The Coca-Cola Company Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

Fair Value Measurements (Tables)

Fair Value Measurements (Tables)

6 Months Ended

Jul. 03, 2015

Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]

Assets and liabilities measured at fair value on a recurring basis

The following table summarizes those assets and liabilities measured at fair value on a recurring basis as of July 3, 2015 (in millions):



	Level 1		Level 2		Level 3			Netting Adjustment¹				Fair Value Measurements
Assets:
Trading securities²	$	229	$	114	$	3		$	—			$	346
Available-for-sale securities²	3,329		3,415		112		³	—				6,856
Derivatives⁴	38		1,600		—			(466		)	⁵	1,172		⁶
Total assets	$	3,596	$	5,129	$	115		$	(466	)		$	8,374
Liabilities:
Derivatives⁴	$	3	$	476	$	—		$	(365	)		$	114	⁶
Total liabilities	$	3	$	476	$	—		$	(365	)		$	114

¹Amounts represent the impact of legally enforceable master netting agreements that allow the Company to settle positive and negative positions and also cash collateral held or placed with the same counterparties. There are no amounts subject to legally enforceable master netting agreements that management has chosen not to offset or that do not meet the offsetting requirements.


²	Refer to Note 3 for additional information related to the composition of our trading securities and available-for-sale securities.

³Primarily related to long-term debt securities that mature in 2018.

⁴Refer to Note 5 for additional information related to the composition of our derivative portfolio.

⁵The Company is obligated to return $101 million in cash collateral it has netted against its net asset derivative position.

⁶

The Company's derivative financial instruments are recorded at fair value in our condensed consolidated balance sheet as follows: $263 million in the line item prepaid expenses and other assets; $909 million in the line item other assets; $18 million in the line item accounts payable and accrued expenses; and $96 million in the line item other liabilities. Refer to Note 5 for additional information related to the composition of our derivative portfolio.

The following table summarizes those assets and liabilities measured at fair value on a recurring basis as of December 31, 2014 (in millions):



	Level 1		Level 2		Level 3			Netting Adjustment¹			Fair Value Measurements
Assets:
Trading securities²	$	228	$	177	$	4		$	—		$	409
Available-for-sale securities²	4,116		3,627		136		³	—			7,879
Derivatives⁴	9		1,721		—			(437		)	1,293		⁵
Total assets	$	4,353	$	5,525	$	140		$	(437	)	$	9,581
Liabilities:
Derivatives⁴	$	2	$	558	$	—		$	(437	)	$	123	⁵
Total liabilities	$	2	$	558	$	—		$	(437	)	$	123


²	Refer to Note 3 for additional information related to the composition of our trading securities and available-for-sale securities.

³Primarily related to long-term debt securities that mature in 2018.

⁴Refer to Note 5 for additional information related to the composition of our derivative portfolio.

⁵The Company's derivative financial instruments are recorded at fair value in our condensed consolidated balance sheet as follows: $567 million in the line item prepaid expenses and other assets; $726 million in the line item other assets; $14 million in the line item accounts payable and accrued expenses; and $109 million in the line item other liabilities. Refer to Note 5 for additional information related to the composition of our derivative portfolio.

Assets and liabilities measured at fair value on a Nonrecurring basis

The gains or losses on assets measured at fair value on a nonrecurring basis are summarized in the table below (in millions):



	Gains (Losses)
	Three Months Ended						Six Months Ended
	July 3, 2015				June 27, 2014		July 3, 2015				June 27, 2014
Intangible assets	$	(380	)	¹	$	—	$	(432	)	²	$	—
Investment in formerly unconsolidated subsidiary	—				—		(19		)	³	—
Valuation of shares in equity method investee	—				—		(6		)	⁴	—
Total	$	(380	)		$	—	$	(457	)		$	—


¹	The Company recognized an impairment charge of $380 million primarily due to the discontinuation of the energy products in the glacéau portfolio as a result of the Monster Transaction. The loss was derived using a discounted cash flow analysis based on Level 3 inputs. Refer to Note 2 and Note 10.

The Company recognized a loss of $432 million, which included the $380 million impairment charge primarily due to the discontinuation of the energy products in the glacéau portfolio as a result of the Monster Transaction and a $52 million impairment charge on a Venezuelan trademark. The charges were primarily determined by comparing the fair value of the assets to the current carrying value. The fair value of the assets was derived using discounted cash flow analyses based on Level 3 inputs. Refer to Note 1, Note 2 and Note 10.

The Company recognized a loss of $19 million on our previously held investment in a South African bottler, which had been accounted for under the equity method of accounting prior to our acquisition of the bottler in February 2015. Accounting principles generally accepted in the United States require the acquirer to remeasure its previously held noncontrolling equity interest in the acquired entity to fair value as of the acquisition date and recognize any gains or losses in earnings. The Company remeasured our equity interest in the South African bottler based on Level 3 inputs. Refer to Note 2 and Note 10.


⁴	The Company recognized a loss of $6 million as a result of the owners of the majority interest in a Brazilian bottling entity exercising their option to acquire from us a 10 percent interest in the entity's outstanding shares. The exercise price was lower than our carrying value. This loss was determined using Level 3 inputs. Refer to Note 2 and Note 10.