(1)	These accumulated other comprehensive income (AOCI) components are included in the computation of net periodic pension cost. Refer to note 17, “Retirement-Related Benefits,” for additional information.

Reclassifications and Taxes Related to Items of Other Comprehensive Income


(Dollars in millions)	Before Tax		Tax (Expense)/		Net of Tax
For the three months ended September 30, 2019:	Amount		Benefit		Amount
Other comprehensive income/(loss):
Foreign currency translation adjustments	$	(509)	$	(109)	$	(618)
Net changes related to available-for-sale securities:
Unrealized gains/(losses) arising during the period	$	3	$	(1)	$	2
Reclassification of (gains)/losses to other (income) and expense		—		—		—
Total net changes related to available-for-sale securities	$	3	$	(1)	$	2
Unrealized gains/(losses) on cash flow hedges:
Unrealized gains/(losses) arising during the period	$	(439)	$	110	$	(329)
Reclassification of (gains)/losses to:
Cost of services		(22)		6		(17)
Cost of sales		(10)		3		(7)
Cost of financing		21		(5)		15
SG&A expense		(11)		3		(8)
Other (income) and expense		447		(112)		334
Interest expense		64		(16)		48
Total unrealized gains/(losses) on cash flow hedges	$	49	$	(12)	$	36
Retirement-related benefit plans (1):
Net (losses)/gains arising during the period	$	0	$	0	$	0
Curtailments and settlements		3		(1)		2
Amortization of prior service (credits)/costs		(3)		3		(1)
Amortization of net (gains)/losses		461		(128)		333
Total retirement-related benefit plans	$	461	$	(127)	$	335
Other comprehensive income/(loss)	$	4	$	(249)	$	(245)

(1)	These AOCI components are included in the computation of net periodic pension cost. Refer to note 17, “Retirement-Related Benefits,” for additional information.

Reclassifications and Taxes Related to Items of Other Comprehensive Income


(Dollars in millions)	Before Tax		Tax (Expense)/		Net of Tax
For the nine months ended September 30, 2020:	Amount		Benefit		Amount
Other comprehensive income/(loss):
Foreign currency translation adjustments	$	(1,354)	$	260	$	(1,094)
Net changes related to available-for-sale securities:
Unrealized gains/(losses) arising during the period	$	0	$	0	$	0
Reclassification of (gains)/losses to other (income) and expense		—		—		—
Total net changes related to available-for-sale securities	$	0	$	0	$	0
Unrealized gains/(losses) on cash flow hedges:
Unrealized gains/(losses) arising during the period	$	(249)	$	63	$	(186)
Reclassification of (gains)/losses to:
Cost of services		(18)		5		(14)
Cost of sales		(14)		4		(10)
Cost of financing		21		(5)		16
SG&A expense		(12)		3		(9)
Other (income) and expense		(74)		19		(55)
Interest expense		60		(15)		45
Total unrealized gains/(losses) on cash flow hedges	$	(285)	$	73	$	(212)
Retirement-related benefit plans (1):
Prior service costs/(credits)	$	(5)	$	1	$	(3)
Net (losses)/gains arising during the period		65		(24)		41
Curtailments and settlements		42		(12)		30
Amortization of prior service (credits)/costs		1		2		3
Amortization of net (gains)/losses		1,722		(473)		1,249
Total retirement-related benefit plans	$	1,826	$	(507)	$	1,319
Other comprehensive income/(loss)	$	187	$	(175)	$	12

(1)	These AOCI components are included in the computation of net periodic pension cost. Refer to note 17, “Retirement-Related Benefits,” for additional information.

Reclassifications and Taxes Related to Items of Other Comprehensive Income


(Dollars in millions)	Before Tax		Tax (Expense)/		Net of Tax
For the nine months ended September 30, 2019:	Amount		Benefit		Amount
Other comprehensive income/(loss):
Foreign currency translation adjustments	$	(333)	$	(72)	$	(405)
Net changes related to available-for-sale securities:
Unrealized gains/(losses) arising during the period	$	1	$	0	$	1
Reclassification of (gains)/losses to other (income) and expense		—		—		—
Total net changes related to available-for-sale securities	$	1	$	0	$	1
Unrealized gains/(losses) on cash flow hedges:
Unrealized gains/(losses) arising during the period	$	(798)	$	196	$	(601)
Reclassification of (gains)/losses to:
Cost of services		(52)		13		(38)
Cost of sales		(40)		11		(29)
Cost of financing		73		(18)		55
SG&A expense		(45)		12		(33)
Other (income) and expense		331		(83)		248
Interest expense		150		(38)		112
Total unrealized gains/(losses) on cash flow hedges	$	(380)	$	93	$	(287)
Retirement-related benefit plans (1):
Net (losses)/gains arising during the period	$	113	$	(23)	$	90
Curtailments and settlements		7		(1)		6
Amortization of prior service (credits)/costs		(9)		4		(5)
Amortization of net (gains)/losses		1,385		(380)		1,005
Total retirement-related benefit plans	$	1,496	$	(401)	$	1,095
Other comprehensive income/(loss)	$	784	$	(380)	$	404

(1)	These AOCI components are included in the computation of net periodic pension cost. Refer to note 17, “Retirement-Related Benefits,” for additional information.

Accumulated Other Comprehensive Income/(Loss) (net of tax)


					Net Change		Net Unrealized
	Net Unrealized		Foreign		Retirement-		Gains/(Losses)		Accumulated
	Gains/(Losses)		Currency		Related		on Available-		Other
	on Cash Flow		Translation		Benefit		For-Sale		Comprehensive
(Dollars in millions)	Hedges		Adjustments*		Plans		Securities		Income/(Loss)
January 1, 2020	$	(179)	$	(3,700)	$	(24,718)	$	0	$	(28,597)
Other comprehensive income before reclassifications		(186)		(1,094)		37		0		(1,242)
Amount reclassified from accumulated other comprehensive income		(27)		—		1,281		—		1,255
Total change for the period	$	(212)	$	(1,094)	$	1,319	$	0	$	12
September 30, 2020	$	(391)	$	(4,794)	$	(23,399)	$	0	$	(28,584)

* Foreign currency translation adjustments are presented gross except for any associated hedges which are presented net of tax.


					Net Change		Net Unrealized
	Net Unrealized		Foreign		Retirement-		Gains/(Losses)		Accumulated
	Gains/(Losses)		Currency		Related		on Available-		Other
	on Cash Flow		Translation		Benefit		For-Sale		Comprehensive
(Dollars in millions)	Hedges		Adjustments*		Plans		Securities		Income/(Loss)
January 1, 2019	$	284	$	(3,690)	$	(26,083)	$	0	$	(29,490)
Other comprehensive income before reclassifications		(601)		(405)		89		1		(916)
Amount reclassified from accumulated other comprehensive income		315		—		1,005		—		1,320
Total change for the period	$	(287)	$	(405)	$	1,095	$	1	$	404
September 30, 2019	$	(3)	$	(4,095)	$	(24,988)	$	0	$	(29,086)

* Foreign currency translation adjustments are presented gross except for any associated hedges which are presented net of tax.