Medtronic 2015 Annual Report Download - page 114

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Medtronic plc
Notes to Consolidated Financial Statements (Continued)
The Company has elected to present the fair value of derivative assets and liabilities within the consolidated balance sheets on a
gross basis even when derivative transactions are subject to master netting arrangements and may otherwise qualify for net
presentation. The following table provides information as if the Company had elected to offset the asset and liability balances of
derivative instruments, netted in accordance with various criteria as stipulated by the terms of the master netting arrangements
with each of the counterparties. Derivatives not subject to master netting arrangements are not eligible for net presentation.
April 24, 2015 Gross Amount Not Offset on the
Balance Sheet
(in millions)
Gross Amount of
Recognized Assets
(Liabilities)
Financial
Instruments
Cash Collateral
(Received) or
Posted Net Amount
Derivative Assets
Foreign currency exchange rate contracts $ 644 $ (61) $ (325) $ 258
Interest rate contracts 89 (10) (13) 66
$ 733 $ (71) $ (338) $ 324
Derivative Liabilities
Foreign currency exchange rate contracts $ (45) $ 31 — $ (14)
Interest rate contracts (71) 40 8 (23)
$ (116) $ 71 $ 8 $ (37)
Total $ 617 $ — $ (330) $ 287
April 25, 2014 Gross Amount Not Offset on the
Balance Sheet
(in millions)
Gross Amount of
Recognized Assets
(Liabilities)
Financial
Instruments
Cash Collateral
(Received) or
Posted Net Amount
Derivative Assets
Foreign currency exchange rate contracts $ 89 $ (64) $ — $ 25
Interest rate contracts 86 (31) — 55
$ 175 $ (95) $ — $ 80
Derivative Liabilities
Foreign currency exchange rate contracts $ (116) $ 84 $ — $ (32)
Interest rate contracts (11) 11 — —
$ (127) $ 95 $ — $ (32)
Total $ 48$ —$ —$ 48
Concentrations of Credit Risk
Financial instruments, which potentially subject the Company to significant concentrations of credit risk, consist principally of
interest-bearing investments, forward exchange derivative contracts, and trade accounts receivable.
The Company maintains cash and cash equivalents, investments, and certain other financial instruments (including currency
exchange rate and interest rate derivative contracts) with various major financial institutions. The Company performs periodic
evaluations of the relative credit standings of these financial institutions and limits the amount of credit exposure with any one
institution. In addition, the Company has collateral credit agreements with its primary derivatives counterparties. Under these
agreements, either party is required to post eligible collateral when the market value of transactions covered by the agreement
exceeds specific thresholds, thus limiting credit exposure for both parties. As of April 24, 2015, the Company received net cash
collateral of $330 million from its counterparties. As of April 25, 2014, no collateral was posted by either the Company or its
counterparties. The collateral received was recorded in cash and cash equivalents, with the offset recorded as an increase in
other accrued expenses on the consolidated balance sheets.
104