Basis of Presentation and Significant Accounting Policies (Tables)

9 Months Ended

Sep. 30, 2018



Adoption of the standard related to pension and postretirement benefit costs impacted our prior period condensed consolidated statements of income as follows:
	Three Months Ended October 1, 2017
(MILLIONS OF DOLLARS)	As Previously Reported			Effect of Change Higher/(Lower)			As Restated
Cost of sales	$	2,847		$	(3	)	$	2,844
Selling, informational and administrative expenses	3,500			4			3,504
Research and development expenses	1,859			6			1,865
Restructuring charges and certain acquisition-related costs	149			(35		)	114
Other (income)/deductions––net	51			28			79
Income from continuing operations before provision for taxes on income	3,585			—			3,585

	Nine Months Ended October 1, 2017
(MILLIONS OF DOLLARS)	As Previously Reported			Effect of Change Higher/(Lower)			As Restated
Cost of sales	$	7,980		$	(9	)	$	7,972
Selling, informational and administrative expenses	10,233			16			10,249
Research and development expenses	5,346			21			5,367
Restructuring charges and certain acquisition-related costs	377			(110		)	267
Other (income)/deductions––net	(16		)	81			65
Income from continuing operations before provision for taxes on income	11,351			—			11,351



Adoption of the standards impacted our condensed consolidated balance sheet as follows:
				Effect of New Accounting Standards Higher/(Lower)
(MILLIONS OF DOLLARS)	As Previously Reported Balance at December 31, 2017			Revenues			Financial Assets and Liabilities			Income Tax Accounting			Reclassification of Certain Tax Effects from AOCI			Balance at January 1, 2018
Trade accounts receivable	$	8,221		$	13		$	—		$	—		$	—		$	8,234
Inventories	7,578			(11		)	—			—			—			7,567
Current tax assets	3,050			(11		)	—			(3		)	—			3,036
Noncurrent deferred tax assets and other noncurrent tax assets	1,855			(17		)	—			—			—			1,838
Other noncurrent assets	3,227			—			—			(204		)	—			3,023
Other current liabilities	11,115			(123		)	—			—			—			10,992
Noncurrent deferred tax liabilities	3,900			106			—			(18		)	—			3,988
Other noncurrent liabilities	6,149			(459		)	—			—			—			5,690
Retained earnings	85,291			450			419			(189		)	495			86,466
Accumulated other comprehensive loss	(9,321		)	—			(419		)	—			(495		)	(10,235		)



Adoption of the standards related to the classification of certain transactions in the statement of cash flows and the presentation of restricted cash in the statement of cash flows impacted our condensed consolidated statement of cash flows as follows:
	Nine Months Ended October 1, 2017
				Effect of New Accounting Standards Inflow/(Outflow)
(MILLIONS OF DOLLARS)	As Previously Reported			Cash Flow Classification			Restricted Cash			As Restated
Operating Activities
Other adjustments, net	$	(561	)	$	(43	)	$	—		$	(604	)
Other changes in assets and liabilities, net of acquisitions and divestitures	(3,644		)	—			28			(3,616		)
Investing Activities
Proceeds from redemptions/sales of short-term investments	5,783			—			(5		)	5,778
Proceeds from redemptions/sales of long-term investments	2,417			—			(14		)	2,403
Financing Activities
Principal payments on short-term borrowings	(7,691		)	33			—			(7,659		)
Net proceeds from short-term borrowings with original maturities of three months or less	555			10			—			566
Net increase in cash and cash equivalents and restricted cash and cash equivalents	184			—			9			193
Cash and cash equivalents and restricted cash and cash equivalents, beginning	2,595			—			70			2,666
Cash and cash equivalents and restricted cash and cash equivalents, ending	2,779			—			79			2,858



The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the condensed consolidated balance sheet that sum to the total of the same amounts shown in the condensed consolidated statements of cash flows:
(MILLIONS OF DOLLARS)	September 30, 2018		December 31, 2017
Cash and cash equivalents	$	3,559	$	1,342
Restricted cash and cash equivalents in Short-term investments	40		—
Restricted cash and cash equivalents in Long-term investments	59		—
Restricted cash and cash equivalents in Other current assets	—		14
Restricted cash and cash equivalents in Other noncurrent assets	—		75
Total cash and cash equivalents and restricted cash and cash equivalents shown in the condensed consolidated balance sheets	$	3,658	$	1,431



The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the condensed consolidated balance sheet that sum to the total of the same amounts shown in the condensed consolidated statements of cash flows:
(MILLIONS OF DOLLARS)	September 30, 2018		December 31, 2017
Cash and cash equivalents	$	3,559	$	1,342
Restricted cash and cash equivalents in Short-term investments	40		—
Restricted cash and cash equivalents in Long-term investments	59		—
Restricted cash and cash equivalents in Other current assets	—		14
Restricted cash and cash equivalents in Other noncurrent assets	—		75
Total cash and cash equivalents and restricted cash and cash equivalents shown in the condensed consolidated balance sheets	$	3,658	$	1,431



The following table provides information about the balance sheet classification of these accruals:
(MILLIONS OF DOLLARS)	September 30, 2018		December 31, 2017
Reserve against Trade accounts receivable, less allowance for doubtful accounts	$	1,297	$	1,352

Other current liabilities:
Accrued rebates	3,235		2,674
Other accruals	641		512

Other noncurrent liabilities	374		385
Total accrued rebates and other accruals	$	5,548	$	4,923