DuPont 2014 Annual Report Download - page 96

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E. I. du Pont de Nemours and Company
Notes to the Consolidated Financial Statements (continued)
(Dollars in millions, except per share)
F-43
Derivatives not Designated in Hedging Relationships
Foreign Currency Contracts
The company routinely uses forward exchange contracts to reduce its net exposure, by currency, related to foreign currency-
denominated monetary assets and liabilities of its operations so that exchange gains and losses resulting from exchange rate changes
are minimized. The netting of such exposures precludes the use of hedge accounting; however, the required revaluation of the
forward contracts and the associated foreign currency-denominated monetary assets and liabilities intends to achieve a minimal
earnings impact, after taxes. Additionally, the company utilized cross-currency swaps to hedge foreign currency fluctuations on
long-term intercompany loans. These swaps matured during 2013.
Commodity Contracts
The company utilizes options, futures and swaps that are not designated as hedging instruments to reduce exposure to commodity
price fluctuations on purchases of inventory such as corn, soybeans and soybean meal.
Fair Values of Derivative Instruments
The table below presents the fair values of the company's derivative assets and liabilities within the fair value hierarchy, as described
in Note 1, as of December 31, 2014 and 2013.
Fair Value at December 31
Using Level 2 Inputs
Balance Sheet Location 2014 2013
Asset derivatives:
Derivatives designated as hedging instruments:
Interest rate swaps1Accounts and notes receivable, net $ 1 $ —
Interest rate swaps1Other assets — 29
Foreign currency contracts Accounts and notes receivable, net 10 6
11 35
Derivatives not designated as hedging instruments:
Foreign currency contracts2Accounts and notes receivable, net 254 86
Total asset derivatives3 $ 265 $ 121
Cash collateral1,2 Other accrued liabilities $ 47 $ 30
Liability derivatives:
Derivatives designated as hedging instruments:
Foreign currency contracts Other accrued liabilities $ 10 $ 4
Derivatives not designated as hedging instruments:
Foreign currency contracts Other accrued liabilities 62 70
Commodity contracts Other accrued liabilities 1 1
63 71
Total liability derivatives3 $ 73 $ 75
1. Cash collateral held as of December 31, 2014 and 2013 represents $6 and $17, respectively, related to interest rate swap derivatives designated as hedging
instruments.
2 Cash collateral held as of December 31, 2014 and 2013 represents $41 and $13, respectively, related to foreign currency derivatives not designated as hedging
instruments.
3 The company's derivative assets and liabilities subject to enforceable master netting arrangements totaled $67 at December 31, 2014 and $54 at December 31,
2013.