Summary of Significant Accounting Policies (Tables)

12 Months Ended

Dec. 31, 2011

Restaurant Information by Ownership Type

The following table presents restaurant information by ownership type:


Restaurants at December 31,	*2011*		2010		2009
Conventional franchised		19,527		19,279		19,020
Developmental licensed		3,929		3,485		3,160
Foreign affiliated		3,619		3,574		4,036
Franchised		27,075		26,338		26,216
Company-operated		6,435		6,399		6,262
Systemwide restaurants		33,510		32,737		32,478

Share-Based Compensation Expense and Effect on Diluted Earnings Per Common Share

Share-based compensation expense and the effect on diluted earnings per common share were as follows:


In millions, except per share data	*2011*		2010		2009
Share-based compensation expense	$	86.2	$	83.1	$	112.9
After tax	$	59.2	$	56.2	$	76.1
Earnings per common share-diluted	$	0.05	$	0.05	$	0.07

Weighted-Average Assumptions

Weighted-average assumptions


	*2011*			2010			2009
Expected dividend yield		3.2	%		3.5	%		3.2	%
Expected stock price volatility		21.5	%		22.1	%		24.4	%
Risk-free interest rate		2.8	%		2.8	%		2.0	%
Expected life of options In years		6.3			6.2			6.2
Fair value per option granted	$	12.18		$	9.90		$	9.66

Activity in Goodwill by Segment

The following table presents the 2011 activity in goodwill by segment:


In millions	U.S.		Europe			APMEA⁽¹⁾			Other Countries & Corporate⁽²⁾			Consolidated
Balance at December 31, 2010	$	1,212.0	$	785.5		$	385.0		$	203.6		$	2,586.1
Net restaurant purchases (sales)		37.3		37.1			29.8			(4.6	)		99.6
Ownership changes and other		5.1					(7.7	)		(3.0	)		(5.6	)
Currency translation				(21.0	)		(1.7	)		(4.2	)		(26.9	)
Balance at December 31, 2011	$	1,254.4	$	801.6		$	405.4		$	191.8		$	2,653.2

(1)

APMEA represents Asia/Pacific, Middle East and Africa.

(2)

Other Countries & Corporate represents Canada, Latin America and Corporate.

Financial Assets and Liabilities Measured at Fair Value on Recurring Basis

The following tables present financial assets and liabilities measured at fair value on a recurring basis by the valuation hierarchy as defined in the fair value guidance:


December 31, 2011
In millions	Level 1			Level 2			Level 3	Carrying Value
Cash equivalents	$	581.7						$	581.7
Investments		132.4	*						132.4
Derivative assets		154.5	*	$	71.1				225.6
Total assets at fair value	$	868.6		$	71.1			$	939.7
Derivative payables				$	(15.6	)		$	(15.6	)
Total liabilities at fair value				$	(15.6	)		$	(15.6	)


December 31, 2010
In millions	Level 1			Level 2			Level 3	Carrying Value
Cash equivalents	$	722.5						$	722.5
Investments		131.6	*						131.6
Derivative assets		104.4	*	$	88.5				192.9
Total assets at fair value	$	958.5		$	88.5			$	1,047.0
Derivative payables				$	(8.4	)		$	(8.4	)
Total liabilities at fair value				$	(8.4	)		$	(8.4	)

*	Includes investments and derivatives that hedge market driven changes in liabilities associated with the Company’s supplemental benefit plans.

Fair Values of Derivative Instruments Included on Consolidated Balance Sheet

The following table presents the fair values of derivative instruments included on the Consolidated balance sheet as of December 31, 2011 and 2010:


	Derivative Assets					Derivative Liabilities
In millions	Balance Sheet Classification	*2011*		2010		Balance Sheet Classification	*2011*			2010
Derivatives designated as hedging instruments
Foreign currency	Prepaid expenses and other current assets	$	6.7	$	7.5	Accrued payroll and other liabilities	$	(0.3	)	$	(4.6	)
Interest rate	Prepaid expenses and other current assets		9.4		0.5
Foreign currency	Miscellaneous other assets		0.7			Other long-term liabilities		(0.3	)
Interest rate	Miscellaneous other assets		46.0		72.1	Other long-term liabilities		(14.0	)		(0.3	)
Total derivatives designated as hedging instruments		$	62.8	$	80.1		$	(14.6	)	$	(4.9	)
Derivatives not designated as hedging instruments
Foreign currency	Prepaid expenses and other current assets	$	8.3	$	6.0	Accrued payroll and other liabilities	$	(1.0	)	$	(3.8	)
Equity	Prepaid expenses and other current assets				104.4
Foreign currency	Miscellaneous other assets				2.7
Equity	Miscellaneous other assets		154.5
Total derivatives not designated as hedging instruments		$	162.8	$	113.1		$	(1.0	)	$	(3.8	)
Total derivatives		$	225.6	$	193.2		$	(15.6	)	$	(8.7	)

Derivatives Pretax Amounts Affecting Income and Other Comprehensive Income

The following table presents the pretax amounts affecting income and OCI for the years ended December 31, 2011 and 2010, respectively:

In millions

Derivatives in

Fair Value

Hedging

Relationships

Gain (Loss)

Recognized in Income

on Derivative

Hedged Items in

Fair Value

Hedging

Relationships

Gain (Loss)

Recognized in Income on

Related Hedged Items

2011

2010

2011

2010

Interest rate

$(11.1)

$7.0

Fixed-rate debt

$11.1

$(7.0)


Derivatives in Cash flow Hedging Relationships	Gain (Loss) Recognized in Accumulated OCI on Derivative (Effective Portion)		Gain (Loss) Reclassified from Accumulated OCI into Income (Effective Portion)				Gain (Loss) Recognized in Income on Derivative (Amount Excluded from Effectiveness Testing and Ineffective Portion)
Derivatives in Cash flow Hedging Relationships	*2011*	2010	*2011*			2010	*2011*	2010
Foreign currency	$ (5.1)	$11.2	$	5.1		$13.4	$(7.7)	$	(25.1	)
Interest rate⁽¹⁾	(14.0)			(2.2	)	0.9			0.3
Total	$(19.1)	$11.2	$	2.9		$14.3	$(7.7)	$	(24.8	)

Net Investment

Hedging Relationships

Gain (Loss)

Recognized in Accumulated

OCI on Derivative

(Effective portion)

Gain (Loss)

Reclassified from
Accumulated OCI

into Income

(Effective Portion)

Derivatives Not

Designated as
Hedging Instruments

Gain (Loss)

Recognized in Income on
Derivative

2011

2010

2011

2010

2011

2010

Foreign currency

(2.2

)

$16.4

Foreign currency denominated debt

$(130.8)

$(144.3)

Equity⁽³⁾

36.9

18.8

Foreign currency derivatives⁽²⁾

(9.4)

(4.3)

$(8.2)

Interest Rate

1.5

Total

$(140.2)

$(148.6)

$(8.2)

Total

36.2

$35.2

Gains (losses) recognized in income on derivatives are recorded in “Nonoperating (income) expense, net” unless otherwise noted.

(1)

The amount of gain (loss) reclassified from accumulated OCI into income is recorded in Interest expense.

(2)

The amount of gain (loss) reclassified from accumulated OCI into income is recorded in Impairment and other charges (credits), net.

(3)

The amount of gain (loss) recognized in income on the derivatives used to hedge the supplemental benefit plan liabilities is recorded in Selling, general & administrative expenses.

- Definition

Tabular disclosure of components of a stock option or other award plan under which equity-based compensation is awarded to employees, typically comprised of the amount of unearned compensation (deferred compensation cost), compensation expense, and changes in the quantity and fair value of the shares (or other type of equity) granted, exercised, forfeited, and issued and outstanding pertaining to that plan. Disclosure may also include nature and general terms of such arrangements that existed during the period and potential effects of those arrangements on shareholders, effect of compensation cost arising from equity-based payment arrangements on the income statement, method of estimating the fair value of the goods or services received, or the fair value of the equity instruments granted, during the period, cash flow effects resulting from equity-based payment arrangements and, for registrants that accelerate vesting of out of the money share options, reasons for the decision to accelerate.

+ References+ Details

- Definition

Tabular disclosure of the location and amount of gains and losses reported in the statement of financial performance, or when applicable, the statement of financial position. For example, (a) gains and losses recognized in the income statement on derivative instruments designated and qualifying as hedging instruments in fair value hedges and related hedged items designated and qualifying in fair value hedges and (b) gains and losses initially recognized in other comprehensive income on derivative instruments designated and qualifying as cash flow hedges.

+ References+ Details

- Definition

Tabular disclosure of the location and fair value amounts of derivative instruments (and nonderivative instruments that are designated and qualify as hedging instruments) reported in the statement of financial position.

+ References+ Details

- Definition

Tabular disclosure of goodwill by reportable segment and in total. Disclosure details may include, but are not limited to, the carrying amount of goodwill, goodwill acquired during the year, goodwill impairment losses recognized, goodwill written-off due to the sale of a business unit, goodwill not yet allocated, and any other changes to goodwill.

+ References+ Details