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Financial Instruments (Tables)
 6 Months Ended
Mar. 31, 2017
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Fair value of financial instruments
Fair values of financial instruments are summarized as follows (in millions):
 
March 31, 2017
 
September 30, 2016
 
Carrying
Value
 
Fair
Value
 
Carrying
Value
 
Fair
Value
Cash and cash equivalents
$
138

 
$
138

 
$
160

 
$
160

Short-term debt
132

 
249

 
14

 
14

Long-term debt
857

 
899

 
982

 
1,051

Foreign exchange forward contracts (other assets)
1

 
1

 
1

 
1

Foreign exchange forward contracts (other liabilities)
—

 
—

 
2

 
2

Short-term foreign currency option contracts (other assets)
3

 
3

 
—

 
—

Long-term foreign currency option contracts (other asset)
2

 
2

 
2

 
2
Offsetting of derivative assets and liabilities
The following table reflects the offsetting of derivative assets and liabilities (in millions):
 
March 31, 2017
 
September 30, 2016
 
Gross
Amounts Recognized
 
Gross Amounts
Offset
 
Net Amounts
Reported
 
Gross
Amounts Recognized
 
Gross Amounts
Offset
 
Net Amounts
Reported
Derivative Asset
 
 
 
 
 
 
 
 
 
 
 
Foreign exchange forward contract
2

 
1

 
1

 
1

 
—

 
1

Derivative Liabilities
 
 
 
 
 
 
 
 
 
 
 
Foreign exchange forward contract
1

 
1

 
—

 
2

 
—

 
2
Fair value of financial instruments by valuation hierarchy
Fair value of financial instruments by the valuation hierarchy at March 31, 2017 is as follows (in millions):
 
Level 1
 
Level 2
 
Level 3
Cash and cash equivalents
$
138

 
$
—

 
$
—

Short-term debt
—

 
244

 
5

Long-term debt
—

 
889

 
10

Foreign exchange forward contracts (asset)
—

 
1

 
—

Foreign exchange forward contracts (liability)
—

 
—

 
—

Short-term foreign currency option contracts (asset)
—

 
—

 
3

Long-term foreign currency option contracts (asset)
—

 
—

 
2


Fair value of financial instruments by the valuation hierarchy at September 30, 2016 is as follows (in millions):
 
Level 1
 
Level 2
 
Level 3
Cash and cash equivalents
$
160

 
$
—

 
$
—

Short-term debt
—

 
—

 
14

Long-term debt
—

 
1,040

 
11

Foreign exchange forward contracts (asset)
—

 
1

 
—

Foreign exchange forward contracts (liability)
—

 
2

 
—

Short-term foreign currency option contracts (asset)
—

 
—

 
—

Long-term foreign currency option contracts (asset)
—

 
—

 
2
Reconciliation of changes in fair value
The tables below provide a reconciliation of changes in fair value of the Level 3 financial assets and liabilities measured at fair value in the condensed consolidated balance sheet for the three and six months ended March 31, 2017 and 2016, respectively. No transfers of assets between any of the Levels occurred during these periods.
Three months ended March 31, 2017 (in millions)
 
Short-term foreign currency option contracts (asset)
 
Long-term foreign currency option contracts (asset)
 
Total
Fair Value as of December 31, 2016
 
$
1

 
$
2

 
$
3

Total unrealized gains (losses):
 
 
 
 
 


Included in other income
 
—

 
—

 
—

Included in cost of sales
 
1

 
1

 
2

Total realized gains (losses):
 
 
 
 
 


Included in other income
 
—

 
—

 
—

Included in cost of sales
 
—

 
—

 
—

Purchases, issuances, sales and settlements:
 
 
 
 
 


Purchases
 
—

 
—

 
—

Settlements
 
—

 
—

 
—

Transfer in and / or out of Level 3 (1)
 
—

 
—

 
—

Reclass between short-term and long-term
 
1

 
(1
)
 
—

Fair Value as of March 31, 2017
 
$
3

 
$
2

 
$
5

Three months ended March 31, 2016 (in millions)
 
Short-term foreign currency option contracts (asset)
 
Long-term foreign currency option contracts (asset)
 
Total
Fair Value as of December 31, 2015
 
$
2

 
$
—

 
$
2

Total unrealized gains (losses):
 
 
 
 
 
 
Included in other income
 
(2
)
 
—

 
(2
)
Included in cost of sales
 
—

 
—

 
—

Total realized gains (losses):
 
 
 
 
 
 
Included in other income
 
—

 
—

 
—

Included in cost of sales
 
—

 
—

 
—

Purchases, issuances, sales and settlements:
 
 
 
 
 
 
Purchases
 
—

 
—

 
—

Settlements
 
—

 
—

 
—

Transfer in and / or out of Level 3 (1)
 
—

 
—

 
—

Reclass between short-term and long-term
 
—

 
—

 
—

Fair Value as of March 31, 2016
 
$
—

 
$
—

 
$
—


Six months ended March 31, 2017 (in millions)
 
Short-term foreign currency option contracts (asset)
 
Long-term foreign currency option contracts (asset)
 
Total
Fair Value as of September 30, 2016
 
$
—

 
$
2

 
$
2

Total unrealized gains (losses):
 
 
 
 
 
 
Included in other income
 
—

 
—

 
—

Included in cost of sales
 
1

 
2

 
3

Total realized gains (losses):
 
 
 
 
 
 
Included in other income
 
—

 
—

 
—

Included in cost of sales
 
—

 
—

 
—

Purchases, issuances, sales and settlements:
 
 
 
 
 


Purchases
 
—

 
—

 
—

Settlements
 
—

 
—

 
—

Transfer in and / or out of Level 3 (1)
 
—

 
—

 
—

Reclass between short-term and long-term
 
2

 
(2
)
 
—

Fair Value as of March 31, 2017
 
$
3

 
$
2

 
$
5

Six months ended March 31, 2016 (in millions)
 
Short-term foreign currency option contracts (asset)
 
Long-term foreign currency option contracts (asset)
 
Total
Fair Value as of September 30, 2015
 
$
1

 
$
1

 
$
2

Total unrealized gains (losses):
 
 
 
 
 
 
Included in other income
 
(2
)
 
—

 
(2
)
Included in cost of sales
 
—

 
(1
)
 
(1
)
Total realized gains (losses):
 
 
 
 
 
 
Included in other income
 
—

 
—

 
—

Included in cost of sales
 
—

 
—

 
—

Purchases, issuances, sales and settlements:
 
 
 
 
 
 
Purchases
 
1

 
—

 
1

Settlements
 
—

 
—

 
—

Transfer in and / or out of Level 3 (1)
 
—

 
—

 
—

Reclass between short-term and long-term
 
—

 
—

 
—

Fair Value as of March 31, 2016
 
$
—

 
$
—

 
$
—

(1) Transfers as of the last day of the reporting period.