FAIR VALUE MEASUREMENTS (Tables)

9 Months Ended

Jul. 31, 2012

FAIR VALUE MEASUREMENTS

Fair Value Of Financial Instruments

The fair values of financial instruments that do not approximate the carrying values in millions of dollars follow:

	July 31, 2012				October 31, 2011				July 31, 2011
	Carrying Value		Fair Value *		Carrying Value		Fair Value		Carrying Value		Fair Value
Financing receivables - net	$	20,685	$	20,707	$	19,924	$	19,919	$	19,437	$	19,439
Financing receivables securitized - net	3,164		3,165		2,905		2,907		2,481		2,486
Short-term securitization borrowings	3,028		3,038		2,777		2,789		2,381		2,394
Long-term borrowings due within one year:
Equipment operations	$	322	$	317	$	244	$	233	$	96	$	97
Financial services	4,491		4,552		5,249		5,331		4,941		5,027
Total	$	4,813	$	4,869	$	5,493	$	5,564	$	5,037	$	5,124
Long-term borrowings:
Equipment operations	$	5,357	$	6,288	$	3,167	$	3,771	$	3,372	$	3,789
Financial services	15,800		16,110		13,793		14,154		12,521		12,903
Total	$	21,157	$	22,398	$	16,960	$	17,925	$	15,893	$	16,692

*Fair value measurements above were Level 3 for all financing receivables and Level 2 for all borrowings.

Assets and Liabilities Measured at Fair Value on a Recurring Basis

Assets and liabilities measured at fair value on a recurring basis in millions of dollars follow:

	July 31		October 31		July 31
	2012*		2011*		2011*
Marketable securities
U.S. government debt securities	$	1,288	$	576	$	270
Municipal debt securities	37		36		31
Corporate debt securities	105		89		79
Residential mortgage-backed securities **	116		86		79
Total marketable securities	1,546		787		459
Other assets
Derivatives:
Interest rate contracts	653		471		388
Foreign exchange contracts	10		12		17
Cross-currency interest rate contracts	23		2		1
Total assets ***	$	2,232	$	1,272	$	865
Accounts payable and accrued expenses
Derivatives:
Interest rate contracts	$	70	$	61	$	12
Foreign exchange contracts	52		100		86
Cross-currency interest rate contracts	87		7		10
Total liabilities	$	209	$	168	$	108

*All measurements above were Level 2 measurements except for Level 1 measurements of U.S. government debt securities of $1,241 million, $540 million and $238 million at July 31, 2012, October 31, 2011 and July 31, 2011, respectively.  There were no transfers between Level 1 and Level 2 during the first nine months of 2012 or 2011.

**Primarily issued by U.S. government sponsored enterprises.

***Excluded from this table are the Company’s cash and cash equivalents, which are carried at cost that approximates fair value.  The cash and cash equivalents consist primarily of money market funds.

Schedule of Contractual Maturities of Marketable Securities

The contractual maturities of debt securities at July 31, 2012 in millions of dollars are shown below.  Actual maturities may differ from those scheduled as a result of prepayments by the issuers.  Because of the potential for prepayment on mortgage-backed securities, they are not categorized by contractual maturity.

	Amortized Cost		Fair Value
Due in one year or less	$	716	$	716
Due after one through five years	563		568
Due after five through 10 years	72		79
Due after 10 years	59		67
Residential mortgage-backed securities	109		116
Debt securities	$	1,519	$	1,546

Assets Measured at Fair Value on a Nonrecurring Basis

Fair value, nonrecurring, Level 3 measurements in millions of dollars follow:

	Fair Value *						Losses
							Nine Months Ended
	July 31		October 31		July 31		July 31
	2012		2011		2011		2012	2011
Financing receivables	$	1	$	5	$	3

* Does not include cost to sell.