Company: ABBV
Filing Date: 2025-02-14
Form Type: 10-K
Source: 0001551152-25-000020
Chunk: 339

Company: AbbVie Inc.
Filing Date: 2025-02-14
Form: 10-K
Item: Item 8
Chunk 339
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, 2023. The company uses the spot method of assessing hedge effectiveness for derivative instruments designated as net investment hedges. Realized and unrealized gains and losses from these hedges are included in AOCI and the initial fair value of hedge components excluded from the assessment of effectiveness is recognized in interest expense, net over the life of the hedging instrument.The company is a party to interest rate swap contracts designated as fair value hedges with notional amounts totaling $3.5 billion at December 31, 2024 and $5.0 billion at December 31, 2023. The effect of the hedge contracts is to change a fixed-rate interest obligation to a floating rate for that portion of the debt. AbbVie records the contracts at fair value and adjusts the carrying amount of the fixed-rate debt by an offsetting amount.No amounts are excluded from the assessment of effectiveness for cash flow hedges or fair value hedges.

2024 Form 10-K   |  78

The following table summarizes the amounts and location of AbbVie's derivative instruments on the consolidated balance sheets:Fair value - Derivatives in asset positionFair value - Derivatives in liability positionas of December 31 (in millions)Balance sheet caption20242023Balance sheet caption20242023Foreign currency forward exchange contractsDesignated as cash flow hedgesPrepaid expenses and other$119 $12 Accounts payable and accrued liabilities$5 $32 Designated as net investment hedgesPrepaid expenses and other4 13 Accounts payable and accrued liabilities— 66 Designated as net investment hedgesOther assets148 — Other long-term liabilities— 69 Not designated as hedgesPrepaid expenses and other42 41 Accounts payable and accrued liabilities30 36 Interest rate swap contractsDesignated as fair value hedgesOther assets— — Other long-term liabilities231 293 Total derivatives$313 $66  $266 $496 While certain derivatives are subject to netting arrangements with the company's counterparties, the company does not offset derivative assets and liabilities within the consolidated balance sheets.The following table presents the pre-tax amounts of gains (losses) from derivative instruments recognized in other comprehensive income (loss):years ended in December 31 (in millions)202420232022Foreign currency forward exchange contractsDesignated as cash flow hedges$192 $(2)$103 Designated as net investment hedges435 (144)395 Cross-currency