FAIR VALUE MEASUREMENTS (Tables)

3 Months Ended

Jan. 31, 2021

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:

	January 31, 2021				November 1, 2020				February 2, 2020
	Carrying Value		Fair Value *		Carrying Value		Fair Value *		Carrying Value		Fair Value *
Financing receivables – net:
Equipment operations	$	103	$	100	$	105	$	103	$	130	$	123
Financial services		29,335		29,591		29,645		29,838		27,164		27,177
Total	$	29,438	$	29,691	$	29,750	$	29,941	$	27,294	$	27,300
Financing receivables securitized – net:
Equipment operations	$	18	$	17	$	26	$	26	$	42	$	40
Financial services		3,913		4,002		4,677		4,773		4,436		4,464
Total	$	3,931	$	4,019	$	4,703	$	4,799	$	4,478	$	4,504
Short-term securitization borrowings:
Equipment operations	$	17	$	17	$	26	$	26	$	42	$	42
Financial services		3,952		3,986		4,656		4,698		4,374		4,403
Total	$	3,969	$	4,003	$	4,682	$	4,724	$	4,416	$	4,445
Long-term borrowings due within one year: **
Equipment operations	$	191	$	198	$	79	$	78	$	567	$	567
Financial services		7,341		7,424		6,870		6,936		6,638		6,650
Total	$	7,532	$	7,622	$	6,949	$	7,014	$	7,205	$	7,217
Long-term borrowings: **
Equipment operations	$	10,103	$	11,813	$	10,085	$	11,837	$	5,544	$	6,403
Financial services		22,633		23,219		22,610		23,170		24,908		25,299
Total	$	32,736	$	35,032	$	32,695	$	35,007	$	30,452	$	31,702

* Fair value measurements above were Level 3 for all financing receivables, Level 3 for equipment operations short-term securitization borrowings, and Level 2 for all other borrowings.

** Excludes finance lease liabilities (see Note 15).

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*:

	January 31		November 1		February 2
	2021		2020		2020
Level 1:
Marketable securities
International equity securities	$	2	$	2	$	3
U.S. equity fund		70		62		62
U.S. government debt securities		60		55		52
Total Level 1 marketable securities		132		119		117
Level 2:
Marketable securities
U.S. government debt securities		119		113		87
Municipal debt securities		71		68		62
Corporate debt securities		197		188		173
International debt securities		8		2		4
Mortgage-backed securities**		140		147		165
Total Level 2 marketable securities		535		518		491
Other assets
Derivatives:
Interest rate contracts		568		669		443
Foreign exchange contracts		34		48		37
Cross-currency interest rate contracts		3		8		1
Total Level 2 other assets		605		725		481
Accounts payable and accrued expenses
Derivatives:
Interest rate contracts		97		88		57
Foreign exchange contracts		76		26		40
Cross-currency interest rate contracts		2		1		4
Total Level 2 accounts payable and accrued expenses		175		115		101
Level 3:
Marketable securities
International debt securities				4		1

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

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

Contractual Maturities of Debt Securities

The contractual maturities of debt securities at January 31, 2021 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		Fair
	Cost		Value
Due in one year or less	$	21	$	22
Due after one through five years		89		94
Due after five through 10 years		117		124
Due after 10 years		203		215
Mortgage-backed securities		134		140
Debt securities	$	564	$	595

Fair Value, Recurring, Level 3 Measurements

Fair value, recurring Level 3 measurements from available-for-sale marketable securities in millions of dollars follow:

	Three Months Ended
	January 31		February 2
	2021		2020
Beginning of period balance	$	4	$	1
Principal payments
Other		(4)
End of period balance			$	1

Fair Value, Nonrecurring Level 3 Measurements from Impairments

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

	Fair Value *					Losses
						Three Months Ended
	January 31		November 1		February 2	January 31		February 2
	2021		2020		2020	2021		2020
Other receivables			$	1
Equipment on operating leases – net			$	371
Property and equipment – net	$	41	$	135		$	44
Investments in unconsolidated affiliates			$	19
Other assets	$	1	$	59		$	6

*  Financing receivables with specific allowances were not significant.