Annual report pursuant to Section 13 and 15(d)

Assets and Liabilities Measured at Fair Value

v3.22.4
Assets and Liabilities Measured at Fair Value
 12 Months Ended
Dec. 31, 2022
Fair Value Disclosures [Abstract]  
Fair value disclosures Financial Instruments and Fair Value MeasurementsFor assets and liabilities required to be reported or disclosed at fair value, U.S. GAAP provides a hierarchy that prioritizes inputs to valuation techniques used to measure fair value into three broad levels. Level 1 inputs are quoted market prices in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date. Level 2 inputs, other than quoted market prices included within Level 1, are observable for the asset or liability, either directly or indirectly. Level 3 inputs are unobservable inputs for the asset or liability.
The Company measures the fair value of money market funds based on quoted prices in active markets for identical assets. Money market funds are included as cash equivalents Level 1 fair value instruments in the table below. The 2067 Notes (ticker: QVCD) and the 2068 Notes (ticker: QVCC) are traded on the New York Stock Exchange, which the Company considers to be an "active market," as defined by U.S. GAAP. Therefore, these Notes are measured based on quoted prices in an active market and included as Level 1 fair value instruments in the table below. The remainder of the Company's debt instruments and derivative instruments are considered Level 2 fair value instruments and measured based on quoted market prices that are not considered to be traded on "active markets." Accordingly, these financial instruments are reported in the below tables as Level 2 fair value instruments.
The Company’s assets and liabilities measured or disclosed at fair value were as follows:
Fair value measurements at December 31, 2022 using
(in millions) Total Quoted prices
in active
markets for
identical
assets
(Level 1)		 Significant
other
observable
inputs
(Level 2)		 Significant
unobservable
inputs
(Level 3)
Current assets:
Cash equivalents $ 64  64  —  — 
Current liabilities:
Debt (note 8) 213  —  213  — 
Foreign currency forward
 10  —  10  — 
Long-term liabilities:
Debt (note 8) 3,520  346  3,174  — 
Fair value measurements at December 31, 2021 using
(in millions) Total Quoted prices
in active
markets for
identical
assets
(Level 1)		 Significant
other
observable
inputs
(Level 2)		 Significant
unobservable
inputs
(Level 3)
Current assets:
Cash equivalents $ 124  124  —  — 
Current liabilities:
Interest rate swap arrangements 1  —  1  — 
Long-term liabilities:
Debt (note 8) 5,076  745  4,331  — 
Interest Rate Swap Arrangement
In July 2019, the Company entered into a three-year interest swap arrangement with a notional amount of $125 million to mitigate the interest rate risk associated with interest payments related to its variable rate debt. The swap arrangement did not qualify as a cash flow hedge under U.S. GAAP. Changes in the fair value of the swap arrangement are reflected in (losses) gains on financial instruments in the consolidated statements of operations. The swap arrangement expired in July 2022 and was in a net liability position of $1 million as of December 31, 2021, which was included in accrued liabilities.
Foreign Currency Forward Contract
On October 31, 2022, the Company entered into foreign currency forward contracts with an aggregate notional amount of $167 million to mitigate the foreign currency risk associated with the sale and leaseback of Germany and U.K. properties. The forward did not qualify as a cash flow hedge under U.S. GAAP. Changes in the fair value of the forward are reflected in (losses) gains on financial instruments in the consolidated statements of operations. The forward expired in January 2023 and was in a net liability position of $10 million as of December 31, 2022, which was included in accrued liabilities.