DERIVATIVE INSTRUMENTS (Tables)

12 Months Ended

Oct. 31, 2016

Fair Value Hedge Interest Rate Contracts and Underlying Borrowings

The gains (losses) on these contracts and the underlying borrowings recorded in interest expense follow in millions of dollars:


	2016		2015
Interest rate contracts*	$	7	$	104
Borrowings**		(9)		(102)

* Includes changes in fair values of interest rate contracts excluding net accrued interest income of $146 million and $173 million during 2016 and 2015, respectively.

** Includes adjustments for fair values of hedged borrowings excluding accrued interest expense of $290 million and $274 million during 2016 and 2015, respectively.

Fair Value of Derivative Instruments in Consolidated Balance Sheet

Fair values of derivative instruments in the consolidated balance sheet at October 31 in millions of dollars follow:


	2016		2015
Other Assets
Designated as hedging instruments:
Interest rate contracts	$	268	$	299
Cross-currency interest rate contracts		11		14
Total designated		279		313
Not designated as hedging instruments:
Interest rate contracts		26		54
Foreign exchange contracts		60		50
Cross-currency interest rate contracts		10		11
Total not designated		96		115
Total derivative assets	$	375	$	428
Accounts Payable and Accrued Expenses
Designated as hedging instruments:
Interest rate contracts	$	10	$	8
Total designated		10		8
Not designated as hedging instruments:
Interest rate contracts		19		52
Foreign exchange contracts		43		18
Total not designated		62		70
Total derivative liabilities	$	72	$	78

Gains (Losses) Related to Derivative Instruments on Statement of Consolidated Income

The classification and gains (losses) including accrued interest expense related to derivative instruments on the statement of consolidated income consisted of the following in millions of dollars:


	2016		2015		2014
Fair Value Hedges
Interest rate contracts – Interest expense	$	153	$	277	$	155

Cash Flow Hedges
Recognized in OCI
(Effective Portion):
Interest rate contracts – OCI (pretax)*		(3)		(16)		(10)
Foreign exchange contracts – OCI (pretax)*		1		4		(4)

Reclassified from OCI
(Effective Portion):
Interest rate contracts – Interest expense*		(7)		(12)		(13)
Foreign exchange contracts – Other expense*		1		4		(6)

Recognized Directly in Income
(Ineffective Portion)		**		**		**

Not Designated as Hedges
Interest rate contracts – Interest expense*	$	(1)	$	(17)	$	3
Foreign exchange contracts – Cost of sales		(15)		97		25
Foreign exchange contracts – Other expense*		74		304		79
Total not designated	$	58	$	384	$	107

* Includes interest and foreign exchange gains (losses) from cross-currency interest rate contracts.

** The amounts are not significant.

Impact on Derivative Assets and Liabilities Related to Netting Arrangements and Collateral

The impact on the derivative assets and liabilities related to netting arrangements and any collateral received or paid at October 31 in millions of dollars follows:


	Gross Amounts		Netting		Collateral		Net
	Recognized		Arrangements		Received		Amount
2016
Assets	$	375	$	(32)	$	(6)	$	337
Liabilities		72		(32)				40
2015
Assets	$	428	$	(62)			$	366
Liabilities		78		(62)				16