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62 The Procter & Gamble Company Notes to Consolidated Financial Statements
Amounts in millions of dollars except per share amounts or as otherwise specified.
Disclosures about Derivative Instruments
The notional amounts and fair values of qualifying and non-qualifying
financial instruments used in hedging transactions as of June30,
2010 and 2009 are as follows:
Notional Amount Fair Value Asset (Liability)
June 30 2010 2009 2010 2009
DERIVATIVES IN CASH
FLOW HEDGING
RELATIONSHIPS
Interest rate contracts $ — $ 4,000 $ — $ (13)
Foreign currency contracts 690 690 (177) (103)
Commodity contracts 43 503 10 (73)
TOTAL 733 5,193 (167) (189)
DERIVATIVES IN FAIR
VALUE HEDGING
RELATIONSHIPS
Interest rate contracts 7,942 —191 —
DERIVATIVES IN NET
INVESTMENT HEDGING
RELATIONSHIPS
Net investment hedges 1,586 2,271 (9) (2)
DERIVATIVES NOT
DESIGNATED AS
HEDGING
INSTRUMENTS
Foreign currency contracts 11,845 12,348 (94) 261
Commodity contracts 19 ———
TOTAL 11,864 12,348 (94) 261
The total notional amount of contracts outstanding at the end of the
period is indicative of the level of the Company’s derivative activity
during the period.
Amount of Gain
(Loss) Recognized in
Accumulated OCI
on Derivatives
(Effective Portion)
June 30 2010 2009
DERIVATIVES IN CASH
FLOW HEDGING
RELATIONSHIPS
Interest rate contracts $ 19 $ 18
Foreign currency contracts 23 26
Commodity contracts 11 (62)
TOTAL 53 (18)
DERIVATIVES IN NET
INVESTMENT HEDGING
RELATIONSHIPS
Net investment hedges (8) (2)
During the next 12 months, the amount of the June30, 2010 accu-
mulated OCI balance that will be reclassified to earnings is expected
to be immaterial.
The amounts of gains and losses on qualifying and non-qualifying
financial instruments used in hedging transactions for the years ended
June30, 2010 and 2009 are as follows:
Amount of Gain (Loss)
Reclassified from
Accumulated
OCI into Income (1)
Years ended June 30 2010 2009
DERIVATIVES IN CASH FLOW
HEDGING RELATIONSHIPS
Interest rate contracts $ (8 ) $ (56 )
Foreign currency contracts (48 ) (66 )
Commodity contracts (76 ) (170)
TOTAL (132 ) (292)
Amount of Gain (Loss)
Recognized in Income
Years ended June 30 2010 2009
DERIVATIVES IN FAIR VALUE
HEDGING RELATIONSHIPS (2)
Interest rate contracts $ 191 $ —
Debt (196) —
TOTAL (5) —
DERIVATIVES IN NET INVESTMENT
HEDGING RELATIONSHIPS (2)
Net investment hedges 3(5)
DERIVATIVES NOT DESIGNATED
AS HEDGING INSTRUMENTS (3)
Foreign currency contracts (814) (1,047)
Commodity contracts 1(5)
TOTAL (813) (1,052)
(1) The gain or loss on the effective portion of cash flow hedging relationships is reclassified
from accumulated OCI into net income in the same period during which the related item
affects earnings. Such amounts are included in the Consolidated Statements of Earnings as
follows: interest rate contracts in interest expense, foreign currency contracts in selling,
general and administrative expense and interest expense and commodity contracts in cost
of products sold.
(2) The gain or loss on the ineffective portion of interest rate contracts and net investment
hedges, if any, is included in the Consolidated Statements of Earnings in interest expense.
(3) The gain or loss on contracts not designated as hedging instruments is included in the
Consolidated Statements of Earnings as follows: foreign currency contracts in selling, general
and administrative expense and commodity contracts in cost of products sold.