Caterpillar Financial Services 10-K 16 Feb 16 2015 FY Annual report Financial data

Document and Entity Information

Document and Entity Information Document - USD ($)	12 Months Ended
	Dec. 31, 2015	Feb. 16, 2016
Document Information [Line Items]
Entity Registrant Name	CATERPILLAR FINANCIAL SERVICES CORPORATION
Entity Central Index Key	764,764
Current Fiscal Year End Date	--12-31
Entity Filer Category	Non-accelerated Filer
Document Type	10-K
Document Period End Date	Dec. 31, 2015
Document Fiscal Year Focus	2,015
Document Fiscal Period Focus	FY
Amendment Flag	false
Entity Common Stock, Shares Outstanding		1
Entity Well-known Seasoned Issuer	Yes
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Public Float	$ 0

Consolidated Statements of Prof

Consolidated Statements of Profit - USD ($) $ in Millions		12 Months Ended
		Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Revenues:
Retail finance		$ 1,243	$ 1,366	$ 1,387
Operating lease		1,012	1,057	948
Wholesale finance		285	311	306
Other, net		133	151	144
Total revenues		2,673	2,885	2,785
Expenses:
Interest		593	631	734
Depreciation on equipment leased to others		836	870	770
General, operating and administrative		415	433	427
Provision for credit losses		119	139	101
Other		64	37	24
Total expenses		2,027	2,110	2,056
Other income (expense)		(27)	(22)	(35)
Profit before income taxes		619	753	694
Provision for income taxes		158	209	167
Profit of consolidated companies		461	544	527
Less: Profit attributable to noncontrolling interests		1	9	14
Profit	[1]	$ 460	$ 535	$ 513
[1]	Profit attributable to Caterpillar Financial Services Corporation.

Consolidated Statements of Comp

Consolidated Statements of Comprehensive Income - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Statement of Comprehensive Income [Abstract]
Profit of consolidated companies	$ 461	$ 544	$ 527
Other comprehensive income (loss), net of tax:
Foreign currency translation, net of tax (expense)/benefit	(545)	(481)	(59)
Derivative financial instruments:
Gains (losses) deferred, net of tax (expense)/benefit	2	(4)	(1)
(Gains) losses reclassified to earnings, net of tax expense/(benefit)	3	4	4
Total Other comprehensive income (loss), net of tax	(540)	(481)	(56)
Comprehensive income (loss)	(79)	63	471
Less: Comprehensive income (loss) attributable to the noncontrolling interests	(6)	9	17
Comprehensive income (loss) attributable to Caterpillar Financial Services Corporation	$ (73)	$ 54	$ 454

Consolidated Statements of Com4

Consolidated Statements of Comprehensive Income Parenthetical (Parentheticals) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Statement of Comprehensive Income [Abstract]
Foreign currency translation, tax	$ (91)	$ (119)	$ 41
Derivative financial instruments:
Gains (losses) deferred, tax	(1)	2	1
(Gains) losses reclassified to earnings, tax	$ (2)	$ (2)	$ (2)

Consolidated Statements of Fina

Consolidated Statements of Financial Position - USD ($) $ in Millions	Dec. 31, 2015	Dec. 31, 2014
Assets:
Cash and cash equivalents	$ 1,016	$ 857
Finance receivables, net (Note 3)	27,388	29,074
Notes receivable from Caterpillar (Note 14)	490	414
Equipment on operating leases, less accumulated depreciation (Note 4)	3,564	3,624
Deferred and refundable income taxes (Note 12)	240	206
Other assets (Note 5)	1,205	1,001
Total assets	33,903	35,176
Liabilities and stockholder's equity:
Payable to dealers and others	137	113
Payable to Caterpillar - other	62	69
Accrued expenses	200	212
Income taxes payable	47	66
Payable to Caterpillar – borrowings (Note 14)	1,096	1,108
Short-term borrowings (Note 8)	6,958	4,699
Current maturities of long-term debt (Note 9)	5,362	6,283
Long-term debt (Note 9)	16,243	18,291
Deferred income taxes and other liabilities (Note 12)	823	681
Total liabilities	$ 30,928	$ 31,522
Commitments and contingent liabilities (Note 11)
Common stock - $1 par value Authorized: 2,000 shares; Issued and outstanding: one share (at paid-in amount)	$ 745	$ 745
Additional paid-in capital	2	2
Retained earnings	2,999	3,139
Accumulated other comprehensive income/(loss)	(897)	(364)
Noncontrolling interests	126	132
Total stockholder's equity	2,975	3,654
Total liabilities and stockholder's equity	$ 33,903	$ 35,176

Consolidated Statements of Fin6

Consolidated Statements of Financial Position Parenthetical (Parentheticals) - $ / shares	Dec. 31, 2015	Dec. 31, 2014
Liabilities and Stockholders' Equity [Abstract]
Common stock - par value	$ 1	$ 1
Common stock - authorized	2,000	2,000
Common stock - issued	1	1
Common stock - outstanding	1	1

Consolidated Statements of Chan

Consolidated Statements of Changes in Stockholder's Equity - USD ($) $ in Millions	Total	Common stock	Additional paid-in capital	Retained earnings	Accumulated other comprehensive income/(loss)	Noncontrolling interests
Balance at Dec. 31, 2012	$ 3,720	$ 745	$ 2	$ 2,691	$ 176	$ 106
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Profit of consolidated companies	527			513		14
Dividend paid to Caterpillar	(200)			(200)
Foreign currency transalation, net of tax	(59)				(62)	3
Derivative financial instruments, net of tax	3				3
Balance at Dec. 31, 2013	3,991	745	2	3,004	117	123
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Profit of consolidated companies	544			535		9
Dividend paid to Caterpillar	(400)			(400)
Foreign currency transalation, net of tax	(481)				(481)	0
Derivative financial instruments, net of tax	0				0
Balance at Dec. 31, 2014	3,654	745	2	3,139	(364)	132
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Profit of consolidated companies	461			460		1
Dividend paid to Caterpillar	(600)			(600)
Foreign currency transalation, net of tax	(545)				(538)	(7)
Derivative financial instruments, net of tax	5				5
Balance at Dec. 31, 2015	$ 2,975	$ 745	$ 2	$ 2,999	$ (897)	$ 126

Consolidated Statements of Cash

Consolidated Statements of Cash Flows - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Cash flows from operating activities:
Profit of consolidated companies	$ 461	$ 544	$ 527
Adjustments for non-cash items:
Depreciation and amortization	848	883	790
Amortization of receivables purchase discount	(222)	(243)	(233)
Provision for credit losses	119	139	101
Gain on sales of receivables	(2)	(5)	(4)
Other, net	31	(4)	77
Changes in assets and liabilities:
Receivables from others	(43)	10	25
Other receivables/payables with Caterpillar	(17)	23	1
Payable to dealers and others	83	(26)	(95)
Accrued interest payable	7	(60)	(22)
Accrued expenses and other liabilities, net	76	107	(6)
Income taxes payable	(74)	(33)	(65)
Other assets, net	4	3	0
Net cash provided by operating activities	1,271	1,338	1,096
Cash flows from investing activities:
Capital expenditures for equipment on operating leases and other capital expenditures	(1,461)	(1,627)	(1,822)
Proceeds from disposals of equipment	583	771	681
Additions to finance receivables	(12,928)	(14,396)	(14,075)
Collections of finance receivables	12,225	12,608	12,256
Net changes in Caterpillar purchased receivables	745	10	181
Proceeds from sales of receivables	136	179	227
Net change in variable lending to Caterpillar	0	0	32
Additions to other notes receivable with Caterpillar	(134)	(103)	(45)
Collections on other notes receivable with Caterpillar	58	34	29
Restricted cash and cash equivalents activity, net	(7)	6	2
Settlements of derivatives	(58)	(40)	3
Net cash provided by (used for) investing activities	(841)	(2,558)	(2,531)
Cash flows from financing activities:
Net change in variable lending from Caterpillar	0	0	(65)
Proceeds from borrowings with Caterpillar	0	0	1,000
Proceeds from debt issued (original maturities greater than three months)	5,129	8,655	9,133
Payments on debt issued (original maturities greater than three months)	(7,775)	(8,463)	(9,101)
Short-term borrowings, net (original maturities three months or less)	3,018	1,043	(70)
Dividend paid to Caterpillar	(600)	(400)	(200)
Net cash provided by (used for) financing activities	(228)	835	697
Effect of exchange rate changes on cash and cash equivalents	(43)	(78)	(22)
Increase/(decrease) in cash and cash equivalents	159	(463)	(760)
Cash and cash equivalents at beginning of period	857	1,320	2,080
Cash and cash equivalents at end of period	1,016	857	1,320
Cash paid for interest	579	674	713
Cash paid for taxes	$ 125	$ 175	$ 192
Cash and cash equivalents policy	All short-term investments, which consist primarily of highly liquid investments with original maturities of three months or less, are considered to be cash equivalents.

Summary of Significant Accounti

Summary of Significant Accounting Policies	12 Months Ended
	Dec. 31, 2015
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Summary of Significant Accounting Policies	SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES A. Nature of Operations Caterpillar Financial Services Corporation, a Delaware corporation organized in 1981 (together with its subsidiaries, "Cat Financial," "the Company," "we" and "our"), is a wholly-owned finance subsidiary of Caterpillar Inc. (together with its other subsidiaries, "Caterpillar" or "Cat"). Our primary business is to provide retail and wholesale financing alternatives for Caterpillar products to customers and dealers around the world. Retail financing is primarily comprised of financing of Caterpillar equipment, machinery and engines. In addition, we also provide financing for vehicles, power generation facilities and marine vessels that, in most cases, incorporate Caterpillar products. We also provide wholesale financing to Caterpillar dealers and purchase short-term receivables from Caterpillar. The various financing plans offered by Cat Financial are primarily designed to increase the opportunity for sales of Caterpillar products and generate financing income for Cat Financial. A significant portion of our activities is conducted in North America. However, we have additional offices and subsidiaries in Latin America, Europe and Asia/Pacific. B. Basis of Presentation The accompanying consolidated financial statements include the accounts of Cat Financial and consolidated variable interest entities (VIEs) in which Cat Financial is the primary beneficiary. We consolidate all variable-interest entities (VIEs) where we are the primary beneficiary. For VIEs, we assess whether we are the primary beneficiary as prescribed by the accounting guidance on the consolidation of VIEs. The primary beneficiary of a VIE is the party that has both the power to direct the activities that most significantly impact the entity’s economic performance and the obligation to absorb losses or the right to receive benefits that could potentially be significant to the entity. Please refer to Note 11 for more information. We have customers that are VIEs of which we are not the primary beneficiary. Although we have provided financial support to these entities and therefore have a variable interest, we do not have the power to direct the activities that most significantly impact their economic performance. Our maximum exposure to loss from our involvement with these VIEs is limited to the credit risk inherently present in the financial support that we have provided. These risks are evaluated and reflected in our financial statements as part of our overall portfolio of finance receivables and related allowance for credit losses. Certain amounts for prior years have been reclassified to conform with current-year financial statement presentation. C. Recognition of Earned Income Finance revenue is recorded over the life of the related finance receivable using the interest method, including the accretion of certain direct origination costs that are deferred. Revenue from rental payments received on operating leases is recognized on a straight-line basis over the term of the lease. Recognition of finance revenue and operating lease revenue is suspended and the account is placed on non-accrual status when management determines that collection of future income is not probable (generally after 120 days past due). Recognition is resumed, and previously suspended income is recognized, when the account becomes current and collection of remaining amounts is considered probable. We participate in certain marketing programs offered in conjunction with Caterpillar and/or Caterpillar dealers that allow us to periodically offer financing to customers at interest rates that are below market rates. Under these marketing programs, Caterpillar and/or the dealer funds an amount at the outset of the transaction, which we then recognize as revenue over the term of the financing. The funds we receive from Caterpillar and/or the dealer equal an amount that when combined with the customer’s contractual interest provides us with a market interest rate. D. Depreciation Depreciation for equipment on operating leases is recognized using the straight-line method over the lease term, typically one to seven years. The depreciable basis is the original cost of the equipment less the estimated residual value of the equipment at the end of the lease term. E. Residual Values The residuals for leases classified as operating leases are included in Equipment on operating leases. The residuals for leases classified as finance leases, in accordance with lease accounting, are included in finance receivables. During the term of the leases, residual values are monitored. If estimated end-of-term market values of leased equipment reflect a non-temporary impairment due to economic factors, obsolescence or other adverse circumstances, the residual value of the leased equipment is adjusted so that the carrying value at end of lease term will approximate the estimated end-of-term market value. For equipment on operating leases, adjustments are made on a straight-line basis over the remaining term of the lease through depreciation expense. For finance leases, adjustments are recognized at the time of assessment through a reduction of finance revenue. F. Derivative Financial Instruments Our earnings and cash flows are subject to fluctuations due to changes in foreign currency exchange rates and interest rates. Our Risk Management Policy (policy) allows for the use of derivative financial instruments to manage foreign currency exchange rate and interest rate exposures. Our policy specifies that derivatives are not to be used for speculative purposes. Derivatives that we use are primarily foreign currency forward, option, and cross currency contracts and interest rate swaps. All derivatives are recorded at fair value. See Note 10 for additional information. G. Allowance for Credit Losses The allowance for credit losses is an estimate of the losses inherent in our finance receivable portfolio and includes consideration of accounts that have been individually identified as impaired, as well as pools of finance receivables where it is probable that certain receivables in the pool are impaired but the individual accounts cannot yet be identified. In identifying and measuring impairment, management takes into consideration past loss experience, known and inherent risks in the portfolio, adverse situations that may affect the borrower’s ability to repay, estimated value of underlying collateral and current economic conditions. Accounts are identified for individual review based on past-due status and information available about the customer, such as financial statements, news reports and published credit ratings, as well as general information regarding industry trends and the economic environment in which our customers operate. The allowance for credit losses attributable to finance receivables that are individually evaluated and determined to be impaired is based either on the present value of expected future cash flows discounted at the receivables' effective interest rate or the fair value of the collateral for collateral-dependent receivables. In determining collateral value, we estimate the current fair market value of the collateral less selling costs. We also consider credit enhancements such as additional collateral and contractual third-party guarantees. The allowance for credit losses attributable to the remaining accounts not yet individually identified as impaired is estimated based on loss forecast models utilizing probabilities of default, our estimate of the loss emergence period and the estimated loss given default. In addition, qualitative factors not able to be fully captured in our loss forecast models including industry trends, macroeconomic factors and model imprecision are considered in the evaluation of the adequacy of the allowance for credit losses. These qualitative factors are subjective and require a degree of management judgment. Receivable balances, including accrued interest, are written off against the allowance for credit losses when, in the judgment of management, they are considered uncollectible (generally upon repossession of the collateral). The amount of the write-off is determined by comparing the fair value of the collateral, less cost to sell, to the recorded investment. Subsequent recoveries, if any, are credited to the allowance for credit losses when received. H. Income Taxes The Provision for income taxes is determined using the asset and liability approach taking into account guidance related to uncertain tax positions. Tax laws require items to be included in tax filings at different times than the items are reflected in the financial statements. A current liability is recognized for the estimated taxes payable for the current year. Deferred taxes represent the future tax consequences expected to occur when the reported amounts of assets and liabilities are recovered or paid. Deferred taxes are adjusted for enacted changes in tax rates and tax laws. Valuation allowances are recorded to reduce deferred tax assets when it is more likely than not that a tax benefit will not be realized. We join Caterpillar in the filing of a consolidated U.S. Federal income tax return and certain state income tax returns. In accordance with our tax sharing agreement with Caterpillar, we generally pay to or receive from Caterpillar our allocated share of income taxes or credits reflected in these consolidated filings. This amount is calculated on a separate return basis by taking taxable income times the applicable statutory tax rate and includes payment for certain tax attributes earned during the year. I. Foreign Currency Translation The functional currency for most of our subsidiaries is the respective local currency. Gains and losses resulting from the remeasurement of foreign currency amounts to the functional currency are included in Other income (expense) in the Consolidated Statements of Profit. Gains and losses resulting from translating assets and liabilities from the functional currency to U.S. dollars are included in Accumulated other comprehensive income/(loss) in the Consolidated Statements of Financial Position. J. Use of Estimates in the Preparation of Financial Statements The preparation of financial statements, in conformity with generally accepted accounting principles in the United States of America, requires management to make estimates and assumptions that affect the reported amounts. Significant estimates include the allowance for credit losses, residual values for leased assets, income taxes and the assumptions used to determine the fair value of derivatives. Actual results may differ from these estimates. K. New Accounting Pronouncements Reporting discontinued operations and disclosures of disposals of components of an entity – In April 2014, the Financial Accounting Standards Board (FASB) issued accounting guidance for determining which disposals can be presented as discontinued operations and modifies related disclosure requirements. The guidance defines a discontinued operation as a disposal of a component or group of components that is disposed of or is classified as held for sale and represents a strategic shift that has (or will have) a major effect on an entity's operations and financial results. This guidance was effective January 1, 2015 and did not have a material impact on our financial statements. Revenue recognition – In May 2014, the FASB issued new revenue recognition guidance to provide a single, comprehensive revenue recognition model for all contracts with customers. Under the new guidance, an entity will recognize revenue to depict the transfer of promised goods or services to customers at an amount that the entity expects to be entitled to in exchange for those goods or services. A five step model has been introduced for an entity to apply when recognizing revenue. The new guidance also includes enhanced disclosure requirements and is effective January 1, 2018, with early adoption permitted for January 1, 2017. Entities have the option to apply the new guidance under a retrospective approach to each prior reporting period presented, or a modified retrospective approach with the cumulative effect of initially applying the new guidance recognized at the date of initial application within the Consolidated Statement of Changes in Stockholder's Equity. We are in the process of evaluating the application and implementation of the new guidance. Variable interest entities – In February 2015, the FASB issued accounting guidance on the consolidation of VIEs. The new guidance revises previous guidance by establishing an analysis for determining whether a limited partnership or similar entity is a VIE and whether outsourced decision-maker fees are considered variable interests. In addition, the new guidance revises how a reporting entity evaluates economics and related parties when assessing who should consolidate a VIE. This guidance was effective January 1, 2016 and did not have a material impact on our financial statements. Presentation of debt issuance costs – In April 2015, the FASB issued accounting guidance which requires debt issuance costs to be presented in the balance sheet as a direct deduction from the carrying value of the associated debt liability. Prior to the issuance of the new guidance, debt issuance costs were required to be presented in the balance sheet as an asset. This guidance was effective January 1, 2016 and did not have a material impact on our financial statements. Recognition and measurement of financial assets and financial liabilities – In January 2016, the FASB issued accounting guidance that affects the accounting for equity investments, financial liabilities accounted for under the fair value option and the presentation and disclosure requirements for financial instruments. Under the new guidance, all equity investments in unconsolidated entities (other than those accounted for using the equity method of accounting) will generally be measured at fair value through earnings. There will no longer be an available-for-sale classification for equity securities with readily determinable fair values. For financial liabilities when the fair value option has been elected, changes in fair value due to instrument-specific credit risk will be recognized separately in other comprehensive income. In addition, the FASB clarified guidance related to the valuation allowance assessment when recognizing deferred tax assets resulting from unrealized losses on available-for-sale debt securities. The new guidance is effective January 1, 2018, with the cumulative effect adjustment from initially applying the new guidance recognized in the Statement of Financial Position as of the beginning of the year of adoption. We do not expect the adoption to have a material impact on our financial statements.

Accumulated Other Comprehensive

Accumulated Other Comprehensive Income/(Loss)	12 Months Ended
	Dec. 31, 2015
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]
Accumulated Other Comprehensive Income/(Loss)	ACCUMULATED OTHER COMPREHENSIVE INCOME/(LOSS) Comprehensive income/(loss) and its components are presented in the Consolidated Statements of Comprehensive Income. Changes in Accumulated other comprehensive income/(loss), net of tax, included in the Consolidated Statements of Changes in Stockholder's Equity, consisted of the following: (Millions of dollars) Foreign currency translation Derivative financial instruments Total Balance at December 31, 2012 $ 184 $ (8 ) $ 176 Other comprehensive income/(loss) before reclassifications (62 ) (1 ) (63 ) Amounts reclassified from accumulated other comprehensive (income)/loss — 4 4 Other comprehensive income/(loss) (62 ) 3 (59 ) Balance at December 31, 2013 $ 122 $ (5 ) $ 117 Other comprehensive income/(loss) before reclassifications (481 ) (4 ) (485 ) Amounts reclassified from accumulated other comprehensive (income)/loss — 4 4 Other comprehensive income/(loss) (481 ) — (481 ) Balance at December 31, 2014 $ (359 ) $ (5 ) $ (364 ) Other comprehensive income/(loss) before reclassifications (538 ) 2 (536 ) Amounts reclassified from accumulated other comprehensive (income)/loss — 3 3 Other comprehensive income/(loss) (538 ) 5 (533 ) Balance at December 31, 2015 $ (897 ) $ — $ (897 ) The effect of the reclassifications out of Accumulated other comprehensive income/(loss) on the Consolidated Statements of Profit during the years ended December 31, 2015 , 2014 and 2013 was as follows: (Millions of dollars) Classification of income (expense) 2015 2014 2013 Cross currency contracts Other income (expense) $ 1 $ — $ — Interest rate contracts Interest expense (6 ) (6 ) (6 ) Reclassifications before tax (5 ) (6 ) (6 ) Tax (provision) benefit 2 2 2 Total reclassifications from Accumulated other comprehensive income/(loss) $ (3 ) $ (4 ) $ (4 )

Finance Receivables

Finance Receivables	12 Months Ended
	Dec. 31, 2015
Receivables [Abstract]
Finance Receivables	FINANCE RECEIVABLES A summary of finance receivables included in the Consolidated Statements of Financial Position as of December 31, was as follows: (Millions of dollars) 2015 2014 Finance leases and installment sale contracts – Retail $ 13,728 $ 14,455 Retail notes receivable 10,616 11,005 Wholesale notes receivable 3,887 4,514 Finance leases and installment sale contracts – Wholesale 289 384 28,520 30,358 Less: Unearned income (794 ) (883 ) Less: Allowance for credit losses (338 ) (401 ) Total finance receivables, net $ 27,388 $ 29,074 Maturities of our finance receivables, as of December 31, 2015 , reflect contractual repayments due from borrowers and were as follows: (Millions of dollars) Amounts due in Retail Installment Sale Contracts Wholesale Installment Sale Contracts Retail Finance Leases Wholesale Finance Leases Retail Notes Wholesale Notes Total 2016 $ 2,597 $ 48 $ 2,543 $ 53 $ 4,297 $ 3,495 $ 13,033 2017 2,015 7 1,661 52 1,940 232 5,907 2018 1,368 3 939 38 1,450 158 3,956 2019 699 1 425 18 1,024 2 2,169 2020 202 — 170 6 929 — 1,307 Thereafter 11 — 98 2 976 — 1,087 Total 6,892 59 5,836 169 10,616 3,887 27,459 Guaranteed residual value — — 334 35 — — 369 Unguaranteed residual value — — 666 26 — — 692 Total $ 6,892 $ 59 $ 6,836 $ 230 $ 10,616 $ 3,887 $ 28,520 Our finance receivables generally may be repaid or refinanced without penalty prior to contractual maturity and we also sell finance receivables to third parties to mitigate the concentration of credit risk with certain customers. Accordingly, this presentation should not be regarded as a forecast of future cash collections. Allowance for Credit Losses The allowance for credit losses is an estimate of the losses inherent in our finance receivable portfolio and includes consideration of accounts that have been individually identified as impaired, as well as pools of finance receivables where it is probable that certain receivables in the pool are impaired but the individual accounts cannot yet be identified. In identifying and measuring impairment, management takes into consideration past loss experience, known and inherent risks in the portfolio, adverse situations that may affect the borrower’s ability to repay, estimated value of underlying collateral and current economic conditions. Accounts are identified for individual review based on past-due status and information available about the customer, such as financial statements, news reports and published credit ratings, as well as general information regarding industry trends and the economic environment in which our customers operate. The allowance for credit losses attributable to finance receivables that are individually evaluated and determined to be impaired is based either on the present value of expected future cash flows discounted at the receivables' effective interest rate or the fair value of the collateral for collateral-dependent receivables. In determining collateral value, we estimate the current fair market value of the collateral less selling costs. We also consider credit enhancements such as additional collateral and contractual third-party guarantees. The allowance for credit losses attributable to the remaining accounts not yet individually identified as impaired is estimated based on loss forecast models utilizing probabilities of default, our estimate of the loss emergence period and the estimated loss given default. In addition, qualitative factors not able to be fully captured in our loss forecast models including industry trends, macroeconomic factors and model imprecision are considered in the evaluation of the adequacy of the allowance for credit losses. These qualitative factors are subjective and require a degree of management judgment. Our allowance for credit losses is segregated into three portfolio segments: • Customer - Finance receivables with retail customers. • Dealer - Finance receivables with Caterpillar dealers. • Caterpillar Purchased Receivables - Trade receivables purchased from Caterpillar entities. A portfolio segment is the level at which the Company develops a systematic methodology for determining its allowance for credit losses. We further evaluate our portfolio segments by the class of finance receivables, which is defined as a level of information (below a portfolio segment) in which the finance receivables have the same initial measurement attribute and a similar method for assessing and monitoring credit risk. Typically, our finance receivables within a geographic area have similar credit risk profiles and methods for assessing and monitoring credit risk. Our classes, which align with management reporting for credit losses, are as follows: • North America - Finance receivables originated in the United States or Canada. • Europe - Finance receivables originated in Europe, Africa, Middle East and the Commonwealth of Independent States. • Asia/Pacific - Finance receivables originated in Australia, New Zealand, China, Japan, South Korea and Southeast Asia. • Mining - Finance receivables related to large mining customers worldwide. • Latin America - Finance receivables originated in Central and South American countries and Mexico. • Caterpillar Power Finance - Finance receivables related to marine vessels with Caterpillar engines worldwide and Caterpillar electrical power generation, gas compression and co-generation systems and non-Caterpillar equipment that is powered by these systems worldwide. Our allowance for credit losses as of December 31, 2015 was $338 million or 1.22 percent of net finance receivables compared with $401 million or 1.36 percent as of December 31, 2014 , which is a decrease of $63 million . The decrease in allowance rate is primarily a result of changes in our estimate of the loss emergence period and loss given default. An analysis of the allowance for credit losses was as follows: (Millions of dollars) December 31, 2015 Allowance for Credit Losses: Customer Dealer Caterpillar Purchased Receivables Total Balance at beginning of year $ 388 $ 10 $ 3 $ 401 Receivables written off (196 ) — — (196 ) Recoveries on receivables previously written off 41 — — 41 Provision for credit losses 119 (1 ) (1 ) 117 Adjustment due to sale of receivables (2 ) — — (2 ) Foreign currency translation adjustment (23 ) — — (23 ) Balance at end of year $ 327 $ 9 $ 2 $ 338 Individually evaluated for impairment $ 65 $ — $ — $ 65 Collectively evaluated for impairment 262 9 2 273 Ending Balance $ 327 $ 9 $ 2 $ 338 Recorded Investment in Finance Receivables: Individually evaluated for impairment $ 601 $ — $ — $ 601 Collectively evaluated for impairment 19,431 5,093 2,601 27,125 Ending Balance $ 20,032 $ 5,093 $ 2,601 $ 27,726 (Millions of dollars) December 31, 2014 Allowance for Credit Losses: Customer Dealer Caterpillar Purchased Receivables Total Balance at beginning of year $ 374 $ 10 $ 3 $ 387 Receivables written off (146 ) — — (146 ) Recoveries on receivables previously written off 47 — — 47 Provision for credit losses 136 — — 136 Adjustment due to sale of receivables (3 ) — — (3 ) Foreign currency translation adjustment (20 ) — — (20 ) Balance at end of year $ 388 $ 10 $ 3 $ 401 Individually evaluated for impairment $ 75 $ — $ — $ 75 Collectively evaluated for impairment 313 10 3 326 Ending Balance $ 388 $ 10 $ 3 $ 401 Recorded Investment in Finance Receivables: Individually evaluated for impairment $ 614 $ — $ — $ 614 Collectively evaluated for impairment 20,454 5,169 3,238 28,861 Ending Balance $ 21,068 $ 5,169 $ 3,238 $ 29,475 Credit quality of finance receivables At origination, we evaluate credit risk based on a variety of credit quality factors including prior payment experience, customer financial information, credit-rating agency ratings, loan-to-value ratios and other internal metrics. On an ongoing basis, we monitor credit quality based on past-due status and collection experience as there is a meaningful correlation between the past-due status of customers and the risk of loss. In determining past-due status, we consider the entire finance receivable balance past due when any installment is over 30 days past due. The tables below summarize our recorded investment of finance receivables by aging category. (Millions of dollars) December 31, 2015 31-60 Days Past Due 61-90 Days Past Due 91+ Days Past Due Total Past Due Current Total Finance Receivables 91+ Still Accruing Customer North America $ 45 $ 12 $ 30 $ 87 $ 8,031 $ 8,118 $ 4 Europe 18 7 44 69 2,358 2,427 9 Asia/Pacific 22 12 21 55 2,108 2,163 6 Mining 6 1 68 75 1,793 1,868 1 Latin America 45 31 199 275 1,998 2,273 — Caterpillar Power Finance — 1 35 36 3,147 3,183 2 Dealer North America — — — — 3,387 3,387 — Europe — — — — 330 330 — Asia/Pacific — — — — 611 611 — Mining — — — — 4 4 — Latin America — — — — 758 758 — Caterpillar Power Finance — — — — 3 3 — Caterpillar Purchased Receivables North America 16 5 1 22 1,386 1,408 1 Europe 4 — 4 8 307 315 3 Asia/Pacific — — — — 407 407 — Mining — — — — — — — Latin America — — — — 454 454 — Caterpillar Power Finance — 1 — 1 16 17 — Total $ 156 $ 70 $ 402 $ 628 $ 27,098 $ 27,726 $ 26 (Millions of dollars) December 31, 2014 31-60 Days Past Due 61-90 Days Past Due 91+ Days Past Due Total Past Due Current Total Finance Receivables 91+ Still Accruing Customer North America $ 46 $ 8 $ 27 $ 81 $ 7,291 $ 7,372 $ 4 Europe 16 23 29 68 2,607 2,675 6 Asia/Pacific 29 22 69 120 2,773 2,893 16 Mining 28 — 11 39 2,084 2,123 — Latin America 55 23 196 274 2,583 2,857 8 Caterpillar Power Finance 1 4 64 69 3,079 3,148 1 Dealer North America — — — — 3,209 3,209 — Europe — — — — 467 467 — Asia/Pacific — — — — 637 637 — Mining — — — — 3 3 — Latin America — — — — 853 853 — Caterpillar Power Finance — — — — — — — Caterpillar Purchased Receivables North America 23 5 1 29 1,916 1,945 1 Europe 4 1 5 10 429 439 1 Asia/Pacific — — — — 401 401 — Mining — — — — — — — Latin America 6 5 — 11 420 431 — Caterpillar Power Finance — — 1 1 21 22 1 Total $ 208 $ 91 $ 403 $ 702 $ 28,773 $ 29,475 $ 38 Impaired finance receivables For all classes, a finance receivable is considered impaired, based on current information and events, if it is probable that we will be unable to collect all amounts due according to the contractual terms. Impaired finance receivables include finance receivables that have been restructured and are considered to be Troubled Debt Restructures. There were no impaired finance receivables as of December 31, 2015 , 2014 and 2013 , for the Dealer and Caterpillar Purchased Receivables portfolio segments. Our recorded investment in impaired finance receivables and the related unpaid principal balances and allowance for the Customer portfolio segment were as follows: (Millions of dollars) As of December 31, 2015 As of December 31, 2014 Impaired Finance Receivables With No Allowance Recorded Recorded Investment Unpaid Principal Balance Related Allowance Recorded Investment Unpaid Principal Balance Related Allowance North America $ 12 $ 12 $ — $ 14 $ 14 $ — Europe 41 41 — 44 43 — Asia/Pacific 1 1 — 2 2 — Mining 84 84 — 29 29 — Latin America 28 28 — 34 34 — Caterpillar Power Finance 242 241 — 129 128 — Total $ 408 $ 407 $ — $ 252 $ 250 $ — Impaired Finance Receivables With An Allowance Recorded North America $ 14 $ 13 $ 4 $ 6 $ 6 $ 1 Europe 11 10 5 12 12 4 Asia/Pacific 34 34 4 29 29 8 Mining 11 11 3 138 137 9 Latin America 53 53 21 42 42 12 Caterpillar Power Finance 70 70 28 135 134 41 Total $ 193 $ 191 $ 65 $ 362 $ 360 $ 75 Total Impaired Finance Receivables North America $ 26 $ 25 $ 4 $ 20 $ 20 $ 1 Europe 52 51 5 56 55 4 Asia/Pacific 35 35 4 31 31 8 Mining 95 95 3 167 166 9 Latin America 81 81 21 76 76 12 Caterpillar Power Finance 312 311 28 264 262 41 Total $ 601 $ 598 $ 65 $ 614 $ 610 $ 75 (Millions of dollars) Year Ended Year Ended Year Ended Impaired Finance Receivables With No Allowance Recorded Average Recorded Investment Interest Income Recognized Average Recorded Investment Interest Income Recognized Average Recorded Investment Interest Income Recognized North America $ 12 $ 1 $ 20 $ 1 $ 25 $ 3 Europe 42 1 47 1 49 1 Asia/Pacific 2 — 3 — 4 — Mining 75 3 69 3 61 3 Latin America 31 — 30 — 11 — Caterpillar Power Finance 170 5 164 6 271 5 Total $ 332 $ 10 $ 333 $ 11 $ 421 $ 12 Impaired Finance Receivables With An Allowance Recorded North America $ 9 $ — $ 9 $ — $ 18 $ 1 Europe 14 1 21 1 22 1 Asia/Pacific 44 2 23 1 18 1 Mining 39 1 90 7 1 — Latin America 56 3 36 1 52 2 Caterpillar Power Finance 115 3 96 2 135 1 Total $ 277 $ 10 $ 275 $ 12 $ 246 $ 6 Total Impaired Finance Receivables North America $ 21 $ 1 $ 29 $ 1 $ 43 $ 4 Europe 56 2 68 2 71 2 Asia/Pacific 46 2 26 1 22 1 Mining 114 4 159 10 62 3 Latin America 87 3 66 1 63 2 Caterpillar Power Finance 285 8 260 8 406 6 Total $ 609 $ 20 $ 608 $ 23 $ 667 $ 18 Recognition of income is suspended and the finance receivable is placed on non-accrual status when management determines that collection of future income is not probable (generally after 120 days past due). Recognition is resumed and previously suspended income is recognized when the finance receivable becomes current and collection of remaining amounts is considered probable. Payments received while the finance receivable is on non-accrual status are applied to interest and principal in accordance with the contractual terms. As of December 31, 2015 and 2014 , there were no finance receivables on non-accrual status for the Dealer portfolio segment. As of December 31, 2015 and 2014 , there was $1 million and $4 million, respectively, in finance receivables on non-accrual status for the Caterpillar Purchased Receivables portfolio segment, all of which was in the Europe finance receivable class. The investment in Customer finance receivables on non-accrual status as of December 31, was as follows: (Millions of dollars) 2015 2014 North America $ 31 $ 27 Europe 39 28 Asia/Pacific 15 54 Mining 106 62 Latin America 217 201 Caterpillar Power Finance 77 96 Total $ 485 $ 468 Troubled debt restructurings A restructuring of a finance receivable constitutes a troubled debt restructuring (TDR) when the lender grants a concession it would not otherwise consider to a borrower experiencing financial difficulties. Concessions granted may include extended contract maturities, inclusion of interest only periods, below market interest rates, extended skip payment periods and reduction of principal and/or accrued interest. As of December 31, 2015 , there were $3 million of additional funds committed to lend to a borrower whose terms have been modified in a TDR. There were no remaining commitments to lend additional funds to a borrower whose terms have been modified in a TDR as of December 31, 2014 and 2013 . There were no finance receivables modified as TDRs during the years ended December 31, 2015 , 2014 and 2013 for the Dealer or Caterpillar Purchased Receivables portfolio segments. Finance receivables in the Customer portfolio segment modified as TDRs during the years ended December 31, 2015 , 2014 and 2013 , were as follows: (Dollars in millions) Year Ended Number of Contracts Pre-TDR Recorded Investment Post-TDR Recorded Investment North America 14 $ 1 $ 1 Europe 23 2 2 Asia/Pacific 21 26 26 Mining 4 65 65 Latin America 11 1 2 Caterpillar Power Finance 21 259 242 Total 94 $ 354 $ 338 Year Ended Number of Contracts Pre-TDR Recorded Investment Post-TDR Recorded Investment North America 34 $ 12 $ 7 Europe 8 7 7 Asia/Pacific 2 — — Mining 51 185 176 Latin America 35 31 30 Caterpillar Power Finance 18 137 139 Total 148 $ 372 $ 359 Year Ended Number of Contracts Pre-TDR Recorded Investment Post-TDR Recorded Investment North America 62 $ 9 $ 9 Europe 51 7 7 Asia/Pacific 3 1 1 Mining 45 123 123 Latin America 32 3 3 Caterpillar Power Finance 17 153 157 Total 210 $ 296 $ 300 During the years ended December 31, 2015 and 2013 , $4 million and $25 million , respectively, of additional funds were subsequently loaned to a borrower whose terms had been modified in a TDR. The $4 million and $25 million of additional funds are not reflected in the tables above as no incremental modifications have been made with those borrowers during the periods presented. During the year ended December 31, 2014 , no additional funds were subsequently loaned to a borrower whose terms had been modified in a TDR. TDRs in the Customer portfolio segment with a payment default during the years ended December 31, 2015 , 2014 and 2013 , which had been modified within twelve months prior to the default date, were as follows: (Dollars in millions) Year Ended Year Ended Year Ended Number of Contracts Post-TDR Recorded Investment Number of Contracts Post-TDR Recorded Investment Number of Contracts Post-TDR Recorded Investment North America 12 $ 1 11 $ 1 19 $ 4 Europe — — 46 2 5 — Latin America 12 1 11 1 — — Caterpillar Power Finance — — — — 2 3 Total 24 $ 2 68 $ 4 26 $ 7

Equipment on Operating Leases

Equipment on Operating Leases	12 Months Ended
	Dec. 31, 2015
Leases [Abstract]
Equipment on Operating Leases	EQUIPMENT ON OPERATING LEASES Components of equipment on operating leases, less accumulated depreciation as of December 31, were as follows: (Millions of dollars) 2015 2014 Equipment on operating leases, at cost $ 5,202 $ 5,273 Less: Accumulated depreciation (1,638 ) (1,649 ) Equipment on operating leases, net $ 3,564 $ 3,624 At December 31, 2015 , scheduled minimum rental payments for operating leases were as follows: 2016 2017 2018 2019 2020 Thereafter Total $ 818 $ 522 $ 308 $ 142 $ 49 $ 12 $ 1,851

Other Assets

Other Assets	12 Months Ended
	Dec. 31, 2015
Other Assets [Abstract]
Other Assets	OTHER ASSETS The components of other assets as of December 31, were as follows: (Millions of dollars) 2015 2014 Collateral held for resale, at net realizable value $ 560 $ 321 Customer and other miscellaneous receivables 421 428 Other 224 252 Total other assets $ 1,205 $ 1,001

Concentration of Credit Risk

Concentration of Credit Risk	12 Months Ended
	Dec. 31, 2015
Risks and Uncertainties [Abstract]
Concentration of Credit Risk	CONCENTRATION OF CREDIT RISK Financial instruments with potential credit risk consist primarily of finance receivables. Additionally, to a lesser extent, we have potential credit risk associated with counterparties to derivative contracts. As of December 31, 2015 and 2014 , receivables from customers in construction-related industries made up approximately one-third of our total portfolio of which customers in North America were approximately 60 percent and 50 percent, respectively. No single customer or dealer represented a significant concentration of credit risk. We typically maintain a security interest in retail financed equipment and in some instances, wholesale financed equipment. We also require physical damage insurance coverage on all financed equipment. See Note 16 for further information concerning business segments. For derivative contracts, collateral is generally not required of the counterparties or of us. We enter into International Swaps and Derivatives Association (ISDA) master netting agreements that permit the net settlement of amounts owed under their respective derivative contracts. Our exposure to credit loss in the event of nonperformance by the counterparties is limited to only those gains that we have recorded, but for which we have not yet received cash payment. The master netting agreements reduce the amount of loss the company would incur should the counterparties fail to meet their obligations. At December 31, 2015 and 2014 , the maximum exposure to credit loss, was $91 million and $101 million , respectively, before the application of any master netting agreements. See Note 10 for further information concerning derivatives.

Credit Commitments

Credit Commitments	12 Months Ended
	Dec. 31, 2015
Credit Commitments [Abstract]
Credit Commitments	CREDIT COMMITMENTS Revolving credit facilities We have three global credit facilities with a syndicate of banks totaling $10.50 billion (Credit Facility) available in the aggregate to both Caterpillar and us for general liquidity purposes. Based on management's allocation decision, which can be revised from time to time, the portion of the Credit Facility available to us as of December 31, 2015 was $7.75 billion . • The 364-day facility of $3.15 billion (of which $2.33 billion is available to us) expires in September 2016. • The three-year facility, as amended and restated in September 2015, of $2.73 billion (of which $2.01 billion is available to us) expires in September 2018. • The five-year facility, as amended and restated in September 2015, of $4.62 billion (of which $3.41 billion is available to us) expires in September 2020. At December 31, 2015 , Caterpillar’s consolidated net worth was $19.92 billion , which was above the $9.00 billion required under the Credit Facility. The consolidated net worth is defined in the Credit Facility as the consolidated stockholders' equity including preferred stock but excluding the pension and other postretirement benefits balance within Accumulated other comprehensive income/(loss). At December 31, 2015 , our covenant interest coverage ratio was 2.05 to 1 . This is above the 1.15 to 1 minimum ratio, calculated as (1) profit excluding income taxes, interest expense and net gain/(loss) from interest rate derivatives to (2) interest expense calculated at the end of each calendar quarter for the rolling four quarter period then most recently ended, required by the Credit Facility. In addition, at December 31, 2015 , our six-month covenant leverage ratio was 7.49 to 1 and our year-end covenant leverage ratio was 7.93 to 1 . This is below the maximum ratio of debt to net worth of 10 to 1 , calculated (1) on a monthly basis as the average of the leverage ratios determined on the last day of each of the six preceding calendar months and (2) at each December 31, required by the Credit Facility. In the event that either Caterpillar or we do not meet one or more of our respective financial covenants under the Credit Facility in the future (and are unable to obtain a consent or waiver), the syndicate of banks may terminate the commitments allocated to the party that does not meet its covenants. Additionally, in such event, certain of our other lenders under other loan agreements where similar financial covenants or cross default provisions are applicable, may, at their election, choose to pursue remedies under those loan agreements, including accelerating the repayment of outstanding borrowings. At December 31, 2015 , there were no borrowings under the Credit Facility. Bank borrowings Credit lines with banks as of December 31, 2015 totaled $3.57 billion . These committed and uncommitted credit lines, which may be eligible for renewal at various future dates or have no specified expiration date, are used primarily by our non-U.S. subsidiaries for local funding requirements. The remaining available credit commitments may be withdrawn any time at the lenders' discretion. As of December 31, 2015 and 2014 , we had $1.44 billion and $1.90 billion , respectively, outstanding against these credit lines and were in compliance with all debt covenants under these credit lines. Variable denomination floating rate demand notes We obtain funding from the sale of variable denomination floating rate demand notes, which may be redeemed at any time at the option of the holder without any material restriction. We do not hold reserves to fund the payment of the demand notes. The notes are offered on a continuous basis. Notes receivable from/payable to Caterpillar Under our variable amount lending agreements and other notes receivable with Caterpillar, we may borrow up to $2.28 billion from Caterpillar and Caterpillar may borrow up to $1.29 billion from us. The agreements are in effect for indefinite periods of time and may be changed or terminated by either party with 30 days notice. We had notes receivable of $490 million and notes payable of $1.10 billion outstanding under these agreements as of December 31, 2015 , compared with notes receivable of $414 million and notes payable of $1.11 billion as of December 31, 2014 . Committed credit facility We extended a $2 billion committed credit facility to Caterpillar, which expires in February 2019. We receive a fee from Caterpillar based on amounts drawn under the credit facility and a commitment fee for the undrawn amounts under the credit facility. At December 31, 2015 , there were no borrowings under this credit facility.

Short-Term Borrowings

Short-Term Borrowings	12 Months Ended
	Dec. 31, 2015
Short-term Debt [Abstract]
Short-Term Borrowings	SHORT-TERM BORROWINGS Short-term borrowings outstanding as of December 31, were comprised of the following: (Millions of dollars) 2015 2014 Balance Avg. Rate Balance Avg. Rate Commercial paper, net $ 5,811 0.5% $ 3,688 0.3% Bank borrowings 440 9.3% 411 6.8% Variable denomination floating rate demand notes 707 0.8% 600 0.8% Total $ 6,958 $ 4,699

Long-Term Debt

Long-Term Debt	12 Months Ended
	Dec. 31, 2015
Long-term Debt, Unclassified [Abstract]
Long-Term Debt	LONG-TERM DEBT During 2015 , we issued $3.76 billion of medium-term notes, of which $2.87 billion were at fixed interest rates and $891 million were at floating interest rates, primarily indexed to LIBOR. At December 31, 2015 , the outstanding medium-term notes had remaining maturities ranging up to 12 years . Debt issuance costs are capitalized and amortized to Interest expense using the straight-line method over the term of the debt issuance. The balance of our Medium-term notes contains unamortized fair value adjustments for debt in a fair value hedge relationship. Long-term debt outstanding as of December 31, was comprised of the following: (Millions of dollars) 2015 2014 Balance Avg. Rate Balance Avg. Rate Medium-term notes $ 20,611 2.4% $ 23,094 2.4% Unamortized discount (1 ) (4 ) Medium-term notes, net 20,610 23,090 Bank borrowings 995 4.0% 1,484 3.4% Total $ 21,605 $ 24,574 Long-term debt outstanding as of December 31, 2015 , matures as follows: ( Millions of dollars) 2016 $ 5,362 2017 5,866 2018 4,154 2019 2,531 2020 1,125 Thereafter 2,567 Total $ 21,605

Derivative Financial Instrument

Derivative Financial Instruments and Risk Management	12 Months Ended
	Dec. 31, 2015
Derivative Instruments and Hedging Activities Disclosure [Abstract]
Derivative Financial Instruments and Risk Management	DERIVATIVE FINANCIAL INSTRUMENTS AND RISK MANAGEMENT Our earnings and cash flow are subject to fluctuations due to changes in foreign currency exchange rates and interest rates. Our Risk Management Policy (policy) allows for the use of derivative financial instruments to manage foreign currency exchange rate and interest rate exposures. Our policy specifies that derivatives are not to be used for speculative purposes. Derivatives that we use are primarily foreign currency forward, option and cross currency contracts and interest rate swaps. Our derivative activities are subject to the management, direction and control of our senior financial officers. Risk management practices, including the use of financial derivative instruments, are presented to our Board of Directors and the Audit Committee of the Caterpillar Inc. Board of Directors at least annually. All derivatives are recognized on the Consolidated Statements of Financial Position at their fair value. On the date the derivative contract is entered into, the derivative instrument is (1) designated as a hedge of the fair value of a recognized asset or liability (fair value hedge), (2) designated as a hedge of a forecasted transaction or the cash flow variability associated with variable-rate debt (cash flow hedge) or (3) undesignated. Changes in the fair value of a derivative that is qualified, designated and highly effective as a fair value hedge, along with the gain or loss on the hedged recognized asset or liability that is attributable to the hedged risk, are recorded in current earnings. Changes in the fair value of a derivative that is qualified, designated and highly effective as a cash flow hedge are recorded in Accumulated other comprehensive income/(loss) (AOCI), to the extent effective, on the Consolidated Statements of Financial Position until they are reclassified to earnings in the same period or periods during which the hedged transaction affects earnings. Changes in the fair value of undesignated derivative instruments and the ineffective portion of designated derivative instruments are reported in current earnings. Cash flows from designated derivative financial instruments are classified within the same category as the item being hedged on the Consolidated Statements of Cash Flows. Cash flows from undesignated derivative financial instruments are included in the investing category on the Consolidated Statements of Cash Flows. We formally document all relationships between hedging instruments and hedged items, as well as the risk-management objective and strategy for undertaking various hedge transactions. This process includes linking all derivatives that are designated as fair value hedges to specific assets and liabilities on the Consolidated Statements of Financial Position and linking cash flow hedges to specific forecasted transactions or variability of cash flow. We also formally assess, both at the hedge’s inception and on an ongoing basis, whether the designated derivatives that are used in hedging transactions are highly effective in offsetting changes in fair value or cash flow of hedged items. When a derivative is determined not to be highly effective as a hedge or the underlying hedged transaction is no longer probable, we discontinue hedge accounting prospectively, in accordance with derecognition criteria for hedge accounting. Foreign currency exchange rate risk We have balance sheet positions and expected future transactions denominated in foreign currencies, thereby creating exposure to movements in exchange rates. In managing foreign currency risk, our objective is to minimize earnings volatility resulting from conversion and the remeasurement of net foreign currency balance sheet positions and future transactions denominated in foreign currencies. Our policy allows the use of foreign currency forward, option and cross currency contracts to offset the risk of currency mismatch between our assets and liabilities and exchange rate risk associated with future transactions denominated in foreign currencies. Substantially all such foreign currency forward, option and cross currency contracts are undesignated. Interest rate risk Interest rate movements create a degree of risk by affecting the amount of our interest payments and the value of our fixed-rate debt. Our practice is to use interest rate swaps to manage our exposure to interest rate changes. We have a match-funding policy that addresses interest rate risk by aligning the interest rate profile (fixed or floating rate and duration) of our debt portfolio with the interest rate profile of our receivables portfolio within predetermined ranges on an ongoing basis. In connection with that policy, we use interest rate derivative instruments to modify the debt structure to match assets within the receivables portfolio. This matched funding reduces the volatility of margins between interest-bearing assets and interest-bearing liabilities, regardless of which direction interest rates move. Our policy allows us to use fixed-to-floating, floating-to-fixed and floating-to-floating interest rate swaps to meet the match-funding objective. We designate fixed-to-floating interest rate swaps as fair value hedges to protect debt against changes in fair value due to changes in the benchmark interest rate. We designate most floating-to-fixed interest rate swaps as cash flow hedges to protect against the variability of cash flows due to changes in the benchmark interest rate. As of December 31, 2015 , less than $1 million of deferred net losses, net of tax, included in equity (AOCI in the Consolidated Statements of Financial Position), related to our floating-to-fixed interest rate swaps, are expected to be reclassified to Interest expense over the next twelve months. The actual amount recorded in Interest expense will vary based on interest rates at the time the hedged transactions impact earnings. We have, at certain times, liquidated fixed-to-floating interest rate swaps that resulted in deferred gains at the time of liquidation. The deferred gains associated with these interest rate swaps are included in Long-term debt in the Consolidated Statements of Financial Position and are being amortized to Interest expense over the remaining term of the previously designated hedged item. The location and fair value of derivative instruments reported in the Consolidated Statements of Financial Position were as follows: (Millions of dollars) Asset (Liability) Fair Value December 31, Consolidated Statements of Financial Position Location 2015 2014 Designated derivatives Interest rate contracts Other assets $ 51 $ 79 Interest rate contracts Accrued expenses (4 ) (8 ) Cross currency contracts Other assets 1 — $ 48 $ 71 Undesignated derivatives Foreign exchange contracts Other assets $ 3 $ 5 Foreign exchange contracts Accrued expenses (6 ) (15 ) Cross currency contracts Other assets 36 17 $ 33 $ 7 The total notional amounts of the derivative instruments were $3.54 billion and $5.25 billion as of December 31, 2015 and 2014 , respectively. The notional amounts of the derivative financial instruments do not represent amounts exchanged by the parties. The amounts exchanged by the parties are calculated by reference to the notional amounts and by other terms of the derivatives, such as foreign currency exchange rates and interest rates. For the years ended December 31, 2015 , 2014 and 2013 , the deferred gains (losses) recorded in AOCI on the Consolidated Statements of Changes in Stockholder’s Equity associated with our cash flow interest rate contract hedges were as follows: (Millions of dollars) Balance as of December 31, 2014, net of tax (expense)/benefit of $3 $ (5 ) Gains (losses) deferred during the year, net of tax (expense)/benefit of $(1) 2 (Gains) losses reclassified to earnings, net of tax expense/(benefit) of $(2) 3 Balance as of December 31, 2015, net of tax (expense)/benefit of $0 $ — (Millions of dollars) Balance as of December 31, 2013, net of tax (expense)/benefit of $3 $ (5 ) Gains (losses) deferred during the year, net of tax (expense)/benefit of $2 (4 ) (Gains) losses reclassified to earnings, net of tax expense/(benefit) of $(2) 4 Balance as of December 31, 2014, net of tax (expense)/benefit of $3 $ (5 ) (Millions of dollars) Balance as of December 31, 2012, net of tax (expense)/benefit of $4 $ (8 ) Gains (losses) deferred during the year, net of tax (expense)/benefit of $1 (1 ) (Gains) losses reclassified to earnings, net of tax expense/(benefit) of $(2) 4 Balance as of December 31, 2013, net of tax (expense)/benefit of $3 $ (5 ) The effect of derivatives designated as hedging instruments on the Consolidated Statements of Profit was as follows: Fair Value Hedges (Millions of dollars) Year Ended December 31, 2015 Classification Gains (Losses) on Derivatives Gains (Losses) on Borrowings Interest rate contracts Other income (expense) $ (27 ) $ 26 Year Ended December 31, 2014 Classification Gains (Losses) on Derivatives Gains (Losses) on Borrowings Interest rate contracts Other income (expense) $ (41 ) $ 40 Year Ended December 31, 2013 Classification Gains (Losses) on Derivatives Gains (Losses) on Borrowings Interest rate contracts Other income (expense) $ (107 ) $ 109 Cash Flow Hedges (Millions of dollars) Year Ended December 31, 2015 Classification Reclassified from AOCI to Earnings (Effective Portion) Recognized in Earnings (Ineffective Portion) Interest rate contracts Interest expense $ (6 ) $ — Interest rate contracts Other income (expense) — — Cross currency contracts Other income (expense) 1 — $ (5 ) $ — Year Ended December 31, 2014 Classification Reclassified from AOCI to Earnings (Effective Portion) Recognized in Earnings (Ineffective Portion) Interest rate contracts Interest expense $ (6 ) $ — Interest rate contracts Other income (expense) — — $ (6 ) $ — Year Ended December 31, 2013 Classification Reclassified from AOCI to Earnings (Effective Portion) Recognized in Earnings (Ineffective Portion) Interest rate contracts Interest expense $ (6 ) $ — Interest rate contracts Other income (expense) — 1 $ (6 ) $ 1 The effect of derivatives not designated as hedging instruments on the Consolidated Statements of Profit was as follows for the years ended December 31: Undesignated Derivatives (Millions of dollars) Classification 2015 2014 2013 Foreign exchange contracts Other income (expense) $ (50 ) $ (49 ) $ 3 Cross currency contracts Other income (expense) 16 2 5 Interest rate contracts Other income (expense) — — (3 ) $ (34 ) $ (47 ) $ 5 Balance sheet offsetting We enter into International Swaps and Derivatives Association (ISDA) master netting agreements that permit the net settlement of amounts owed under their respective derivative contracts. Under these master netting agreements, net settlement generally permits us or the counterparty to determine the net amount payable for contracts due on the same date and in the same currency for similar types of derivative transactions. The master netting agreements generally also provide for net settlement of all outstanding contracts with a counterparty in the case of an event of default or a termination event. Collateral is generally not required of the counterparties or us under the master netting agreements. As of December 31, 2015 , 2014 and 2013 , no cash collateral was received or pledged under the master netting agreements. The effect of net settlement provisions of the master netting agreements on our derivative balances upon an event of default or a termination event as of December 31, was as follows: Offsetting of Derivative Assets and Liabilities (Millions of dollars) 2015 2014 Derivative Assets Gross Amount of Recognized Assets $ 91 $ 101 Gross Amounts Offset — — Net Amount of Assets (1) 91 101 Gross Amounts Not Offset (5 ) (8 ) Net Amount $ 86 $ 93 Derivative Liabilities Gross Amount of Recognized Liabilities $ (10 ) $ (23 ) Gross Amounts Offset — — Net Amount of Liabilities (1) (10 ) (23 ) Gross Amounts Not Offset 5 8 Net Amount $ (5 ) $ (15 ) (1) As presented in the Consolidated Statements of Financial Position.

Commitments and Contingent Liab

Commitments and Contingent Liabilities	12 Months Ended
	Dec. 31, 2015
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingent Liabilities	COMMITMENTS AND CONTINGENT LIABILITIES We provide loan guarantees to third-party lenders for financing associated with machinery purchased by customers. These guarantees have varying terms and are secured by the machinery being financed. In addition, we participate in standby letters of credit issued to third parties on behalf of our customers. These standby letters of credit have varying terms and beneficiaries and are secured by customer assets. No significant loss has been experienced or is anticipated under any of these guarantees. At December 31, 2015 and 2014 , the related liability was less than $1 million and $1 million , respectively. The maximum potential amount of future payments (undiscounted and without reduction for any amounts that may possibly be recovered under recourse or collateralized provisions) we could be required to make under the guarantees was $39 million and $42 million , at December 31, 2015 and 2014 , respectively. We provide guarantees to repurchase certain loans of Caterpillar dealers from a special purpose corporation (SPC) that qualifies as a VIE (see Note 1 for additional information regarding the accounting guidance on the consolidation of VIEs). The purpose of the SPC is to provide short-term working capital loans to Caterpillar dealers. This SPC issues commercial paper and uses the proceeds to fund its loan program. We have a loan purchase agreement with the SPC that obligates us to purchase certain loans that are not paid at maturity. We receive a fee for providing this guarantee, which provides a source of liquidity for the SPC. We are the primary beneficiary of the SPC as our guarantees result in us having both the power to direct the activities that most significantly impact the SPC's economic performance and the obligation to absorb losses and therefore we have consolidated the financial statements of the SPC. As of December 31, 2015 and 2014 , the SPC’s assets of $1.21 billion and $1.09 billion , respectively, were primarily comprised of loans to dealers, which are included in Retail notes receivable in the Consolidated Statements of Financial Position, and the SPC's liabilities of $1.21 billion and $1.08 billion , respectively, were primarily comprised of commercial paper, which is included in Short-term borrowings in the Consolidated Statements of Financial Position. The assets of the SPC are not available to pay our creditors. We may be obligated to perform under the guarantee if the SPC experiences losses. No loss has been experienced or is anticipated under this loan purchase agreement. We are party to agreements in the normal course of business with selected customers and Caterpillar dealers in which we commit to provide a set dollar amount of financing on a pre-approved basis. We also provide lines of credit to certain customers and Caterpillar dealers, of which a portion remains unused as of the end of the period. Commitments and lines of credit generally have fixed expiration dates or other termination clauses. It has been our experience that not all commitments and lines of credit will be used. Management applies the same credit policies when making commitments and granting lines of credit as it does for any other financing. We do not require collateral for these commitments/lines, but if credit is extended, collateral may be required upon funding. As of December 31, 2015 and 2014 , the amount of the unused commitments and lines of credit for dealers was $13.12 billion and $12.55 billion , respectively. As of December 31, 2015 and 2014 , the amount of the unused commitments and lines of credit for customers was $3.57 billion and $4.00 billion , respectively. We are involved in unresolved legal actions that arise in the normal course of business. Although it is not possible to predict with certainty the outcome of our unresolved legal actions, we believe that these unresolved legal actions will neither individually nor in the aggregate have a material adverse effect on our consolidated results of operations, financial position or liquidity.

Income Taxes

Income Taxes	12 Months Ended
	Dec. 31, 2015
Income Tax Disclosure [Abstract]
Income Taxes	INCOME TAXES The components of Profit before income taxes for the years ended December 31, were as follows: (Millions of dollars) 2015 2014 2013 U.S. $ 230 $ 207 $ 91 Non-U.S. 389 546 603 Total $ 619 $ 753 $ 694 Profit before income taxes, as shown above, is based on the location of the entity to which such earnings are attributable. Where an entity’s earnings are subject to taxation, however, may not correlate solely to where an entity is located. For example, the profit before income tax reported in the U.S. may be subject to tax by non-U.S. jurisdictions and profit before income tax outside the U.S. may be subject to tax in the U.S. Thus, the income tax provision shown below as U.S. or non-U.S. may not correspond to the earnings shown above. The components of the Provision for income taxes were as follows for the years ended December 31: (Millions of dollars) 2015 2014 2013 Current income tax provision (benefit): U.S. $ (21 ) $ 14 $ (14 ) Non-U.S. 109 138 183 State (U.S.) 2 (1 ) — 90 151 169 Deferred income tax provision (benefit): U.S. 45 44 17 Non-U.S. 21 13 (18 ) State (U.S.) 2 1 (1 ) 68 58 (2 ) Total Provision for income taxes $ 158 $ 209 $ 167 Current income tax provision is the amount of income taxes reported or expected to be reported on our income tax returns. We join Caterpillar in the filing of a consolidated U.S. Federal income tax return and certain state income tax returns. In accordance with our tax sharing agreement with Caterpillar, we generally pay to or receive from Caterpillar our allocated share of income taxes or credits reflected in these consolidated filings. This amount is calculated on a separate return basis by taking taxable income times the applicable statutory tax rate and includes payment for certain tax attributes earned during the year. The actual Provision for income taxes differs from the Provision for income taxes that would result from applying the U.S. statutory rate to Profit before income taxes for the years ended December 31, for the reasons set forth in the following reconciliation: (Millions of dollars) 2015 2014 2013 Taxes computed at U.S. statutory rates $ 217 35.0 % $ 264 35.0 % $ 243 35.0 % (Decreases) increases in taxes resulting from: State Income Tax, net of Federal Tax 3 0.5 % — — % (1 ) (0.1 )% Subsidiaries' results subject to tax rates other than U.S. statutory rates (19 ) (3.1 )% (53 ) (7.0 )% (68 ) (9.8 )% Income from non-U.S. subsidiaries taxed at U.S. statutory rates, net of foreign tax credits (39 ) (6.3 )% — — % — — % Other, net (4 ) (0.6 )% (2 ) (0.2 )% (7 ) (1.0 )% Provision for income taxes $ 158 25.5 % $ 209 27.8 % $ 167 24.1 % We have recorded income tax expense at U.S. tax rates on all profits, except for undistributed profits of non-U.S. subsidiaries of approximately $2 billion , which are considered indefinitely reinvested. Upon distribution of these profits in the form of dividends or otherwise, we would be subject to both U.S. income taxes (subject to an adjustment for foreign tax credits) and in some instances withholding taxes payable to the various non-U.S. jurisdictions. Determination of the amount of unrecognized deferred income tax liability related to indefinitely reinvested profits is not feasible primarily due to the complexity of the legal entity structure and U.S. and local tax laws. If U.S. tax law changes in the future, there may be a significant negative impact on the provision for income taxes to record an incremental tax liability in the period the change occurs. At December 31, 2015 , cash held by non-U.S. subsidiaries was approximately $342 million . Accounting for income taxes under generally accepted accounting principles in the United States of America requires individual tax-paying entities of the Company to offset deferred income tax assets and liabilities within each particular tax jurisdiction and present them as a single amount in the Consolidated Statements of Financial Position. Amounts in different tax jurisdictions cannot be offset against each other. The amounts of deferred income taxes at December 31, included in the following lines in our Consolidated Statements of Financial Position were: (Millions of dollars) 2015 2014 Assets: Deferred and refundable income taxes $ 75 $ 94 Liabilities: Deferred income taxes and other liabilities (812 ) (668 ) Deferred income taxes, net $ (737 ) $ (574 ) Differences between accounting rules and income tax laws cause differences between the bases of certain assets and liabilities for financial reporting and income tax purposes. The income tax effects of these differences, to the extent they are temporary, are recorded as deferred income tax assets and liabilities netted by tax jurisdiction and taxpayer. Our consolidated deferred income taxes consisted of the following components as of December 31: (Millions of dollars) 2015 2014 Deferred income tax assets: Allowance for credit losses $ 142 $ 149 Tax carryforwards 48 46 190 195 Deferred income tax liabilities (primarily lease basis differences) (574 ) (514 ) Valuation allowance for deferred income tax assets (10 ) (3 ) Deferred income tax on translation adjustment (343 ) (252 ) Deferred income taxes, net $ (737 ) $ (574 ) As of December 31, 2015 , amounts and expiration dates of net operating loss (NOL) carryforwards in various U.S. state taxing jurisdictions were: (Millions of dollars) 2016 2017 2018 2019 2020-2031 Total $ — $ 2 $ 6 $ 4 $ 119 $ 131 The gross deferred income tax asset associated with these NOL carryforwards is $10 million as of December 31, 2015 . In some U.S. state income tax jurisdictions, we join with other Caterpillar entities in filing combined income tax returns. In other U.S. state income tax jurisdictions, we file on a separate, stand-alone basis. As of December 31, 2015 , amounts and expiration dates of NOL carryforwards in various non-U.S. taxing jurisdictions were: (Millions of dollars) 2016 2017 2018 2019 2020-2031 Unlimited Total $ — $ — $ — $ — $ 6 $ 50 $ 56 Valuation allowances totaling $10 million have been recorded at certain non-U.S. subsidiaries that have not yet demonstrated consistent and/or sustainable profitability to support the recognition of net deferred income tax assets. As of December 31, 2015 , approximately $26 million of U.S. foreign tax credits were available for carryforward. These credits expire in 2025 and 2026. A reconciliation of the beginning and ending amounts of gross unrecognized income tax benefits for uncertain income tax positions, including positions impacting only the timing of income tax benefits was as follows: (Millions of dollars) 2015 2014 Reconciliation of unrecognized income tax benefits (1) : Balance at beginning of year $ — $ — Additions for income tax positions related to prior year 2 — Reductions for income tax positions related to settlements (2) (2 ) — Balance at end of year $ — $ — Amount that, if recognized, would impact the effective tax rate $ — $ — (1) Foreign currency translation amounts are included within each line as applicable. (2) Includes cash payment or other reduction of assets to settle liability. We classify interest and penalties on income taxes as a component of the Provision for income taxes. During the years ended December 31, 2015 , 2014 and 2013 , we recognized an expense of less than $1 million , a benefit of less than $1 million and a benefit of less than $1 million in interest and penalties, respectively. As of December 31, 2015 and 2014 , the total amount of accrued interest and penalties was less than $1 million . On January 30, 2015, Caterpillar received a Revenue Agent's Report (RAR) from the Internal Revenue Service (IRS) indicating the end of field examination of our U.S. tax returns for 2007 to 2009. In the opinion of management, the ultimate disposition of the matters raised in this report will not have a material adverse effect on our consolidated financial position, liquidity or results of operations. The IRS field examination of our U.S. tax returns for 2010 to 2012 began in 2015. In our major non-U.S. jurisdictions, tax years are typically subject to examination for three to six years. Due to the uncertainty related to the timing and potential outcome of audits, we cannot estimate the range of reasonably possible change in unrecognized tax benefits in the next 12 months.

Fair Value Measurements

Fair Value Measurements	12 Months Ended
	Dec. 31, 2015
Fair Value Disclosures [Abstract]
Fair Value Measurements	FAIR VALUE MEASUREMENTS A. Fair Value Measurements The guidance on fair value measurements defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants. This guidance also specifies a fair value hierarchy based upon the observability of inputs used in valuation techniques. Observable inputs (highest level) reflect market data obtained from independent sources, while unobservable inputs (lowest level) reflect internally developed market assumptions. In accordance with this guidance, fair value measurements are classified under the following hierarchy: • Level 1 – Quoted prices for identical instruments in active markets. • Level 2 – Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs or significant value-drivers are observable in active markets. • Level 3 – Model-derived valuations in which one or more significant inputs or significant value-drivers are unobservable. When available, we use quoted market prices to determine fair value and we classify such measurements within Level 1. In some cases where market prices are not available, we make use of observable market-based inputs to calculate fair value, in which case the measurements are classified within Level 2. If quoted or observable market prices are not available, fair value is based upon internally developed models that use, where possible, current market-based parameters such as interest rates, yield curves and currency rates. These measurements are classified within Level 3. Fair value measurements are classified according to the lowest level input or value-driver that is significant to the valuation. A measurement may therefore be classified within Level 3 even though there may be significant inputs that are readily observable. Fair value measurement includes the consideration of nonperformance risk. Nonperformance risk refers to the risk that an obligation (either by a counterparty or us) will not be fulfilled. For financial assets traded in an active market (Level 1), the nonperformance risk is included in the market price. For certain other financial assets and liabilities (Level 2 and 3), our fair value calculations have been adjusted accordingly. Derivative financial instruments The fair value of interest rate swap derivatives is primarily based on standard industry accepted models that utilize the appropriate market-based forward swap curves and zero-coupon interest rates to determine discounted cash flows. The fair value of foreign currency forward and cross currency contracts is based on a standard industry accepted valuation model that discounts cash flows resulting from the differential between the contract price and the market-based forward rate. Derivative financial instruments are measured on a recurring basis at fair value and are classified as Level 2 measurements. We had derivative financial instruments in a net asset position, included in our Consolidated Statements of Financial Position of $81 million and $78 million as of December 31, 2015 and 2014 , respectively. Impaired loans Our impaired loans are subject to measurement at fair value on a nonrecurring basis and are classified as Level 3 measurements. A loan is considered impaired when management determines that collection of contractual amounts due is not probable. In these cases, an allowance for credit losses may be established based either on the present value of expected future cash flows discounted at the receivables' effective interest rate, or the fair value of the collateral for collateral-dependent receivables. In determining collateral value, we estimate the current fair market value of the collateral less selling costs. We had impaired loans carried at the fair value of the underlying collateral value of $91 million and $248 million as of December 31, 2015 and 2014 , respectively. B. Fair Values of Financial Instruments In addition to the methods and assumptions we use to record the fair value of financial instruments as discussed in the Fair Value Measurements section above, we used the following methods and assumptions to estimate the fair value of our financial instruments. Cash and cash equivalents – carrying amount approximated fair value. Finance receivables, net – fair value was estimated by discounting the future cash flows using current rates representative of receivables with similar remaining maturities. Restricted cash and cash equivalents – carrying amount approximated fair value. Short-term borrowings – carrying amount approximated fair value. Long-term debt – fair value for fixed and floating-rate debt was estimated based on quoted market prices. Guarantees – fair value of guarantees is based on our estimate of the premium a market participant would require to issue the same guarantee in a stand-alone, arms-length transaction with an unrelated party. If quoted or observable market prices are not available, fair value is based upon internally developed models that utilize current market-based assumptions. Please refer to the table below for the fair values of our financial instruments. (Millions of dollars) 2015 2014 Carrying Amount Fair Value Carrying Amount Fair Value Fair Value Levels Reference Cash and cash equivalents $ 1,016 $ 1,016 $ 857 $ 857 1 Foreign currency contracts: In a receivable position $ 3 $ 3 $ 5 $ 5 2 Note 10 In a payable position $ (6 ) $ (6 ) $ (15 ) $ (15 ) 2 Note 10 Cross currency contracts In a receivable position $ 37 $ 37 $ 17 $ 17 2 Note 10 Finance receivables, net (excluding finance leases (1) ) $ 20,935 $ 20,925 $ 21,434 $ 21,093 3 Note 3 Restricted cash and cash equivalents (2) $ 18 $ 18 $ 11 $ 11 1 Short-term borrowings $ (6,958 ) $ (6,958 ) $ (4,699 ) $ (4,699 ) 1 Note 8 Long-term debt $ (21,605 ) $ (21,904 ) $ (24,574 ) $ (25,103 ) 2 Note 9 Interest rate swaps: In a net receivable position $ 51 $ 51 $ 79 $ 79 2 Note 10 In a net payable position $ (4 ) $ (4 ) $ (8 ) $ (8 ) 2 Note 10 Guarantees $ — $ — $ (1 ) $ (1 ) 3 Note 11 (1) As of December 31, 2015 and 2014 , represents finance leases with a net carrying value of $6.45 billion and $7.64 billion , respectively. (2) Included in Other assets in the Consolidated Statements of Financial Position.

Transactions with Related Parti

Transactions with Related Parties	12 Months Ended
	Dec. 31, 2015
Related Party Transactions [Abstract]
Transactions with Related Parties	TRANSACTIONS WITH RELATED PARTIES We have a Support Agreement with Caterpillar, which provides that Caterpillar will (1) remain, directly or indirectly, our sole owner; (2) cause us to maintain a tangible net worth of at least $20 million and (3) ensure that we maintain a ratio of profit before income taxes and interest expense to interest expense (as defined by the Support Agreement) of not less than 1.15 to 1, calculated on an annual basis. Although this agreement can be modified or terminated by either party, any termination or any modification which would adversely affect holders of our debt requires the consent of holders of 66-2/3 percent in principal amount of outstanding debt of each series so affected. Any modification or termination which would adversely affect the lenders under the Credit Facility requires their consent. Caterpillar's obligation under this agreement is not directly enforceable by any of our creditors and does not constitute a guarantee of any of our obligations. A cash dividend of $600 million , $400 million and $200 million was paid to Caterpillar in 2015 , 2014 and 2013 , respectively. We have variable amount lending agreements and other notes receivable with Caterpillar. Under these agreements, we may borrow up to $2.28 billion from Caterpillar, and Caterpillar may borrow up to $1.29 billion from us. The agreements are in effect for indefinite periods of time and may be changed or terminated by either party with 30 days notice. We extended a $2 billion committed credit facility to Caterpillar, which expires in February 2019. Under this agreement, we receive a fee from Caterpillar based on amounts drawn under the credit facility and a commitment fee for the undrawn amounts under the credit facility. Information concerning these agreements was as follows: (Millions of dollars) 2015 2014 2013 Notes payable as of December 31, $ 1,096 $ 1,108 $ 1,118 Notes receivable as of December 31, $ 490 $ 414 $ 345 Interest expense $ 6 $ 7 $ 7 Interest income on Notes Receivable with Caterpillar (1) $ 21 $ 18 $ 19 Fees on committed credit facility extended to Caterpillar (1) $ 40 $ 41 $ 41 (1) Included in Other revenues, net in the Consolidated Statements of Profit. We have agreements with Caterpillar to purchase certain trade receivables at a discount. Information pertaining to these purchases was as follows: (Millions of dollars) 2015 2014 2013 Purchases made $ 33,154 $ 36,816 $ 33,018 Discounts earned $ 222 $ 243 $ 233 Balance as of December 31, $ 2,601 $ 3,238 $ 3,092 We participate in certain marketing programs offered in conjunction with Caterpillar that allow us to periodically offer financing to customers at interest rates that are below market rates. Under these marketing programs, Caterpillar funds an amount at the outset of the transaction, which we then recognize as revenue over the term of the financing. During 2015 , 2014 and 2013 , relative to such programs, we received $188 million , $173 million and $189 million , respectively. We have finance receivables and equipment on operating leases, net of depreciation, with Caterpillar wholly-owned dealers of $49 million and $58 million as of December 31, 2015 and 2014 , respectively. For the years ended December 31, 2015 , 2014 and 2013 , we recognized revenues of $9 million , $11 million and $11 million , respectively, related to these finance receivables and operating leases. For the years ended December 31, 2015 , 2014 and 2013 , we recognized depreciation related to these operating leases of $7 million , $9 million and $9 million , respectively. At December 31, 2015 and 2014 , $418 million and $568 million , respectively, of our portfolio is subject to guarantees by Caterpillar. We participate in various benefit plans, which are administered by Caterpillar. These plans include employee medical plans and postretirement benefit plans. We reimburse Caterpillar for these charges. During 2015 , 2014 and 2013 , these charges amounted to $29 million , $30 million and $27 million , respectively. Included in these charges are contributions to defined benefit plans in the amount of $7 million for each of 2015 , 2014 and 2013 . These contributions are related to our participation in the following defined benefit plans that are administered by Caterpillar: the Caterpillar Inc. Retirement Income Plan, the Caterpillar Inc. Supplemental Retirement Plan and the Caterpillar Inc. Retiree Benefit Program. The total cost of the defined benefit plans is determined by actuarial valuation and we receive an allocation of the service and prior service cost based on headcount. We participate in the Caterpillar stock incentive plans. In 2015 , 2014 and 2013 , Caterpillar allocated to us $12 million , $11 million and $11 million , respectively, in expenses related to stock based compensation. Further information about these plans is available in Caterpillar’s 2015 Annual Report on Form 10-K filed separately with the Securities and Exchange Commission. Caterpillar provides operational and administrative support, which is integral to the conduct of our business. In 2015 , 2014 and 2013 , these operational and support charges for which we reimburse Caterpillar amounted to $37 million , $37 million and $33 million , respectively. In addition, we provide administrative support services to certain Caterpillar subsidiaries. Caterpillar reimburses us for these charges. During 2015 , 2014 and 2013 , these charges amounted to $12 million in each year. We join Caterpillar in the filing of a consolidated U.S. Federal income tax return and certain state income tax returns. In accordance with our tax sharing agreement with Caterpillar, we generally pay to or receive from Caterpillar our allocated share of income taxes or credits reflected in these consolidated filings. This amount is calculated on a separate return basis by taking taxable income times the applicable statutory tax rate and includes payment for certain tax attributes earned during the year.

Leases

Leases	12 Months Ended
	Dec. 31, 2015
Leases [Abstract]
Leases	LEASES We lease our offices and other property through operating leases. Rental expense is charged to operations as incurred. For 2015 , 2014 and 2013 , total rental expense for operating leases was $16 million , $17 million and $17 million , respectively. At December 31, 2015 , minimum payments for operating leases having initial non-cancelable terms in excess of one year were as follows: (Millions of dollars) 2016 $ 15 2017 14 2018 13 2019 13 2020 12 Thereafter 16 Total $ 83

Segment and Geographic Informat

Segment and Geographic Information	12 Months Ended
	Dec. 31, 2015
Segment Reporting [Abstract]
Segment and Geographic Information	SEGMENT AND GEOGRAPHIC INFORMATION A. Basis for Segment Information We report information internally for operating segments based on management responsibility. Our operating segments offer financing to customers and dealers for the purchase and lease of Caterpillar and other equipment, as well as financing for Caterpillar sales to dealers. Financing plans include operating and finance leases, installment sale contracts, working capital loans and wholesale financing plans within each of the respective segments. B. Description of Segments We have 5 operating segments that offer financing services. Following is a brief description of our segments. • North America - Includes our operations in the United States and Canada. • Europe - Includes our operations in Europe, Africa, Middle East and the Commonwealth of Independent States. • Asia/Pacific - Includes our operations in Australia, China, Japan, South Korea and Southeast Asia. • Latin America and Caterpillar Power Finance - Includes our operations in Brazil, Mexico and Chile that serve local dealers and customers in Central and South America. This segment also includes Caterpillar Power Finance (CPF), which finances marine vessels with Caterpillar engines worldwide and also provides debt financing for Caterpillar electrical power generation, gas compression and co-generation systems, as well as non-Caterpillar equipment that is powered by these systems worldwide. • Mining - Serves large mining customers worldwide and provides project financing in various countries. C. Segment Measurement and Reconciliations Cash, debt and other expenses are allocated to our segments based on their respective portfolios. The related Interest expense is calculated based on the amount of allocated debt and the rates associated with that debt. The performance of each segment is assessed based on a consistent leverage ratio. The Provision for credit losses is based on each segment's respective portfolio. Capital expenditures include expenditures for equipment on operating leases and other miscellaneous capital expenditures. Reconciling items are created based on accounting differences between segment reporting and consolidated external reporting. For the reconciliation of profit before income taxes, we have grouped the reconciling items as follows: • Unallocated - This item is related to corporate requirements and strategies that are considered to be for the benefit of the entire organization. Also included are the consolidated results of the special purpose corporation (see Note 11 for additional information) and other miscellaneous items. • Timing - Timing differences in the recognition of costs between segment reporting and consolidated external reporting. • Methodology - Methodology differences between segment reporting and consolidated external reporting are as follows: ◦ Segment assets include off-balance sheet managed assets for which we maintain servicing responsibilities. ◦ The impact of differences between the actual leverage and the segment leverage ratios. ◦ Interest expense includes realized forward points on foreign currency forward contracts. ◦ The net gain or loss from interest rate derivatives. ◦ The profit attributable to noncontrolling interests is considered a component of segment profit. As noted above, the segment information is presented on a management-reporting basis. Unlike financial reporting, there is no authoritative guidance for management reporting equivalent to generally accepted accounting principles. Supplemental segment data and reconciliations to consolidated external reporting for the years ended December 31 was as follows: (Millions of dollars) 2015 External Revenues Profit before income taxes Interest Expense Depreciation on equipment leased to others Provision for credit losses Assets at December 31, 2015 Capital expenditures North America $ 1,156 $ 370 $ 261 $ 409 $ 7 $ 14,444 $ 1,118 Europe 284 96 31 76 3 3,758 136 Asia/Pacific 285 65 100 21 29 3,924 37 Latin America and CPF 533 108 152 104 64 7,381 89 Mining 373 47 54 225 14 2,848 69 Total Segments 2,631 686 598 835 117 32,355 1,449 Unallocated 72 (96 ) 69 1 — 1,847 9 Timing (30 ) (32 ) — — 2 164 3 Methodology — 61 (74 ) — — (216 ) — Inter-segment Eliminations (1) — — — — — (247 ) — Total $ 2,673 $ 619 $ 593 $ 836 $ 119 $ 33,903 $ 1,461 2014 External Revenues Profit before income taxes Interest Expense Depreciation on equipment leased to others Provision for credit losses Assets at December 31, 2014 Capital expenditures North America $ 1,067 $ 355 $ 240 $ 361 $ 3 $ 13,661 $ 1,068 Europe 353 114 52 94 10 4,276 133 Asia/Pacific 368 129 116 24 35 4,767 34 Latin America and CPF 594 144 166 118 62 8,001 111 Mining 461 64 65 272 29 3,161 269 Total Segments 2,843 806 639 869 139 33,866 1,615 Unallocated 70 (82 ) 48 1 2 1,648 10 Timing (28 ) (8 ) — — (2 ) 120 2 Methodology — 37 (56 ) — — (215 ) — Inter-segment Eliminations (1) — — — — — (243 ) — Total $ 2,885 $ 753 $ 631 $ 870 $ 139 $ 35,176 $ 1,627 2013 External Revenues Profit before income taxes Interest Expense Depreciation on equipment leased to others Provision for credit losses Assets at December 31, 2013 Capital expenditures North America $ 946 $ 283 $ 259 $ 293 $ — $ 12,160 $ 773 Europe 347 109 59 80 13 4,720 241 Asia/Pacific 399 156 135 25 9 5,251 54 Latin America and CPF 572 126 188 99 69 8,295 273 Mining 474 85 79 272 12 3,441 469 Total Segments 2,738 759 720 769 103 33,867 1,810 Unallocated 73 (73 ) 53 1 2 1,595 10 Timing (26 ) (10 ) — — (4 ) 68 2 Methodology — 18 (39 ) — — (189 ) — Inter-segment Eliminations (1) — — — — — (227 ) — Total $ 2,785 $ 694 $ 734 $ 770 $ 101 $ 35,114 $ 1,822 (1) Elimination is primarily related to intercompany loans. Geographic information: (Millions of dollars) 2015 2014 2013 Revenues Inside U.S. $ 1,330 $ 1,219 $ 1,045 Inside Canada 198 259 329 Inside Australia 200 261 287 All other 945 1,146 1,124 Total $ 2,673 $ 2,885 $ 2,785 Equipment on Operating Leases and Non-Leased Equipment (included in Other Assets), Net 2015 2014 Inside U.S. $ 2,058 $ 1,696 Inside Canada 572 756 Inside Australia 282 358 All other 716 896 Total $ 3,628 $ 3,706

Selected Quarterly Financial Da

Selected Quarterly Financial Data (Unaudited)	12 Months Ended
	Dec. 31, 2015
Quarterly Financial Information Disclosure [Abstract]
Selected Quarterly Financial Data (Unaudited)	SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED) (Millions of dollars) 2015 First quarter Second quarter Third quarter Fourth quarter Total revenues $ 689 $ 683 $ 653 $ 648 Profit before income taxes $ 187 $ 150 $ 153 $ 129 Profit $ 133 $ 104 $ 109 $ 114 2014 First quarter Second quarter Third quarter Fourth quarter Total revenues $ 711 $ 728 $ 743 $ 703 Profit before income taxes $ 182 $ 208 $ 197 $ 166 Profit $ 131 $ 148 $ 148 $ 108

Employee Separation Charges

Employee Separation Charges	12 Months Ended
	Dec. 31, 2015
Restructuring and Related Activities [Abstract]
Employee Separation Charges	EMPLOYEE SEPARATION CHARGES Our accounting for employee separations is dependent upon how the particular program is designed. For voluntary programs, eligible separation costs are recognized at the time of employee acceptance unless the acceptance requires explicit approval by the Company. For involuntary programs, eligible costs are recognized when management has approved the program, the affected employees have been properly notified and the costs are estimable. In September 2015, Caterpillar Inc. announced restructuring and cost reduction actions to lower operating costs in response to current economic and business conditions. As part of the announcement, we offered a voluntary retirement enhancement program to qualifying U.S. employees. After employee acceptance, this program required Company approval, which occurred in the fourth quarter of 2015. During 2015, we recognized employee separation charges of $15 million , which is included in Other expenses in the Consolidated Statements of Profit, primarily related to the voluntary retirement enhancement program. The following table summarizes the 2015 separation activity: (Millions of dollars) Liability balance at December 31, 2014 $ — Increase in liability (separation charges) 15 Reduction in liability (payments and other adjustments) (5 ) Liability balance at December 31, 2015 $ 10 The remaining liability balance as of December 31, 2015, represents costs for employees who have not yet separated from the Company or whose full severance has not yet been paid. These remaining costs are expected to be paid in 2016.

Critical Accounting Policies (P

Critical Accounting Policies (Policies)	12 Months Ended
	Dec. 31, 2015
Accounting Policies [Abstract]
Residual values for leased assets	Residual values for leased assets Lease residual values are an estimate of the market value of leased equipment at the end of the lease term and are based on an analysis of historical wholesale market sales prices, projected forward on a level trend line without consideration for inflation or possible future pricing action. At the inception of the lease, residual values are estimated with consideration of the following critical factors: market size and demand, any known significant market/product trends, total expected hours of usage, machine configuration, application, location, model changes, quantities and past re-marketing experience, third-party residual guarantees and contractual customer purchase options. Many of these factors are gathered in an application survey that is completed prior to quotation. The lease agreement also clearly defines applicable return conditions and remedies for non-compliance, to ensure that the leased equipment will be in good operating condition upon return. Model changes and updates, as well as market strength and product acceptance, are monitored and adjustments are made to residual values in accordance with the significance of any such changes. Remarketing sales staff works closely with customers and dealers to manage the sale of lease returns and the recovery of residual exposure. During the term of the leases, residual values are monitored. If estimated end-of-term market values of leased equipment reflect a non-temporary impairment due to economic factors, obsolescence or other adverse circumstances, the residual value of the leased equipment is adjusted so that the carrying value at end of lease term will approximate the estimated end-of-term market value. For equipment on operating leases, adjustments are made on a straight-line basis over the remaining term of the lease through depreciation expense. For finance leases, adjustments are recognized at the time of assessment through a reduction of finance revenue. At December 31, 2015 , the aggregate residual value of equipment on operating leases was $2.09 billion. Without consideration of other factors such as third-party residual guarantees or contractual customer purchase options, a 10 percent non-temporary decrease in the market value of our equipment subject to operating leases would reduce residual value estimates and result in recognition of approximately $80 million of additional annual depreciation expense.
Allowance for credit losses	Allowance for credit losses The allowance for credit losses is an estimate of the losses inherent in our finance receivable portfolio and includes consideration of accounts that have been individually identified as impaired, as well as pools of finance receivables where it is probable that certain receivables in the pool are impaired but the individual accounts cannot yet be identified. In identifying and measuring impairment, management takes into consideration past loss experience, known and inherent risks in the portfolio, adverse situations that may affect the borrower’s ability to repay, estimated value of underlying collateral and current economic conditions. Accounts are identified for individual review based on past-due status and information available about the customer, such as financial statements, news reports and published credit ratings, as well as general information regarding industry trends and the economic environment in which our customers operate. The allowance for credit losses attributable to finance receivables that are individually evaluated and determined to be impaired is based either on the present value of expected future cash flows discounted at the receivables' effective interest rate or the fair value of the collateral for collateral-dependent receivables. In determining collateral value, we estimate the current fair market value of the collateral less selling costs. We also consider credit enhancements such as additional collateral and contractual third-party guarantees. The allowance for credit losses attributable to the remaining accounts not yet individually identified as impaired is estimated based on loss forecast models utilizing probabilities of default, our estimate of the loss emergence period and the estimated loss given default. In addition, qualitative factors not able to be fully captured in our loss forecast models including industry trends, macroeconomic factors and model imprecision are considered in the evaluation of the adequacy of the allowance for credit losses. These qualitative factors are subjective and require a degree of management judgment. While management believes it has exercised prudent judgment and applied reasonable assumptions, there can be no assurance that in the future, changes in economic conditions or other factors would not cause changes in the financial health of our customers. If the financial health of our customers deteriorates, the timing and level of payments received could be impacted and therefore, could result in a change to our estimated losses.
Income taxes	Income taxes We are subject to the income tax laws of the many jurisdictions in which we operate. These tax laws are complex, and the manner in which they apply to our facts is sometimes open to interpretation. In establishing the Provision for income taxes, we must make judgments about the application of these inherently complex tax laws. Despite our belief that our tax return positions are consistent with applicable tax laws, we believe that taxing authorities could challenge certain positions. Settlement of any challenge can result in no change, a complete disallowance, or some partial adjustment reached through negotiations or litigation. We record tax benefits for uncertain tax positions based upon management's evaluation of the information available at the reporting date. To be recognized in the financial statements, a tax benefit must be at least more likely than not of being sustained based on technical merits. The benefit for positions meeting the recognition threshold is measured as the largest benefit more likely than not of being realized upon ultimate settlement with a taxing authority that has full knowledge of all relevant information. Significant judgment is required in making these determinations and adjustments to unrecognized tax benefits may be necessary to reflect actual taxes payable upon settlement. Adjustments related to positions impacting the effective tax rate affect the Provision for income taxes. Adjustments related to positions impacting the timing of income or deductions impact deferred tax assets and liabilities. Our income tax positions and analysis are based on currently enacted tax law. Future changes in tax law could significantly impact the Provision for income taxes, the amount of taxes payable and the deferred tax asset and liability balances. Deferred tax assets generally represent tax benefits for tax deductions or credits available in future tax returns. Certain estimates and assumptions are required to determine whether it is more likely than not that all or some portion of the benefit of a deferred tax asset will not be realized. In making this assessment, management analyzes and estimates the impact of future taxable income, reversing temporary differences and available prudent and feasible tax planning strategies. Should a change in facts or circumstances lead to a change in judgment about the realizability of a deferred tax asset, we record or adjust the related valuation allowance in the period that the change in facts and circumstances occurs, along with a corresponding increase or decrease in the Provision for income taxes. A provision for U.S. income taxes has not been recorded on undistributed profits of our non-U.S. subsidiaries that we have determined to be indefinitely reinvested outside the U.S. If management intentions or U.S. tax law changes in the future, there may be a significant negative impact on the Provision for income taxes to record an incremental tax liability in the period the change occurs. A deferred tax asset is recognized only if we have definite plans to generate a U.S. tax benefit by repatriating earnings in the foreseeable future. Income taxes are based on the statutory tax rate of the jurisdiction where earnings are subject to taxation which may differ from the jurisdiction where that entity is incorporated. Taxes are paid in the jurisdictions where earnings are subject to taxation. The effective tax rate differs from the U.S. statutory rate in part due to results of non-U.S. subsidiaries being subject to statutory tax rates which are generally lower than the U.S. rate of 35 percent.

Summary of Significant Accoun28

Summary of Significant Accounting Policies (Policies)	12 Months Ended
	Dec. 31, 2015
Accounting Policies [Abstract]
Basis of Presentation	Basis of Presentation The accompanying consolidated financial statements include the accounts of Cat Financial and consolidated variable interest entities (VIEs) in which Cat Financial is the primary beneficiary. We consolidate all variable-interest entities (VIEs) where we are the primary beneficiary. For VIEs, we assess whether we are the primary beneficiary as prescribed by the accounting guidance on the consolidation of VIEs. The primary beneficiary of a VIE is the party that has both the power to direct the activities that most significantly impact the entity’s economic performance and the obligation to absorb losses or the right to receive benefits that could potentially be significant to the entity. Please refer to Note 11 for more information. We have customers that are VIEs of which we are not the primary beneficiary. Although we have provided financial support to these entities and therefore have a variable interest, we do not have the power to direct the activities that most significantly impact their economic performance. Our maximum exposure to loss from our involvement with these VIEs is limited to the credit risk inherently present in the financial support that we have provided. These risks are evaluated and reflected in our financial statements as part of our overall portfolio of finance receivables and related allowance for credit losses. Certain amounts for prior years have been reclassified to conform with current-year financial statement presentation.
Recognition of Earned Income	Recognition of Earned Income Finance revenue is recorded over the life of the related finance receivable using the interest method, including the accretion of certain direct origination costs that are deferred. Revenue from rental payments received on operating leases is recognized on a straight-line basis over the term of the lease. Recognition of finance revenue and operating lease revenue is suspended and the account is placed on non-accrual status when management determines that collection of future income is not probable (generally after 120 days past due). Recognition is resumed, and previously suspended income is recognized, when the account becomes current and collection of remaining amounts is considered probable. We participate in certain marketing programs offered in conjunction with Caterpillar and/or Caterpillar dealers that allow us to periodically offer financing to customers at interest rates that are below market rates. Under these marketing programs, Caterpillar and/or the dealer funds an amount at the outset of the transaction, which we then recognize as revenue over the term of the financing. The funds we receive from Caterpillar and/or the dealer equal an amount that when combined with the customer’s contractual interest provides us with a market interest rate.
Depreciation	Depreciation Depreciation for equipment on operating leases is recognized using the straight-line method over the lease term, typically one to seven years. The depreciable basis is the original cost of the equipment less the estimated residual value of the equipment at the end of the lease term.
Derivative Financial Instruments	Derivative Financial Instruments Our earnings and cash flows are subject to fluctuations due to changes in foreign currency exchange rates and interest rates. Our Risk Management Policy (policy) allows for the use of derivative financial instruments to manage foreign currency exchange rate and interest rate exposures. Our policy specifies that derivatives are not to be used for speculative purposes. Derivatives that we use are primarily foreign currency forward, option, and cross currency contracts and interest rate swaps. All derivatives are recorded at fair value. See Note 10 for additional information.
Foreign Currency Translation	Foreign Currency Translation The functional currency for most of our subsidiaries is the respective local currency. Gains and losses resulting from the remeasurement of foreign currency amounts to the functional currency are included in Other income (expense) in the Consolidated Statements of Profit. Gains and losses resulting from translating assets and liabilities from the functional currency to U.S. dollars are included in Accumulated other comprehensive income/(loss) in the Consolidated Statements of Financial Position.
Use of Estimates in the Preparation of Financial Statements	Use of Estimates in the Preparation of Financial Statements The preparation of financial statements, in conformity with generally accepted accounting principles in the United States of America, requires management to make estimates and assumptions that affect the reported amounts. Significant estimates include the allowance for credit losses, residual values for leased assets, income taxes and the assumptions used to determine the fair value of derivatives. Actual results may differ from these estimates.

Accumulated Other Comprehensi29

Accumulated Other Comprehensive Income/(Loss) (Tables)	12 Months Ended
	Dec. 31, 2015
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]
Schedule of Accumulated other comprehensive income/(loss)	Comprehensive income/(loss) and its components are presented in the Consolidated Statements of Comprehensive Income. Changes in Accumulated other comprehensive income/(loss), net of tax, included in the Consolidated Statements of Changes in Stockholder's Equity, consisted of the following: (Millions of dollars) Foreign currency translation Derivative financial instruments Total Balance at December 31, 2012 $ 184 $ (8 ) $ 176 Other comprehensive income/(loss) before reclassifications (62 ) (1 ) (63 ) Amounts reclassified from accumulated other comprehensive (income)/loss — 4 4 Other comprehensive income/(loss) (62 ) 3 (59 ) Balance at December 31, 2013 $ 122 $ (5 ) $ 117 Other comprehensive income/(loss) before reclassifications (481 ) (4 ) (485 ) Amounts reclassified from accumulated other comprehensive (income)/loss — 4 4 Other comprehensive income/(loss) (481 ) — (481 ) Balance at December 31, 2014 $ (359 ) $ (5 ) $ (364 ) Other comprehensive income/(loss) before reclassifications (538 ) 2 (536 ) Amounts reclassified from accumulated other comprehensive (income)/loss — 3 3 Other comprehensive income/(loss) (538 ) 5 (533 ) Balance at December 31, 2015 $ (897 ) $ — $ (897 )
Reclassifications out of Accumulated other comprehensive income/(loss)	The effect of the reclassifications out of Accumulated other comprehensive income/(loss) on the Consolidated Statements of Profit during the years ended December 31, 2015 , 2014 and 2013 was as follows: (Millions of dollars) Classification of income (expense) 2015 2014 2013 Cross currency contracts Other income (expense) $ 1 $ — $ — Interest rate contracts Interest expense (6 ) (6 ) (6 ) Reclassifications before tax (5 ) (6 ) (6 ) Tax (provision) benefit 2 2 2 Total reclassifications from Accumulated other comprehensive income/(loss) $ (3 ) $ (4 ) $ (4 )

Finance Receivables (Tables)

Finance Receivables (Tables)	12 Months Ended
	Dec. 31, 2015
Receivables [Abstract]
Summary of finance receivables included in the Consolidated Statements of Financial Position	A summary of finance receivables included in the Consolidated Statements of Financial Position as of December 31, was as follows: (Millions of dollars) 2015 2014 Finance leases and installment sale contracts – Retail $ 13,728 $ 14,455 Retail notes receivable 10,616 11,005 Wholesale notes receivable 3,887 4,514 Finance leases and installment sale contracts – Wholesale 289 384 28,520 30,358 Less: Unearned income (794 ) (883 ) Less: Allowance for credit losses (338 ) (401 ) Total finance receivables, net $ 27,388 $ 29,074
Maturities of finance receivables	Maturities of our finance receivables, as of December 31, 2015 , reflect contractual repayments due from borrowers and were as follows: (Millions of dollars) Amounts due in Retail Installment Sale Contracts Wholesale Installment Sale Contracts Retail Finance Leases Wholesale Finance Leases Retail Notes Wholesale Notes Total 2016 $ 2,597 $ 48 $ 2,543 $ 53 $ 4,297 $ 3,495 $ 13,033 2017 2,015 7 1,661 52 1,940 232 5,907 2018 1,368 3 939 38 1,450 158 3,956 2019 699 1 425 18 1,024 2 2,169 2020 202 — 170 6 929 — 1,307 Thereafter 11 — 98 2 976 — 1,087 Total 6,892 59 5,836 169 10,616 3,887 27,459 Guaranteed residual value — — 334 35 — — 369 Unguaranteed residual value — — 666 26 — — 692 Total $ 6,892 $ 59 $ 6,836 $ 230 $ 10,616 $ 3,887 $ 28,520
Allowance for credit losses and recorded investment in finance receivables	An analysis of the allowance for credit losses was as follows: (Millions of dollars) December 31, 2015 Allowance for Credit Losses: Customer Dealer Caterpillar Purchased Receivables Total Balance at beginning of year $ 388 $ 10 $ 3 $ 401 Receivables written off (196 ) — — (196 ) Recoveries on receivables previously written off 41 — — 41 Provision for credit losses 119 (1 ) (1 ) 117 Adjustment due to sale of receivables (2 ) — — (2 ) Foreign currency translation adjustment (23 ) — — (23 ) Balance at end of year $ 327 $ 9 $ 2 $ 338 Individually evaluated for impairment $ 65 $ — $ — $ 65 Collectively evaluated for impairment 262 9 2 273 Ending Balance $ 327 $ 9 $ 2 $ 338 Recorded Investment in Finance Receivables: Individually evaluated for impairment $ 601 $ — $ — $ 601 Collectively evaluated for impairment 19,431 5,093 2,601 27,125 Ending Balance $ 20,032 $ 5,093 $ 2,601 $ 27,726 (Millions of dollars) December 31, 2014 Allowance for Credit Losses: Customer Dealer Caterpillar Purchased Receivables Total Balance at beginning of year $ 374 $ 10 $ 3 $ 387 Receivables written off (146 ) — — (146 ) Recoveries on receivables previously written off 47 — — 47 Provision for credit losses 136 — — 136 Adjustment due to sale of receivables (3 ) — — (3 ) Foreign currency translation adjustment (20 ) — — (20 ) Balance at end of year $ 388 $ 10 $ 3 $ 401 Individually evaluated for impairment $ 75 $ — $ — $ 75 Collectively evaluated for impairment 313 10 3 326 Ending Balance $ 388 $ 10 $ 3 $ 401 Recorded Investment in Finance Receivables: Individually evaluated for impairment $ 614 $ — $ — $ 614 Collectively evaluated for impairment 20,454 5,169 3,238 28,861 Ending Balance $ 21,068 $ 5,169 $ 3,238 $ 29,475
Aging related to finance receivables	In determining past-due status, we consider the entire finance receivable balance past due when any installment is over 30 days past due. The tables below summarize our recorded investment of finance receivables by aging category. (Millions of dollars) December 31, 2015 31-60 Days Past Due 61-90 Days Past Due 91+ Days Past Due Total Past Due Current Total Finance Receivables 91+ Still Accruing Customer North America $ 45 $ 12 $ 30 $ 87 $ 8,031 $ 8,118 $ 4 Europe 18 7 44 69 2,358 2,427 9 Asia/Pacific 22 12 21 55 2,108 2,163 6 Mining 6 1 68 75 1,793 1,868 1 Latin America 45 31 199 275 1,998 2,273 — Caterpillar Power Finance — 1 35 36 3,147 3,183 2 Dealer North America — — — — 3,387 3,387 — Europe — — — — 330 330 — Asia/Pacific — — — — 611 611 — Mining — — — — 4 4 — Latin America — — — — 758 758 — Caterpillar Power Finance — — — — 3 3 — Caterpillar Purchased Receivables North America 16 5 1 22 1,386 1,408 1 Europe 4 — 4 8 307 315 3 Asia/Pacific — — — — 407 407 — Mining — — — — — — — Latin America — — — — 454 454 — Caterpillar Power Finance — 1 — 1 16 17 — Total $ 156 $ 70 $ 402 $ 628 $ 27,098 $ 27,726 $ 26 (Millions of dollars) December 31, 2014 31-60 Days Past Due 61-90 Days Past Due 91+ Days Past Due Total Past Due Current Total Finance Receivables 91+ Still Accruing Customer North America $ 46 $ 8 $ 27 $ 81 $ 7,291 $ 7,372 $ 4 Europe 16 23 29 68 2,607 2,675 6 Asia/Pacific 29 22 69 120 2,773 2,893 16 Mining 28 — 11 39 2,084 2,123 — Latin America 55 23 196 274 2,583 2,857 8 Caterpillar Power Finance 1 4 64 69 3,079 3,148 1 Dealer North America — — — — 3,209 3,209 — Europe — — — — 467 467 — Asia/Pacific — — — — 637 637 — Mining — — — — 3 3 — Latin America — — — — 853 853 — Caterpillar Power Finance — — — — — — — Caterpillar Purchased Receivables North America 23 5 1 29 1,916 1,945 1 Europe 4 1 5 10 429 439 1 Asia/Pacific — — — — 401 401 — Mining — — — — — — — Latin America 6 5 — 11 420 431 — Caterpillar Power Finance — — 1 1 21 22 1 Total $ 208 $ 91 $ 403 $ 702 $ 28,773 $ 29,475 $ 38
Impaired finance receivables	Our recorded investment in impaired finance receivables and the related unpaid principal balances and allowance for the Customer portfolio segment were as follows: (Millions of dollars) As of December 31, 2015 As of December 31, 2014 Impaired Finance Receivables With No Allowance Recorded Recorded Investment Unpaid Principal Balance Related Allowance Recorded Investment Unpaid Principal Balance Related Allowance North America $ 12 $ 12 $ — $ 14 $ 14 $ — Europe 41 41 — 44 43 — Asia/Pacific 1 1 — 2 2 — Mining 84 84 — 29 29 — Latin America 28 28 — 34 34 — Caterpillar Power Finance 242 241 — 129 128 — Total $ 408 $ 407 $ — $ 252 $ 250 $ — Impaired Finance Receivables With An Allowance Recorded North America $ 14 $ 13 $ 4 $ 6 $ 6 $ 1 Europe 11 10 5 12 12 4 Asia/Pacific 34 34 4 29 29 8 Mining 11 11 3 138 137 9 Latin America 53 53 21 42 42 12 Caterpillar Power Finance 70 70 28 135 134 41 Total $ 193 $ 191 $ 65 $ 362 $ 360 $ 75 Total Impaired Finance Receivables North America $ 26 $ 25 $ 4 $ 20 $ 20 $ 1 Europe 52 51 5 56 55 4 Asia/Pacific 35 35 4 31 31 8 Mining 95 95 3 167 166 9 Latin America 81 81 21 76 76 12 Caterpillar Power Finance 312 311 28 264 262 41 Total $ 601 $ 598 $ 65 $ 614 $ 610 $ 75 (Millions of dollars) Year Ended Year Ended Year Ended Impaired Finance Receivables With No Allowance Recorded Average Recorded Investment Interest Income Recognized Average Recorded Investment Interest Income Recognized Average Recorded Investment Interest Income Recognized North America $ 12 $ 1 $ 20 $ 1 $ 25 $ 3 Europe 42 1 47 1 49 1 Asia/Pacific 2 — 3 — 4 — Mining 75 3 69 3 61 3 Latin America 31 — 30 — 11 — Caterpillar Power Finance 170 5 164 6 271 5 Total $ 332 $ 10 $ 333 $ 11 $ 421 $ 12 Impaired Finance Receivables With An Allowance Recorded North America $ 9 $ — $ 9 $ — $ 18 $ 1 Europe 14 1 21 1 22 1 Asia/Pacific 44 2 23 1 18 1 Mining 39 1 90 7 1 — Latin America 56 3 36 1 52 2 Caterpillar Power Finance 115 3 96 2 135 1 Total $ 277 $ 10 $ 275 $ 12 $ 246 $ 6 Total Impaired Finance Receivables North America $ 21 $ 1 $ 29 $ 1 $ 43 $ 4 Europe 56 2 68 2 71 2 Asia/Pacific 46 2 26 1 22 1 Mining 114 4 159 10 62 3 Latin America 87 3 66 1 63 2 Caterpillar Power Finance 285 8 260 8 406 6 Total $ 609 $ 20 $ 608 $ 23 $ 667 $ 18
Investment in Customer finance receivables on non-accrual status	The investment in Customer finance receivables on non-accrual status as of December 31, was as follows: (Millions of dollars) 2015 2014 North America $ 31 $ 27 Europe 39 28 Asia/Pacific 15 54 Mining 106 62 Latin America 217 201 Caterpillar Power Finance 77 96 Total $ 485 $ 468
Finance receivables modified as TDRs	Finance receivables in the Customer portfolio segment modified as TDRs during the years ended December 31, 2015 , 2014 and 2013 , were as follows: (Dollars in millions) Year Ended Number of Contracts Pre-TDR Recorded Investment Post-TDR Recorded Investment North America 14 $ 1 $ 1 Europe 23 2 2 Asia/Pacific 21 26 26 Mining 4 65 65 Latin America 11 1 2 Caterpillar Power Finance 21 259 242 Total 94 $ 354 $ 338 Year Ended Number of Contracts Pre-TDR Recorded Investment Post-TDR Recorded Investment North America 34 $ 12 $ 7 Europe 8 7 7 Asia/Pacific 2 — — Mining 51 185 176 Latin America 35 31 30 Caterpillar Power Finance 18 137 139 Total 148 $ 372 $ 359 Year Ended Number of Contracts Pre-TDR Recorded Investment Post-TDR Recorded Investment North America 62 $ 9 $ 9 Europe 51 7 7 Asia/Pacific 3 1 1 Mining 45 123 123 Latin America 32 3 3 Caterpillar Power Finance 17 153 157 Total 210 $ 296 $ 300 During the years ended December 31, 2015 and 2013 , $4 million and $25 million , respectively, of additional funds were subsequently loaned to a borrower whose terms had been modified in a TDR. The $4 million and $25 million of additional funds are not reflected in the tables above as no incremental modifications have been made with those borrowers during the periods presented. During the year ended December 31, 2014 , no additional funds were subsequently loaned to a borrower whose terms had been modified in a TDR. TDRs in the Customer portfolio segment with a payment default during the years ended December 31, 2015 , 2014 and 2013 , which had been modified within twelve months prior to the default date, were as follows: (Dollars in millions) Year Ended Year Ended Year Ended Number of Contracts Post-TDR Recorded Investment Number of Contracts Post-TDR Recorded Investment Number of Contracts Post-TDR Recorded Investment North America 12 $ 1 11 $ 1 19 $ 4 Europe — — 46 2 5 — Latin America 12 1 11 1 — — Caterpillar Power Finance — — — — 2 3 Total 24 $ 2 68 $ 4 26 $ 7

Equipment on Operating Leases (

Equipment on Operating Leases (Tables)	12 Months Ended
	Dec. 31, 2015
Leases [Abstract]
Equipment leased to others	Components of equipment on operating leases, less accumulated depreciation as of December 31, were as follows: (Millions of dollars) 2015 2014 Equipment on operating leases, at cost $ 5,202 $ 5,273 Less: Accumulated depreciation (1,638 ) (1,649 ) Equipment on operating leases, net $ 3,564 $ 3,624
Schedule of minimum rental payments to be received for equipment leased to others	At December 31, 2015 , scheduled minimum rental payments for operating leases were as follows: 2016 2017 2018 2019 2020 Thereafter Total $ 818 $ 522 $ 308 $ 142 $ 49 $ 12 $ 1,851

Other Assets (Tables)

Other Assets (Tables)	12 Months Ended
	Dec. 31, 2015
Other Assets [Abstract]
Schedule of other assets	The components of other assets as of December 31, were as follows: (Millions of dollars) 2015 2014 Collateral held for resale, at net realizable value $ 560 $ 321 Customer and other miscellaneous receivables 421 428 Other 224 252 Total other assets $ 1,205 $ 1,001

Short-Term Borrowings (Tables)

Short-Term Borrowings (Tables)	12 Months Ended
	Dec. 31, 2015
Short-term Debt [Abstract]
Short-term borrowings	Short-term borrowings outstanding as of December 31, were comprised of the following: (Millions of dollars) 2015 2014 Balance Avg. Rate Balance Avg. Rate Commercial paper, net $ 5,811 0.5% $ 3,688 0.3% Bank borrowings 440 9.3% 411 6.8% Variable denomination floating rate demand notes 707 0.8% 600 0.8% Total $ 6,958 $ 4,699

Long-Term Debt (Tables)

Long-Term Debt (Tables)	12 Months Ended
	Dec. 31, 2015
Long-term Debt, Unclassified [Abstract]
Long-term debt	Long-term debt outstanding as of December 31, was comprised of the following: (Millions of dollars) 2015 2014 Balance Avg. Rate Balance Avg. Rate Medium-term notes $ 20,611 2.4% $ 23,094 2.4% Unamortized discount (1 ) (4 ) Medium-term notes, net 20,610 23,090 Bank borrowings 995 4.0% 1,484 3.4% Total $ 21,605 $ 24,574
Aggregate amounts of maturities of long-term debt	Long-term debt outstanding as of December 31, 2015 , matures as follows: ( Millions of dollars) 2016 $ 5,362 2017 5,866 2018 4,154 2019 2,531 2020 1,125 Thereafter 2,567 Total $ 21,605

Derivative Financial Instrume35

Derivative Financial Instruments and Risk Management (Tables)	12 Months Ended
	Dec. 31, 2015
Derivative Instruments and Hedging Activities Disclosure [Abstract]
Location and fair value of derivative instruments reported in the Consolidated Statements of Financial Position	The location and fair value of derivative instruments reported in the Consolidated Statements of Financial Position were as follows: (Millions of dollars) Asset (Liability) Fair Value December 31, Consolidated Statements of Financial Position Location 2015 2014 Designated derivatives Interest rate contracts Other assets $ 51 $ 79 Interest rate contracts Accrued expenses (4 ) (8 ) Cross currency contracts Other assets 1 — $ 48 $ 71 Undesignated derivatives Foreign exchange contracts Other assets $ 3 $ 5 Foreign exchange contracts Accrued expenses (6 ) (15 ) Cross currency contracts Other assets 36 17 $ 33 $ 7
Deferred gains (losses) recorded in AOCI on the Consolidated Statements of Changes in Stockholder's Equity	For the years ended December 31, 2015 , 2014 and 2013 , the deferred gains (losses) recorded in AOCI on the Consolidated Statements of Changes in Stockholder’s Equity associated with our cash flow interest rate contract hedges were as follows: (Millions of dollars) Balance as of December 31, 2014, net of tax (expense)/benefit of $3 $ (5 ) Gains (losses) deferred during the year, net of tax (expense)/benefit of $(1) 2 (Gains) losses reclassified to earnings, net of tax expense/(benefit) of $(2) 3 Balance as of December 31, 2015, net of tax (expense)/benefit of $0 $ — (Millions of dollars) Balance as of December 31, 2013, net of tax (expense)/benefit of $3 $ (5 ) Gains (losses) deferred during the year, net of tax (expense)/benefit of $2 (4 ) (Gains) losses reclassified to earnings, net of tax expense/(benefit) of $(2) 4 Balance as of December 31, 2014, net of tax (expense)/benefit of $3 $ (5 ) (Millions of dollars) Balance as of December 31, 2012, net of tax (expense)/benefit of $4 $ (8 ) Gains (losses) deferred during the year, net of tax (expense)/benefit of $1 (1 ) (Gains) losses reclassified to earnings, net of tax expense/(benefit) of $(2) 4 Balance as of December 31, 2013, net of tax (expense)/benefit of $3 $ (5 )
Schedule of effect of derivatives designated as fair value hedging instruments on the Consolidated Statements of Profit	The effect of derivatives designated as hedging instruments on the Consolidated Statements of Profit was as follows: Fair Value Hedges (Millions of dollars) Year Ended December 31, 2015 Classification Gains (Losses) on Derivatives Gains (Losses) on Borrowings Interest rate contracts Other income (expense) $ (27 ) $ 26 Year Ended December 31, 2014 Classification Gains (Losses) on Derivatives Gains (Losses) on Borrowings Interest rate contracts Other income (expense) $ (41 ) $ 40 Year Ended December 31, 2013 Classification Gains (Losses) on Derivatives Gains (Losses) on Borrowings Interest rate contracts Other income (expense) $ (107 ) $ 109
Schedule of effect of derivatives designated as cash flow hedging instruments on the Consolidated Statements of Profit	Cash Flow Hedges (Millions of dollars) Year Ended December 31, 2015 Classification Reclassified from AOCI to Earnings (Effective Portion) Recognized in Earnings (Ineffective Portion) Interest rate contracts Interest expense $ (6 ) $ — Interest rate contracts Other income (expense) — — Cross currency contracts Other income (expense) 1 — $ (5 ) $ — Year Ended December 31, 2014 Classification Reclassified from AOCI to Earnings (Effective Portion) Recognized in Earnings (Ineffective Portion) Interest rate contracts Interest expense $ (6 ) $ — Interest rate contracts Other income (expense) — — $ (6 ) $ — Year Ended December 31, 2013 Classification Reclassified from AOCI to Earnings (Effective Portion) Recognized in Earnings (Ineffective Portion) Interest rate contracts Interest expense $ (6 ) $ — Interest rate contracts Other income (expense) — 1 $ (6 ) $ 1
Schedule of effect of derivatives not designated as hedging instruments on the Consolidated Statements of Profit	The effect of derivatives not designated as hedging instruments on the Consolidated Statements of Profit was as follows for the years ended December 31: Undesignated Derivatives (Millions of dollars) Classification 2015 2014 2013 Foreign exchange contracts Other income (expense) $ (50 ) $ (49 ) $ 3 Cross currency contracts Other income (expense) 16 2 5 Interest rate contracts Other income (expense) — — (3 ) $ (34 ) $ (47 ) $ 5
Schedule of offsetting of derivative assets and liabilities	The effect of net settlement provisions of the master netting agreements on our derivative balances upon an event of default or a termination event as of December 31, was as follows: Offsetting of Derivative Assets and Liabilities (Millions of dollars) 2015 2014 Derivative Assets Gross Amount of Recognized Assets $ 91 $ 101 Gross Amounts Offset — — Net Amount of Assets (1) 91 101 Gross Amounts Not Offset (5 ) (8 ) Net Amount $ 86 $ 93 Derivative Liabilities Gross Amount of Recognized Liabilities $ (10 ) $ (23 ) Gross Amounts Offset — — Net Amount of Liabilities (1) (10 ) (23 ) Gross Amounts Not Offset 5 8 Net Amount $ (5 ) $ (15 ) (1) As presented in the Consolidated Statements of Financial Position.

Income Taxes (Tables)

Income Taxes (Tables)	12 Months Ended
	Dec. 31, 2015
Income Tax Disclosure [Abstract]
Components of Profit before income taxes	The components of Profit before income taxes for the years ended December 31, were as follows: (Millions of dollars) 2015 2014 2013 U.S. $ 230 $ 207 $ 91 Non-U.S. 389 546 603 Total $ 619 $ 753 $ 694
Components of the Provision for income taxes	The components of the Provision for income taxes were as follows for the years ended December 31: (Millions of dollars) 2015 2014 2013 Current income tax provision (benefit): U.S. $ (21 ) $ 14 $ (14 ) Non-U.S. 109 138 183 State (U.S.) 2 (1 ) — 90 151 169 Deferred income tax provision (benefit): U.S. 45 44 17 Non-U.S. 21 13 (18 ) State (U.S.) 2 1 (1 ) 68 58 (2 ) Total Provision for income taxes $ 158 $ 209 $ 167
Reconciliation of the U.S. federal statutory rate to effective rate	The actual Provision for income taxes differs from the Provision for income taxes that would result from applying the U.S. statutory rate to Profit before income taxes for the years ended December 31, for the reasons set forth in the following reconciliation: (Millions of dollars) 2015 2014 2013 Taxes computed at U.S. statutory rates $ 217 35.0 % $ 264 35.0 % $ 243 35.0 % (Decreases) increases in taxes resulting from: State Income Tax, net of Federal Tax 3 0.5 % — — % (1 ) (0.1 )% Subsidiaries' results subject to tax rates other than U.S. statutory rates (19 ) (3.1 )% (53 ) (7.0 )% (68 ) (9.8 )% Income from non-U.S. subsidiaries taxed at U.S. statutory rates, net of foreign tax credits (39 ) (6.3 )% — — % — — % Other, net (4 ) (0.6 )% (2 ) (0.2 )% (7 ) (1.0 )% Provision for income taxes $ 158 25.5 % $ 209 27.8 % $ 167 24.1 %
Deferred income tax assets and liabilities	The amounts of deferred income taxes at December 31, included in the following lines in our Consolidated Statements of Financial Position were: (Millions of dollars) 2015 2014 Assets: Deferred and refundable income taxes $ 75 $ 94 Liabilities: Deferred income taxes and other liabilities (812 ) (668 ) Deferred income taxes, net $ (737 ) $ (574 ) Differences between accounting rules and income tax laws cause differences between the bases of certain assets and liabilities for financial reporting and income tax purposes. The income tax effects of these differences, to the extent they are temporary, are recorded as deferred income tax assets and liabilities netted by tax jurisdiction and taxpayer. Our consolidated deferred income taxes consisted of the following components as of December 31: (Millions of dollars) 2015 2014 Deferred income tax assets: Allowance for credit losses $ 142 $ 149 Tax carryforwards 48 46 190 195 Deferred income tax liabilities (primarily lease basis differences) (574 ) (514 ) Valuation allowance for deferred income tax assets (10 ) (3 ) Deferred income tax on translation adjustment (343 ) (252 ) Deferred income taxes, net $ (737 ) $ (574 )
Summary of net operating loss carryforwards	As of December 31, 2015 , amounts and expiration dates of net operating loss (NOL) carryforwards in various U.S. state taxing jurisdictions were: (Millions of dollars) 2016 2017 2018 2019 2020-2031 Total $ — $ 2 $ 6 $ 4 $ 119 $ 131 The gross deferred income tax asset associated with these NOL carryforwards is $10 million as of December 31, 2015 . In some U.S. state income tax jurisdictions, we join with other Caterpillar entities in filing combined income tax returns. In other U.S. state income tax jurisdictions, we file on a separate, stand-alone basis. As of December 31, 2015 , amounts and expiration dates of NOL carryforwards in various non-U.S. taxing jurisdictions were: (Millions of dollars) 2016 2017 2018 2019 2020-2031 Unlimited Total $ — $ — $ — $ — $ 6 $ 50 $ 56 Valuation allowances totaling $10 million have been recorded at certain non-U.S. subsidiaries that have not yet demonstrated consistent and/or sustainable profitability to support the recognition of net deferred income tax assets.
Schedule of unrecognized tax benefits	A reconciliation of the beginning and ending amounts of gross unrecognized income tax benefits for uncertain income tax positions, including positions impacting only the timing of income tax benefits was as follows: (Millions of dollars) 2015 2014 Reconciliation of unrecognized income tax benefits (1) : Balance at beginning of year $ — $ — Additions for income tax positions related to prior year 2 — Reductions for income tax positions related to settlements (2) (2 ) — Balance at end of year $ — $ — Amount that, if recognized, would impact the effective tax rate $ — $ — (1) Foreign currency translation amounts are included within each line as applicable. (2) Includes cash payment or other reduction of assets to settle liability.

Fair Value Measurements (Tables

Fair Value Measurements (Tables)	12 Months Ended
	Dec. 31, 2015
Fair Value Disclosures [Abstract]
Fair values of financial instruments	Please refer to the table below for the fair values of our financial instruments. (Millions of dollars) 2015 2014 Carrying Amount Fair Value Carrying Amount Fair Value Fair Value Levels Reference Cash and cash equivalents $ 1,016 $ 1,016 $ 857 $ 857 1 Foreign currency contracts: In a receivable position $ 3 $ 3 $ 5 $ 5 2 Note 10 In a payable position $ (6 ) $ (6 ) $ (15 ) $ (15 ) 2 Note 10 Cross currency contracts In a receivable position $ 37 $ 37 $ 17 $ 17 2 Note 10 Finance receivables, net (excluding finance leases (1) ) $ 20,935 $ 20,925 $ 21,434 $ 21,093 3 Note 3 Restricted cash and cash equivalents (2) $ 18 $ 18 $ 11 $ 11 1 Short-term borrowings $ (6,958 ) $ (6,958 ) $ (4,699 ) $ (4,699 ) 1 Note 8 Long-term debt $ (21,605 ) $ (21,904 ) $ (24,574 ) $ (25,103 ) 2 Note 9 Interest rate swaps: In a net receivable position $ 51 $ 51 $ 79 $ 79 2 Note 10 In a net payable position $ (4 ) $ (4 ) $ (8 ) $ (8 ) 2 Note 10 Guarantees $ — $ — $ (1 ) $ (1 ) 3 Note 11 (1) As of December 31, 2015 and 2014 , represents finance leases with a net carrying value of $6.45 billion and $7.64 billion , respectively. (2) Included in Other assets in the Consolidated Statements of Financial Position.

Transactions with Related Par38

Transactions with Related Parties (Tables)	12 Months Ended
	Dec. 31, 2015
Related Party Transactions [Abstract]
Transactions with Related Parties	We have variable amount lending agreements and other notes receivable with Caterpillar. Under these agreements, we may borrow up to $2.28 billion from Caterpillar, and Caterpillar may borrow up to $1.29 billion from us. The agreements are in effect for indefinite periods of time and may be changed or terminated by either party with 30 days notice. We extended a $2 billion committed credit facility to Caterpillar, which expires in February 2019. Under this agreement, we receive a fee from Caterpillar based on amounts drawn under the credit facility and a commitment fee for the undrawn amounts under the credit facility. Information concerning these agreements was as follows: (Millions of dollars) 2015 2014 2013 Notes payable as of December 31, $ 1,096 $ 1,108 $ 1,118 Notes receivable as of December 31, $ 490 $ 414 $ 345 Interest expense $ 6 $ 7 $ 7 Interest income on Notes Receivable with Caterpillar (1) $ 21 $ 18 $ 19 Fees on committed credit facility extended to Caterpillar (1) $ 40 $ 41 $ 41 (1) Included in Other revenues, net in the Consolidated Statements of Profit. We have agreements with Caterpillar to purchase certain trade receivables at a discount. Information pertaining to these purchases was as follows: (Millions of dollars) 2015 2014 2013 Purchases made $ 33,154 $ 36,816 $ 33,018 Discounts earned $ 222 $ 243 $ 233 Balance as of December 31, $ 2,601 $ 3,238 $ 3,092

Leases (Tables)

Leases (Tables)	12 Months Ended
	Dec. 31, 2015
Leases [Abstract]
Minimum payments for operating leases having initial non-cancelable terms in excess of one year	At December 31, 2015 , minimum payments for operating leases having initial non-cancelable terms in excess of one year were as follows: (Millions of dollars) 2016 $ 15 2017 14 2018 13 2019 13 2020 12 Thereafter 16 Total $ 83

Segment and Geographic Inform40

Segment and Geographic Information (Tables)	12 Months Ended
	Dec. 31, 2015
Segment Reporting [Abstract]
Segment Information	Supplemental segment data and reconciliations to consolidated external reporting for the years ended December 31 was as follows: (Millions of dollars) 2015 External Revenues Profit before income taxes Interest Expense Depreciation on equipment leased to others Provision for credit losses Assets at December 31, 2015 Capital expenditures North America $ 1,156 $ 370 $ 261 $ 409 $ 7 $ 14,444 $ 1,118 Europe 284 96 31 76 3 3,758 136 Asia/Pacific 285 65 100 21 29 3,924 37 Latin America and CPF 533 108 152 104 64 7,381 89 Mining 373 47 54 225 14 2,848 69 Total Segments 2,631 686 598 835 117 32,355 1,449 Unallocated 72 (96 ) 69 1 — 1,847 9 Timing (30 ) (32 ) — — 2 164 3 Methodology — 61 (74 ) — — (216 ) — Inter-segment Eliminations (1) — — — — — (247 ) — Total $ 2,673 $ 619 $ 593 $ 836 $ 119 $ 33,903 $ 1,461 2014 External Revenues Profit before income taxes Interest Expense Depreciation on equipment leased to others Provision for credit losses Assets at December 31, 2014 Capital expenditures North America $ 1,067 $ 355 $ 240 $ 361 $ 3 $ 13,661 $ 1,068 Europe 353 114 52 94 10 4,276 133 Asia/Pacific 368 129 116 24 35 4,767 34 Latin America and CPF 594 144 166 118 62 8,001 111 Mining 461 64 65 272 29 3,161 269 Total Segments 2,843 806 639 869 139 33,866 1,615 Unallocated 70 (82 ) 48 1 2 1,648 10 Timing (28 ) (8 ) — — (2 ) 120 2 Methodology — 37 (56 ) — — (215 ) — Inter-segment Eliminations (1) — — — — — (243 ) — Total $ 2,885 $ 753 $ 631 $ 870 $ 139 $ 35,176 $ 1,627 2013 External Revenues Profit before income taxes Interest Expense Depreciation on equipment leased to others Provision for credit losses Assets at December 31, 2013 Capital expenditures North America $ 946 $ 283 $ 259 $ 293 $ — $ 12,160 $ 773 Europe 347 109 59 80 13 4,720 241 Asia/Pacific 399 156 135 25 9 5,251 54 Latin America and CPF 572 126 188 99 69 8,295 273 Mining 474 85 79 272 12 3,441 469 Total Segments 2,738 759 720 769 103 33,867 1,810 Unallocated 73 (73 ) 53 1 2 1,595 10 Timing (26 ) (10 ) — — (4 ) 68 2 Methodology — 18 (39 ) — — (189 ) — Inter-segment Eliminations (1) — — — — — (227 ) — Total $ 2,785 $ 694 $ 734 $ 770 $ 101 $ 35,114 $ 1,822
Geographic information	Geographic information: (Millions of dollars) 2015 2014 2013 Revenues Inside U.S. $ 1,330 $ 1,219 $ 1,045 Inside Canada 198 259 329 Inside Australia 200 261 287 All other 945 1,146 1,124 Total $ 2,673 $ 2,885 $ 2,785 Equipment on Operating Leases and Non-Leased Equipment (included in Other Assets), Net 2015 2014 Inside U.S. $ 2,058 $ 1,696 Inside Canada 572 756 Inside Australia 282 358 All other 716 896 Total $ 3,628 $ 3,706

Selected Quarterly Financial 41

Selected Quarterly Financial Data (Unaudited) (Tables)	12 Months Ended
	Dec. 31, 2015
Quarterly Financial Information Disclosure [Abstract]
Selected quarterly financial data (unaudited)	(Millions of dollars) 2015 First quarter Second quarter Third quarter Fourth quarter Total revenues $ 689 $ 683 $ 653 $ 648 Profit before income taxes $ 187 $ 150 $ 153 $ 129 Profit $ 133 $ 104 $ 109 $ 114 2014 First quarter Second quarter Third quarter Fourth quarter Total revenues $ 711 $ 728 $ 743 $ 703 Profit before income taxes $ 182 $ 208 $ 197 $ 166 Profit $ 131 $ 148 $ 148 $ 108

Employee Separation Charges (Ta

Employee Separation Charges (Tables)	12 Months Ended
	Dec. 31, 2015
Restructuring and Related Activities [Abstract]
Summary of separation charges	The following table summarizes the 2015 separation activity: (Millions of dollars) Liability balance at December 31, 2014 $ — Increase in liability (separation charges) 15 Reduction in liability (payments and other adjustments) (5 ) Liability balance at December 31, 2015 $ 10

Summary of Significant Accoun43

Summary of Significant Accounting Policies (Details)	12 Months Ended
	Dec. 31, 2015
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Period after which collection of future income is considered as not probable	120 days

Summary of Significant Accoun44

Summary of Significant Accounting Policies (Details 2) - Equipment on operating leases	12 Months Ended
	Dec. 31, 2015
Minimum
Depreciation
Lease term used to calculate depreciation	1 year
Maximum
Depreciation
Lease term used to calculate depreciation	7 years

Accumulated Other Comprehensi45

Accumulated Other Comprehensive Income/(Loss) (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Accumulated Other Comprehensive Income (Loss) [Line Items]
Balance at beginning of year	$ (364)	$ 117	$ 176
Other comprehensive income/(loss) before reclassifications	(536)	(485)	(63)
Amounts reclassified from accumulated other comprehensive (income)/loss	3	4	4
Other comprehensive income/(loss)	(533)	(481)	(59)
Balance at end of year	(897)	(364)	117
Foreign currency translation
Accumulated Other Comprehensive Income (Loss) [Line Items]
Balance at beginning of year	(359)	122	184
Other comprehensive income/(loss) before reclassifications	(538)	(481)	(62)
Amounts reclassified from accumulated other comprehensive (income)/loss	0	0	0
Other comprehensive income/(loss)	(538)	(481)	(62)
Balance at end of year	(897)	(359)	122
Derivative financial instruments
Accumulated Other Comprehensive Income (Loss) [Line Items]
Balance at beginning of year	(5)	(5)	(8)
Other comprehensive income/(loss) before reclassifications	2	(4)	(1)
Amounts reclassified from accumulated other comprehensive (income)/loss	3	4	4
Other comprehensive income/(loss)	5	0	3
Balance at end of year	$ 0	$ (5)	$ (5)

Accumulated Other Comprehensi46

Accumulated Other Comprehensive Income/(Loss) (Details 2) - USD ($) $ in Millions	3 Months Ended								12 Months Ended
	Dec. 31, 2015	Sep. 30, 2015	Jun. 30, 2015	Mar. 31, 2015	Dec. 31, 2014	Sep. 30, 2014	Jun. 30, 2014	Mar. 31, 2014	Dec. 31, 2015		Dec. 31, 2014		Dec. 31, 2013
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items]
Other income (expense)									$ (27)		$ (22)		$ (35)
Interest Expense									(593)		(631)		(734)
Tax (provision) benefit									(158)		(209)		(167)
Total reclassifications from Accumulated other comprehensive income/(loss)	$ 114	$ 109	$ 104	$ 133	$ 108	$ 148	$ 148	$ 131	460	[1]	535	[1]	513	[1]
Reclassifications out of Accumulated other comprehensive income/(loss) | Derivative financial instruments
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items]
Reclassifications before tax									(5)		(6)		(6)
Tax (provision) benefit									2		2		2
Total reclassifications from Accumulated other comprehensive income/(loss)									(3)		(4)		(4)
Reclassifications out of Accumulated other comprehensive income/(loss) | Derivative financial instruments | Cross currency contracts
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items]
Other income (expense)									1		0		0
Reclassifications out of Accumulated other comprehensive income/(loss) | Derivative financial instruments | Interest rate contracts
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items]
Interest Expense									$ (6)		$ (6)		$ (6)
[1]	Profit attributable to Caterpillar Financial Services Corporation.

Finance Receivables (Details)

Finance Receivables (Details) - USD ($) $ in Millions	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Accounts, Notes, Loans and Financing Receivable
Finance leases and installment sales contracts - Retail	$ 13,728	$ 14,455
Retail notes receivable	10,616	11,005
Wholesale notes receivable	3,887	4,514
Finance leases and installment sales contracts - Wholesale	289	384
Total gross finance receivables	28,520	30,358
Less: Unearned income	(794)	(883)
Less: Allowance for credit losses	(338)	(401)	$ (387)
Total finance receivables, net	$ 27,388	$ 29,074

Finance Receivables (Details 2)

Finance Receivables (Details 2) - USD ($) $ in Millions	Dec. 31, 2015	Dec. 31, 2014
Accounts, Notes, Loans and Financing Receivable
Amounts due in 2016	$ 13,033
Amounts due in 2017	5,907
Amounts due in 2018	3,956
Amounts due in 2019	2,169
Amounts due in 2020	1,307
Amounts due thereafter	1,087
Total	27,459
Guaranteed residual value	369
Unguaranteed residual value	692
Total gross finance receivables	28,520	$ 30,358
Retail Installment Sale Contracts
Accounts, Notes, Loans and Financing Receivable
Amounts due in 2016	2,597
Amounts due in 2017	2,015
Amounts due in 2018	1,368
Amounts due in 2019	699
Amounts due in 2020	202
Amounts due thereafter	11
Total	6,892
Guaranteed residual value	0
Unguaranteed residual value	0
Total gross finance receivables	6,892
Wholesale Installment Sale Contracts
Accounts, Notes, Loans and Financing Receivable
Amounts due in 2016	48
Amounts due in 2017	7
Amounts due in 2018	3
Amounts due in 2019	1
Amounts due in 2020	0
Amounts due thereafter	0
Total	59
Guaranteed residual value	0
Unguaranteed residual value	0
Total gross finance receivables	59
Retail Finance Leases
Accounts, Notes, Loans and Financing Receivable
Amounts due in 2016	2,543
Amounts due in 2017	1,661
Amounts due in 2018	939
Amounts due in 2019	425
Amounts due in 2020	170
Amounts due thereafter	98
Total	5,836
Guaranteed residual value	334
Unguaranteed residual value	666
Total gross finance receivables	6,836
Wholesale Finance Leases
Accounts, Notes, Loans and Financing Receivable
Amounts due in 2016	53
Amounts due in 2017	52
Amounts due in 2018	38
Amounts due in 2019	18
Amounts due in 2020	6
Amounts due thereafter	2
Total	169
Guaranteed residual value	35
Unguaranteed residual value	26
Total gross finance receivables	230
Retail Notes
Accounts, Notes, Loans and Financing Receivable
Amounts due in 2016	4,297
Amounts due in 2017	1,940
Amounts due in 2018	1,450
Amounts due in 2019	1,024
Amounts due in 2020	929
Amounts due thereafter	976
Total	10,616
Guaranteed residual value	0
Unguaranteed residual value	0
Total gross finance receivables	10,616
Wholesale Notes
Accounts, Notes, Loans and Financing Receivable
Amounts due in 2016	3,495
Amounts due in 2017	232
Amounts due in 2018	158
Amounts due in 2019	2
Amounts due in 2020	0
Amounts due thereafter	0
Total	3,887
Guaranteed residual value	0
Unguaranteed residual value	0
Total gross finance receivables	$ 3,887

Finance Receivables (Details 3)

Finance Receivables (Details 3) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2015	Dec. 31, 2014
Financing Receivable, Allowance for Credit Losses
Allowance for credit losses	$ 401	$ 387	$ 338	$ 401
Allowance for credit losses as percent of net finance receivables			1.22%	1.36%
Increase (decrease) in allowance for credit losses	(63)
Financing Receivable, Allowance for Credit Losses
Balance at beginning of year	401	387
Receivables written off	(196)	(146)
Recoveries on receivables previously written off	41	47
Provision for credit losses	117	136
Adjustment due to sale of receivables	(2)	(3)
Foreign currency translation adjustment	(23)	(20)
Balance at end of year	338	401
Allowance for Credit Losses
Individually evaluated for impairment			$ 65	$ 75
Collectively evaluated for impairment			273	326
Allowance, Ending balance	401	387	338	401
Recorded Investment in Finance Receivables
Individually evaluated for impairment			601	614
Collectively evaluated for impairment			27,125	28,861
Total gross finance receivables			27,726	29,475
Customer
Financing Receivable, Allowance for Credit Losses
Allowance for credit losses	388	374	327	388
Financing Receivable, Allowance for Credit Losses
Balance at beginning of year	388	374
Receivables written off	(196)	(146)
Recoveries on receivables previously written off	41	47
Provision for credit losses	119	136
Adjustment due to sale of receivables	(2)	(3)
Foreign currency translation adjustment	(23)	(20)
Balance at end of year	327	388
Allowance for Credit Losses
Individually evaluated for impairment			65	75
Collectively evaluated for impairment			262	313
Allowance, Ending balance	388	374	327	388
Recorded Investment in Finance Receivables
Individually evaluated for impairment			601	614
Collectively evaluated for impairment			19,431	20,454
Total gross finance receivables			20,032	21,068
Dealer
Financing Receivable, Allowance for Credit Losses
Allowance for credit losses	10	10	9	10
Financing Receivable, Allowance for Credit Losses
Balance at beginning of year	10	10
Receivables written off	0	0
Recoveries on receivables previously written off	0	0
Provision for credit losses	(1)	0
Adjustment due to sale of receivables	0	0
Foreign currency translation adjustment	0	0
Balance at end of year	9	10
Allowance for Credit Losses
Individually evaluated for impairment			0	0
Collectively evaluated for impairment			9	10
Allowance, Ending balance	10	10	9	10
Recorded Investment in Finance Receivables
Individually evaluated for impairment			0	0
Collectively evaluated for impairment			5,093	5,169
Total gross finance receivables			5,093	5,169
Caterpillar Purchased Receivables
Financing Receivable, Allowance for Credit Losses
Allowance for credit losses	3	3	2	3
Financing Receivable, Allowance for Credit Losses
Balance at beginning of year	3	3
Receivables written off	0	0
Recoveries on receivables previously written off	0	0
Provision for credit losses	(1)	0
Adjustment due to sale of receivables	0	0
Foreign currency translation adjustment	0	0
Balance at end of year	2	3
Allowance for Credit Losses
Individually evaluated for impairment			0	0
Collectively evaluated for impairment			2	3
Allowance, Ending balance	$ 3	$ 3	2	3
Recorded Investment in Finance Receivables
Individually evaluated for impairment			0	0
Collectively evaluated for impairment			2,601	3,238
Total gross finance receivables			$ 2,601	$ 3,238

Finance Receivables (Details 4)

Finance Receivables (Details 4) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Receivables [Abstract]
Period after which unpaid installments are considered as past due	30 days
Period after which collection of future income is considered as not probable	120 days
Financing Receivable, Recorded Investment, Aging
Past Due	$ 628	$ 702
Current	27,098	28,773
Total gross finance receivables	27,726	29,475
91 Plus, Still Accruing	26	38
31-60 Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	156	208
61-90 Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	70	91
91 Plus Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	402	403
Customer
Financing Receivable, Recorded Investment, Aging
Total gross finance receivables	20,032	21,068
Customer | North America
Financing Receivable, Recorded Investment, Aging
Past Due	87	81
Current	8,031	7,291
Total gross finance receivables	8,118	7,372
91 Plus, Still Accruing	4	4
Customer | North America | 31-60 Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	45	46
Customer | North America | 61-90 Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	12	8
Customer | North America | 91 Plus Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	30	27
Customer | Europe
Financing Receivable, Recorded Investment, Aging
Past Due	69	68
Current	2,358	2,607
Total gross finance receivables	2,427	2,675
91 Plus, Still Accruing	9	6
Customer | Europe | 31-60 Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	18	16
Customer | Europe | 61-90 Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	7	23
Customer | Europe | 91 Plus Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	44	29
Customer | Asia/Pacific
Financing Receivable, Recorded Investment, Aging
Past Due	55	120
Current	2,108	2,773
Total gross finance receivables	2,163	2,893
91 Plus, Still Accruing	6	16
Customer | Asia/Pacific | 31-60 Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	22	29
Customer | Asia/Pacific | 61-90 Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	12	22
Customer | Asia/Pacific | 91 Plus Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	21	69
Customer | Mining
Financing Receivable, Recorded Investment, Aging
Past Due	75	39
Current	1,793	2,084
Total gross finance receivables	1,868	2,123
91 Plus, Still Accruing	1	0
Customer | Mining | 31-60 Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	6	28
Customer | Mining | 61-90 Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	1	0
Customer | Mining | 91 Plus Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	68	11
Customer | Latin America
Financing Receivable, Recorded Investment, Aging
Past Due	275	274
Current	1,998	2,583
Total gross finance receivables	2,273	2,857
91 Plus, Still Accruing	0	8
Customer | Latin America | 31-60 Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	45	55
Customer | Latin America | 61-90 Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	31	23
Customer | Latin America | 91 Plus Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	199	196
Customer | Caterpillar Power Finance
Financing Receivable, Recorded Investment, Aging
Past Due	36	69
Current	3,147	3,079
Total gross finance receivables	3,183	3,148
91 Plus, Still Accruing	2	1
Customer | Caterpillar Power Finance | 31-60 Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	0	1
Customer | Caterpillar Power Finance | 61-90 Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	1	4
Customer | Caterpillar Power Finance | 91 Plus Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	35	64
Dealer
Financing Receivable, Recorded Investment, Aging
Total gross finance receivables	5,093	5,169
Dealer | North America
Financing Receivable, Recorded Investment, Aging
Past Due	0	0
Current	3,387	3,209
Total gross finance receivables	3,387	3,209
91 Plus, Still Accruing	0	0
Dealer | North America | 31-60 Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	0	0
Dealer | North America | 61-90 Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	0	0
Dealer | North America | 91 Plus Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	0	0
Dealer | Europe
Financing Receivable, Recorded Investment, Aging
Past Due	0	0
Current	330	467
Total gross finance receivables	330	467
91 Plus, Still Accruing	0	0
Dealer | Europe | 31-60 Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	0	0
Dealer | Europe | 61-90 Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	0	0
Dealer | Europe | 91 Plus Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	0	0
Dealer | Asia/Pacific
Financing Receivable, Recorded Investment, Aging
Past Due	0	0
Current	611	637
Total gross finance receivables	611	637
91 Plus, Still Accruing	0	0
Dealer | Asia/Pacific | 31-60 Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	0	0
Dealer | Asia/Pacific | 61-90 Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	0	0
Dealer | Asia/Pacific | 91 Plus Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	0	0
Dealer | Mining
Financing Receivable, Recorded Investment, Aging
Past Due	0	0
Current	4	3
Total gross finance receivables	4	3
91 Plus, Still Accruing	0	0
Dealer | Mining | 31-60 Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	0	0
Dealer | Mining | 61-90 Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	0	0
Dealer | Mining | 91 Plus Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	0	0
Dealer | Latin America
Financing Receivable, Recorded Investment, Aging
Past Due	0	0
Current	758	853
Total gross finance receivables	758	853
91 Plus, Still Accruing	0	0
Dealer | Latin America | 31-60 Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	0	0
Dealer | Latin America | 61-90 Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	0	0
Dealer | Latin America | 91 Plus Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	0	0
Dealer | Caterpillar Power Finance
Financing Receivable, Recorded Investment, Aging
Past Due	0	0
Current	3	0
Total gross finance receivables	3	0
91 Plus, Still Accruing	0	0
Dealer | Caterpillar Power Finance | 31-60 Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	0	0
Dealer | Caterpillar Power Finance | 61-90 Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	0	0
Dealer | Caterpillar Power Finance | 91 Plus Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	0	0
Caterpillar Purchased Receivables
Financing Receivable, Recorded Investment, Aging
Total gross finance receivables	2,601	3,238
Caterpillar Purchased Receivables | North America
Financing Receivable, Recorded Investment, Aging
Past Due	22	29
Current	1,386	1,916
Total gross finance receivables	1,408	1,945
91 Plus, Still Accruing	1	1
Caterpillar Purchased Receivables | North America | 31-60 Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	16	23
Caterpillar Purchased Receivables | North America | 61-90 Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	5	5
Caterpillar Purchased Receivables | North America | 91 Plus Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	1	1
Caterpillar Purchased Receivables | Europe
Financing Receivable, Recorded Investment, Aging
Past Due	8	10
Current	307	429
Total gross finance receivables	315	439
91 Plus, Still Accruing	3	1
Caterpillar Purchased Receivables | Europe | 31-60 Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	4	4
Caterpillar Purchased Receivables | Europe | 61-90 Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	0	1
Caterpillar Purchased Receivables | Europe | 91 Plus Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	4	5
Caterpillar Purchased Receivables | Asia/Pacific
Financing Receivable, Recorded Investment, Aging
Past Due	0	0
Current	407	401
Total gross finance receivables	407	401
91 Plus, Still Accruing	0	0
Caterpillar Purchased Receivables | Asia/Pacific | 31-60 Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	0	0
Caterpillar Purchased Receivables | Asia/Pacific | 61-90 Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	0	0
Caterpillar Purchased Receivables | Asia/Pacific | 91 Plus Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	0	0
Caterpillar Purchased Receivables | Mining
Financing Receivable, Recorded Investment, Aging
Past Due	0	0
Current	0	0
Total gross finance receivables	0	0
91 Plus, Still Accruing	0	0
Caterpillar Purchased Receivables | Mining | 31-60 Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	0	0
Caterpillar Purchased Receivables | Mining | 61-90 Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	0	0
Caterpillar Purchased Receivables | Mining | 91 Plus Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	0	0
Caterpillar Purchased Receivables | Latin America
Financing Receivable, Recorded Investment, Aging
Past Due	0	11
Current	454	420
Total gross finance receivables	454	431
91 Plus, Still Accruing	0	0
Caterpillar Purchased Receivables | Latin America | 31-60 Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	0	6
Caterpillar Purchased Receivables | Latin America | 61-90 Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	0	5
Caterpillar Purchased Receivables | Latin America | 91 Plus Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	0	0
Caterpillar Purchased Receivables | Caterpillar Power Finance
Financing Receivable, Recorded Investment, Aging
Past Due	1	1
Current	16	21
Total gross finance receivables	17	22
91 Plus, Still Accruing	0	1
Caterpillar Purchased Receivables | Caterpillar Power Finance | 31-60 Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	0	0
Caterpillar Purchased Receivables | Caterpillar Power Finance | 61-90 Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	1	0
Caterpillar Purchased Receivables | Caterpillar Power Finance | 91 Plus Days Past Due
Financing Receivable, Recorded Investment, Aging
Past Due	$ 0	$ 1

Finance Receivables (Details 5)

Finance Receivables (Details 5) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Customer
Financing Receivable, Impaired
Recorded Investment With No Allowance Recorded	$ 408	$ 252
Unpaid Principal Balance With No Allowance Recorded	407	250
Related Allowance With No Allowance Recorded	0	0
Recorded Investment With An Allowance Recorded	193	362
Unpaid Principal Balance With An Allowance Recorded	191	360
Related Allowance	65	75
Recorded Investment, Total	601	614
Unpaid Principal Balance, Total	598	610
Related Allowance, Total	65	75
Average Recorded Investment With No Allowance Recorded	332	333	$ 421
Interest Income Recognized With No Allowance Recorded	10	11	12
Average Recorded Investment With An Allowance Recorded	277	275	246
Interest Income Recognized With An Allowance Recorded	10	12	6
Average Recorded Investment, Total	609	608	667
Interest Income Recognized, Total	20	23	18
Customer | North America
Financing Receivable, Impaired
Recorded Investment With No Allowance Recorded	12	14
Unpaid Principal Balance With No Allowance Recorded	12	14
Related Allowance With No Allowance Recorded	0	0
Recorded Investment With An Allowance Recorded	14	6
Unpaid Principal Balance With An Allowance Recorded	13	6
Related Allowance	4	1
Recorded Investment, Total	26	20
Unpaid Principal Balance, Total	25	20
Related Allowance, Total	4	1
Average Recorded Investment With No Allowance Recorded	12	20	25
Interest Income Recognized With No Allowance Recorded	1	1	3
Average Recorded Investment With An Allowance Recorded	9	9	18
Interest Income Recognized With An Allowance Recorded	0	0	1
Average Recorded Investment, Total	21	29	43
Interest Income Recognized, Total	1	1	4
Customer | Europe
Financing Receivable, Impaired
Recorded Investment With No Allowance Recorded	41	44
Unpaid Principal Balance With No Allowance Recorded	41	43
Related Allowance With No Allowance Recorded	0	0
Recorded Investment With An Allowance Recorded	11	12
Unpaid Principal Balance With An Allowance Recorded	10	12
Related Allowance	5	4
Recorded Investment, Total	52	56
Unpaid Principal Balance, Total	51	55
Related Allowance, Total	5	4
Average Recorded Investment With No Allowance Recorded	42	47	49
Interest Income Recognized With No Allowance Recorded	1	1	1
Average Recorded Investment With An Allowance Recorded	14	21	22
Interest Income Recognized With An Allowance Recorded	1	1	1
Average Recorded Investment, Total	56	68	71
Interest Income Recognized, Total	2	2	2
Customer | Asia/Pacific
Financing Receivable, Impaired
Recorded Investment With No Allowance Recorded	1	2
Unpaid Principal Balance With No Allowance Recorded	1	2
Related Allowance With No Allowance Recorded	0	0
Recorded Investment With An Allowance Recorded	34	29
Unpaid Principal Balance With An Allowance Recorded	34	29
Related Allowance	4	8
Recorded Investment, Total	35	31
Unpaid Principal Balance, Total	35	31
Related Allowance, Total	4	8
Average Recorded Investment With No Allowance Recorded	2	3	4
Interest Income Recognized With No Allowance Recorded	0	0	0
Average Recorded Investment With An Allowance Recorded	44	23	18
Interest Income Recognized With An Allowance Recorded	2	1	1
Average Recorded Investment, Total	46	26	22
Interest Income Recognized, Total	2	1	1
Customer | Mining
Financing Receivable, Impaired
Recorded Investment With No Allowance Recorded	84	29
Unpaid Principal Balance With No Allowance Recorded	84	29
Related Allowance With No Allowance Recorded	0	0
Recorded Investment With An Allowance Recorded	11	138
Unpaid Principal Balance With An Allowance Recorded	11	137
Related Allowance	3	9
Recorded Investment, Total	95	167
Unpaid Principal Balance, Total	95	166
Related Allowance, Total	3	9
Average Recorded Investment With No Allowance Recorded	75	69	61
Interest Income Recognized With No Allowance Recorded	3	3	3
Average Recorded Investment With An Allowance Recorded	39	90	1
Interest Income Recognized With An Allowance Recorded	1	7	0
Average Recorded Investment, Total	114	159	62
Interest Income Recognized, Total	4	10	3
Customer | Latin America
Financing Receivable, Impaired
Recorded Investment With No Allowance Recorded	28	34
Unpaid Principal Balance With No Allowance Recorded	28	34
Related Allowance With No Allowance Recorded	0	0
Recorded Investment With An Allowance Recorded	53	42
Unpaid Principal Balance With An Allowance Recorded	53	42
Related Allowance	21	12
Recorded Investment, Total	81	76
Unpaid Principal Balance, Total	81	76
Related Allowance, Total	21	12
Average Recorded Investment With No Allowance Recorded	31	30	11
Interest Income Recognized With No Allowance Recorded	0	0	0
Average Recorded Investment With An Allowance Recorded	56	36	52
Interest Income Recognized With An Allowance Recorded	3	1	2
Average Recorded Investment, Total	87	66	63
Interest Income Recognized, Total	3	1	2
Customer | Caterpillar Power Finance
Financing Receivable, Impaired
Recorded Investment With No Allowance Recorded	242	129
Unpaid Principal Balance With No Allowance Recorded	241	128
Related Allowance With No Allowance Recorded	0	0
Recorded Investment With An Allowance Recorded	70	135
Unpaid Principal Balance With An Allowance Recorded	70	134
Related Allowance	28	41
Recorded Investment, Total	312	264
Unpaid Principal Balance, Total	311	262
Related Allowance, Total	28	41
Average Recorded Investment With No Allowance Recorded	170	164	271
Interest Income Recognized With No Allowance Recorded	5	6	5
Average Recorded Investment With An Allowance Recorded	115	96	135
Interest Income Recognized With An Allowance Recorded	3	2	1
Average Recorded Investment, Total	285	260	406
Interest Income Recognized, Total	8	8	6
Dealer
Financing Receivable, Impaired
Recorded Investment, Total	$ 0	$ 0	$ 0
Average Recorded Investment, Total
Caterpillar Purchased Receivables
Financing Receivable, Impaired
Recorded Investment, Total	$ 0	$ 0	$ 0
Average Recorded Investment, Total

Finance Receivables (Details 6)

Finance Receivables (Details 6) - USD ($) $ in Millions	Dec. 31, 2015	Dec. 31, 2014
Financing Receivable, Recorded Investment, Past Due
Investment in finance receivables on non-accrual status	$ 485	$ 468
Customer | North America
Financing Receivable, Recorded Investment, Past Due
Investment in finance receivables on non-accrual status	31	27
Customer | Europe
Financing Receivable, Recorded Investment, Past Due
Investment in finance receivables on non-accrual status	39	28
Customer | Asia/Pacific
Financing Receivable, Recorded Investment, Past Due
Investment in finance receivables on non-accrual status	15	54
Customer | Mining
Financing Receivable, Recorded Investment, Past Due
Investment in finance receivables on non-accrual status	106	62
Customer | Latin America
Financing Receivable, Recorded Investment, Past Due
Investment in finance receivables on non-accrual status	217	201
Customer | Caterpillar Power Finance
Financing Receivable, Recorded Investment, Past Due
Investment in finance receivables on non-accrual status	77	96
Dealer
Financing Receivable, Recorded Investment, Past Due
Investment in finance receivables on non-accrual status	0	0
Caterpillar Purchased Receivables | Europe
Financing Receivable, Recorded Investment, Past Due
Investment in finance receivables on non-accrual status	$ 1	$ 4

Finance Receivables (Details 7)

Finance Receivables (Details 7) $ in Millions	12 Months Ended
	Dec. 31, 2015USD ($)contracts	Dec. 31, 2014USD ($)contracts	Dec. 31, 2013USD ($)contracts
Loan and finance lease receivables modified as TDRs
Number of Contracts | contracts	94	148	210
Pre-TDR Recorded Investment	$ 354	$ 372	$ 296
Post-TDR Recorded Investment	$ 338	$ 359	$ 300
TDRs with a payment default which had been modified within twelve months prior to the default date
Number of Contracts | contracts	24	68	26
Post-TDR Recorded Investment	$ 2	$ 4	$ 7
Remaining commitments	3	0	0
Additional investments not recorded	$ 4	$ 0	$ 25
Caterpillar Purchased Receivables
Loan and finance lease receivables modified as TDRs
Number of Contracts | contracts	0	0	0
Dealer
Loan and finance lease receivables modified as TDRs
Number of Contracts | contracts	0	0	0
Customer | North America
Loan and finance lease receivables modified as TDRs
Number of Contracts | contracts	14	34	62
Pre-TDR Recorded Investment	$ 1	$ 12	$ 9
Post-TDR Recorded Investment	$ 1	$ 7	$ 9
TDRs with a payment default which had been modified within twelve months prior to the default date
Number of Contracts | contracts	12	11	19
Post-TDR Recorded Investment	$ 1	$ 1	$ 4
Customer | Europe
Loan and finance lease receivables modified as TDRs
Number of Contracts | contracts	23	8	51
Pre-TDR Recorded Investment	$ 2	$ 7	$ 7
Post-TDR Recorded Investment	$ 2	$ 7	$ 7
TDRs with a payment default which had been modified within twelve months prior to the default date
Number of Contracts | contracts	0	46	5
Post-TDR Recorded Investment	$ 0	$ 2	$ 0
Customer | Asia/Pacific
Loan and finance lease receivables modified as TDRs
Number of Contracts | contracts	21	2	3
Pre-TDR Recorded Investment	$ 26	$ 0	$ 1
Post-TDR Recorded Investment	$ 26	$ 0	$ 1
Customer | Mining
Loan and finance lease receivables modified as TDRs
Number of Contracts | contracts	4	51	45
Pre-TDR Recorded Investment	$ 65	$ 185	$ 123
Post-TDR Recorded Investment	$ 65	$ 176	$ 123
Customer | Latin America
Loan and finance lease receivables modified as TDRs
Number of Contracts | contracts	11	35	32
Pre-TDR Recorded Investment	$ 1	$ 31	$ 3
Post-TDR Recorded Investment	$ 2	$ 30	$ 3
TDRs with a payment default which had been modified within twelve months prior to the default date
Number of Contracts | contracts	12	11	0
Post-TDR Recorded Investment	$ 1	$ 1	$ 0
Customer | Caterpillar Power Finance
Loan and finance lease receivables modified as TDRs
Number of Contracts | contracts	21	18	17
Pre-TDR Recorded Investment	$ 259	$ 137	$ 153
Post-TDR Recorded Investment	$ 242	$ 139	$ 157
TDRs with a payment default which had been modified within twelve months prior to the default date
Number of Contracts | contracts	0	0	2
Post-TDR Recorded Investment	$ 0	$ 0	$ 3

Equipment on Operating Leases54

Equipment on Operating Leases (Details) - USD ($) $ in Millions	Dec. 31, 2015	Dec. 31, 2014
Scheduled minimum rental payments for operating leases
2,016	$ 818
2,017	522
2,018	308
2,019	142
2,020	49
Thereafter	12
Total	1,851
Equipment leased to others
Equipment on operating leases
Equipment on operating leases, at cost	5,202	$ 5,273
Less: Accumulated depreciation	(1,638)	(1,649)
Equipment on operating leases, net	$ 3,564	$ 3,624

Other Assets (Details)

Other Assets (Details) - USD ($) $ in Millions	Dec. 31, 2015	Dec. 31, 2014
Other Assets [Abstract]
Collateral held for resale, at net realizable value	$ 560	$ 321
Customer and other miscellaneous receivables	421	428
Other	224	252
Total other assets	$ 1,205	$ 1,001

Concentration of Credit Risk (D

Concentration of Credit Risk (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Concentration Risk
Derivatives, Maximum exposure to credit loss	$ 91	$ 101
Construction related industries
Concentration Risk
Concentration Risk, Percentage	33.00%	33.00%
North America
Concentration Risk
Concentration Risk, Percentage	60.00%	50.00%

Credit Commitments (Details)

Credit Commitments (Details) $ in Millions	6 Months Ended	12 Months Ended
	Dec. 31, 2015USD ($)	Dec. 31, 2015USD ($)	Dec. 31, 2014USD ($)	Dec. 31, 2013USD ($)
Line of Credit Facility
Number of global credit facilities	3	3
Caterpillar's consolidated net worth	$ 19,920	$ 19,920
Minimum net worth required under the Credit Facility	$ 9,000	$ 9,000
Covenant interest coverage ratio, Numerator		2.05
Covenant interest coverage ratio, Denominator		1
Minimum interest coverage ratio, required by the Credit Facility, Numerator		1.15
Minimum interest coverage ratio, required by the Credit Facility, Denominator		1
Leverage Ratio, Numerator	7.49	7.93
Leverage Ratio, Denominator	1	1
Maximum Leverage Ratio, Permissible Under Credit Facility, Numerator		10
Maximum Leverage Ratio, Permissible Under Credit Facility, Denominator		1
Amount available	$ 10,500	$ 10,500
Maximum borrowing capacity from Caterpillar, Variable lending agreements	2,280	2,280
Maximum lending capacity to Caterpillar, Variable lending agreements	1,290	1,290
Notes receivable from Caterpillar	490	490	$ 414	$ 345
Notes payable to Caterpillar	1,096	1,096	1,108	$ 1,118
Amount available, Committed credit facility extended to Caterpillar	2,000	2,000
Amount outstanding, Committed credit facility extended to Caterpillar	0	0
Revolving credit facilities
Line of Credit Facility
Amount outstanding	0	0
Revolving credit facilities | Cat Financial
Line of Credit Facility
Amount available	7,750	7,750
364-day facility
Line of Credit Facility
Amount available	3,150	3,150
364-day facility | Cat Financial
Line of Credit Facility
Amount available	2,330	2,330
Three-year facility
Line of Credit Facility
Amount available	2,730	2,730
Three-year facility | Cat Financial
Line of Credit Facility
Amount available	2,010	2,010
Five-year facility
Line of Credit Facility
Amount available	4,620	4,620
Five-year facility | Cat Financial
Line of Credit Facility
Amount available	3,410	3,410
Credit lines with banks
Line of Credit Facility
Amount available	3,570	3,570
Amount outstanding	$ 1,440	$ 1,440	$ 1,900

Short-Term Borrowings (Details)

Short-Term Borrowings (Details) - USD ($) $ in Millions	Dec. 31, 2015	Dec. 31, 2014
Short-term Debt
Short-term borrowings, Balance	$ 6,958	$ 4,699
Commercial paper, net
Short-term Debt
Short-term borrowings, Balance	$ 5,811	$ 3,688
Short-term borrowings, Avg. Rate	0.50%	0.30%
Bank borrowings
Short-term Debt
Short-term borrowings, Balance	$ 440	$ 411
Short-term borrowings, Avg. Rate	9.30%	6.80%
Variable denomination floating rate demand notes
Short-term Debt
Short-term borrowings, Balance	$ 707	$ 600
Short-term borrowings, Avg. Rate	0.80%	0.80%

Long-Term Debt (Details)

Long-Term Debt (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Debt Instrument
Medium-term notes, maximum remaining maturity	12 years
Long-term debt	$ 21,605	$ 24,574
Long-term debt outstanding maturity:
2,016	5,362
2,017	5,866
2,018	4,154
2,019	2,531
2,020	1,125
Thereafter	2,567
Total	21,605	24,574
Medium-term notes
Debt Instrument
Long-term debt issued	3,760
Long-term debt issued at fixed interest rates	2,870
Long-term debt issued at floating interest rates	891
Long term debt, gross	20,611	23,094
Unamortized discount	(1)	(4)
Long-term debt	$ 20,610	$ 23,090
Long-term debt, Avg. Rate	2.40%	2.40%
Long-term debt outstanding maturity:
Total	$ 20,610	$ 23,090
Bank borrowings
Debt Instrument
Long-term debt	$ 995	$ 1,484
Long-term debt, Avg. Rate	4.00%	3.40%
Long-term debt outstanding maturity:
Total	$ 995	$ 1,484

Derivative Financial Instrume60

Derivative Financial Instruments and Risk Management (Details) $ in Millions	Dec. 31, 2015USD ($)
Maximum
Derivative
Deferred net losses, interest rate risk, to be reclassified from equity to current earnings over the next twelve months	$ 1

Derivative Financial Instrume61

Derivative Financial Instruments and Risk Management (Details 2) - USD ($) $ in Millions	Dec. 31, 2015	Dec. 31, 2014
Derivatives, Fair Value
Asset Fair Value	$ 91	$ 101
Liability Fair Value	(10)	(23)
Designated derivatives
Derivatives, Fair Value
Asset (Liability) Fair Value	48	71
Designated derivatives | Interest rate contracts | Other assets
Derivatives, Fair Value
Asset Fair Value	51	79
Designated derivatives | Interest rate contracts | Accrued expenses
Derivatives, Fair Value
Liability Fair Value	(4)	(8)
Designated derivatives | Cross currency contracts | Other assets
Derivatives, Fair Value
Asset Fair Value	1	0
Undesignated derivatives
Derivatives, Fair Value
Asset (Liability) Fair Value	33	7
Undesignated derivatives | Foreign exchange contracts | Other assets
Derivatives, Fair Value
Asset Fair Value	3	5
Undesignated derivatives | Foreign exchange contracts | Accrued expenses
Derivatives, Fair Value
Liability Fair Value	(6)	(15)
Undesignated derivatives | Cross currency contracts | Other assets
Derivatives, Fair Value
Asset Fair Value	$ 36	$ 17

Derivative Financial Instrume62

Derivative Financial Instruments and Risk Management (Details 3) - USD ($) $ in Millions	Dec. 31, 2015	Dec. 31, 2014
Derivative
Derivative instruments, notional amount	$ 3,540	$ 5,250

Derivative Financial Instrume63

Derivative Financial Instruments and Risk Management (Details 4) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Derivative
Balance at beginning of year, net of tax	$ (5)	$ (5)	$ (8)
Gains (losses) deferred during the year, net of tax	2	(4)	(1)
(Gains) losses reclassified to earnings, net of tax	3	4	4
Balance at end of year, net of tax	0	(5)	(5)
Beginning balance, tax	3	3	4
Gains (losses) deferred, tax	(1)	2	1
(Gains) losses reclassified to earnings, tax	(2)	(2)	(2)
Ending balance, tax	$ 0	$ 3	$ 3

Derivative Financial Instrume64

Derivative Financial Instruments and Risk Management (Details 5) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Designated derivatives | Fair value hedges | Interest rate contracts | Other income (expense)
Derivative Instruments, Gain (Loss)
Gains (Losses) on Derivatives	$ (27)	$ (41)	$ (107)
Gains (Losses) on Borrowings	26	40	109
Designated derivatives | Cash flow hedges
Derivative Instruments, Gain (Loss)
Amount of Gains (Losses) Reclassified from AOCI to Earnings (Effective Portion)	(5)
Recognized in Earnings (Ineffective Portion)	0
Designated derivatives | Cash flow hedges | Interest rate contracts
Derivative Instruments, Gain (Loss)
Amount of Gains (Losses) Reclassified from AOCI to Earnings (Effective Portion)		(6)	(6)
Recognized in Earnings (Ineffective Portion)		0	1
Designated derivatives | Cash flow hedges | Interest rate contracts | Interest expense
Derivative Instruments, Gain (Loss)
Amount of Gains (Losses) Reclassified from AOCI to Earnings (Effective Portion)	(6)	(6)	(6)
Recognized in Earnings (Ineffective Portion)	0	0	0
Designated derivatives | Cash flow hedges | Interest rate contracts | Other income (expense)
Derivative Instruments, Gain (Loss)
Amount of Gains (Losses) Reclassified from AOCI to Earnings (Effective Portion)	0	0	0
Recognized in Earnings (Ineffective Portion)	0	0	1
Designated derivatives | Cash flow hedges | Cross currency contracts | Other income (expense)
Derivative Instruments, Gain (Loss)
Amount of Gains (Losses) Reclassified from AOCI to Earnings (Effective Portion)	1
Recognized in Earnings (Ineffective Portion)	0
Undesignated derivatives
Derivative Instruments, Gain (Loss)
Gains (Losses) on Derivatives Not Designated as Hedging Instruments	(34)	(47)	5
Undesignated derivatives | Interest rate contracts | Other income (expense)
Derivative Instruments, Gain (Loss)
Gains (Losses) on Derivatives Not Designated as Hedging Instruments	0	0	(3)
Undesignated derivatives | Foreign exchange contracts | Other income (expense)
Derivative Instruments, Gain (Loss)
Gains (Losses) on Derivatives Not Designated as Hedging Instruments	(50)	(49)	3
Undesignated derivatives | Cross currency contracts | Other income (expense)
Derivative Instruments, Gain (Loss)
Gains (Losses) on Derivatives Not Designated as Hedging Instruments	$ 16	$ 2	$ 5

Derivative Financial Instrume65

Derivative Financial Instruments and Risk Management (Details 6) - USD ($) $ in Millions	Dec. 31, 2015	Dec. 31, 2014
Offsetting Assets and Liabilities
Gross Amount of Recognized Assets	$ 91	$ 101
Gross Amounts Offset	0	0
Net Amount of Assets	91	101
Gross Amounts Not Offset	(5)	(8)
Net Amount	86	93
Gross Amount of Recognized Liabilities	(10)	(23)
Gross Amounts Offset	0	0
Net Amount of Liabilities	(10)	(23)
Gross Amounts Not Offset	5	8
Net Amount	$ (5)	$ (15)

Commitments and Contingent Li66

Commitments and Contingent Liabilities (Details) - USD ($) $ in Millions	Dec. 31, 2015	Dec. 31, 2014
Guarantees
Related liability		$ 1
Guarantees, maximum potential amount of future payments	$ 39	42
SPC's assets in Consolidated Statements of Financial Position	1,210	1,090
SPC's liabilities in Consolidated Statements of Financial Position	1,210	1,080
Unused commitments and lines of credit for dealers	13,120	12,550
Unused commitments and lines of credit for customers	3,570	$ 4,000
Maximum
Guarantees
Related liability	$ 1

Income Taxes (Details)

Income Taxes (Details) - USD ($) $ in Millions	3 Months Ended								12 Months Ended
	Dec. 31, 2015	Sep. 30, 2015	Jun. 30, 2015	Mar. 31, 2015	Dec. 31, 2014	Sep. 30, 2014	Jun. 30, 2014	Mar. 31, 2014	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Components of Profit before income taxes
U.S.									$ 230	$ 207	$ 91
Non-U.S.									389	546	603
Profit before income taxes	$ 129	$ 153	$ 150	$ 187	$ 166	$ 197	$ 208	$ 182	619	753	694
Current income tax provision (benefit)
U.S.									(21)	14	(14)
Non-U.S.									109	138	183
State (U.S.)									2	(1)	0
Current income tax provision (benefit)									90	151	169
Deferred income tax provision (benefit)
U.S.									45	44	17
Non-U.S.									21	13	(18)
State (U.S.)									2	1	(1)
Deferred income tax provision (benefit)									68	58	(2)
Total Provision for income taxes									$ 158	$ 209	$ 167

Income Taxes (Details 2)

Income Taxes (Details 2) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Undistributed profits of non-U.S. subsidiaries, which are considered indefinitely reinvested	$ 2,000
Cash held by non-U.S. subsidiaries	1,016	$ 857
Reconciliation of statutory rate to effective income tax rate
Taxes computed at U.S. statutory rates	$ 217	$ 264	$ 243
U.S. statutory tax rate (as a percent)	35.00%	35.00%	35.00%
(Decreases) increases in taxes resulting from:
State Income Tax, net of Federal Tax	$ 3	$ 0	$ (1)
State Income Tax, net of Federal Tax (as a percent)	0.50%	0.00%	(0.10%)
Subsidiaries' results subject to tax rates other than U.S. statutory rates	$ (19)	$ (53)	$ (68)
Subsidiaries' results subject to tax rates other than U.S. statutory rates (as a percent)	(3.10%)	(7.00%)	(9.80%)
Income from non-U.S. subsidiaries taxed at U.S. statutory rates, net of foreign tax credits	$ (39)	$ 0	$ 0
Income from non-U.S. subsidiaries taxed at U.S. statutory rates, net of foreign tax credits (as a percent)	(6.30%)	0.00%	0.00%
Other, net	$ (4)	$ (2)	$ (7)
Other, net (as a percent)	(0.60%)	(0.20%)	(1.00%)
Provision for income taxes	$ 158	$ 209	$ 167
Provision for income taxes, Effective Income Tax Rate (as a percent)	25.50%	27.80%	24.10%
Non-U.S.
Cash held by non-U.S. subsidiaries	$ 342

Income Taxes (Details 3)

Income Taxes (Details 3) - USD ($) $ in Millions	Dec. 31, 2015	Dec. 31, 2014
Deferred tax assets
Deferred and refundable income taxes	$ 75	$ 94
Deferred tax liabilities
Deferred income taxes and other liabilities	(812)	(668)
Deferred income taxes, net	$ (737)	$ (574)

Income Taxes (Details 4)

Income Taxes (Details 4) - USD ($) $ in Millions	Dec. 31, 2015	Dec. 31, 2014
Deferred income tax assets:
Allowance for credit losses	$ 142	$ 149
Tax carryforwards	48	46
Deferred tax assets, gross	190	195
Deferred income tax liabilities (primarily lease basis differences)	(574)	(514)
Valuation allowance for deferred income tax assets	(10)	(3)
Deferred income tax on translation adjustment	(343)	(252)
Deferred income taxes, net	$ (737)	$ (574)

Income Taxes (Details 5)

Income Taxes (Details 5) $ in Millions	Dec. 31, 2015USD ($)
Tax credit carryforwards
U.S. foreign tax credits available for carryforward	$ 26
U.S. state taxing jurisdictions
Net operating loss (NOL) carryforwards
NOL carryforwards	131
Gross deferred income tax asset associated with NOL carryforwards	10
U.S. state taxing jurisdictions | Expiration Date 2016
Net operating loss (NOL) carryforwards
NOL carryforwards	0
U.S. state taxing jurisdictions | Expiration Date 2017
Net operating loss (NOL) carryforwards
NOL carryforwards	2
U.S. state taxing jurisdictions | Expiration Date 2018
Net operating loss (NOL) carryforwards
NOL carryforwards	6
U.S. state taxing jurisdictions | Expiration Date 2019
Net operating loss (NOL) carryforwards
NOL carryforwards	4
U.S. state taxing jurisdictions | Expiration Date 2020-2031
Net operating loss (NOL) carryforwards
NOL carryforwards	119
Non-U.S. taxing jurisdictions
Net operating loss (NOL) carryforwards
NOL carryforwards	56
NOL carryforwards, Valuation allowance	10
Non-U.S. taxing jurisdictions | Expiration Date 2016
Net operating loss (NOL) carryforwards
NOL carryforwards	0
Non-U.S. taxing jurisdictions | Expiration Date 2017
Net operating loss (NOL) carryforwards
NOL carryforwards	0
Non-U.S. taxing jurisdictions | Expiration Date 2018
Net operating loss (NOL) carryforwards
NOL carryforwards	0
Non-U.S. taxing jurisdictions | Expiration Date 2019
Net operating loss (NOL) carryforwards
NOL carryforwards	0
Non-U.S. taxing jurisdictions | Expiration Date 2020-2031
Net operating loss (NOL) carryforwards
NOL carryforwards	6
Non-U.S. taxing jurisdictions | Unlimited
Net operating loss (NOL) carryforwards
NOL carryforwards	$ 50

Income Taxes (Details 6)

Income Taxes (Details 6) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Reconciliation of unrecognized income tax benefits
Unrecognized tax benefits, beginning of year	$ 0	$ 0
Additions for income tax positions related to prior year	2	0
Reductions for income tax positions related to settlements	(2)	0
Unrecognized tax benefits, end of year	0	0	$ 0
Unrecognized tax benefits that, if recognized, would impact the effective tax rate	0	0
Maximum
Reconciliation of unrecognized income tax benefits
Recognized interest and penalties	1	(1)	$ (1)
Accrued interest and penalties	$ 1	$ 1

Fair Value Measurements (Detail

Fair Value Measurements (Details) - USD ($) $ in Millions	Dec. 31, 2015	Dec. 31, 2014
Fair Value, Measurements, Recurring | Level 2
Assets
Derivative financial instruments, net	$ 81	$ 78

Fair Value Measurements (Deta74

Fair Value Measurements (Details 2) - USD ($) $ in Millions	Dec. 31, 2015	Dec. 31, 2014
Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Fair value of impaired loans	$ 91	$ 248

Fair Value Measurements (Deta75

Fair Value Measurements (Details 3) - USD ($) $ in Millions	Dec. 31, 2015	Dec. 31, 2014
Financial Instruments, Financial Liabilities, Balance Sheet Groupings
Short-term borrowings	$ (6,958)	$ (4,699)
Fair Value, Level 1
Financial Instruments, Financial Assets, Balance Sheet Groupings
Cash and cash equivalents	1,016	857
Restricted cash and cash equivalents	18	11
Financial Instruments, Financial Liabilities, Balance Sheet Groupings
Short-term borrowings	(6,958)	(4,699)
Fair Value, Level 2
Financial Instruments, Financial Assets, Balance Sheet Groupings
Foreign currency contracts, in a receivable position	3	5
Interest rate swaps, in a net receivable position	51	79
Financial Instruments, Financial Liabilities, Balance Sheet Groupings
Foreign currency contracts, in a payable position	(6)	(15)
Long-term debt	(21,904)	(25,103)
Interest rate swaps, in a net payable position	(4)	(8)
Fair Value, Level 3
Financial Instruments, Financial Assets, Balance Sheet Groupings
Finance receivables, net (excluding finance leases)	20,925	21,093
Financial Instruments, Financial Liabilities, Balance Sheet Groupings
Guarantees	0	(1)
Carrying Amount
Financial Instruments, Financial Assets, Balance Sheet Groupings
Cash and cash equivalents	1,016	857
Foreign currency contracts, in a receivable position	3	5
Finance receivables, net (excluding finance leases)	20,935	21,434
Restricted cash and cash equivalents	18	11
Interest rate swaps, in a net receivable position	51	79
Financial Instruments, Financial Liabilities, Balance Sheet Groupings
Foreign currency contracts, in a payable position	(6)	(15)
Short-term borrowings	(6,958)	(4,699)
Long-term debt	(21,605)	(24,574)
Interest rate swaps, in a net payable position	(4)	(8)
Guarantees	0	(1)
Carrying amount of assets excluded from measurement at fair value
Financial Instruments, Financial Assets, Balance Sheet Groupings
Finance leases	6,450	7,640
Cross currency contracts | Fair Value, Level 2
Financial Instruments, Financial Assets, Balance Sheet Groupings
Foreign currency contracts, in a receivable position	37	17
Cross currency contracts | Carrying Amount
Financial Instruments, Financial Assets, Balance Sheet Groupings
Foreign currency contracts, in a receivable position	$ 37	$ 17

Transactions with Related Par76

Transactions with Related Parties (Details) - USD ($) $ in Millions	3 Months Ended								12 Months Ended
	Dec. 31, 2015	Sep. 30, 2015	Jun. 30, 2015	Mar. 31, 2015	Dec. 31, 2014	Sep. 30, 2014	Jun. 30, 2014	Mar. 31, 2014	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Related Party Transaction
Dividend paid to Caterpillar									$ 600	$ 400	$ 200
Maximum borrowing capacity from Caterpillar, Variable lending agreements	$ 2,280								2,280
Maximum lending capacity to Caterpillar, Variable lending agreements	1,290								1,290
Amount available, Committed credit facility extended to Caterpillar	2,000								2,000
Notes payable to Caterpillar	1,096				$ 1,108				1,096	1,108	1,118
Notes receivable from Caterpillar	490				414				490	414	345
Discounts earned on purchased receivables									222	243	233
Total revenues	648	$ 653	$ 683	$ 689	703	$ 743	$ 728	$ 711	2,673	2,885	2,785
Depreciation on equipment leased to others									836	870	770
Caterpillar
Related Party Transaction
Dividend paid to Caterpillar									600	400	200
Maximum borrowing capacity from Caterpillar, Variable lending agreements	2,280								2,280
Maximum lending capacity to Caterpillar, Variable lending agreements	1,290								1,290
Amount available, Committed credit facility extended to Caterpillar	2,000								2,000
Interest expense, Caterpillar									6	7	7
Interest income on Notes Receivable with Caterpillar									21	18	19
Fees on committed credit facility extended to Caterpillar									40	41	41
Purchases of receivables from Caterpillar									33,154	36,816	33,018
Discounts earned on purchased receivables									222	243	233
Balance of purchased receivables	2,601				3,238				2,601	3,238	3,092
Marketing program payments received									188	173	189
Amount of our portfolio that is subject to guarantees by Caterpillar	418				568				418	568
Charges for employee medical plans and postretirement benefit plans administered by Caterpillar									29	30	27
Contributions to defined benefit plans									7	7	7
Stock based compensation expense									12	11	11
Operational and administrative support charges reimbursed to Caterpillar									37	37	33
Administrative support services to certain Caterpillar subsidiaries reimbursed by Caterpillar									12	12	12
Caterpillar Wholly-Owned Dealers
Related Party Transaction
Total portfolio, which includes finance receivables and equipment on operating lease, net of depreciation	$ 49				$ 58				49	58
Total revenues									9	11	11
Depreciation on equipment leased to others									$ 7	$ 9	$ 9

Leases (Details)

Leases (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Leases [Abstract]
Rental expense for operating leases	$ 16	$ 17	$ 17
Minimum payments for operating leases having initial or remaining non-cancelable terms
2,016	15
2,017	14
2,018	13
2,019	13
2,020	12
Thereafter	16
Total	$ 83

Segment and Geographic Inform78

Segment and Geographic Information (Details) - USD ($) $ in Millions	3 Months Ended								12 Months Ended
	Dec. 31, 2015	Sep. 30, 2015	Jun. 30, 2015	Mar. 31, 2015	Dec. 31, 2014	Sep. 30, 2014	Jun. 30, 2014	Mar. 31, 2014	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Segment Reporting Information
External Revenues	$ 648	$ 653	$ 683	$ 689	$ 703	$ 743	$ 728	$ 711	$ 2,673	$ 2,885	$ 2,785
Profit before income taxes	129	$ 153	$ 150	$ 187	166	$ 197	$ 208	$ 182	619	753	694
Interest Expense									593	631	734
Depreciation on equipment leased to others									836	870	770
Provision for credit losses									119	139	101
Assets	33,903				35,176				33,903	35,176	35,114
Capital expenditures									1,461	1,627	1,822
Operating Segments
Segment Reporting Information
External Revenues									2,631	2,843	2,738
Profit before income taxes									686	806	759
Interest Expense									598	639	720
Depreciation on equipment leased to others									835	869	769
Provision for credit losses									117	139	103
Assets	32,355				33,866				32,355	33,866	33,867
Capital expenditures									1,449	1,615	1,810
Unallocated
Segment Reporting Information
External Revenues									72	70	73
Profit before income taxes									(96)	(82)	(73)
Interest Expense									69	48	53
Depreciation on equipment leased to others									1	1	1
Provision for credit losses									0	2	2
Assets	1,847				1,648				1,847	1,648	1,595
Capital expenditures									9	10	10
Timing
Segment Reporting Information
External Revenues									(30)	(28)	(26)
Profit before income taxes									(32)	(8)	(10)
Interest Expense									0	0	0
Depreciation on equipment leased to others									0	0	0
Provision for credit losses									2	(2)	(4)
Assets	164				120				164	120	68
Capital expenditures									3	2	2
Methodology
Segment Reporting Information
External Revenues									0	0	0
Profit before income taxes									61	37	18
Interest Expense									(74)	(56)	(39)
Depreciation on equipment leased to others									0	0	0
Provision for credit losses									0	0	0
Assets	(216)				(215)				(216)	(215)	(189)
Capital expenditures									0	0	0
Intersegment Eliminations
Segment Reporting Information
External Revenues									0	0	0
Profit before income taxes									0	0	0
Interest Expense									0	0	0
Depreciation on equipment leased to others									0	0	0
Provision for credit losses									0	0	0
Assets	(247)				(243)				(247)	(243)	(227)
Capital expenditures									0	0	0
North America | Operating Segments
Segment Reporting Information
External Revenues									1,156	1,067	946
Profit before income taxes									370	355	283
Interest Expense									261	240	259
Depreciation on equipment leased to others									409	361	293
Provision for credit losses									7	3	0
Assets	14,444				13,661				14,444	13,661	12,160
Capital expenditures									1,118	1,068	773
Europe | Operating Segments
Segment Reporting Information
External Revenues									284	353	347
Profit before income taxes									96	114	109
Interest Expense									31	52	59
Depreciation on equipment leased to others									76	94	80
Provision for credit losses									3	10	13
Assets	3,758				4,276				3,758	4,276	4,720
Capital expenditures									136	133	241
Asia/Pacific | Operating Segments
Segment Reporting Information
External Revenues									285	368	399
Profit before income taxes									65	129	156
Interest Expense									100	116	135
Depreciation on equipment leased to others									21	24	25
Provision for credit losses									29	35	9
Assets	3,924				4,767				3,924	4,767	5,251
Capital expenditures									37	34	54
Latin America and CPF | Operating Segments
Segment Reporting Information
External Revenues									533	594	572
Profit before income taxes									108	144	126
Interest Expense									152	166	188
Depreciation on equipment leased to others									104	118	99
Provision for credit losses									64	62	69
Assets	7,381				8,001				7,381	8,001	8,295
Capital expenditures									89	111	273
Mining | Operating Segments
Segment Reporting Information
External Revenues									373	461	474
Profit before income taxes									47	64	85
Interest Expense									54	65	79
Depreciation on equipment leased to others									225	272	272
Provision for credit losses									14	29	12
Assets	$ 2,848				$ 3,161				2,848	3,161	3,441
Capital expenditures									$ 69	$ 269	$ 469

Segment and Geographic Inform79

Segment and Geographic Information (Details 2) - USD ($) $ in Millions	3 Months Ended								12 Months Ended
	Dec. 31, 2015	Sep. 30, 2015	Jun. 30, 2015	Mar. 31, 2015	Dec. 31, 2014	Sep. 30, 2014	Jun. 30, 2014	Mar. 31, 2014	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Revenues from External Customers and Long-Lived Assets
External Revenues	$ 648	$ 653	$ 683	$ 689	$ 703	$ 743	$ 728	$ 711	$ 2,673	$ 2,885	$ 2,785
Equipment on Operating Leases and Non-Leased Equipment (included in Other Assets), net	3,628				3,706				3,628	3,706
Inside U.S.
Revenues from External Customers and Long-Lived Assets
External Revenues									1,330	1,219	1,045
Equipment on Operating Leases and Non-Leased Equipment (included in Other Assets), net	2,058				1,696				2,058	1,696
Inside Canada
Revenues from External Customers and Long-Lived Assets
External Revenues									198	259	329
Equipment on Operating Leases and Non-Leased Equipment (included in Other Assets), net	572				756				572	756
Inside Australia
Revenues from External Customers and Long-Lived Assets
External Revenues									200	261	287
Equipment on Operating Leases and Non-Leased Equipment (included in Other Assets), net	282				358				282	358
All other
Revenues from External Customers and Long-Lived Assets
External Revenues									945	1,146	$ 1,124
Equipment on Operating Leases and Non-Leased Equipment (included in Other Assets), net	$ 716				$ 896				$ 716	$ 896

Selected Quarterly Financial 80

Selected Quarterly Financial Data (Unaudited) (Details) - USD ($) $ in Millions	3 Months Ended								12 Months Ended
	Dec. 31, 2015	Sep. 30, 2015	Jun. 30, 2015	Mar. 31, 2015	Dec. 31, 2014	Sep. 30, 2014	Jun. 30, 2014	Mar. 31, 2014	Dec. 31, 2015		Dec. 31, 2014		Dec. 31, 2013
Quarterly Financial Information Disclosure [Abstract]
Total revenues	$ 648	$ 653	$ 683	$ 689	$ 703	$ 743	$ 728	$ 711	$ 2,673		$ 2,885		$ 2,785
Profit before income taxes	129	153	150	187	166	197	208	182	619		753		694
Profit	$ 114	$ 109	$ 104	$ 133	$ 108	$ 148	$ 148	$ 131	$ 460	[1]	$ 535	[1]	$ 513	[1]
[1]	Profit attributable to Caterpillar Financial Services Corporation.

Employee Separation Charges (De

Employee Separation Charges (Details) $ in Millions	12 Months Ended
	Dec. 31, 2015USD ($)
Restructuring and Related Activities [Abstract]
Separation charges	$ 15
Employee Separation Charges
Liability balance at beginning of year	0
Increase in liability (separation charges)	15
Reduction in liability (payments and other adjustments)	(5)
Liability balance at end of year	$ 10