FINANCIAL INSTRUMENTS (Tables)
|
6 Months Ended |
Jun. 30, 2023 |
|---|
| Derivative Instruments and Hedging Activities Disclosure [Abstract] |
|
| Estimated Fair Value of Assets and Liabilities |
The following table provides information about assets and liabilities not carried at fair value and excludes finance leases, equity securities without readily determinable fair value and non-financial assets and liabilities. Substantially all of these assets are considered to be Level 3 and the vast majority of our liabilities’ fair value are considered Level 2. | | | | | | | | | | | | | | | | | | | | | | | June 30, 2023 | | December 31, 2022 | | Carrying
amount
(net) | Estimated
fair value | | Carrying
amount
(net) | Estimated
fair value | | Assets | Loans and other receivables | $ | 2,329 | | $ | 2,196 | | | $ | 2,557 | | $ | 2,418 | | | | | | | | | | Liabilities | Borrowings (Note 11) | $ | 21,782 | | $ | 20,805 | | | $ | 24,059 | | $ | 22,849 | | | Investment contracts (Note 13) | 1,632 | | 1,677 | | | 1,708 | | 1,758 | |
|
| Fair Value of Derivative Assets |
| | | | | | | | | | | | | | | | | | | | | | | | | FAIR VALUE OF DERIVATIVES | June 30, 2023 | | December 31, 2022 | | Gross Notional | All other assets | All other liabilities | | Gross Notional | All other assets | All other liabilities | | Currency exchange contracts | $ | 4,784 | | $ | 147 | | $ | 129 | | | $ | 5,112 | | $ | 132 | | $ | 146 | | | | | | | | | | | Derivatives accounted for as hedges | $ | 4,784 | | $ | 147 | | $ | 129 | | | $ | 5,112 | | $ | 132 | | $ | 146 | | | | | | | | | | | Currency exchange contracts | $ | 62,266 | | $ | 1,139 | | $ | 1,056 | | | $ | 51,885 | | $ | 946 | | $ | 1,082 | | | Other contracts | 700 | | 159 | | 15 | | | 901 | | 197 | | 14 | | | | | | | | | | | | | | | | | | | Derivatives not accounted for as hedges | $ | 62,966 | | $ | 1,298 | | $ | 1,071 | | | $ | 52,786 | | $ | 1,143 | | $ | 1,095 | | | | | | | | | | | Gross derivatives | $ | 67,750 | | $ | 1,445 | | $ | 1,200 | | | $ | 57,898 | | $ | 1,275 | | $ | 1,241 | | | | | | | | | | | Netting and credit adjustments | | $ | (926) | | $ | (925) | | | | $ | (821) | | $ | (820) | | | | | | | | | | | Net derivatives recognized in statement of financial position | | $ | 519 | | $ | 275 | | | | $ | 454 | | $ | 420 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
|
| Fair Value of Derivative Liabilities |
| | | | | | | | | | | | | | | | | | | | | | | | | FAIR VALUE OF DERIVATIVES | June 30, 2023 | | December 31, 2022 | | Gross Notional | All other assets | All other liabilities | | Gross Notional | All other assets | All other liabilities | | Currency exchange contracts | $ | 4,784 | | $ | 147 | | $ | 129 | | | $ | 5,112 | | $ | 132 | | $ | 146 | | | | | | | | | | | Derivatives accounted for as hedges | $ | 4,784 | | $ | 147 | | $ | 129 | | | $ | 5,112 | | $ | 132 | | $ | 146 | | | | | | | | | | | Currency exchange contracts | $ | 62,266 | | $ | 1,139 | | $ | 1,056 | | | $ | 51,885 | | $ | 946 | | $ | 1,082 | | | Other contracts | 700 | | 159 | | 15 | | | 901 | | 197 | | 14 | | | | | | | | | | | | | | | | | | | Derivatives not accounted for as hedges | $ | 62,966 | | $ | 1,298 | | $ | 1,071 | | | $ | 52,786 | | $ | 1,143 | | $ | 1,095 | | | | | | | | | | | Gross derivatives | $ | 67,750 | | $ | 1,445 | | $ | 1,200 | | | $ | 57,898 | | $ | 1,275 | | $ | 1,241 | | | | | | | | | | | Netting and credit adjustments | | $ | (926) | | $ | (925) | | | | $ | (821) | | $ | (820) | | | | | | | | | | | Net derivatives recognized in statement of financial position | | $ | 519 | | $ | 275 | | | | $ | 454 | | $ | 420 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
|
| Effects of Derivatives on AOCI |
| | | | | | | | | | | | | | | | | | | | CASH FLOW HEDGES AND NET INVESTMENT HEDGES | | | | | | | | Gain (loss) recognized in AOCI | Three months ended June 30 | | Six months ended June 30 | | 2023 | 2022 | | 2023 | 2022 | | | Cash flow hedges(a) | $ | 21 | | $ | (110) | | | $ | 49 | | $ | (157) | | | | Net investment hedges(b) | (68) | | 183 | | | (130) | | 294 | | |
(a) Primarily related to currency exchange contracts. (b) The carrying value of foreign currency debt designated as net investment hedges was $4,710 million and $3,311 million as of June 30, 2023 and 2022, respectively. The total reclassified from AOCI into earnings was zero for both the three months and six months ended June 30, 2023 and 2022.
|
| Effects of Derivatives on Earnings |
The table below presents the effects of hedges and resulting gains (losses) of our derivative financial instruments in the Statement of Earnings (Loss): | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Three months ended June 30, 2023 | | Three months ended June 30, 2022 | | | | | | Revenues | | Interest Expense | SG&A | Other(a) | | Revenues | | Interest Expense | SG&A | Other(a) | | $ | 16,699 | | | $ | 267 | | $ | 2,358 | | $ | 13,054 | | | $ | 14,127 | | | $ | 368 | | $ | 1,817 | | $ | 9,298 | | | | | | | | | | | | | | | Cash flow hedges | $ | 4 | | | $ | (4) | | $ | — | | $ | 11 | | | $ | — | | | $ | (7) | | $ | — | | $ | (36) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Fair value hedges | | | | | | | | | $ | (7) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Non-hedging derivatives (b) | $ | (1) | | | $ | — | | $ | 175 | | $ | (69) | | | $ | 1 | | | $ | — | | $ | (349) | | $ | (29) | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Six months ended June 30, 2023 | | Six months ended June 30, 2022 | | | | | | Revenues | | Interest Expense | SG&A | Other(a) | | Revenues | | Interest Expense | SG&A | Other(a) | | $ | 31,185 | | | $ | 536 | | $ | 4,500 | | $ | 29,864 | | | $ | 26,802 | | | $ | 756 | | $ | 4,543 | | $ | 19,120 | | | | | | | | | | | | | | | Cash flow hedges | $ | 5 | | | $ | (6) | | $ | — | | $ | 9 | | | $ | 4 | | | $ | (13) | | $ | — | | $ | (68) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Fair value hedges | | | | | | | | | $ | (16) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Non-hedging derivatives (b) | $ | — | | | $ | — | | $ | 290 | | $ | (127) | | | $ | 2 | | | $ | — | | $ | (454) | | $ | (95) | |
(a) Amounts are inclusive of cost of sales and other income (loss). (b) SG&A was primarily driven by hedges of deferred incentive compensation, and hedges of remeasurement of monetary assets and liabilities.
|