McDonalds 2011 Annual Report Download - page 34

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The following table presents the fair values of derivative instruments included on the Consolidated balance sheet as of December 31,
2011 and 2010:
Derivative Assets Derivative Liabilities
In millions Balance Sheet Classification 2011 2010 Balance Sheet Classification 2011 2010
Derivatives designated as hedging instruments
Foreign currency Prepaid expenses and other
current assets $ 6.7 $ 7.5 Accrued payroll and other
liabilities $ (0.3) $(4.6)
Interest rate Prepaid expenses and other
current assets 9.4 0.5
Foreign currency Miscellaneous other assets 0.7 Other long-term liabilities (0.3)
Interest rate Miscellaneous other assets 46.0 72.1 Other long-term liabilities (14.0) (0.3)
Total derivatives designated as hedging instruments $ 62.8 $ 80.1 $(14.6) $(4.9)
Derivatives not designated as hedging instruments
Foreign currency Prepaid expenses and other
current assets $ 8.3 $ 6.0 Accrued payroll and other
liabilities $ (1.0) $(3.8)
Equity Prepaid expenses and other
current assets 104.4
Foreign currency Miscellaneous other assets 2.7
Equity Miscellaneous other assets 154.5
Total derivatives not designated as hedging instruments $162.8 $113.1 $ (1.0) $(3.8)
Total derivatives $225.6 $193.2 $(15.6) $(8.7)
The following table presents the pretax amounts affecting income and OCI for the years ended December 31, 2011 and 2010,
respectively:
In millions
Derivatives in
Fair Value
Hedging
Relationships
Gain (Loss)
Recognized in Income
on Derivative
Hedged Items in
Fair Value
Hedging
Relationships
Gain (Loss)
Recognized in Income on
Related Hedged Items
2011 2010 2011 2010
Interest rate $(11.1) $7.0 Fixed-rate debt $11.1 $(7.0)
Derivatives in
Cash flow
Hedging
Relationships
Gain (Loss) Recognized in
Accumulated OCI on Derivative
(Effective Portion)
Gain (Loss)
Reclassified from Accumulated
OCI into Income
(Effective Portion)
Gain (Loss)
Recognized in Income on
Derivative (Amount Excluded
from Effectiveness Testing and
Ineffective Portion)
2011 2010 2011 2010 2011 2010
Foreign currency $ (5.1) $11.2 $ 5.1 $13.4 $(7.7) $(25.1)
Interest rate(1) (14.0) (2.2) 0.9 0.3
Total $(19.1) $11.2 $ 2.9 $14.3 $(7.7) $(24.8)
Net Investment
Hedging Relationships
Gain (Loss)
Recognized in Accumulated
OCI on Derivative
(Effective portion)
Gain (Loss)
Reclassified from
Accumulated OCI
into Income
(Effective Portion) Derivatives Not
Designated as
Hedging Instruments
Gain (Loss)
Recognized in Income on
Derivative
2011 2010 2011 2010 2011 2010
Foreign currency $ (2.2) $16.4
Foreign currency denominated debt $(130.8) $(144.3) Equity(3) 36.9 18.8
Foreign currency derivatives(2) (9.4) (4.3) $(8.2) Interest Rate 1.5
Total $(140.2) $(148.6) $(8.2) Total $36.2 $35.2
Gains (losses) recognized in income on derivatives are recorded in “Nonoperating (income) expense, net” unless otherwise noted.
(1) The amount of gain (loss) reclassified from accumulated OCI into income is recorded in Interest expense.
(2) The amount of gain (loss) reclassified from accumulated OCI into income is recorded in Impairment and other charges (credits), net.
(3) The amount of gain (loss) recognized in income on the derivatives used to hedge the supplemental benefit plan liabilities is recorded in Selling, general & administrative expenses.
32 McDonald’s Corporation Annual Report 2011