Financial Instruments, Derivatives and Fair Value Measures (Tables)

9 Months Ended

Sep. 30, 2019

Financial Instruments, Derivatives and Fair Value Measures

Summary of the amounts and location of certain derivative financial instruments

	Fair Value - Assets					Fair Value - Liabilities
	Sept. 30,		Dec. 31,			Sept. 30,		Dec. 31,
(in millions)	2019		2018		Balance Sheet Caption	2019		2018		Balance Sheet Caption
Interest rate swaps designated as fair value hedges	$	74	$	—	Deferred income taxes and other assets	$	—	$	100	Post-employment obligations, deferred income taxes and other long-term liabilities
Foreign currency forward exchange contracts:
Hedging instruments		244		81	Prepaid expenses and other receivables		33		44	Other accrued liabilities
Others not designated as hedges		54		33	Prepaid expenses and other receivables		62		51	Other accrued liabilities
	$	372	$	114		$	95	$	195

Schedule of derivatives gain (loss) in OCI and earnings

	Gain (loss) Recognized in Other								Income (expense) and Gain (loss)
	Comprehensive Income (loss)								Reclassified into Income
	Three Months				Nine Months				Three Months				Nine Months
	Ended Sept. 30				Ended Sept. 30				Ended Sept. 30				Ended Sept. 30				Income Statement
(in millions)	2019		2018		2019		2018		2019		2018		2019		2018		Caption
Foreign currency forward exchange contracts designated as cash flow hedges	$	99	$	18	$	78	$	45	$	26	$	(37)	$	58	$	(120)	Cost of products sold
Interest rate swaps designated as fair value hedges		n/a		n/a		n/a		n/a		35		(42)		174		(179)	Interest expense

Schedule of carrying values and fair values of certain financial instruments

	September 30, 2019				December 31, 2018
	Carrying		Fair		Carrying		Fair
(in millions)	Value		Value		Value		Value
Investment Securities:
Equity securities	$	830	$	830	$	856	$	856
Other		44		44		41		41
Total Long-term Debt		(18,893)		(21,525)		(19,366)		(19,871)
Foreign Currency Forward Exchange Contracts:
Receivable position		298		298		114		114
(Payable) position		(95)		(95)		(95)		(95)
Interest Rate Hedge Contracts:
Receivable position		74		74		—		—
(Payable) position		—		—		(100)		(100)

Schedule of assets and liabilities measured at fair value on a recurring basis

			Basis of Fair Value Measurement
			Quoted		Significant
			Prices in		Other		Significant
	Outstanding		Active		Observable		Unobservable
(in millions)	Balances		Markets		Inputs		Inputs
September 30, 2019:
Equity securities	$	341	$	341	$	—	$	—
Interest rate swap derivative financial instruments		74		—		74		—
Foreign currency forward exchange contracts		298		—		298		—
Total Assets	$	713	$	341	$	372	$	—
Fair value of hedged long-term debt	$	2,927	$	—	$	2,927	$	—
Foreign currency forward exchange contracts		95		—		95		—
Contingent consideration related to business combinations		68		—		—		68
Total Liabilities	$	3,090	$	—	$	3,022	$	68
December 31, 2018:
Equity securities	$	320	$	320	$	—	$	—
Foreign currency forward exchange contracts		114		—		114		—
Total Assets	$	434	$	320	$	114	$	—
Fair value of hedged long-term debt	$	2,743	$	—	$	2,743	$	—
Interest rate swap derivative financial instruments		100		—		100		—
Foreign currency forward exchange contracts		95		—		95		—
Contingent consideration related to business combinations		71		—		—		71
Total Liabilities	$	3,009	$	—	$	2,938	$	71