Fair value measurement (Tables)

6 Months Ended

Jun. 30, 2017

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

The fair values of each major class of the Company’s financial assets and liabilities measured at fair value on a recurring basis were 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, 2017, using:							Total
Assets:
Available-for-sale investments:
U.S. Treasury securities	$	7,661	$	—	$	—	$	7,661
Other government-related debt securities:
U.S.	—		226		—		226
Foreign and other	—		2,353		—		2,353
Corporate debt securities:
Financial	—		9,637		—		9,637
Industrial	—		9,569		—		9,569
Other	—		1,235		—		1,235
Residential mortgage-backed securities	—		1,682		—		1,682
Other mortgage- and asset-backed securities	—		1,853		—		1,853
Money market mutual funds	2,165		—		—		2,165
Other short-term interest-bearing securities	—		2,382		—		2,382
Equity securities	159		—		—		159
Derivatives:
Foreign currency contracts	—		18		—		18
Cross-currency swap contracts	—		153		—		153
Interest rate swap contracts	—		52		—		52
Total assets	$	9,985	$	29,160	$	—	$	39,145

Liabilities:
Derivatives:
Foreign currency contracts	$	—	$	93	$	—	$	93
Cross-currency swap contracts	—		398		—		398
Contingent consideration obligations in connection with business combinations	—		—		182		182
Total liabilities	$	—	$	491	$	182	$	673



	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, 2016, using:							Total
Assets:
Available-for-sale investments:
U.S. Treasury securities	$	6,614	$	—	$	—	$	6,614
Other government-related debt securities:
U.S.	—		299		—		299
Foreign and other	—		1,759		—		1,759
Corporate debt securities:
Financial	—		8,460		—		8,460
Industrial	—		8,789		—		8,789
Other	—		1,077		—		1,077
Residential mortgage-backed securities	—		1,940		—		1,940
Other mortgage- and asset-backed securities	—		1,719		—		1,719
Money market mutual funds	2,782		—		—		2,782
Other short-term interest-bearing securities	—		4,188		—		4,188
Equity securities	154		—		—		154
Derivatives:
Foreign currency contracts	—		203		—		203
Interest rate swap contracts	—		41		—		41
Total assets	$	9,550	$	28,475	$	—	$	38,025

Liabilities:
Derivatives:
Foreign currency contracts	$	—	$	4	$	—	$	4
Cross-currency swap contracts	—		523		—		523
Interest rate swap contracts	—		7		—		7
Contingent consideration obligations in connection with business combinations	—		—		179		179
Total liabilities	$	—	$	534	$	179	$	713

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,
	2017			2016			2017		2016
Beginning balance	$	184		$	194		$	179	$	188
Net changes in valuation	(2		)	(23		)	3		(17		)
Ending balance	$	182		$	171		$	182	$	171