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. 01, 2022

Assets and liabilities measured at fair value on a recurring basis

The following tables summarize assets and liabilities measured at fair value on a recurring basis (in millions):


July 1, 2022	Level 1		Level 2		Level 3			Other3		Netting Adjustment		4	Fair Value Measurements
Assets:
Equity securities with readily determinable values1	$	1,902	$	195	$	17		$	92	$	—		$	2,206
Debt securities1	—		1,775		9			—		—			1,784
Derivatives2	101		559		—			—		(495)			165		7
Total assets	$	2,003	$	2,529	$	26		$	92	$	(495)		$	4,155
Liabilities:
Contingent consideration liability	$	—	$	—	$	1,529	5	$	—	$	—		$	1,529
Derivatives2	27		1,190		—			—		(1,192)		6	25		7
Total liabilities	$	27	$	1,190	$	1,529		$	—	$	(1,192)		$	1,554

1Refer to Note 4 for additional information related to the composition of our equity securities with readily determinable values and debt securities.

2Refer to Note 6 for additional information related to the composition of our derivatives portfolio.

3Certain investments that are measured at fair value using the net asset value per share (or its equivalent) practical expedient have not been categorized in the fair value hierarchy but are included to reconcile to the amounts presented in Note 4.

4Amounts represent the impact of legally enforceable master netting agreements that allow the Company to settle net 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. Refer to Note 6.

5Represents the fair value of future milestone payments related to our acquisition of fairlife in 2020, which are contingent on fairlife achieving certain financial targets through 2024 and, if achieved, are payable in 2023 and 2025. These milestone payments are based on agreed-upon formulas related to fairlife’s operating results, the resulting values of which are not subject to a ceiling. The fair value was determined using a Monte Carlo valuation model.

6The Company has the right to reclaim $753 million in cash collateral it has netted against its derivative positions.

7The Company’s derivative financial instruments are recorded at fair value in our consolidated balance sheet as follows: $79 million in the line item prepaid expenses and other current assets, $86 million in the line item other noncurrent assets and $25 million in the line item other noncurrent liabilities. Refer to Note 6 for additional information related to the composition of our derivatives portfolio.


December 31, 2021	Level 1		Level 2		Level 3			Other3		Netting Adjustment		4	Fair Value Measurements
Assets:
Equity securities with readily determinable values1	$	2,372	$	230	$	17		$	104	$	—		$	2,723
Debt securities1	—		1,556		33			—		—			1,589
Derivatives2	69		588		—			—		(459)		6	198		8
Total assets	$	2,441	$	2,374	$	50		$	104	$	(459)		$	4,510
Liabilities:
Contingent consideration liability	$	—	$	—	$	590	5	$	—	$	—		$	590
Derivatives2	—		96		—			—		(82)		7	14		8
Total liabilities	$	—	$	96	$	590		$	—	$	(82)		$	604

1Refer to Note 4 for additional information related to the composition of our equity securities with readily determinable values and debt securities.

2Refer to Note 6 for additional information related to the composition of our derivatives portfolio.

6The Company is obligated to return $331 million in cash collateral it has netted against its derivative positions.

7The Company does not have the right to reclaim any cash collateral it has netted against its derivative positions.

8The Company’s derivative financial instruments are recorded at fair value in our consolidated balance sheet as follows: $198 million in the line item other noncurrent assets and $14 million in the line item other noncurrent liabilities. Refer to Note 6 for additional information related to the composition of our derivatives portfolio.