Kimberly-Clark 2015 Annual Report Download - page 44
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Please find page 44 of the 2015 Kimberly-Clark annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.Level2—Quotedpricesforsimilarassetsorliabilitiesinactivemarkets.Quotedpricesforidenticalorsimilarassetsandliabilitiesinmarketsthatarenot
consideredactiveorfinancialinstrumentsforwhichallsignificantinputsareobservable,eitherdirectlyorindirectly.
Level3—Pricesorvaluationsthatrequireinputsthataresignificanttothevaluationandareunobservable.
Afinancialinstrument'slevelwithinthefairvaluehierarchyisbasedonthelowestlevelofanyinputthatissignificanttothefairvaluemeasurement.
During2015and2014,therewerenosignificanttransfersamonglevel1,2or3fairvaluedeterminations.
Company-ownedlifeinsurance("COLI")assetsandderivativeassetsandliabilitiesaremeasuredonarecurringbasisatfairvalue.COLIassetswere$57and$58
atDecember31,2015and2014,respectively.TheCOLIpoliciesareasourceoffundingprimarilyforournonqualifiedemployeebenefitsandareincludedin
otherassets.ThefairvalueoftheCOLIpoliciesisconsideredalevel2measurementandisderivedfrominvestmentsinamixofmoneymarket,fixedincomeand
equityfundsmanagedbyunrelatedfundmanagers.AtDecember31,2015and2014,derivativeassetswere$56and$54,respectively,andderivativeliabilities
were$42and$112,respectively.ThefairvaluesofderivativesusedtomanageinterestrateriskandcommoditypriceriskarebasedonLIBORratesandinterest
rateswapcurvesandNYMEXpricequotations,respectively.Thefairvalueofhedginginstrumentsusedtomanageforeigncurrencyriskisbasedonpublished
quotationsofspotcurrencyratesandforwardpoints,whichareconvertedintoimpliedforwardcurrencyrates.Measurementofourderivativeassetsandliabilities
isconsideredalevel2measurement.AdditionalinformationonourclassificationanduseofderivativeinstrumentsiscontainedinNote13.
Thefollowingtableincludesthefairvalueofourfinancialinstrumentsforwhichdisclosureoffairvalueisrequired:
Fair Value
Hierarchy
Level
Carrying
Amount
Estimated
Fair
Value
Carrying
Amount
Estimated
Fair
Value
December 31, 2015
December 31, 2014
Assets
Cashandcashequivalents(a) 1
$ 619
$ 619
$ 789
$ 789
Timedepositsandother(b) 1
124
124
130
130
Liabilities and redeemable securities of subsidiaries
Short-termdebt(c) 2
1,071
1,071
777
777
Long-termdebt(d) 2
6,704
7,300
6,179
6,963
Redeemablepreferredsecuritiesofsubsidiaries(e) 3
64
64
72
72
(a) Cashequivalentsarecomposedofcertificatesofdeposit,timedepositsandotherinterest-bearinginvestmentswithoriginalmaturitydatesof90daysorless.Cashequivalentsarerecorded
atcost,whichapproximatesfairvalue.
(b) Timedepositsarecomposedofdepositswithoriginalmaturitiesofmorethan90daysbutlessthanoneyearandinstrumentswithoriginalmaturitiesofgreaterthanoneyear,includedin
othercurrentassetsorotherassetsintheConsolidatedBalanceSheet,asappropriate.Other,includedinothercurrentassets,iscomposedoffundsheldinescrow.Timedepositsandother
arerecordedatcost,whichapproximatesfairvalue.
(c) Short-termdebtis composedofU.S.commercial paperand/orothersimilarshort-termdebtissuedbynon-U.S. subsidiaries,allofwhicharerecordedatcost,whichapproximatesfair
value.
(d) Long-termdebtincludesthecurrentportionofthesedebtinstruments.Fairvalueswereestimatedbasedonquotedpricesforfinancialinstrumentsforwhichallsignificant inputswere
observable,eitherdirectlyorindirectly.
(e) Theredeemablepreferredsecuritiesofsubsidiariesarenottradedinactivemarkets.Forcertaininstruments,fairvalueswerecalculatedusingafloatingratepricingmodelthatcompared
thestatedspreadtothefairvaluespreadtodeterminethepriceatwhicheachofthefinancialinstrumentsshouldtrade.Themodelusedthefollowinginputstocalculatefairvalues:face
value, current LIBOR rate, unobservable fair value credit spread, stated spread, maturity date and interest or dividend payment dates. Additionally, the fair value of the remaining
redeemablesecuritieswasbasedonvariousinputs,includinganindependentthird-partyappraisal,adjustedforcurrentmarketconditions.
40 KIMBERLY-CLARKCORPORATION - 2015 Annual Report