Financial Instruments (Tables)

Presented in the table below is the fair value of derivatives on a gross basis segregated between those derivatives that are designated as hedging instruments and those that are not designated as hedging instruments as of December 31:



		2013						2012
		Fair Value of Derivative				U.S. Dollar Notional		Fair Value of Derivative				U.S. Dollar Notional
	Balance Sheet Caption	Asset		Liability		U.S. Dollar Notional		Asset		Liability		U.S. Dollar Notional
Derivatives Designated as Hedging Instruments
Interest rate swap contracts (non-current)	Other assets	$	13	$	—	$	1,550	$	—	$	—	$	—
Interest rate swap contracts (non-current)	Other noncurrent liabilities	—		25		2,000		—		—		—
Foreign exchange contracts (current)	Deferred income taxes and other current assets	493		—		4,427		281		—		6,646
Foreign exchange contracts (non-current)	Other assets	515		—		6,676		387		—		5,989
Foreign exchange contracts (current)	Accrued and other current liabilities	—		19		1,659		—		13		938
		$	1,021	$	44	$	16,312	$	668	$	13	$	13,573
Derivatives Not Designated as Hedging Instruments
Foreign exchange contracts (current)	Deferred income taxes and other current assets	$	69	$	—	$	5,705	$	55	$	—	$	4,548
Foreign exchange contracts (non-current)	Other assets	—		—		—		8		—		232
Foreign exchange contracts (current)	Accrued and other current liabilities	—		140		7,892		—		216		8,203
		$	69	$	140	$	13,597	$	63	$	216	$	12,983
		$	1,090	$	184	$	29,909	$	731	$	229	$	26,556

The following table provides information on the Company’s derivative positions subject to these master netting arrangements as if they were presented on a net basis, allowing for the right of offset by counterparty and cash collateral exchanged per the master agreements and related credit support annexes at December 31:



	2013						2012
	Asset			Liability			Asset			Liability
Gross amounts recognized in the consolidated balance sheet	$	1,090		$	184		$	731		$	229
Gross amount subject to offset in master netting arrangements not offset in the consolidated balance sheet	(147		)	(147		)	(195		)	(195		)
Cash collateral (received) posted	(652		)	—			(305		)	—
Net amounts	$	291		$	37		$	231		$	34

The table below provides information on the location and pretax gain or loss amounts for derivatives that are: (i) designated in a fair value hedging relationship, (ii) designated in a foreign currency cash flow hedging relationship, (iii) designated in a foreign currency net investment hedging relationship and (iv) not designated in a hedging relationship:



Years Ended December 31	2013			2012			2011
Derivatives designated in a fair value hedging relationship
Interest rate swap contracts
Amount of loss (gain) recognized in Other (income) expense, net on derivatives ⁽¹⁾	$	12		$	—		$	(196	)
Amount of (gain) loss recognized in Other (income) expense, net on hedged item ⁽¹⁾	(14		)	—			196
Derivatives designated in foreign currency cash flow hedging relationships
Foreign exchange contracts
Amount of loss reclassified from AOCI to Sales	45			50			85
Amount of (gain) loss recognized in OCI on derivatives	(306		)	204			143
Derivatives designated in foreign currency net investment hedging relationships
Foreign exchange contracts
Amount of gain recognized in Other (income) expense, net on derivatives ⁽²⁾	(10		)	(20		)	(10		)
Amount of (gain) loss recognized in OCI on derivatives	(363		)	(208		)	122
Derivatives not designated in a hedging relationship
Foreign exchange contracts
Amount of loss (gain) recognized in Other (income) expense, net on derivatives ⁽³⁾	183			382			(113		)
Amount of loss recognized in Sales	8			30			—


⁽¹⁾	There was $2 million of ineffectiveness on the hedge during 2013.


⁽²⁾	There was no ineffectiveness on the hedge. Represents the amount excluded from hedge effectiveness testing.


⁽³⁾	These derivative contracts mitigate changes in the value of remeasured foreign currency denominated monetary assets and liabilities attributable to changes in foreign currency exchange rates

Information on available-for-sale investments at December 31 is as follows:



	2013									2012
	Fair Value		Amortized Cost		Gross Unrealized					Fair Value		Amortized Cost		Gross Unrealized
	Fair Value		Amortized Cost		Gains		Losses			Fair Value		Amortized Cost		Gains		Losses
Corporate notes and bonds	$	7,054	$	7,037	$	32	$	(15	)	$	5,063	$	5,013	$	52	$	(2	)
Asset-backed securities	1,300		1,303		1		(4		)	837		835		3		(1		)
U.S. government and agency securities	1,236		1,239		1		(4		)	1,206		1,204		2		—
Commercial paper	1,206		1,206		—		—			2,150		2,150		—		—
Mortgage-backed securities	476		479		2		(5		)	435		436		2		(3		)
Foreign government bonds	125		126		—		(1		)	108		107		1		—
Equity securities	471		397		74		—			403		370		33		—
	$	11,868	$	11,787	$	110	$	(29	)	$	10,202	$	10,115	$	93	$	(6	)

Financial assets and liabilities measured at fair value on a recurring basis at December 31 are summarized below:



	Fair Value Measurements Using								Fair Value Measurements Using
	Quoted Prices In Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total		Quoted Prices In Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total
	2013								2012
Assets
Investments
Corporate notes and bonds	$	—	$	7,054	$	—	$	7,054	$	—	$	5,063	$	—	$	5,063
Asset-backed securities ⁽¹⁾	—		1,300		—		1,300		—		837		—		837
U.S. government and agency securities	—		1,236		—		1,236		—		1,206		—		1,206
Commercial paper	—		1,206		—		1,206		—		2,150		—		2,150
Mortgage-backed securities ⁽¹⁾	—		476		—		476		—		435		—		435
Foreign government bonds	—		125		—		125		—		108		—		108
Equity securities	238		—		—		238		196		—		—		196
	238		11,397		—		11,635		196		9,799		—		9,995
Other assets
Securities held for employee compensation	186		47		—		233		169		38		—		207
Derivative assets ⁽²⁾
Purchased currency options	—		868		—		868		—		546		—		546
Forward exchange contracts	—		209		—		209		—		185		—		185
Interest rate swaps	—		13		—		13		—		—		—		—
	—		1,090		—		1,090		—		731		—		731
Total assets	$	424	$	12,534	$	—	$	12,958	$	365	$	10,568	$	—	$	10,933
Liabilities
Derivative liabilities ⁽²⁾
Forward exchange contracts	$	—	$	134	$	—	$	134	$	—	$	216	$	—	$	216
Written currency options	—		25		—		25		—		13		—		13
Interest rate swaps	—		25		—		25		—		—		—		—
Total liabilities	$	—	$	184	$	—	$	184	$	—	$	229	$	—	$	229

⁽¹⁾

Primarily all of the asset-backed securities are highly-rated (Standard & Poor’s rating of AAA and Moody’s Investors Service rating of Aaa), secured primarily by credit card, auto loan, and home equity receivables, with weighted-average lives of primarily 5 years or less. Mortgage-backed securities represent AAA-rated securities issued or unconditionally guaranteed as to payment of principal and interest by U.S. government agencies.


⁽²⁾	The fair value determination of derivatives includes the impact of the credit risk of counterparties to the derivatives and the Company’s own credit risk, the effects of which were not significant.