XML 23 R11.htm IDEA: XBRL DOCUMENT v3.24.2
Valuation of debt and equity investments and certain liabilities
 6 Months Ended
Jun. 30, 2024
Fair Value Disclosures [Abstract]  
Valuation of debt and equity investments and certain liabilities Valuation of debt and equity investments and certain liabilities
Investments measured at fair value
Money market funds, debt investments and mutual funds are stated at fair value, which is generally based on market prices or broker quotes. We classify all debt investments as available-for-sale. See Fair-value considerations. Unrealized gains and losses are recorded as an increase or decrease, net of taxes, in AOCI on our Consolidated Balance Sheets, and any credit losses are recorded as an allowance for credit losses with an offset recognized in OI&E in our Consolidated Statements of Income.
Our mutual funds hold a variety of debt and equity investments intended to generate returns that offset changes in certain deferred compensation liabilities. We record changes in the fair value of these mutual funds and the related deferred compensation liabilities in SG&A.
Other investments
Our other investments include equity-method investments and nonmarketable investments, which are not measured at fair value. These investments consist of interests in venture capital funds and other nonmarketable securities. Gains and losses from equity-method investments are recognized in OI&E based on our ownership share of the investee’s financial results. Nonmarketable securities are measured at cost with adjustments for observable changes in price or impairments. Gains and losses on nonmarketable investments are recognized in OI&E.
Details of our investments are as follows:
 June 30, 2024December 31, 2023
Cash and Cash EquivalentsShort-Term InvestmentsLong-Term InvestmentsCash and Cash EquivalentsShort-Term InvestmentsLong-Term Investments
Measured at fair value:      
Money market funds$1,105 $— $— $1,068 $— $— 
Corporate obligations372 1,740 — 349 1,605 — 
U.S. government and agency securities548 4,962 — 696 3,808 — 
Non-U.S. government and agency securities— 246 — 50 198 — 
Mutual funds— — 11 — — 12 
Total2,025 6,948 11 2,163 5,611 12 
Other measurement basis:
Equity-method investments— — 12 — — 17 
Nonmarketable investments— — 4 — — 5 
Total— — 16 — — 22 
Cash on hand715 — — 801 — — 
Total$2,740 $6,948 $27 $2,964 $5,611 $34 
As of June 30, 2024, and December 31, 2023, unrealized gains and losses associated with our debt investments were not material. We did not recognize any credit losses related to debt investments for the first six months of 2024 and 2023.
The following table presents the aggregate maturities of our available-for-sale debt investments as of June 30, 2024:
Fair Value
One year or less$6,839 
One to two years1,029 
Proceeds from sales, redemptions and maturities of short-term available-for-sale investments were $3.13 billion and $3.07 billion for the second quarters of 2024 and 2023, respectively, and $5.76 billion and $7.09 billion for the first six months of 2024 and 2023, respectively. Gross realized gains and losses from these sales were not material.
Fair-value considerations
We measure and report certain financial assets and liabilities at fair value on a recurring basis. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date.
The three-level hierarchy described below indicates the extent and level of judgment used to estimate fair-value measurements.
•Level 1 – Uses unadjusted quoted prices that are available in active markets for identical assets or liabilities as of the reporting date.
•Level 2 – Uses inputs other than Level 1 that are either directly or indirectly observable as of the reporting date through correlation with market data, including quoted prices for similar assets and liabilities in active markets and quoted prices in markets that are not active. Level 2 also includes assets and liabilities that are valued using models or other pricing methodologies that do not require significant judgment since the input assumptions used in the models, such as interest rates and volatility factors, are corroborated by readily observable data. We utilize a third-party data service to provide Level 2 valuations. We verify these valuations for reasonableness relative to unadjusted quotes obtained from brokers or dealers based on observable prices for similar assets in active markets.
•Level 3 – Uses inputs that are unobservable, supported by little or no market activity and reflect the use of significant management judgment. These values are generally determined using pricing models that utilize management estimates of market participant assumptions. As of June 30, 2024, and December 31, 2023, we had no Level 3 assets or liabilities.
The following are our assets and liabilities that were accounted for at fair value on a recurring basis. These tables do not include cash on hand, assets held by our postretirement plans, or assets and liabilities that are measured at historical cost or any basis other than fair value.
 June 30, 2024December 31, 2023
 Level 1Level 2TotalLevel 1Level 2Total
Assets:      
Money market funds$1,105 $— $1,105 $1,068 $— $1,068 
Corporate obligations— 2,112 2,112 — 1,954 1,954 
U.S. government and agency securities2,930 2,580 5,510 3,618 886 4,504 
Non-U.S. government and agency securities— 246 246 — 248 248 
Mutual funds11 — 11 12 — 12 
Total assets$4,046 $4,938 $8,984 $4,698 $3,088 $7,786 
Liabilities:
Deferred compensation$411 $— $411 $393 $— $393 
Total liabilities$411 $— $411 $393 $— $393