European entities on a revolving basis to certain multi-seller commercial paper conduit entities ("conduits"). The Company maintains servicing responsibilities and the related costs are insignificant. The proceeds received are comprised of cash and interests in specified assets of the conduits (the receivables sold by the Company) that entitle the Company to the residual cash flows of such specified assets in the conduits after the commercial paper has been repaid. Neither the conduits nor the investors in those entities have recourse to other assets of the Company in the event of nonpayment by the debtors.

During the year ended December 31, 2011, the Company recognized a loss of $24 million on the sale of these receivables ($26 million loss for the year ended December 31, 2010), which is included in “Interest expense and amortization of debt discount” in the consolidated statements of income. The Company's interests in the conduits are carried at fair value and included in “Accounts and notes receivable – Other” in the consolidated balance sheets. Fair value of the interests is determined by calculating the expected amount of cash to be received and is based on unobservable inputs (a Level 3 measurement). The key input in the valuation is the percentage of anticipated credit losses in the portfolio of receivables sold that have not yet been collected. Given the short-term nature of the underlying receivables, discount rates and prepayments are not factors in determining the fair value of the interests.

The following table summarizes the carrying value of interests held, which represents the Company's maximum exposure to loss related to the receivables sold, and the percentage of anticipated credit losses related to the trade accounts receivable sold. Also provided is the sensitivity of the fair value of the interests held to hypothetical adverse changes in the anticipated credit losses; amounts shown below are the corresponding hypothetical decreases in the carrying value of interests.

Interests Held at December 31
In millions	2011			2010
Carrying value of interests held	$	1,141		$	1,267
Percentage of anticipated credit losses (1)	1.22		%	1.42		%
Impact to carrying value - 10% adverse change (1)	$	2		$	2
Impact to carrying value - 20% adverse change (1)	$	4		$	5

(1)    Applies to North America only as there are no anticipated credit losses in Europe.

Credit losses, net of any recoveries, were $8 million for the period ending December 31, 2011 ($2 million for the period December 31, 2010).

Following is an analysis of certain cash flows between the Company and the conduits:

Cash Proceeds
In millions	2011		2010
Sale of receivables	$	16	$	818
Collections reinvested in revolving receivables	$	28,609	$	22,866
Interests in conduits (1)	$	1,737	$	1,038

(1)    Presented in "Operating Activities" in the consolidated statements of cash flows.

Following is additional information related to the sale of receivables under these facilities:

Trade Accounts Receivable Sold at December 31
In millions	2011		2010
Delinquencies on sold receivables still outstanding	$	155	$	169
Trade accounts receivable outstanding and derecognized	$	2,385	$	2,335

In September 2011, the Company repurchased $71 million of previously sold receivables related to a divestiture ($13 million related to a divestiture in May 2010).

Sale of Trade Accounts Receivable in Asia Pacific

The Company sells participating interests in trade accounts receivable of select Asia Pacific entities. The Company maintains servicing responsibilities and the related costs are insignificant. The third-party holders of the participating interests do not have recourse to the Company’s assets in the event of nonpayment by the debtors.

During the years ended December 31, 2011 and 2010, the Company recognized an insignificant loss on the sale of the participating interests in the receivables, which is included in “Interest expense and amortization of debt discount” in the consolidated statements of income. The Company receives cash upon the sale of the participating interests in the receivables.

Following is an analysis of certain cash flows between the Company and the third-party holders of the participating interests:

Cash Proceeds
In millions	2011		2010
Sale of participating interests	$	143	$	218
Collections reinvested in revolving receivables	$	120	$	195

Following is additional information related to the sale of participating interests in the receivables under this facility:

Trade Accounts Receivable at December 31 In millions	2011		2010
Derecognized from the consolidated balance sheets	$	13	$	25
Outstanding in the consolidated balance sheets	303		281
Total accounts receivable in select Asia Pacific entities	$	316	$	306

There were no credit losses on receivables relating to the participating interests sold during the years ended December 31, 2011 and 2010. There were no delinquencies on the outstanding receivables related to the participating interests sold at December 31, 2011 or December 31, 2010.