Derivatives (Tables)

9 Months Ended

Mar. 31, 2013

Fair Values of Derivative Instruments

The following tables present the gross fair values of derivative instruments designated as hedging instruments (“designated hedge derivatives”) and not designated as hedging instruments (“non-designated hedge derivatives”). The fair values exclude the impact of netting derivative assets and liabilities when a legally enforceable master netting agreement exists and fair value adjustments related to our own credit risk and counterparty credit risk:

(In millions)	Foreign Exchange Contracts			Equity Contracts			Interest Rate Contracts			Credit Contracts			Commodity Contracts		Total Derivatives
March 31, 2013
Assets
Non-designated hedge derivatives:
Short-term investments	$	18		$	156		$	7		$	17		$	3	$	201
Other current assets		35			0			0			0			0		35
Total	$	53		$	156		$	7		$	17		$	3	$	236
Designated hedge derivatives:
Short-term investments	$	8		$	0		$	0		$	0		$	0	$	8
Other current assets		128			0			0			0			0		128
Total	$	136		$	0		$	0		$	0		$	0	$	136
Total assets	$	189		$	156		$	7		$	17		$	3	$	372
Liabilities
Non-designated hedge derivatives:
Other current liabilities	$	(77	)	$	(16	)	$	(6	)	$	(14	)	$	0	$	(113	)
Designated hedge derivatives:
Other current liabilities	$	(2	)	$	0		$	0		$	0		$	0	$	(2	)
Total liabilities	$	(79	)	$	(16	)	$	(6	)	$	(14	)	$	0	$	(115	)

(In millions)	Foreign Exchange Contracts			Equity Contracts			Interest Rate Contracts			Credit Contracts			Commodity Contracts		Total Derivatives
June 30, 2012
Assets
Non-designated hedge derivatives:
Short-term investments	$	14		$	162		$	10		$	26		$	3	$	215
Other current assets		85			0			0			0			0		85
Total	$	99		$	162		$	10		$	26		$	3	$	300
Designated hedge derivatives:
Short-term investments	$	6		$	0		$	0		$	0		$	0	$	6
Other current assets		177			0			0			0			0		177
Total	$	183		$	0		$	0		$	0		$	0	$	183
Total assets	$	282		$	162		$	10		$	26		$	3	$	483
Liabilities
Non-designated hedge derivatives:
Other current liabilities	$	(84	)	$	(19	)	$	(17	)	$	(21	)	$	0	$	(141	)
Designated hedge derivatives:
Other current liabilities	$	(14	)	$	0		$	0		$	0		$	0	$	(14	)
Total liabilities	$	(98	)	$	(19	)	$	(17	)	$	(21	)	$	0	$	(155	)

Fair value hedging

Gains (Losses) on Derivative Instruments

We recognized in other income (expense) the following gains (losses) on contracts designated as fair value hedges and their related hedged items:

(In millions)	Three Months Ended March 31,						Nine Months Ended March 31,
	2013			2012			2013			2012
Foreign Exchange Contracts
Derivatives	$	45		$	(12	)	$	68		$	36
Hedged items		(47	)		11			(68	)		(37	)
Total	$	(2	)	$	(1	)	$	0		$	(1	)

Cash flow hedging

Gains (Losses) on Derivative Instruments

We recognized the following gains (losses) on foreign exchange contracts designated as cash flow hedges (our only cash flow hedges during the periods presented):

(In millions)	Three Months Ended March 31,						Nine Months Ended March 31,
	2013			2012			2013			2012
Effective Portion
Gains (losses) recognized in OCI, net of tax effects of $36 and $(28) for the three months ended March 31, 2013 and 2012, and $31 and $74 for the nine months ended March 31, 2013 and 2012	$	66		$	(52	)	$	56		$	138
Gains (losses) reclassified from AOCI into revenue	$	47		$	(12	)	$	116		$	(82	)
Amount Excluded from Effectiveness Assessment and Ineffective Portion
Losses recognized in other income (expense)	$	(27	)	$	(107	)	$	(134	)	$	(172	)

Non-designated hedge derivatives

Gains (Losses) on Derivative Instruments

Gains (losses) from changes in fair values of derivatives that are not designated as hedges are primarily recognized in other income (expense). These amounts are shown in the table below, with the exception of gains (losses) on derivatives presented in income statement line items other than other income (expense), which were immaterial for the periods presented. Other than those derivatives entered into for investment purposes, such as commodity contracts, the gains (losses) below are generally economically offset by unrealized gains (losses) in the underlying available-for-sale securities.

(In millions)	Three Months Ended March 31,						Nine Months Ended March 31,
	2013			2012			2013			2012
Foreign exchange contracts	$	(25	)	$	(44	)	$	(50	)	$	(109	)
Equity contracts		8			5			25			(63	)
Interest-rate contracts		(1	)		21			18			79
Credit contracts		10			(6	)		1			(13	)
Commodity contracts		(5	)		(1	)		16			(89	)
Total	$	(13	)	$	(25	)	$	10		$	(195	)