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

Quarterly report pursuant to Section 13 or 15(d)

Hedging Transactions and Derivative Financial Instruments (Tables)

Hedging Transactions and Derivative Financial Instruments (Tables)

9 Months Ended

Sep. 27, 2013

Hedging Transactions and Derivative Financial Instruments

Derivative instruments, fair value, designated as hedging instruments

The following table presents the fair values of the Company's derivative instruments that were designated and qualified as part of a hedging relationship (in millions):



		Fair Value^1,2
Derivatives Designated as Hedging Instruments	Balance Sheet Location¹	September 27, 2013		December 31, 2012
Assets
Foreign currency contracts	Prepaid expenses and other assets	$	146	$	149
Foreign currency contracts	Other assets	39		—
Interest rate contracts	Prepaid expenses and other assets	47		7
Interest rate contracts	Other assets	299		335
Total assets		$	531	$	491
Liabilities
Foreign currency contracts	Accounts payable and accrued expenses	$	102	$	55
Foreign currency contracts	Other liabilities	17		—
Commodity contracts	Accounts payable and accrued expenses	1		1
Interest rate contracts	Other liabilities	—		6
Total liabilities		$	120	$	62

¹All of the Company's derivative instruments are carried at fair value in our condensed consolidated balance sheets after considering the impact of legally enforceable master netting agreements and cash collateral held or placed with the same counterparties, as applicable. Current disclosure requirements mandate that derivatives must also be disclosed without reflecting the impact of master netting agreements and cash collateral. Refer to Note 14 for the net presentation of the Company's derivative instruments.

²Refer to Note 14 for additional information related to the estimated fair value.

Schedule of Other Derivatives Not Designated as Hedging Instruments, Statements of Financial Performance and Financial Position, Location [Table Text Block]

The following table presents the fair values of the Company's derivative instruments that were not designated as hedging instruments (in millions):



		Fair Value^1,2
Derivatives Not Designated as Hedging Instruments	Balance Sheet Location¹	September 27, 2013		December 31, 2012
Assets
Foreign currency contracts	Prepaid expenses and other assets	$	21	$	19
Foreign currency contracts	Other assets	164		42
Commodity contracts	Prepaid expenses and other assets	31		72
Other derivative instruments	Prepaid expenses and other assets	2		6
Total assets		$	218	$	139
Liabilities
Foreign currency contracts	Accounts payable and accrued expenses	$	27	$	24
Foreign currency contracts	Other liabilities	—		1
Commodity contracts	Accounts payable and accrued expenses	14		43
Commodity contracts	Other liabilities	1		1
Interest rate contracts	Other liabilities	3		—
Other derivative instruments	Accounts payable and accrued expenses	2		2
Total liabilities		$	47	$	71

²Refer to Note 14 for additional information related to the estimated fair value.

Derivative instruments, designated as hedging instruments, gain (loss) in statement of financial performance

The following table presents the pretax impact that changes in the fair values of derivatives designated as cash flow hedges had on AOCI and earnings during the three months ended September 27, 2013 (in millions):



	Gain (Loss) Recognized in Other Comprehensive Income ("OCI")			Location of Gain (Loss) Recognized in Income¹	Gain (Loss) Reclassified from AOCI into Income (Effective Portion)			Gain (Loss) Recognized in Income (Ineffective Portion and Amount Excluded from Effectiveness Testing)
Foreign currency contracts	$	(70	)	Net operating revenues	$	53		$	—
Foreign currency contracts	(4		)	Cost of goods sold	11			—
Interest rate contracts	4			Interest expense	(3		)	—
Commodity contracts	—			Cost of goods sold	(1		)	—
Total	$	(70	)		$	60		$	—

¹The Company records gains and losses reclassified from AOCI into income for the effective portion and the ineffective portion, if any, to the same line items in our condensed consolidated statements of income.

The following table presents the pretax impact that changes in the fair values of derivatives designated as cash flow hedges had on AOCI and earnings during the nine months ended September 27, 2013 (in millions):



	Gain (Loss) Recognized in OCI		Location of Gain (Loss) Recognized in Income¹	Gain (Loss) Reclassified from AOCI into Income (Effective Portion)			Gain (Loss) Recognized in Income (Ineffective Portion and Amount Excluded from Effectiveness Testing)
Foreign currency contracts	$	150	Net operating revenues	$	123		$	1
Foreign currency contracts	31		Cost of goods sold	21			—
Interest rate contracts	155		Interest expense	(9		)	—		²
Commodity contracts	1		Cost of goods sold	(2		)	—
Total	$	337		$	133		$	1

²Includes a de minimis amount of ineffectiveness in the hedging relationship.



	Gain (Loss) Recognized in OCI			Location of Gain (Loss) Recognized in Income¹	Gain (Loss) Reclassified from AOCI into Income (Effective Portion)			Gain (Loss) Recognized in Income (Ineffective Portion and Amount Excluded from Effectiveness Testing)
Foreign currency contracts	$	(82	)	Net operating revenues	$	(6	)	$	—	²
Foreign currency contracts	(7		)	Cost of goods sold	(4		)	—
Interest rate contracts	(11		)	Interest expense	(3		)	—
Commodity contracts	—			Cost of goods sold	—			—
Total	$	(100	)		$	(13	)	$	—

²Includes a de minimis amount of ineffectiveness in the hedging relationship.



	Gain (Loss) Recognized in OCI			Location of Gain (Loss) Recognized in Income¹	Gain (Loss) Reclassified from AOCI into Income (Effective Portion)			Gain (Loss) Recognized in Income (Ineffective Portion and Amount Excluded from Effectiveness Testing)
Foreign currency contracts	$	(11	)	Net operating revenues	$	(32	)	$	2
Foreign currency contracts	5			Cost of goods sold	(16		)	—
Interest rate contracts	(11		)	Interest expense	(9		)	—
Commodity contracts	(4		)	Cost of goods sold	—			—
Total	$	(21	)		$	(57	)	$	2

Derivative instruments, fair value hedges, gain (loss) recognized in income

The following table summarizes the pretax impact that changes in the fair values of derivatives designated as fair value hedges had on earnings during the three months ended September 27, 2013, and September 28, 2012 (in millions):



Fair Value Hedging Instruments	Location of Gain (Loss) Recognized in Income	Gain (Loss) Recognized in Income
Fair Value Hedging Instruments	Location of Gain (Loss) Recognized in Income	September 27, 2013			September 28, 2012
Interest rate swaps	Interest expense	$	4		$	42
Fixed-rate debt	Interest expense	5			(30		)
Net impact to interest expense		$	9		$	12
Foreign currency contracts	Other income (loss) — net	$	39		$	8
Available-for-sale securities	Other income (loss) — net	(45		)	(5		)
Net impact to other income (loss) — net		$	(6	)	$	3
Net impact of fair value hedging instruments		$	3		$	15

The following table summarizes the pretax impact that changes in the fair values of derivatives designated as fair value hedges had on earnings during the nine months ended September 27, 2013, and September 28, 2012 (in millions):



Fair Value Hedging Instruments	Location of Gain (Loss) Recognized in Income	Gain (Loss) Recognized in Income
Fair Value Hedging Instruments	Location of Gain (Loss) Recognized in Income	September 27, 2013			September 28, 2012
Interest rate swaps	Interest expense	$	(147	)	$	111
Fixed-rate debt	Interest expense	181			(81		)
Net impact to interest expense		$	34		$	30
Foreign currency contracts	Other income (loss) — net	$	32		$	23
Available-for-sale securities	Other income (loss) — net	(47		)	(21		)
Net impact to other income (loss) — net		$	(15	)	$	2
Net impact of fair value hedging instruments		$	19		$	32

Schedule of Net Investment Hedges in Accumulated Other Comprehensive Income (Loss) [Table Text Block]

The following table presents the pretax impact that changes in the fair values of derivatives designated as net investment hedges had on AOCI during the three and nine months ended September 27, 2013, and September 28, 2012 (in millions):



	Gain (Loss) Recognized in OCI
	Three Months Ended						Nine Months Ended
	September 27, 2013			September 28, 2012			September 27, 2013		September 28, 2012
Foreign currency contracts	$	(22	)	$	(100	)	$	8	$	(58	)

Schedule of Derivative Instruments Not Designated as Hedging Instruments Gain (Loss) in Statement of Financial Performance [Table Text Block]

The following tables present the pretax impact that changes in the fair values of derivatives not designated as hedging instruments had on earnings during the three and nine months ended September 27, 2013, and September 28, 2012, respectively (in millions):



		Three Months Ended
Derivatives Not Designated as Hedging Instruments	Location of Gain (Loss) Recognized in Income	September 27, 2013			September 28, 2012
Foreign currency contracts	Net operating revenues	$	(2	)	$	(2	)
Foreign currency contracts	Other income (loss) — net	47			18
Foreign currency contracts	Cost of goods sold	2			(3		)
Interest rate contracts	Interest expense	—			—
Commodity contracts	Net operating revenues	2			5
Commodity contracts	Cost of goods sold	(3		)	25
Commodity contracts	Selling, general and administrative expenses	3			19
Other derivative instruments	Selling, general and administrative expenses	9			3
Total		$	58		$	65



		Nine Months Ended
Derivatives Not Designated as Hedging Instruments	Location of Gain (Loss) Recognized in Income	September 27, 2013			September 28, 2012
Foreign currency contracts	Net operating revenues	$	2		$	(5	)
Foreign currency contracts	Other income (loss) — net	120			(54		)
Foreign currency contracts	Cost of goods sold	2			—
Interest rate contracts	Interest expense	(3		)	—
Commodity contracts	Net operating revenues	1			5
Commodity contracts	Cost of goods sold	(147		)	(19		)
Commodity contracts	Selling, general and administrative expenses	1			12
Other derivative instruments	Selling, general and administrative expenses	33			21
Total		$	9		$	(40	)