Boeing 2010 Annual Report Download - page 109

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Derivative Instruments Not Receiving Hedge Accounting Treatment
We also hold certain derivative instruments, primarily foreign currency forward contracts, for risk
management purposes but without electing any form of hedge accounting.
Notional Amounts and Fair Values
The notional amounts and fair values of derivative instruments in the Consolidated Statements of
Financial Position as of December 31 were as follows:
Notional
amounts(1) Other assets
Other
accrued
liabilities
2010 2009 2010 2009 2010 2009
Derivatives designated as hedging instruments:
Foreign exchange contracts $2,001 $2,353 $266 $ 233 $ (15) $ (22)
Interest rate contracts 875 1,475 24 32 (18)
Commodity contracts 144 189 (113) (88)
Derivatives not receiving hedge accounting
treatment:
Foreign exchange contracts 646 693 832 (58) (99)
Total derivatives 3,666 4,710 298 297 (186) (227)
Netting arrangements (71) (119) 71 119
Net recorded balance $227 $ 178 $(115) $(108)
(1) Notional amounts represent the gross contract/notional amount of the derivatives outstanding.
Gains/(losses) associated with our cash flow and undesignated hedging transactions and their effect
on other comprehensive loss and Net earnings were as follows:
Years ended December 31, 2010 2009
Effective portion recognized in other comprehensive loss, net of taxes:
Foreign exchange contracts $67 $180
Commodity contracts (30) (24)
Undesignated derivatives recognized in Other income/(expense), net:
Foreign exchange contracts (33) (9)
For the year ended December 31, 2010, we reclassified a net gain of $14 (pre-tax) from Accumulated
other comprehensive loss to earnings. Based on our portfolio of cash flow hedges, we expect to
reclassify gains of $22 (pre-tax) during the next 12 months. Ineffectiveness related to our hedges was
insignificant for the years ended December 31, 2010 and 2009.
We have derivative instruments with credit-risk-related contingent features. For foreign exchange
contracts with original maturities of at least five years, our derivative counterparties could require
settlement if we default on our five-year credit facility, expiring November 2012. For commodity
contracts, our counterparties could require collateral posted in an amount determined by our credit
ratings. The fair value of foreign exchange and commodity contracts that have credit-risk-related
contingent features that are in a net liability position at December 31, 2010 was $78. At December 31,
2010, there was no collateral posted related to our derivatives.
97