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McDonald’s Corporation 2014 Annual Report 37
The following table presents the fair values of derivative instruments included on the Consolidated balance sheet as of December 31,
2014 and 2013:
Derivative Assets Derivative Liabilities
In millions Balance Sheet Classification 2014 2013 Balance Sheet Classification 2014 2013
Derivatives designated as hedging instruments
Foreign currency Prepaid expenses and other
current assets $ 80.5 $ 28.3
Accrued payroll and other
liabilities $ (0.2) $ (28.8)
Interest rate Prepaid expenses and other
current assets 2.6 —
Foreign currency Miscellaneous other assets 15.5 2.5 Other long-term liabilities (34.6) (114.7)
Interest rate Miscellaneous other assets 9.6 24.8 Other long-term liabilities (7.5) (12.0)
Total derivatives designated as hedging instruments $ 108.2 $ 55.6 $ (42.3) $ (155.5)
Derivatives not designated as hedging instruments
Equity Prepaid expenses and other
current assets $ 120.6 $ 6.7
Foreign currency Prepaid expenses and other
current assets 17.3 9.3
Accrued payroll and other
liabilities $ (7.9) $ (23.8)
Equity Miscellaneous other assets —128.2
Total derivatives not designated as hedging instruments $ 137.9 $ 144.2 $ (7.9) $ (23.8)
Total derivatives $ 246.1 $ 199.8 $ (50.2) $ (179.3)
The following table presents the pretax amounts affecting income and OCI for the years ended December 31, 2014 and 2013,
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
2014 2013 2014 2013
Interest rate $ (8.1) $ (29.5) Fixed-rate debt $ 8.1 $ 29.5
Derivatives in
Cash Flow
Hedging
Relationships
Gain (Loss) Recognized in
Accumulated OCI on
Derivative
(Effective Portion)
Gain (Loss)
Reclassified into Income
from Accumulated OCI
(Effective Portion)
Gain (Loss)
Recognized in Income on
Derivative (Amount Excluded
from Effectiveness Testing and
Ineffective Portion)
2014 2013 2014 2013 2014 2013
Commodity $ — $ (34.1)
Foreign currency 62.0 (65.5) $ 11.0 $ (50.3) $ 9.5 $ (6.1)
Interest rate(1) ——(0.5) (0.4) ——
Total $ 62.0 $ (99.6) $ 10.5 $ (50.7) $ 9.5 $ (6.1)
Gain (Loss)
Recognized in
Accumulated OCI
(Effective Portion)
Derivatives Not
Designated for
Hedge
Accounting
Gain (Loss)
Recognized in
Income
on Derivative
Net Investment
Hedging Relationships
2014 2013 2014 2013
Foreign currency denominated debt $ 954.6 $ (382.8) Foreign currency $ 10.4 $ (30.2)
Foreign currency derivatives 126.6 (18.4) Equity(2) 23.5 21.8
Total $1,081.2 $ (401.2) Total $ 33.9 $ (8.4)
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) recognized in income on the derivatives used to hedge the supplemental benefit plan liabilities is primarily recorded in Selling, general &
administrative expenses.