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Organization, Consolidation and Presentation of Financial Statements Disclosure
3 Months Ended
Sep. 30, 2011
Notes to Financial Statements [Abstract]
Organization, Consolidation and Presentation of Financial Statements Disclosure
These statements should be read in conjunction with the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2011. The results of operations for the three-month period ended September 30, 2011 are not necessarily indicative of annual results.
Comprehensive Income - Total comprehensive income is comprised primarily of net earnings, net currency translation gains and losses, impacts of net investment and cash flow hedges, net unrealized gains and losses on investment securities and defined benefit and other retiree benefit plan activities. Total comprehensive income for the three months ended September 30, 2011 and 2010 was $83 million and $5,896 million, respectively.
Goodwill and Other Intangible Assets - Goodwill as of September 30, 2011 is allocated by reportable segment as follows (amounts in millions):
Beauty
Grooming
Health Care
Snacks and Pet Care
Fabric Care and Home Care
Baby Care and Family Care
Corporate
Total Company
GOODWILL at JUNE 30, 2011
19,068
21,621
8,179
2,243
4,589
1,553
309
57,562
Acquisitions and divestitures
—
(1
)
—
—
—
—
—
(1
)
Translation and other
(628
)
(532
)
(145
)
(9
)
(111
)
(57
)
—
(1,482
)
GOODWILL at SEPTEMBER 30, 2011
18,440
21,088
8,034
2,234
4,478
1,496
309
56,079
The decrease in goodwill from June 30, 2011 is primarily due to currency translation across reportable segments.
Identifiable intangible assets as of September 30, 2011 are comprised of (amounts in millions):
Gross Carrying Amount
Accumulated Amortization
Amortizable intangible assets with determinable lives
$
8,894
$
4,267
Intangible assets with indefinite lives
27,231
—
Total identifiable intangible assets
$
36,125
$
4,267
Amortizable intangible assets consist principally of brands, patents, technology and customer relationships. The intangible assets with indefinite lives consist primarily of brands.
The amortization of intangible assets for the three months ended September 30, 2011 and 2010 was $128 million and $140 million, respectively.
Share-Based Compensation - Pursuant to applicable accounting guidance for share-based payments, companies must recognize the cost of employee services received in exchange for awards of equity instruments based on the grant-date fair value of those awards.
Total share-based compensation for the three months ended September 30, 2011 and 2010 are summarized in the following table (amounts in millions):
Three Months Ended September 30
2011
2010
Share-Based Compensation
Stock options
$
62
$
68
Other share-based awards
18
19
Total share-based compensation
$
80
$
87
Assumptions utilized in the model are evaluated and revised, as necessary, to reflect market conditions and experience.
Postretirement Benefits - The Company offers various postretirement benefits to its employees.
The components of net periodic benefit cost for defined benefit plans are as follows:
Pension Benefits
Other Retiree Benefits
Three Months Ended September 30
Three Months Ended September 30
Amounts in millions
2011
2010
2011
2010
Service cost
$
67
$
62
$
36
$
35
Interest cost
157
140
69
65
Expected return on plan assets
(146
)
(119
)
(108
)
(108
)
Amortization of deferred amounts
6
4
(5
)
(5
)
Recognized net actuarial loss
26
37
25
24
Gross benefit cost (credit)
110
124
17
11
Dividends on ESOP preferred stock
—
—
(19
)
(20
)
Net periodic benefit cost (credit)
$
110
$
124
$
(2
)
$
(9
)
For the year ending June 30, 2012, the expected return on plan assets is 7.4% and 9.2% for defined benefit and other retiree benefit plans, respectively.
Risk Management Activities and Fair Value Measurements
3 Months Ended
Sep. 30, 2011
Notes to Financial Statements [Abstract]
Risk Management And Fair Value Measurements
Risk Management Activities and Fair Value Measurements
As a multinational company with diverse product offerings, we are exposed to market risks, such as changes in interest rates, currency exchange rates and commodity prices.
For details on the Company’s risk management activities and fair value measurement policies under the fair value hierarchy, refer to the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2011.
Fair Value Hierarchy
The Company has not changed its valuation techniques in measuring the fair value of any financial assets and liabilities during the period.
The following table sets forth the Company’s financial assets and liabilities as of September 30 and June 30, 2011 that are measured at fair value on a recurring basis during the period, segregated by level within the fair value hierarchy:
Level 1
Level 2
Level 3
Total
Amounts in millions
September 30, 2011
June 30, 2011
September 30, 2011
June 30, 2011
September 30, 2011
June 30, 2011
September 30, 2011
June 30, 2011
Assets at fair value:
Investment securities
$
10
$
16
$
—
$
—
$
23
$
23
$
33
$
39
Derivatives relating to:
Foreign currency hedges
—
—
—
1
—
—
—
1
Other foreign currency instruments (1)
—
—
49
182
—
—
49
182
Interest rates
—
—
295
163
—
—
295
163
Net investment hedges
—
—
5
—
—
—
5
—
Commodities
—
—
3
4
—
—
3
4
Total assets at fair value (2)
10
16
352
350
23
23
385
389
Liabilities at fair value:
Derivatives relating to:
Foreign currency hedges
—
—
174
119
—
—
174
119
Other foreign currency instruments (1)
—
—
361
43
—
—
361
43
Net investment hedges
—
—
182
138
—
—
182
138
Commodities
—
—
3
1
—
—
3
1
Total liabilities at fair value (3)
—
—
720
301
—
—
720
301
(1)
Other foreign currency instruments are comprised of foreign currency financial instruments that do not qualify as hedges.
(2)
Investment securities are presented in other noncurrent assets and all derivative assets are presented in prepaid expenses and other current assets or other noncurrent assets.
(3)
All liabilities are presented in accrued and other liabilities or other noncurrent liabilities.
The Company recognizes transfers between levels within the fair value hierarchy, if any, at the end of each quarter. There was no significant activity within the Level 3 assets and liabilities during the periods presented. There were no assets or liabilities that were re-measured at fair value on a non-recurring basis during the periods presented.
Certain of the Company’s financial instruments used in hedging transactions are governed by industry standard netting agreements with counterparties. If the Company’s credit rating were to fall below the levels stipulated in the agreements, the counterparties could demand either collateralization or termination of the arrangement. The aggregate fair value of the instruments covered by these contractual features that are in a net liability position as of September 30, 2011 was $504 million. The Company has never been required to post any collateral as a result of these contractual features.
Fair Values of Other Financial Instruments
Other financial instruments, including cash equivalents, other investments and short-term debt, are recorded at cost, which approximates fair value. The fair value of the long-term debt was $24,807 million and $23,418 million at September 30 and June 30, 2011, respectively.
Disclosures about Derivative Instruments
The notional amounts and fair values of qualifying and non-qualifying financial instruments used in hedging transactions as of September 30 and June 30, 2011 are as follows:
Notional Amount
Fair Value Asset (Liability)
Amounts in Millions
September 30, 2011
June 30, 2011
September 30, 2011
June 30, 2011
Derivatives in Cash Flow Hedging Relationships
Interest rate contracts
$
—
$
—
$
—
$
—
Foreign currency contracts
831
831
(174
)
(118
)
Commodity contracts
10
16
2
4
Total
841
847
(172
)
(114
)
Derivatives in Fair Value Hedging Relationships
Interest rate contracts
9,025
10,308
295
163
Derivatives in Net Investment Hedging Relationships
Net investment hedges
1,413
1,540
(177
)
(138
)
Derivatives Not Designated as Hedging Instruments
Foreign currency contracts
14,652
14,957
(312
)
139
Commodity contracts
33
39
(2
)
(1
)
Total
14,685
14,996
(314
)
138
The total notional amount of contracts outstanding at the end of the period is indicative of the level of the Company’s derivative activity during the period.
Amount of Gain (Loss) Recognized in Accumulated OCI on Derivatives (Effective Portion)
Amounts in Millions
September 30, 2011
June 30, 2011
Derivatives in Cash Flow Hedging Relationships
Interest rate contracts
$
14
$
15
Foreign currency contracts
25
32
Commodity contracts
1
3
Total
40
50
Derivatives in Net Investment Hedging Relationships
Net investment hedges
(111
)
(88
)
The effective portion of gains and losses on derivative instruments that was recognized in other comprehensive income (OCI) during the three months ended September 30, 2011 and 2010 was not material. During the next 12 months, the amount of the September 30, 2011 accumulated OCI balance that will be reclassified to earnings is expected to be immaterial.
The amounts of gains and losses on qualifying and non-qualifying financial instruments used in hedging transactions for the three months ended September 30, 2011 and 2010 are as follows:
Amount of Gain (Loss) Reclassified from Accumulated OCI into Income (1)
Three Months Ended September 30
Amounts in Millions
2011
2010
Derivatives in Cash Flow Hedging Relationships
Interest rate contracts
$
2
$
2
Foreign currency contracts
(45
)
(49
)
Commodity contracts
1
14
Total
(42
)
(33
)
Amount of Gain (Loss) Recognized in Income
Three Months Ended September 30
Amounts in Millions
2011
2010
Derivatives in Fair Value Hedging Relationships (2)
Interest rate contracts
131
62
Debt
(133
)
(63
)
Total
(2
)
(1
)
Derivatives in Net Investment Hedging Relationships (2)
Net investment hedges
(3
)
—
Derivatives Not Designated as Hedging Instruments (3)
Foreign currency contracts
(581
)
736
Commodity contracts
(1
)
2
Total
(582
)
738
(1)
The gain or loss on the effective portion of cash flow hedging relationships is reclassified from accumulated OCI into net income in the same period during which the related item affects earnings. Such amounts are included in the Consolidated Statements of Earnings as follows: interest rate contracts in interest expense, foreign currency contracts in selling, general and administrative expense and interest expense and commodity contracts in cost of products sold.
(2)
The gain or loss on the ineffective portion of interest rate contracts and net investment hedges, if any, is included in the Consolidated Statements of Earnings in interest expense.
(3)
The gain or loss on contracts not designated as hedging instruments is included in the Consolidated Statements of Earnings as follows: foreign currency contracts in selling, general and administrative expense and commodity contracts in cost of products sold.
No new accounting pronouncement issued or effective during the fiscal year has had or is expected to have a material impact on the Consolidated Financial Statements.
We are subject to various legal proceedings and claims arising out of our business which cover a wide range of matters such as antitrust, trade and other governmental regulations, product liability, patent and trademark matters, income taxes and other actions.
As previously disclosed, the Company is and has been subject to a variety of investigations into potential competition law violations in Europe. These matters involve a number of other consumer products companies and/or retail customers. The Company’s policy is to comply with all laws and regulations, including all antitrust and competition laws, and to cooperate with investigations by relevant regulatory authorities, which the Company is doing. Competition and antitrust law inquiries often continue for several years and, if violations are found, can result in substantial fines.
In response to the actions of the regulatory authorities, the Company launched its own internal investigations into potential violations of competition laws. The Company has identified violations in certain European countries and appropriate actions were taken.
Several regulatory authorities in Europe have issued separate complaints pursuant to their investigations alleging that the Company, along with several other companies, engaged in violations of competition laws in those countries. The remaining authorities' investigations are in various stages of the regulatory process. As a result of our initial and on-going analyses of the complaints, as well as final decisions issued by authorities in a number of countries, the Company has accrued liabilities for competition law violations totaling $283 million as of September 30, 2011. While the ultimate resolution of the matters for which we have accrued liabilities may result in fines or costs in excess of the amounts reserved, we do not expect any such incremental losses to materially impact our financial statements in the period in which they are accrued and paid, respectively. For our other remaining competition law matters, at this time, there are none that we consider reasonably possible to result in fines that are probable and estimable and we cannot reasonably estimate any additional fines to which the Company may be subject. We will continue to monitor developments for all of these investigations and will record additional charges as appropriate.
With respect to other litigation and claims, while considerable uncertainty exists, in the opinion of management and our counsel, the ultimate resolution of the various lawsuits and claims will not materially affect our financial position, results of operations or cash flows.
We are also subject to contingencies pursuant to environmental laws and regulations that in the future may require us to take action to correct the effects on the environment of prior manufacturing and waste disposal practices. Based on currently available information, we do not believe the ultimate resolution of environmental remediation will have a material adverse effect on our financial position, results of operations or cash flows.
Income Tax Uncertainties
The Company is present in over 150 taxable jurisdictions and, at any point in time, has 50 – 60 audits underway at various stages of completion. We evaluate our tax positions and establish liabilities for uncertain tax positions that may be challenged by local authorities and may not be fully sustained, despite our belief that the underlying tax positions are fully supportable. Uncertain tax positions are reviewed on an ongoing basis and are adjusted in light of changing facts and circumstances, including progress of tax audits, developments in case law and closing of statute of limitations. Such adjustments are reflected in the tax provision as appropriate. We have tax years open ranging from 2002 and forward. We are generally not able to reliably estimate the ultimate settlement amounts or timing until the close of the audit. While we do not expect material changes, it is possible that the amount of unrecognized benefit with respect to our uncertain tax positions will significantly increase or decrease within the next 12 months related to audits described above. At this time, we are not able to make a reasonable estimate of the range of impact on the balance of uncertain tax positions or the impact on the effective tax rate related to these items.
Additional information on the Commitments and Contingencies of the Company can be found in Note 10, Commitments and Contingencies, which appears in the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2011.
Risk Management Activities and Fair Value Measurements (Tables)
3 Months Ended
Sep. 30, 2011
Notes to Financial Statements [Abstract]
Schedule Of Fair Value Assets And Liabilities Measured On Recurring Basis Table
The following table sets forth the Company’s financial assets and liabilities as of September 30 and June 30, 2011 that are measured at fair value on a recurring basis during the period, segregated by level within the fair value hierarchy:
Level 1
Level 2
Level 3
Total
Amounts in millions
September 30, 2011
June 30, 2011
September 30, 2011
June 30, 2011
September 30, 2011
June 30, 2011
September 30, 2011
June 30, 2011
Assets at fair value:
Investment securities
$
10
$
16
$
—
$
—
$
23
$
23
$
33
$
39
Derivatives relating to:
Foreign currency hedges
—
—
—
1
—
—
—
1
Other foreign currency instruments (1)
—
—
49
182
—
—
49
182
Interest rates
—
—
295
163
—
—
295
163
Net investment hedges
—
—
5
—
—
—
5
—
Commodities
—
—
3
4
—
—
3
4
Total assets at fair value (2)
10
16
352
350
23
23
385
389
Liabilities at fair value:
Derivatives relating to:
Foreign currency hedges
—
—
174
119
—
—
174
119
Other foreign currency instruments (1)
—
—
361
43
—
—
361
43
Net investment hedges
—
—
182
138
—
—
182
138
Commodities
—
—
3
1
—
—
3
1
Total liabilities at fair value (3)
—
—
720
301
—
—
720
301
(1)
Other foreign currency instruments are comprised of foreign currency financial instruments that do not qualify as hedges.
(2)
Investment securities are presented in other noncurrent assets and all derivative assets are presented in prepaid expenses and other current assets or other noncurrent assets.
(3)
All liabilities are presented in accrued and other liabilities or other noncurrent liabilities.
Schedule of Derivative Instruments
The notional amounts and fair values of qualifying and non-qualifying financial instruments used in hedging transactions as of September 30 and June 30, 2011 are as follows:
Notional Amount
Fair Value Asset (Liability)
Amounts in Millions
September 30, 2011
June 30, 2011
September 30, 2011
June 30, 2011
Derivatives in Cash Flow Hedging Relationships
Interest rate contracts
$
—
$
—
$
—
$
—
Foreign currency contracts
831
831
(174
)
(118
)
Commodity contracts
10
16
2
4
Total
841
847
(172
)
(114
)
Derivatives in Fair Value Hedging Relationships
Interest rate contracts
9,025
10,308
295
163
Derivatives in Net Investment Hedging Relationships
Net investment hedges
1,413
1,540
(177
)
(138
)
Derivatives Not Designated as Hedging Instruments
Foreign currency contracts
14,652
14,957
(312
)
139
Commodity contracts
33
39
(2
)
(1
)
Total
14,685
14,996
(314
)
138
Derivative Instruments and Hedging Activities Disclosure
The total notional amount of contracts outstanding at the end of the period is indicative of the level of the Company’s derivative activity during the period.
Amount of Gain (Loss) Recognized in Accumulated OCI on Derivatives (Effective Portion)
Amounts in Millions
September 30, 2011
June 30, 2011
Derivatives in Cash Flow Hedging Relationships
Interest rate contracts
$
14
$
15
Foreign currency contracts
25
32
Commodity contracts
1
3
Total
40
50
Derivatives in Net Investment Hedging Relationships
Net investment hedges
(111
)
(88
)
The effective portion of gains and losses on derivative instruments that was recognized in other comprehensive income (OCI) during the three months ended September 30, 2011 and 2010 was not material. During the next 12 months, the amount of the September 30, 2011 accumulated OCI balance that will be reclassified to earnings is expected to be immaterial.
The amounts of gains and losses on qualifying and non-qualifying financial instruments used in hedging transactions for the three months ended September 30, 2011 and 2010 are as follows:
Amount of Gain (Loss) Reclassified from Accumulated OCI into Income (1)
Three Months Ended September 30
Amounts in Millions
2011
2010
Derivatives in Cash Flow Hedging Relationships
Interest rate contracts
$
2
$
2
Foreign currency contracts
(45
)
(49
)
Commodity contracts
1
14
Total
(42
)
(33
)
Amount of Gain (Loss) Recognized in Income
Three Months Ended September 30
Amounts in Millions
2011
2010
Derivatives in Fair Value Hedging Relationships (2)
Interest rate contracts
131
62
Debt
(133
)
(63
)
Total
(2
)
(1
)
Derivatives in Net Investment Hedging Relationships (2)
Net investment hedges
(3
)
—
Derivatives Not Designated as Hedging Instruments (3)
Foreign currency contracts
(581
)
736
Commodity contracts
(1
)
2
Total
(582
)
738
(1)
The gain or loss on the effective portion of cash flow hedging relationships is reclassified from accumulated OCI into net income in the same period during which the related item affects earnings. Such amounts are included in the Consolidated Statements of Earnings as follows: interest rate contracts in interest expense, foreign currency contracts in selling, general and administrative expense and interest expense and commodity contracts in cost of products sold.
(2)
The gain or loss on the ineffective portion of interest rate contracts and net investment hedges, if any, is included in the Consolidated Statements of Earnings in interest expense.
(3)
The gain or loss on contracts not designated as hedging instruments is included in the Consolidated Statements of Earnings as follows: foreign currency contracts in selling, general and administrative expense and commodity contracts in cost of products sold.
Risk Management Activities and Fair Value Measurements - Financial Assets and Liabilities that are Measured at Fair Value on a Recurring Basis (Detail) (USD $) In Millions
Fair Value, Inputs, Level 3 | Other Foreign Currency Instruments
Assets at fair value:
Derivative assets
0
[3]
0
[3]
Liabilities at fair value:
Derivative liabilities
0
[3]
0
[3]
Fair Value, Inputs, Level 3 | Interest Rate
Assets at fair value:
Derivative assets
0
0
Fair Value, Inputs, Level 3 | Derivatives in Net Investment Hedging Relationships
Assets at fair value:
Derivative assets
0
0
Liabilities at fair value:
Derivative liabilities
0
0
Fair Value, Inputs, Level 3 | Commodities
Assets at fair value:
Derivative assets
0
0
Liabilities at fair value:
Derivative liabilities
0
0
Foreign currency hedges
Assets at fair value:
Derivative assets
0
1
Liabilities at fair value:
Derivative liabilities
174
119
Other Foreign Currency Instruments
Assets at fair value:
Derivative assets
49
[3]
182
[3]
Liabilities at fair value:
Derivative liabilities
361
[3]
43
[3]
Interest Rate
Assets at fair value:
Derivative assets
295
163
Derivatives in Net Investment Hedging Relationships
Assets at fair value:
Derivative assets
5
0
Liabilities at fair value:
Derivative liabilities
182
138
Commodities
Assets at fair value:
Derivative assets
3
4
Liabilities at fair value:
Derivative liabilities
$ 3
$ 1
[1]
Investment securities are presented in other noncurrent assets and all derivative assets are presented in prepaid expenses and other current assets or other noncurrent assets.
[2]
All liabilities are presented in accrued and other liabilities or other noncurrent liabilities.
[3]
Other foreign currency instruments are comprised of foreign currency financial instruments that do not qualify as hedges.
Risk Management Activities and Fair Value Measurements - Notional Amounts and Fair Values of Qualifying and Non-Qualifying Financial Instruments used in Hedging Transactions (Detail) (USD $) In Millions
Sep. 30, 2011
Jun. 30, 2011
Derivatives in Cash Flow Hedging Relationships
Notional amount
$ 841
$ 847
Fair Value Asset (Liability)
(172)
(114)
Derivatives in Cash Flow Hedging Relationships | Interest Rate
Notional amount
0
0
Fair Value Asset (Liability)
0
0
Derivatives in Cash Flow Hedging Relationships | Foreign currency hedges
Notional amount
831
831
Fair Value Asset (Liability)
(174)
(118)
Derivatives in Cash Flow Hedging Relationships | Commodities
Notional amount
10
16
Fair Value Asset (Liability)
2
4
Derivatives in Fair Value Hedging Relationships | Interest Rate
Notional amount
9,025
10,308
Fair Value Asset (Liability)
295
163
Derivatives in Net Investment Hedging Relationships
Notional amount
1,413
1,540
Fair Value Asset (Liability)
(177)
(138)
Derivatives Not Designated as Hedging Instruments
Notional amount
14,685
14,996
Fair Value Asset (Liability)
(314)
138
Derivatives Not Designated as Hedging Instruments | Foreign currency hedges
Notional amount
14,652
14,957
Fair Value Asset (Liability)
(312)
139
Derivatives Not Designated as Hedging Instruments | Commodities
Risk Management Activities and Fair Value Measurements - Gains and Losses on Qualifying and Non-Qualifying Financial Instruments used in Hedging Transactions (Detail) (USD $) In Millions
3 Months Ended
12 Months Ended
Sep. 30, 2011
Sep. 30, 2010
Jun. 30, 2011
Derivatives in Cash Flow Hedging Relationships
Amount of Gain (Loss) Recognized in AOCI on Derivatives (Effective Portion)
$ 40
$ 50
Amount of Gain (Loss) Reclassified from AOCI into Income
(42)
[1]
(33)
[1]
Derivatives in Cash Flow Hedging Relationships | Interest Rate
Amount of Gain (Loss) Recognized in AOCI on Derivatives (Effective Portion)
14
15
Amount of Gain (Loss) Reclassified from AOCI into Income
2
[1]
2
[1]
Derivatives in Cash Flow Hedging Relationships | Foreign currency hedges
Amount of Gain (Loss) Recognized in AOCI on Derivatives (Effective Portion)
25
32
Amount of Gain (Loss) Reclassified from AOCI into Income
(45)
[1]
(49)
[1]
Derivatives in Cash Flow Hedging Relationships | Commodities
Amount of Gain (Loss) Recognized in AOCI on Derivatives (Effective Portion)
1
3
Amount of Gain (Loss) Reclassified from AOCI into Income
1
[1]
14
[1]
Derivatives in Net Investment Hedging Relationships
Amount of Gain (Loss) Recognized in AOCI on Derivatives (Effective Portion)
(111)
(88)
Amount of Gain (Loss) Recognized in Income
(3)
[2]
0
[2]
Derivatives in Fair Value Hedging Relationships
Amount of Gain (Loss) Recognized in Income
(2)
[2]
(1)
[2]
Derivatives in Fair Value Hedging Relationships | Interest Rate
Amount of Gain (Loss) Recognized in Income
131
[2]
62
[2]
Derivatives in Fair Value Hedging Relationships | Debt
Amount of Gain (Loss) Recognized in Income
(133)
[2]
(63)
[2]
Derivatives Not Designated as Hedging Instruments
Amount of Gain (Loss) Recognized in Income
(582)
[3]
738
[3]
Derivatives Not Designated as Hedging Instruments | Foreign currency hedges
Amount of Gain (Loss) Recognized in Income
(581)
[3]
736
[3]
Derivatives Not Designated as Hedging Instruments | Commodities
Amount of Gain (Loss) Recognized in Income
$ (1)
[3]
$ 2
[3]
[1]
The gain or loss on the effective portion of cash flow hedging relationships is reclassified from accumulated OCI into net income in the same period during which the related item affects earnings. Such amounts are included in the Consolidated Statements of Earnings as follows: interest rate contracts in interest expense, foreign currency contracts in selling, general and administrative expense and interest expense and commodity contracts in cost of products sold.
[2]
The gain or loss on the ineffective portion of interest rate contracts and net investment hedges, if any, is included in the Consolidated Statements of Earnings in interest expense.
[3]
The gain or loss on contracts not designated as hedging instruments is included in the Consolidated Statements of Earnings as follows: foreign currency contracts in selling, general and administrative expense and commodity contracts in cost of products sold.
