SEC Info - Pepsico Inc - ‘10-K’ for 12/26/09

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Pepsico Inc – ‘10-K’ for 12/26/09 – ‘XML.R16’

On: Monday, 2/22/10, at 4:19pm ET · For: 12/26/09 · Accession #: 1193125-10-36385 · File #: 1-01183

  As Of               Filer                 Filing    For·On·As Docs:Size             Issuer                      Filing Agent

 2/22/10  Pepsico Inc                       10-K       12/26/09   40:6.7M                                   Donnelley … Solutions/FA

Annual Report — Form 10-K — Sect. 13 / 15(d) – SEA’34
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: 10-K        Annual Report                                       HTML   1.42M 
 3: EX-14       Worldwide Code of Conduct                           HTML     39K 
 4: EX-21       Subsidiaries of Pepsico, Inc.                       HTML    161K 
 5: EX-23       Consent of Kpmg LLP                                 HTML     24K 
 6: EX-24       Power of Attorney                                   HTML    107K 
 2: EX-12       Computaion of Ratio of Earnings to Fixed Charges    HTML     34K 
 7: EX-31       Certification of Our CEO and CFO Pursuant to        HTML     30K 
                Section 302                                                      
 8: EX-32       Certification of Our CEO and CFO Pursuant to        HTML     18K 
                Section 906                                                      
32: XML         IDEA XML File -- Definitions and References          XML    102K 
37: XML         IDEA XML File -- Filing Summary                      XML     68K 
35: XML.R1      Statement Of Income Alternative                      XML    153K 
36: XML.R2      Statement Of Cash Flows Indirect                     XML    427K 
22: XML.R3      Statement Of Financial Position Classified           XML    261K 
26: XML.R4      Statement Of Financial Position Classified           XML     57K 
                (Parenthetical)                                                  
30: XML.R5      Statement Of Shareholders Equity And Other           XML   1.74M 
                Comprehensive Income                                             
29: XML.R6      Statement Of Shareholders Equity And Other           XML     36K 
                Comprehensive Income (Parenthetical)                             
39: XML.R7      Basis of Presentation and Our Divisions              XML    148K 
18: XML.R8      Our Significant Accounting Policies                  XML     42K 
28: XML.R9      Restructuring and Impairment Charges                 XML     86K 
17: XML.R10     Property, Plant and Equipment and Intangible         XML    128K 
                Assets                                                           
16: XML.R11     Income Taxes                                         XML    118K 
21: XML.R12     Stock-Based Compensation                             XML     68K 
34: XML.R13     Pension, Retiree Medical and Savings Plans           XML    354K 
23: XML.R14     Noncontrolled Bottling Affiliates                    XML     69K 
24: XML.R15     Debt Obligations and Commitments                     XML     67K 
27: XML.R16     Financial Instruments                                XML    147K 
40: XML.R17     Net Income Attributable to PepsiCo per Common        XML     56K 
                Share                                                            
20: XML.R18     Preferred Stock                                      XML     39K 
15: XML.R19     Accumulated Other Comprehensive Loss Attributable    XML     39K 
                to PepsiCo                                                       
25: XML.R20     Supplemental Financial Information                   XML     77K 
33: XML.R21     Acquisition of Common Stock of PBG and PAS           XML     29K 
19: XML.R22     Document Information                                 XML     34K 
31: XML.R23     Entity Information                                   XML    102K 
38: EXCEL       IDEA Workbook of Financial Reports (.xls)            XLS    128K 
 9: EX-101.INS  XBRL Instance -- pep-20091226                        XML   1.42M 
11: EX-101.CAL  XBRL Calculations -- pep-20091226_cal                XML    150K 
12: EX-101.DEF  XBRL Definitions -- pep-20091226_def                 XML    333K 
13: EX-101.LAB  XBRL Labels -- pep-20091226_lab                      XML    367K 
14: EX-101.PRE  XBRL Presentations -- pep-20091226_pre               XML    401K 
10: EX-101.SCH  XBRL Schema -- pep-20091226                          XSD     63K

‘XML.R16’ — Financial Instruments

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<div> Note 10 — Financial Instruments In March 2008, the FASB issued new disclosure guidance on derivative instruments and hedging activities, which amends and expands the disclosure requirements of previously issued guidance on accounting for derivative instruments and hedging activities, to provide an enhanced understanding of the use of derivative instruments, how they are accounted for and their effect on financial position, financial performance and cash flows. We adopted the disclosure provisions of the new guidance in the first quarter of 2009. We are exposed to market risks arising from adverse changes in: <table style="BORDER-COLLAPSE: collapse" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr> <td width="5%"> </td> <td valign="top" width="4%" align="left">•</td> <td valign="top" width="1%"> </td> <td valign="top" align="left"> commodity prices, affecting the cost of our raw materials and energy, </td> </tr> </table> <table style="BORDER-COLLAPSE: collapse" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr> <td width="5%"> </td> <td valign="top" width="4%" align="left">•</td> <td valign="top" width="1%"> </td> <td valign="top" align="left"> foreign exchange risks, and </td> </tr> </table> <table style="BORDER-COLLAPSE: collapse" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr> <td width="5%"> </td> <td valign="top" width="4%" align="left">•</td> <td valign="top" width="1%"> </td> <td valign="top" align="left"> interest rates. </td> </tr> </table> In the normal course of business, we manage these risks through a variety of strategies, including the use of derivatives. Certain derivatives are designated as either cash flow or fair value hedges and qualify for hedge accounting treatment, while others do not qualify and are marked to market through earnings. Cash flows from derivatives used to manage commodity, foreign exchange or interest risks are classified as operating activities. See “Our Business Risks” in Management’s Discussion and Analysis of Financial Condition and Results of Operations for further unaudited information on our business risks. For cash flow hedges, changes in fair value are deferred in accumulated other comprehensive loss within common shareholders’ equity until the underlying hedged item is recognized in net income. For fair value hedges, changes in fair value are recognized immediately in earnings, consistent with the underlying hedged item. Hedging transactions are limited to an underlying exposure. As a result, any change in the value of our derivative instruments would be substantially offset by an opposite change in the value of the underlying hedged items. Hedging ineffectiveness and a net earnings impact occur when the change in the value of the hedge does not offset the change in the value of the underlying hedged item. Ineffectiveness of our hedges is not material. If the derivative instrument is terminated, we continue to defer the related gain or loss and then include it as a component of the cost of the underlying hedged item. Upon determination that the underlying hedged item will not be part of an actual transaction, we recognize the related gain or loss in net income immediately. We also use derivatives that do not qualify for hedge accounting treatment. We account for such derivatives at market value with the resulting gains and losses reflected in our income statement. We do not use derivative instruments for trading or speculative purposes. We perform assessments of our counterparty credit risk regularly, including a review of credit ratings, credit default swap rates and potential nonperformance of the counterparty. Based on our most recent assessment of our counterparty credit risk, we consider this risk to be low. In addition, we enter into derivative contracts with a variety of financial institutions that we believe are creditworthy in order to reduce our concentration of credit risk and generally settle with these financial institutions on a net basis. Commodity Prices We are subject to commodity price risk because our ability to recover increased costs through higher pricing may be limited in the competitive environment in which we operate. This risk is managed through the use of fixed-price purchase orders, pricing agreements, geographic diversity and derivatives. We use derivatives, with terms of no more than three years, to economically hedge price fluctuations related to a portion of our anticipated commodity purchases, primarily for natural gas and diesel fuel. For those derivatives that qualify for hedge accounting, any ineffectiveness is recorded immediately. We classify both the earnings and cash flow impact from these derivatives consistent with the underlying hedged item. During the next 12 months, we expect to reclassify net losses of $124 million related to these hedges from accumulated other comprehensive loss into net income. Derivatives used to hedge commodity price risk that do not qualify for hedge accounting are marked to market each period and reflected in our income statement. Our open commodity derivative contracts that qualify for hedge accounting had a face value of $151 million as of December 26, 2009 and $303 million as of December 27, 2008. These contracts resulted in net unrealized losses of $29 million as of December 26, 2009 and $117 million as of December 27, 2008. Our open commodity derivative contracts that do not qualify for hedge accounting had a face value of $231 million as of December 26, 2009 and $626 million as of December 27, 2008. These contracts resulted in net losses of $57 million in 2009 and $343 million in 2008. Foreign Exchange Financial statements of foreign subsidiaries are translated into U.S. dollars using period-end exchange rates for assets and liabilities and weighted-average exchange rates for revenues and expenses. Adjustments resulting from translating net assets are reported as a separate component of accumulated other comprehensive loss within common shareholders’ equity as currency translation adjustment. Our operations outside of the U.S. generate 48% of our net revenue, with Mexico, Canada and the United Kingdom comprising 16% of our net revenue. As a result, we are exposed to foreign currency risks. On occasion, we may enter into derivatives, primarily forward contracts with terms of no more than two years, to manage our exposure to foreign currency transaction risk. Exchange rate gains or losses related to foreign currency transactions are recognized as transaction gains or losses in our income statement as incurred. Our foreign currency derivatives had a total face value of $1.2 billion as of December 26, 2009 and $1.4 billion as of December 27, 2008. The contracts that qualify for hedge accounting resulted in net unrealized losses of $20 million as of December 26, 2009 and net unrealized gains of $111 million as of December 27, 2008. During the next 12 months, we expect to reclassify net losses of $20 million related to these hedges from accumulated other comprehensive loss into net income. The contracts that do not qualify for hedge accounting resulted in a net gain of $1 million in 2009 and net losses of $28 million in 2008. All losses and gains were offset by changes in the underlying hedged items, resulting in no net material impact on earnings. Interest Rates We centrally manage our debt and investment portfolios considering investment opportunities and risks, tax consequences and overall financing strategies. We use various interest rate derivative instruments including, but not limited to, interest rate swaps, cross currency interest rate swaps, Treasury locks and swap locks to manage our overall interest expense and foreign exchange risk. These instruments effectively change the interest rate and currency of specific debt issuances. Our interest rate and cross currency swaps are generally entered into concurrently with the issuance of the debt that they modify. The notional amount, interest payment and maturity date of the interest rate and cross currency swaps match the principal, interest payment and maturity date of the related debt. Our Treasury locks and swap locks are entered into to protect against unfavorable interest rate changes relating to forecasted debt transactions. The notional amounts of the interest rate derivative instruments outstanding as of December 26, 2009 and December 27, 2008 were $5.75 billion and $2.75 billion, respectively. For those interest rate derivative instruments that qualify for cash flow hedge accounting, any ineffectiveness is recorded immediately. We classify both the earnings and cash flow impact from these interest rate derivative instruments consistent with the underlying hedged item. During the next 12 months, we expect to reclassify net losses of $6 million related to these hedges from accumulated other comprehensive loss into net income. Concurrently with the debt issuance after year-end, we terminated $1.5 billion of interest rate derivative instruments, and the realized loss will be amortized into interest expense over the duration of the debt term. As of December 26, 2009, approximately 57% of total debt, after the impact of the related interest rate derivative instruments, was exposed to variable rates compared to 58% as of December 27, 2008. In addition to variable rate long-term debt, all debt with maturities of less than one year is categorized as variable for purposes of this measure. Fair Value Measurements In September 2006, the FASB issued new accounting guidance on fair value measurements, which defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements. We adopted the new guidance as of the beginning of our 2008 fiscal year as it relates to recurring financial assets and liabilities. As of the beginning of our 2009 fiscal year, we adopted the new guidance as it relates to nonrecurring fair value measurement requirements for nonfinancial assets and liabilities. These include goodwill, other nonamortizable intangible assets and unallocated purchase price for recent acquisitions which are included within other assets. Our adoption did not have a material impact on our financial statements. See Note 7 for the fair value framework. The fair values of our financial assets and liabilities as of December 26, 2009 are categorized as follows: <table border="0" cellspacing="0" cellpadding="0" width="100%" align="center"> <tr> <td width="72%"></td> <td valign="bottom" width="4%"></td> <td></td> <td></td> <td valign="bottom" width="4%"></td> <td></td> <td></td> <td valign="bottom" width="4%"></td> <td></td> <td></td> <td valign="bottom" width="4%"></td> <td></td> <td></td> </tr> <tr> <td valign="bottom"> </td> <td valign="bottom"> </td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="11" align="center">2009</td> </tr> <tr> <td valign="bottom"> </td> <td valign="bottom"> </td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center">Total</td> <td valign="bottom"> </td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center">Level 1</td> <td valign="bottom"> </td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center">Level 2</td> <td valign="bottom"> </td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center">Level 3</td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> Assets(a) </td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr> <td valign="top"> Available-for-sale securities(b) </td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">71</td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">71</td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">— </td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">— </td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> Short-term investments – index funds(c) </td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">120</td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">120</td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">— </td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">— </td> </tr> <tr> <td valign="top"> Derivatives designated as hedging instruments: </td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> Forward exchange contracts(d) </td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">11</td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">— </td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">11</td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">— </td> </tr> <tr> <td valign="top"> Interest rate derivatives(e) </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">177</td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">— </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">177</td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">— </td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> Prepaid forward contracts(f) </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">46</td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">— </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">46</td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">— </td> </tr> <tr> <td valign="top"> Commodity contracts – other(g) </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">8</td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">— </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">8</td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">— </td> </tr> <tr style="FONT-SIZE: 1px"> <td valign="bottom"></td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"></td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">242</td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">— </td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">242</td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">— </td> </tr> <tr> <td valign="top"> Derivatives not designated as hedging instruments: </td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> Forward exchange contracts(d) </td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">4</td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">— </td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">4</td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">— </td> </tr> <tr> <td valign="top"> Commodity contracts – other(g) </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">7</td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">— </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">7</td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">— </td> </tr> <tr style="FONT-SIZE: 1px"> <td valign="bottom"></td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"></td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">11</td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">— </td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">11</td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">— </td> </tr> <tr style="FONT-SIZE: 1px"> <td valign="bottom"></td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> </tr> <tr> <td valign="top"> Total asset derivatives at fair value </td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">253</td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">— </td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">253</td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">— </td> </tr> <tr style="FONT-SIZE: 1px"> <td valign="bottom"></td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> Total assets at fair value </td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">444</td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">191</td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">253</td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">— </td> </tr> <tr style="FONT-SIZE: 1px"> <td valign="bottom"></td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 3px double" valign="bottom"> </td> <td style="BORDER-TOP: #000000 3px double" valign="bottom"> </td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 3px double" valign="bottom"> </td> <td style="BORDER-TOP: #000000 3px double" valign="bottom"> </td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 3px double" valign="bottom"> </td> <td style="BORDER-TOP: #000000 3px double" valign="bottom"> </td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 3px double" valign="bottom"> </td> <td style="BORDER-TOP: #000000 3px double" valign="bottom"> </td> </tr> <tr> <td valign="top"> Liabilities(a) </td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> Deferred compensation(h) </td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">461</td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">121</td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">340</td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">— </td> </tr> <tr> <td valign="top"> Derivatives designated as hedging instruments: </td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> Forward exchange contracts(d) </td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">31</td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">— </td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">31</td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">— </td> </tr> <tr> <td valign="top"> Interest rate derivatives(e) </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">43</td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">— </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">43</td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">— </td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> Commodity contracts – other(g) </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">5</td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">— </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">5</td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">— </td> </tr> <tr> <td valign="top"> Commodity contracts – futures(i) </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">32</td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">32</td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">— </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">— </td> </tr> <tr style="FONT-SIZE: 1px"> <td valign="bottom"></td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"></td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">111</td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">32</td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">79</td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">— </td> </tr> <tr> <td valign="top"> Derivatives not designated as hedging instruments: </td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> Forward exchange contracts(d) </td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">2</td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">— </td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">2</td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">— </td> </tr> <tr> <td valign="top"> Commodity contracts – other(g) </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">60</td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">— </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">60</td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">— </td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> Commodity contracts – futures(i) </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">3</td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">3</td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">— </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">— </td> </tr> <tr style="FONT-SIZE: 1px"> <td valign="bottom"></td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> </tr> <tr> <td valign="top"></td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">65</td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">3</td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">62</td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">— </td> </tr> <tr style="FONT-SIZE: 1px"> <td valign="bottom"></td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> Total liability derivatives at fair value </td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">176</td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">35</td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">141</td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">— </td> </tr> <tr style="FONT-SIZE: 1px"> <td valign="bottom"></td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> </tr> <tr> <td valign="top"> Total liabilities at fair value </td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">637</td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">156</td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">481</td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">— </td> </tr> <tr style="FONT-SIZE: 1px"> <td valign="bottom"></td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 3px double" valign="bottom"> </td> <td style="BORDER-TOP: #000000 3px double" valign="bottom"> </td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 3px double" valign="bottom"> </td> <td style="BORDER-TOP: #000000 3px double" valign="bottom"> </td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 3px double" valign="bottom"> </td> <td style="BORDER-TOP: #000000 3px double" valign="bottom"> </td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 3px double" valign="bottom"> </td> <td style="BORDER-TOP: #000000 3px double" valign="bottom"> </td> </tr> </table> <table style="BORDER-COLLAPSE: collapse" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr> <td valign="top" width="5%" align="left">(a)</td> <td valign="top" align="left"> Financial assets are classified on our balance sheet within other assets, with the exception of short-term investments. Financial liabilities are classified on our balance sheet within other current liabilities and other liabilities. </td> </tr> </table> <table style="BORDER-COLLAPSE: collapse" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr> <td valign="top" width="5%" align="left">(b)</td> <td valign="top" align="left"> Based on the price of common stock. </td> </tr> </table> <table style="BORDER-COLLAPSE: collapse" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr> <td valign="top" width="5%" align="left">(c)</td> <td valign="top" align="left"> Based on price changes in index funds used to manage a portion of market risk arising from our deferred compensation liability. </td> </tr> </table> <table style="BORDER-COLLAPSE: collapse" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr> <td valign="top" width="5%" align="left">(d)</td> <td valign="top" align="left"> Based on observable market transactions of spot and forward rates. </td> </tr> </table> <table style="BORDER-COLLAPSE: collapse" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr> <td valign="top" width="5%" align="left">(e)</td> <td valign="top" align="left"> Based on LIBOR and recently reported transactions in the marketplace. </td> </tr> </table> <table style="BORDER-COLLAPSE: collapse" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr> <td valign="top" width="5%" align="left">(f)</td> <td valign="top" align="left"> Based primarily on the price of our common stock. </td> </tr> </table> <table style="BORDER-COLLAPSE: collapse" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr> <td valign="top" width="5%" align="left">(g)</td> <td valign="top" align="left"> Based on recently reported transactions in the marketplace, primarily swap arrangements. </td> </tr> </table> <table style="BORDER-COLLAPSE: collapse" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr> <td valign="top" width="5%" align="left">(h)</td> <td valign="top" align="left"> Based on the fair value of investments corresponding to employees’ investment elections. </td> </tr> </table> <table style="BORDER-COLLAPSE: collapse" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr> <td valign="top" width="5%" align="left">(i)</td> <td valign="top" align="left"> Based on average prices on futures exchanges. </td> </tr> </table> The effective portion of the pre-tax (gains)/losses on our derivative instruments are categorized in the tables below. <table border="0" cellspacing="0" cellpadding="0" width="100%" align="center"> <tr> <td width="54%"></td> <td valign="bottom" width="13%"></td> <td></td> <td></td> <td></td> <td valign="bottom" width="13%"></td> <td></td> <td></td> <td></td> <td valign="bottom" width="13%"></td> <td></td> <td></td> <td></td> </tr> <tr> <td valign="bottom"> </td> <td valign="bottom"> </td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="10" align="center">2009</td> <td valign="bottom"> </td> </tr> <tr> <td valign="bottom"> </td> <td valign="bottom"> </td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center">(Gains)/Losses Recognized in Income Statement</td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center">Losses/(Gains) Recognized in Accumulated Other Comprehensive Loss</td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center">(Gains)/Losses Reclassified from Accumulated Other Comprehensive Loss into Income Statement</td> <td valign="bottom"> </td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> Fair Value/Non-designated Hedges </td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr> <td valign="top"> Forward exchange contracts(a) </td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">(29</td> <td valign="bottom" nowrap="nowrap">) </td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> Interest rate derivatives(b) </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">206</td> <td valign="bottom" nowrap="nowrap"> </td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr> <td valign="top"> Prepaid forward contracts(a) </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">(5</td> <td valign="bottom" nowrap="nowrap">) </td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> Commodity contracts(a) </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">(274</td> <td valign="bottom" nowrap="nowrap">) </td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr style="FONT-SIZE: 1px"> <td valign="bottom"></td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td> </td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr> <td valign="top"> Total </td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">(102</td> <td valign="bottom" nowrap="nowrap">) </td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr style="FONT-SIZE: 1px"> <td valign="bottom"></td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 3px double" valign="bottom"> </td> <td style="BORDER-TOP: #000000 3px double" valign="bottom"> </td> <td> </td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr> <td height="8"></td> <td height="8" colspan="4"></td> <td height="8" colspan="4"></td> <td height="8" colspan="4"></td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> Cash Flow Hedges </td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr> <td valign="top"> Forward exchange contracts(c) </td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">75</td> <td valign="bottom" nowrap="nowrap"> </td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">(64</td> <td valign="bottom" nowrap="nowrap">) </td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> Commodity contracts(c) </td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">(1</td> <td valign="bottom" nowrap="nowrap">) </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">90</td> <td valign="bottom" nowrap="nowrap"> </td> </tr> <tr> <td valign="top"> Interest rate derivatives(b) </td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">32</td> <td valign="bottom" nowrap="nowrap"> </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">— </td> <td valign="bottom" nowrap="nowrap"> </td> </tr> <tr style="FONT-SIZE: 1px"> <td valign="bottom"></td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td> </td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td> </td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> Total </td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">106</td> <td valign="bottom" nowrap="nowrap"> </td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">26</td> <td valign="bottom" nowrap="nowrap"> </td> </tr> <tr style="FONT-SIZE: 1px"> <td valign="bottom"></td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 3px double" valign="bottom"> </td> <td style="BORDER-TOP: #000000 3px double" valign="bottom"> </td> <td> </td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 3px double" valign="bottom"> </td> <td style="BORDER-TOP: #000000 3px double" valign="bottom"> </td> <td> </td> </tr> </table> <table style="BORDER-COLLAPSE: collapse" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr> <td valign="top" width="5%" align="left">(a)</td> <td valign="top" align="left"> Included in corporate unallocated expenses. </td> </tr> </table> <table style="BORDER-COLLAPSE: collapse" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr> <td valign="top" width="5%" align="left">(b)</td> <td valign="top" align="left"> Included in interest expense in our income statement. </td> </tr> </table> <table style="BORDER-COLLAPSE: collapse" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr> <td valign="top" width="5%" align="left">(c)</td> <td valign="top" align="left"> Included in cost of sales in our income statement. </td> </tr> </table> The fair values of our financial assets and liabilities as of December 27, 2008 are categorized as follows: <table border="0" cellspacing="0" cellpadding="0" width="100%" align="center"> <tr> <td width="72%"></td> <td valign="bottom" width="4%"></td> <td></td> <td></td> <td valign="bottom" width="4%"></td> <td></td> <td></td> <td valign="bottom" width="4%"></td> <td></td> <td></td> <td valign="bottom" width="4%"></td> <td></td> <td></td> </tr> <tr> <td valign="bottom"> </td> <td valign="bottom"> </td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="11" align="center">2008</td> </tr> <tr> <td valign="bottom"> </td> <td valign="bottom"> </td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center">Total</td> <td valign="bottom"> </td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center">Level 1</td> <td valign="bottom"> </td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center">Level 2</td> <td valign="bottom"> </td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center">Level 3</td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> Assets(a) </td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr> <td valign="top"> Available-for-sale securities(b) </td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">41</td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">41</td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">— </td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">— </td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> Short-term investments – index funds(c) </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">98</td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">98</td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">— </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">— </td> </tr> <tr> <td valign="top"> Forward exchange contracts(d) </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">139</td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">— </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">139</td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">— </td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> Interest rate derivatives(e) </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">372</td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">— </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">372</td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">— </td> </tr> <tr> <td valign="top"> Prepaid forward contracts(f) </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">41</td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">— </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">41</td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">— </td> </tr> <tr style="FONT-SIZE: 1px"> <td valign="bottom"></td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> Total assets at fair value </td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">691</td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">139</td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">552</td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">— </td> </tr> <tr style="FONT-SIZE: 1px"> <td valign="bottom"></td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 3px double" valign="bottom"> </td> <td style="BORDER-TOP: #000000 3px double" valign="bottom"> </td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 3px double" valign="bottom"> </td> <td style="BORDER-TOP: #000000 3px double" valign="bottom"> </td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 3px double" valign="bottom"> </td> <td style="BORDER-TOP: #000000 3px double" valign="bottom"> </td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 3px double" valign="bottom"> </td> <td style="BORDER-TOP: #000000 3px double" valign="bottom"> </td> </tr> <tr> <td valign="top"> Liabilities(a) </td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"> </td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> Forward exchange contracts(d) </td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">56</td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">— </td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">56</td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">— </td> </tr> <tr> <td valign="top"> Commodity contracts – other(g) </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">345</td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">— </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">345</td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">— </td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> Commodity contracts – futures(i) </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">115</td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">115</td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">— </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">— </td> </tr> <tr> <td valign="top"> Deferred compensation(h) </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">447</td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">99</td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">348</td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom" align="right">— </td> </tr> <tr style="FONT-SIZE: 1px"> <td valign="bottom"></td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> <td style="BORDER-TOP: #000000 1px solid" valign="bottom"> </td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> Total liabilities at fair value </td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">963</td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">214</td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">749</td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">— </td> </tr> <tr style="FONT-SIZE: 1px"> <td valign="bottom"></td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 3px double" valign="bottom"> </td> <td style="BORDER-TOP: #000000 3px double" valign="bottom"> </td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 3px double" valign="bottom"> </td> <td style="BORDER-TOP: #000000 3px double" valign="bottom"> </td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 3px double" valign="bottom"> </td> <td style="BORDER-TOP: #000000 3px double" valign="bottom"> </td> <td valign="bottom"> </td> <td style="BORDER-TOP: #000000 3px double" valign="bottom"> </td> <td style="BORDER-TOP: #000000 3px double" valign="bottom"> </td> </tr> </table> <table style="BORDER-COLLAPSE: collapse" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr> <td valign="top" width="5%" align="left">(a)</td> <td valign="top" align="left"> Financial assets are classified on our balance sheet within other assets, with the exception of short-term investments. Financial liabilities are classified on our balance sheet within other current liabilities and other liabilities. </td> </tr> </table> <table style="BORDER-COLLAPSE: collapse" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr> <td valign="top" width="5%" align="left">(b)</td> <td valign="top" align="left"> Based on the price of common stock. </td> </tr> </table> <table style="BORDER-COLLAPSE: collapse" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr> <td valign="top" width="5%" align="left">(c)</td> <td valign="top" align="left"> Based on price changes in index funds used to manage a portion of market risk arising from our deferred compensation liability. </td> </tr> </table> <table style="BORDER-COLLAPSE: collapse" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr> <td valign="top" width="5%" align="left">(d)</td> <td valign="top" align="left"> Based on observable market transactions of spot and forward rates. </td> </tr> </table> <table style="BORDER-COLLAPSE: collapse" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr> <td valign="top" width="5%" align="left">(e)</td> <td valign="top" align="left"> Based on LIBOR and recently reported transactions in the marketplace. </td> </tr> </table> <table style="BORDER-COLLAPSE: collapse" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr> <td valign="top" width="5%" align="left">(f)</td> <td valign="top" align="left"> Based primarily on the price of our common stock. </td> </tr> </table> <table style="BORDER-COLLAPSE: collapse" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr> <td valign="top" width="5%" align="left">(g)</td> <td valign="top" align="left"> Based on recently reported transactions in the marketplace, primarily swap arrangements. </td> </tr> </table> <table style="BORDER-COLLAPSE: collapse" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr> <td valign="top" width="5%" align="left">(h)</td> <td valign="top" align="left"> Based on the fair value of investments corresponding to employees’ investment elections. </td> </tr> </table> <table style="BORDER-COLLAPSE: collapse" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr> <td valign="top" width="5%" align="left">(i)</td> <td valign="top" align="left"> Based on average prices on futures exchanges. </td> </tr> </table> The carrying amounts of our cash and cash equivalents and short-term investments approximate fair value due to the short-term maturity. Short-term investments consist principally of short-term time deposits and index funds of $120 million as of December 26, 2009 and $98 million as of December 27, 2008 used to manage a portion of market risk arising from our deferred compensation liability. The fair value of our debt obligations as of December 26, 2009 and December 27, 2008 was $8.6 billion and $8.8 billion, respectively, based upon prices of similar instruments in the marketplace. The table above excludes guarantees, including our guarantee aggregating $2.3 billion of Bottling Group, LLC’s long-term debt. The guarantee had a fair value of $20 million as of December 26, 2009 and $117 million as of December 27, 2008 based on our estimate of the cost to us of transferring the liability to an independent financial institution. See Note 9 for additional information on our guarantees. </div>

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<NonNumericTextHeader> Note 10 — Financial Instruments In March 2008, the FASB issued new disclosure guidance on derivative instruments and hedging activities, which amends </NonNumericTextHeader>

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4 Subsequent Filings that Reference this Filing

  As Of               Filer                 Filing    For·On·As Docs:Size             Issuer                      Filing Agent

 8/30/10  SEC                               UPLOAD¶    10/11/17    1:59K  Pepsico Inc.
 6/25/10  SEC                               UPLOAD¶    10/11/17    1:65K  Pepsico Inc.
 5/03/10  SEC                               UPLOAD¶    10/11/17    1:72K  Pepsico Inc.
 4/09/10  SEC                               UPLOAD¶    10/11/17    1:87K  Pepsico Inc.

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Filing Submission 0001193125-10-036385 – Alternative Formats (Word / Rich Text, HTML, Plain Text, et al.)

Pepsico Inc – ‘10-K’ for 12/26/09 – ‘XML.R16’

On: Monday, 2/22/10, at 4:19pm ET · For: 12/26/09 · Accession #: 1193125-10-36385 · File #: 1-01183

Annual Report — Form 10-K — Sect. 13 / 15(d) – SEA’34Filing Table of Contents

‘XML.R16’ — Financial Instruments

This Financial Report is an XBRL XML File.

4 Subsequent Filings that Reference this Filing

Annual Report — Form 10-K — Sect. 13 / 15(d) – SEA’34
Filing Table of Contents