Johnson Controls 2015 Annual Report Download - page 79

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79
$1.3 billion, fixed a portion of the future interest cost for 5-year, 10-year and 30-year notes. The fair value of each treasury lock
agreement, or the difference between the treasury lock reference rate and the fixed rate at time of note issuance, is amortized to
interest expense over the life of the respective note issuance. In January 2006, in connection with the Company’s debt refinancing,
the three forward treasury lock agreements were terminated.
The following table presents the location and fair values of derivative instruments and hedging activities included in the Company’s
consolidated statements of financial position (in millions):
Derivatives and Hedging Activities
Designated as Hedging Instruments
under ASC 815
Derivatives and Hedging Activities Not
Designated as Hedging Instruments
under ASC 815
September 30,
2015 September 30,
2014 September 30,
2015 September 30,
2014
Other current assets
Foreign currency exchange derivatives $ 31 $ 21 $ 27 $ 13
Interest rate swaps 1———
Cross-currency interest rate swaps 515——
Other noncurrent assets
Interest rate swaps 5 2 — —
Equity swap — — 164 192
Total assets $ 42 $ 38 $ 191 $ 205
Other current liabilities
Foreign currency exchange derivatives $ 37 $ 22 $ 26 $ 11
Commodity derivatives 7 3 — —
Cross-currency interest rate swaps 1———
Current portion of long-term debt
Fixed rate debt swapped to floating 801 125 — —
Long-term debt
Fixed rate debt swapped to floating 855 1,649 — —
Other noncurrent liabilities
Interest rate swaps — 3 — —
Total liabilities $ 1,701 $ 1,802 $ 26 $ 11
The Company enters into International Swaps and Derivatives Associations (ISDA) master netting agreements with counterparties
that permit the net settlement of amounts owed under the derivative contracts. The master netting agreements generally provide
for net settlement of all outstanding contracts with a counterparty in the case of an event of default or a termination event. The
Company has not elected to offset the fair value positions of the derivative contracts recorded in the consolidated statements of
financial position. Collateral is generally not required of the Company or the counterparties under the master netting agreements.
As of September 30, 2015 and September 30, 2014, no cash collateral was received or pledged under the master netting agreements.
The gross and net amounts of derivative assets and liabilities were as follows (in millions):
Fair Value of Assets Fair Value of Liabilities
September 30,
2015 September 30,
2014 September 30,
2015 September 30,
2014
Gross amount recognized $ 233 $ 243 $ 1,727 $ 1,813
Gross amount eligible for offsetting (8) (11) (8) (11)
Net amount $ 225 $ 232 $ 1,719 $ 1,802