Boeing 2014 Annual Report Download - page 112
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100
Gains/(losses) associated with our cash flow and undesignated hedging transactions and their effect on
Other comprehensive income/(loss) and Net earnings were as follows:
Years ended December 31, 2014 2013
Effective portion recognized in Other comprehensive income/(loss), net of taxes:
Foreign exchange contracts ($135) ($76)
Commodity contracts (2) 1
Effective portion reclassified out of Accumulated other comprehensive loss into
earnings, net of taxes:
Foreign exchange contracts 637
Commodity contracts (13) (20)
Forward points recognized in Other income, net:
Foreign exchange contracts 28 34
Undesignated derivatives recognized in Other income, net:
Foreign exchange contracts (7) 17
Based on our portfolio of cash flow hedges, we expect to reclassify losses of $98 (pre-tax) out of
Accumulated other comprehensive loss into earnings during the next 12 months. Ineffectiveness related
to our hedges recognized in Other income was insignificant for the years ended December 31, 2014 and
2013.
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. 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,
2014 was $20. At December 31, 2014, there was no collateral posted related to our derivatives.
Note 18 – Significant Group Concentrations of Risk
Credit Risk
Financial instruments involving potential credit risk are predominantly with commercial aircraft customers
and the U.S. government. Of the $11,438 in gross accounts receivable and gross customer financing
included in the Consolidated Statements of Financial Position as of December 31, 2014, $5,246 related
predominantly to commercial aircraft customers ($1,664 of accounts receivable and $3,582 of customer
financing) and $4,281 related to the U.S. government.
Of the $3,582 in gross customer financing, $2,429 related to customers we believe have less than
investment-grade credit including American Airlines, Hawaiian Airlines, and United/Continental Airlines
who were associated with 11%, 9% and 8%, respectively, of our financing portfolio. Financing for aircraft
is collateralized by security in the related asset and in some instances security in other assets as well.
Other Risk
As of December 31, 2014, approximately 39% of our total workforce was represented by collective
bargaining agreements, the majority of which expire after 2015.