Fair value measurement (Tables)

3 Months Ended

Mar. 31, 2018

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 March 31, 2018, using:							Total
Assets:
Interest-bearing securities:
U.S. Treasury securities	$	5,103	$	—	$	—	$	5,103
Other government-related debt securities:
U.S.	—		129		—		129
Foreign and other	—		1,674		—		1,674
Corporate debt securities:
Financial	—		6,053		—		6,053
Industrial	—		5,565		—		5,565
Other	—		896		—		896
Residential-mortgage-backed securities	—		1,699		—		1,699
Other mortgage- and asset-backed securities	—		1,267		—		1,267
Money market mutual funds	9,234		—		—		9,234
Other short-term interest-bearing securities	—		50		—		50
Equity securities	155		—		—		155
Derivatives:
Foreign currency contracts	—		17		—		17
Cross-currency swap contracts	—		433		—		433
Total assets	$	14,492	$	17,783	$	—	$	32,275

Liabilities:
Derivatives:
Foreign currency contracts	$	—	$	259	$	—	$	259
Cross-currency swap contracts	—		148		—		148
Interest rate swap contracts	—		215		—		215
Contingent consideration obligations in connection with business combinations	—		—		110		110
Total liabilities	$	—	$	622	$	110	$	732



	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, 2017, using:							Total
Assets:
Interest-bearing securities:
U.S. Treasury securities	$	8,242	$	—	$	—	$	8,242
Other government-related debt securities:
U.S.	—		223		—		223
Foreign and other	—		2,422		—		2,422
Corporate debt securities:
Financial	—		10,072		—		10,072
Industrial	—		9,670		—		9,670
Other	—		1,390		—		1,390
Residential-mortgage-backed securities	—		2,168		—		2,168
Other mortgage- and asset-backed securities	—		2,297		—		2,297
Money market mutual funds	3,245		—		—		3,245
Other short-term interest-bearing securities	—		1,440		—		1,440
Equity securities	149		—		—		149
Derivatives:
Foreign currency contracts	—		6		—		6
Cross-currency swap contracts	—		270		—		270
Interest rate swap contracts	—		10		—		10
Total assets	$	11,636	$	29,968	$	—	$	41,604

Liabilities:
Derivatives:
Foreign currency contracts	$	—	$	204	$	—	$	204
Cross-currency swap contracts	—		220		—		220
Interest rate swap contracts	—		61		—		61
Contingent consideration obligations in connection with business combinations	—		—		69		69
Total liabilities	$	—	$	485	$	69	$	554

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 March 31,
	2018			2017
Beginning balance	$	69		$	179
Addition from K-A acquisition	45			—
Net changes in valuations	(4		)	5
Ending balance	$	110		$	184