|
FAIR VALUE MEASUREMENTS (Tables)
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12 Months Ended |
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Dec. 31, 2014
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| Fair Value Measurements Disclosure [Abstract] |
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| Assets and liabilities measured at fair value on a recurring basis |
The following tables summarize those assets and liabilities measured at fair value on a recurring basis (in millions):
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December 31, 2014 |
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Level 1 |
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Level 2 |
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Level 3 |
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Netting
Adjustment1
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Fair Value
Measurements
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Assets: |
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Trading securities2
|
$ |
228 |
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|
$ |
177 |
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|
$ |
4 |
|
|
$ |
— |
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|
$ |
409 |
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Available-for-sale securities2
|
4,116 |
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|
3,627 |
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|
136 |
|
3 |
— |
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|
7,879 |
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Derivatives4
|
9 |
|
|
1,721 |
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|
— |
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|
(437 |
) |
|
1,293 |
|
5 |
Total assets |
$ |
4,353 |
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|
$ |
5,525 |
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|
$ |
140 |
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|
$ |
(437 |
) |
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$ |
9,581 |
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Liabilities: |
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Derivatives4
|
$ |
2 |
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|
$ |
558 |
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|
$ |
— |
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|
$ |
(437 |
) |
|
$ |
123 |
|
5 |
Total liabilities |
$ |
2 |
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$ |
558 |
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|
$ |
— |
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|
$ |
(437 |
) |
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$ |
123 |
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1 |
Amounts 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 5.
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2 |
Refer to Note 3 for additional information related to the composition of our trading securities and available-for-sale securities. |
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3 |
Primarily related to long-term debt securities that mature in 2018. |
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4 |
Refer to Note 5 for additional information related to the composition of our derivative portfolio.
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5 |
The Company's derivative financial instruments are recorded at fair value in our 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.
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December 31, 2013 |
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Level 1 |
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Level 2 |
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Level 3 |
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Netting
Adjustment1
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Fair Value
Measurements
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Assets: |
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Trading securities2
|
$ |
206 |
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|
$ |
163 |
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$ |
3 |
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|
$ |
— |
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$ |
372 |
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Available-for-sale securities2
|
1,453 |
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|
3,281 |
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|
108 |
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3 |
— |
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4,842 |
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Derivatives4
|
17 |
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|
822 |
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— |
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(150 |
) |
|
689 |
|
5 |
Total assets |
$ |
1,676 |
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$ |
4,266 |
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$ |
111 |
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$ |
(150 |
) |
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$ |
5,903 |
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Liabilities: |
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Derivatives4
|
$ |
10 |
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$ |
165 |
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$ |
— |
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$ |
(151 |
) |
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$ |
24 |
|
5 |
Total liabilities |
$ |
10 |
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$ |
165 |
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|
$ |
— |
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$ |
(151 |
) |
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$ |
24 |
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1 |
Amounts 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 5.
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2 |
Refer to Note 3 for additional information related to the composition of our trading securities and available-for-sale securities. |
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3 |
Primarily related to long-term debt securities that mature in 2018. |
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4 |
Refer to Note 5 for additional information related to the composition of our derivative portfolio.
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5 |
The Company's derivative financial instruments are recorded at fair value in our consolidated balance sheet as follows: $129 million in the line item prepaid expenses and other assets; $560 million in the line item other assets; $12 million in the line item accounts payable and accrued expenses; and $12 million in the line item other liabilities. Refer to Note 5 for additional information related to the composition of our derivative portfolio.
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| Assets measured at fair value on a nonrecurring basis |
Assets measured at fair value on a nonrecurring basis for the years ended December 31, 2014 and 2013, are summarized below (in millions):
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Gains (Losses) |
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December 31, |
2014 |
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2013 |
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Assets held for sale |
$ |
(494 |
) |
1 |
$ |
— |
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Intangible assets |
(18 |
) |
2 |
(195 |
) |
2 |
Exchange of investment in equity securities |
— |
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|
(114 |
) |
4 |
Valuation of shares in equity method investee |
(32 |
) |
3 |
139 |
|
3 |
Total |
$ |
(544 |
) |
|
$ |
(170 |
) |
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1 |
As of December 31, 2014, the Company had entered into agreements to refranchise additional territories in North America. These operations met the criteria to be classified as held for sale in our consolidated balance sheet as of December 31, 2014, and we were required to record their assets and liabilities at the lower of carrying value or fair value less any costs to sell based on the agreed-upon sale price. The Company recognized a noncash loss of $494 million during the year ended December 31, 2014 as a result of writing down the assets to their fair value less costs to sell. The loss was calculated based on Level 3 inputs. Refer to Note 2.
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2 |
The Company recognized losses of $18 million and $195 million during years ended December 31, 2014 and 2013, respectively, due to impairment charges on certain intangible assets. 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 and Note 17.
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3 |
In 2014, the Company recognized a loss of $32 million as a result of the owners of the majority interest in certain Brazilian bottling operations 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. In 2013, the Company recognized a gain of $139 million as a result of Coca-Cola FEMSA, an equity method investee, issuing additional shares of its own stock at a per share amount greater than the carrying value of the Company's per share investment. Accordingly, the Company is required to treat this type of transaction as if the Company had sold a proportionate share of its investment in Coca-Cola FEMSA. This gain was determined using Level 1 inputs. Refer to Note 17.
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4 |
The Company recognized a net loss of $114 million on the exchange of shares it previously owned in certain equity method investees for shares in the newly formed entity CCEJ. CCEJ is also an equity method investee. The net loss represents the difference between the carrying value of the shares the Company relinquished and the fair value of the CCEJ shares received as a result of the transaction. The net loss and the initial carrying value of the Company's investment were calculated based on Level 1 inputs. Refer to Note 17.
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| Summary of the fair value of pension plan assets for U.S. and non-U.S. pension plans |
The following table summarizes the levels within the fair value hierarchy for our pension plan assets as of December 31, 2014 and 2013 (in millions):
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December 31, 2014 |
|
December 31, 2013 |
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Level 1 |
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Level 2 |
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Level 3 |
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Total |
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Level 1 |
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Level 2 |
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Level 3 |
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Total |
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Cash and cash equivalents |
$ |
161 |
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$ |
100 |
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$ |
— |
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$ |
261 |
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$ |
331 |
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$ |
183 |
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$ |
— |
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$ |
514 |
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Equity securities: |
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U.S.-based companies |
1,793 |
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6 |
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17 |
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1,816 |
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|
1,680 |
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7 |
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|
15 |
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1,702 |
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International-based companies |
1,050 |
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13 |
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— |
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1,063 |
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|
1,271 |
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13 |
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— |
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1,284 |
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Fixed-income securities: |
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Government bonds |
— |
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|
863 |
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|
3 |
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|
866 |
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— |
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|
719 |
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|
49 |
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|
768 |
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Corporate bonds and debt securities |
— |
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1,533 |
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|
33 |
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1,566 |
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— |
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1,466 |
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|
40 |
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1,506 |
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Mutual, pooled and commingled funds |
98 |
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1,134 |
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31 |
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1,263 |
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|
56 |
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1,531 |
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— |
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1,587 |
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Hedge funds/limited partnerships |
— |
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|
215 |
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|
584 |
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|
799 |
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— |
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|
190 |
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|
353 |
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|
543 |
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Real estate |
— |
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16 |
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|
392 |
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|
408 |
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— |
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— |
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|
251 |
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|
251 |
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Other |
— |
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14 |
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|
846 |
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1 |
860 |
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— |
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7 |
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|
584 |
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1 |
591 |
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Total |
$ |
3,102 |
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$ |
3,894 |
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$ |
1,906 |
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$ |
8,902 |
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$ |
3,338 |
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$ |
4,116 |
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$ |
1,292 |
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$ |
8,746 |
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1 |
Includes purchased annuity contracts and insurance-linked securities. |
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| Reconciliation of the beginning and ending balance of Level 3 assets for U.S. and non-U.S. pension plans |
The following table provides a reconciliation of the beginning and ending balance of Level 3 assets for our U.S. and non-U.S. pension plans for the years ended December 31, 2014 and 2013 (in millions):
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Fixed-Income Securities |
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Hedge
Funds/Limited
Partnerships
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Real Estate |
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Equity
Securities
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Mutual,
Pooled and
Commingled
Funds
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Other |
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Total |
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2013 |
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Balance at beginning of year |
$ |
— |
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$ |
400 |
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$ |
257 |
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$ |
14 |
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$ |
— |
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$ |
510 |
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$ |
1,181 |
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Actual return on plan assets: |
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Related to assets still held at the reporting date |
(4 |
) |
|
(6 |
) |
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13 |
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|
— |
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|
— |
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|
39 |
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|
42 |
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Related to assets sold during the year |
(2 |
) |
|
24 |
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|
6 |
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|
— |
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|
— |
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|
— |
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|
28 |
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Purchases, sales and settlements — net |
95 |
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|
14 |
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|
(24 |
) |
|
1 |
|
|
— |
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|
193 |
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|
279 |
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Transfers in or out of Level 3 — net |
— |
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|
(78 |
) |
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— |
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— |
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|
— |
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|
(172 |
) |
|
(250 |
) |
Foreign currency translation |
— |
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|
(1 |
) |
|
(1 |
) |
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— |
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|
— |
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|
14 |
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|
12 |
|
Balance at end of year |
$ |
89 |
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$ |
353 |
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$ |
251 |
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$ |
15 |
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$ |
— |
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$ |
584 |
|
1 |
$ |
1,292 |
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2014 |
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Balance at beginning of year |
$ |
89 |
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$ |
353 |
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$ |
251 |
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$ |
15 |
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$ |
— |
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$ |
584 |
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$ |
1,292 |
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Actual return on plan assets: |
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Related to assets still held at the reporting date |
17 |
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|
(17 |
) |
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29 |
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|
1 |
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|
— |
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|
50 |
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|
80 |
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Related to assets sold during the year |
(2 |
) |
|
42 |
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|
7 |
|
|
— |
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|
— |
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|
— |
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|
47 |
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Purchases, sales and settlements — net |
(41 |
) |
|
198 |
|
|
106 |
|
|
1 |
|
|
31 |
|
|
241 |
|
|
536 |
|
Transfers in or out of Level 3 — net |
(27 |
) |
|
9 |
|
|
— |
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|
— |
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|
— |
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|
— |
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|
(18 |
) |
Foreign currency translation |
— |
|
|
(1 |
) |
|
(1 |
) |
|
— |
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|
— |
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|
(29 |
) |
|
(31 |
) |
Balance at end of year |
$ |
36 |
|
|
$ |
584 |
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$ |
392 |
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$ |
17 |
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$ |
31 |
|
|
$ |
846 |
|
1 |
$ |
1,906 |
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1 |
Includes purchased annuity contracts and insurance-linked securities. |
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| Summary of the fair value of postretirement benefit plan assets |
The following table summarizes the levels within the fair value hierarchy for our other postretirement benefit plan assets as of December 31, 2014 and 2013 (in millions):
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December 31, 2014 |
|
December 31, 2013 |
|
Level 1 |
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Level 2 |
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Level 3 1
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Total |
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Level 1 |
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Level 2 |
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Level 3 1
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Total |
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Cash and cash equivalents |
$ |
9 |
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|
$ |
1 |
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$ |
— |
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$ |
10 |
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|
$ |
— |
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|
$ |
10 |
|
|
$ |
— |
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|
$ |
10 |
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Equity securities: |
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|
|
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U.S.-based companies |
114 |
|
|
— |
|
|
— |
|
|
114 |
|
|
112 |
|
|
— |
|
|
— |
|
|
112 |
|
International-based companies |
7 |
|
|
— |
|
|
— |
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|
7 |
|
|
8 |
|
|
— |
|
|
— |
|
|
8 |
|
Fixed-income securities: |
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|
|
|
|
|
|
|
|
|
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Government bonds |
76 |
|
|
3 |
|
|
— |
|
|
79 |
|
|
76 |
|
|
3 |
|
|
— |
|
|
79 |
|
Corporate bonds and debt securities |
— |
|
|
9 |
|
|
— |
|
|
9 |
|
|
— |
|
|
9 |
|
|
— |
|
|
9 |
|
Mutual, pooled and commingled funds |
10 |
|
|
6 |
|
|
— |
|
|
16 |
|
|
11 |
|
|
7 |
|
|
— |
|
|
18 |
|
Hedge funds/limited partnerships |
— |
|
|
1 |
|
|
4 |
|
|
5 |
|
|
— |
|
|
1 |
|
|
2 |
|
|
3 |
|
Real estate |
— |
|
|
— |
|
|
3 |
|
|
3 |
|
|
— |
|
|
— |
|
|
2 |
|
|
2 |
|
Other |
— |
|
|
— |
|
|
3 |
|
|
3 |
|
|
— |
|
|
— |
|
|
2 |
|
|
2 |
|
Total |
$ |
216 |
|
|
$ |
20 |
|
|
$ |
10 |
|
|
$ |
246 |
|
|
$ |
207 |
|
|
$ |
30 |
|
|
$ |
6 |
|
|
$ |
243 |
|
|
|
1 |
Level 3 assets are not a significant portion of other postretirement benefit plan assets. |
|