v2.4.0.6
Financial Instruments (Tables)
 6 Months Ended
Jun. 16, 2012
Fair Values of Financial Assets and Liabilities

The fair values of our financial assets and liabilities as of June 16, 2012 and June 11, 2011 are categorized as follows:

 

     2012      2011  
     Assets(a)      Liabilities(a)      Assets(a)      Liabilities(a)  

Available-for-sale securities(b)

    $ 62       $ –       $ 85       $ –   

Short-term investments – index funds(c)

    $ 158       $ –       $ 176       $ –   

Prepaid forward contracts(d)

    $ 40       $ –       $ 41       $ –   

Deferred compensation(e)

    $ –       $ 501       $ –       $ 547   

Derivatives designated as fair value hedging instruments:

            

Interest rate derivatives(f)

    $ 289       $ –       $ 345       $ –   

Derivatives designated as cash flow hedging instruments:

         

Foreign exchange contracts(g)

    $ 41       $ 14       $ 7       $ 36   

Interest rate derivatives(f)

      –         –         –         14   

Commodity contracts(h)

      –         79         74         13   
  

 

 

     

 

 

     

 

 

     

 

 

  
   $ 41       $ 93       $ 81       $ 63   

Derivatives not designated as hedging instruments:

            

Foreign exchange contracts(g)

    $ 17       $ 16       $ 8       $ 15   

Interest rate derivatives(f)

      124         156         44         81   

Commodity contracts(h)

      17         72         47         2   
  

 

 

     

 

 

     

 

 

     

 

 

  
   $ 158       $ 244       $ 99       $ 98   
  

 

 

     

 

 

     

 

 

     

 

 

  

Total derivatives at fair value

    $ 488       $ 337       $ 525       $ 161   
  

 

 

     

 

 

     

 

 

     

 

 

  

Total

    $ 748       $ 838       $ 827       $ 708   
  

 

 

     

 

 

     

 

 

     

 

 

  

 

(a) 

Financial assets are classified on our balance sheet within prepaid expenses and other current assets and other assets, with the exception of available-for-sale securities and short-term investments. Financial liabilities are classified on our balance sheet within accounts payable, other current liabilities and other liabilities. Unless specifically indicated, all financial assets and liabilities are categorized as Level 2 assets or liabilities.

 

(b) 

Based on the price of common stock. Categorized as a Level 1 asset.

 

(c) 

Based on price changes in index funds used to manage a portion of market risk arising from our deferred compensation liability. Categorized as a Level 1 asset.

 

(d) 

Based primarily on the price of our common stock.

 

(e) 

Based on the fair value of investments corresponding to employees’ investment elections. As of June 16, 2012 and June 11, 2011, $11 million and $46 million, respectively, are categorized as Level 1 liabilities. The remaining balances are categorized as Level 2 liabilities.

 

(f) 

Based on LIBOR forward rates.

 

(g) 

Based on recently reported market transactions of spot and forward rates.

 

(h) 

Based on recently reported market transactions, primarily swap arrangements, except for liabilities as of June 11, 2011, which primarily related to commodity futures contracts. The futures contracts are valued based on average prices on futures exchanges and categorized as Level 1 liabilities.
Effective Portion Of Pre-Tax (Gains)/Losses On Derivative Instruments

The effective portion of the pre-tax losses/(gains) on our derivative instruments are categorized in the tables below.

 

     12 Weeks Ended  
     Fair Value/Non-
designated Hedges		     Cash Flow Hedges  
     Losses/(Gains)
Recognized in
Income Statement(a)		     (Gains)/Losses
Recognized in
Accumulated Other
Comprehensive Loss		     Losses/(Gains)
Reclassified from
Accumulated Other
Comprehensive Loss
into Income
Statement(b)		  
     6/16/12        6/11/11        6/16/12        6/11/11        6/16/12         6/11/11   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

     

 

 

  

Foreign exchange contracts

    $ 3      $ 2      $ (33 )    $ 12      $ 5       $ 16   

Interest rate derivatives

      (19 )      (56 )      –        35        5         3   

Commodity contracts

      72        (7 )      55        (15 )      16         (19 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

     

 

 

  

Total

    $ 56      $ (61 )    $ 22      $ 32      $ 26       $ –   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

     

 

 

  

 

     24 Weeks Ended  
     Fair Value/Non-
designated Hedges		     Cash Flow Hedges  
     (Gains)/Losses
Recognized in
Income Statement(a)		     (Gains)/Losses
Recognized in
Accumulated Other
Comprehensive Loss		     Losses/(Gains)
Reclassified from
Accumulated Other
Comprehensive Loss
into Income
Statement(b)		  
     6/16/12        6/11/11        6/16/12        6/11/11        6/16/12         6/11/11   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

     

 

 

  

Foreign exchange contracts

    $ (7 )    $ 1      $ (4 )    $ 37      $ 2       $ 21   

Interest rate derivatives

      8        (78 )      4        29        9         6   

Commodity contracts

      23        (46 )      37        (55 )      27         (25 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

     

 

 

  

Total

    $ 24      $ (123 )    $ 37      $ 11      $ 38       $ 2   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

     

 

 

  

 

(a) 

Interest rate derivatives gains/losses are primarily from fair value hedges and are included in interest expense. These gains/losses are substantially offset by increases/decreases in the value of the underlying debt, which are also included in interest expense. All other gains/losses are from non-designated hedges and are included in corporate unallocated expenses.

 

(b) 

Interest rate losses are included in interest expense. All other gains/losses are primarily included in cost of sales.