Fair value measurement (Tables)

6 Months Ended

Jun. 30, 2016

Fair value of each major class of financial assets and liabilities measured at fair value on a recurring basis

The fair value of each major class of the Company’s financial assets and liabilities measured at fair value on a recurring basis was as follows (in millions):



	Quoted prices in active markets for identical assets (Level 1)		Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)
Fair value measurement
as of June 30, 2016, using:							Total
Assets:
Available-for-sale investments:
U.S. Treasury securities	$	8,020	$	—	$	—	$	8,020
Other government-related debt securities:
U.S.	—		347		—		347
Foreign and other	—		1,866		—		1,866
Corporate debt securities:
Financial	—		8,238		—		8,238
Industrial	—		8,473		—		8,473
Other	—		1,018		—		1,018
Residential mortgage-backed securities	—		1,738		—		1,738
Other mortgage- and asset-backed securities	—		2,180		—		2,180
Money market mutual funds	1,673		—		—		1,673
Other short-term interest-bearing securities	—		1,014		—		1,014
Equity securities	123		—		—		123
Derivatives:
Foreign currency contracts	—		68		—		68
Cross-currency swap contracts	—		17		—		17
Interest rate swap contracts	—		266		—		266
Total assets	$	9,816	$	25,225	$	—	$	35,041

Liabilities:
Derivatives:
Foreign currency contracts	$	—	$	27	$	—	$	27
Cross-currency swap contracts	—		456		—		456
Forward interest rate contracts	—		4		—		4
Contingent consideration obligations in connection with business combinations	—		—		171		171
Total liabilities	$	—	$	487	$	171	$	658



	Quoted prices in active markets for identical assets (Level 1)		Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)
Fair value measurement
as of December 31, 2015, using:							Total
Assets:
Available-for-sale investments:
U.S. Treasury securities	$	4,274	$	—	$	—	$	4,274
Other government-related debt securities:
U.S.	—		534		—		534
Foreign and other	—		1,739		—		1,739
Corporate debt securities:
Financial	—		7,871		—		7,871
Industrial	—		7,836		—		7,836
Other	—		885		—		885
Residential mortgage-backed securities	—		1,470		—		1,470
Other mortgage- and asset-backed securities	—		2,469		—		2,469
Money market mutual funds	3,370		—		—		3,370
Other short-term interest-bearing securities	—		528		—		528
Equity securities	136		—		—		136
Derivatives:
Foreign currency contracts	—		142		—		142
Interest rate swap contracts	—		71		—		71
Total assets	$	7,780	$	23,545	$	—	$	31,325

Liabilities:
Derivatives:
Foreign currency contracts	$	—	$	8	$	—	$	8
Cross-currency swap contracts	—		250		—		250
Interest rate swap contracts	—		3		—		3
Contingent consideration obligations in connection with business combinations	—		—		188		188
Total liabilities	$	—	$	261	$	188	$	449

Changes in carrying amounts of contingent consideration obligations

Changes in the carrying amounts of contingent consideration obligations were as follows (in millions):



	Three months ended June 30,					Six months ended June 30,
	2016			2015		2016			2015
Beginning balance	$	194		$	215	$	188		$	215
Net changes in valuation	(23		)	—		(17		)	—
Ending balance	$	171		$	215	$	171		$	215