MASTERCARD INC, 10-K filed on 2/14/2020
Annual Report
v3.19.3.a.u2
Cover Page - USD ($)
$ in Billions
12 Months Ended
Dec. 31, 2019
Feb. 11, 2020
Jun. 28, 2019
Document Type 10-K    
Document Transition Report false    
Document Period End Date Dec. 31, 2019    
Document Annual Report true    
Entity File Number 001-32877    
Entity Registrant Name Mastercard Incorporated    
Entity Incorporation, State or Country Code DE    
Entity Tax Identification Number 13-4172551    
Entity Address, Postal Zip Code 10577    
Entity Address, State or Province NY    
Entity Address, City or Town Purchase,    
Entity Address, Address Line One 2000 Purchase Street    
City Area Code 914    
Local Phone Number 249-2000    
Entity Well-known Seasoned Issuer Yes    
Entity Voluntary Filers No    
Entity Current Reporting Status Yes    
Entity Interactive Data Current Yes    
Entity Filer Category Large Accelerated Filer    
Entity Small Business false    
Entity Emerging Growth Company false    
Entity Shell Company false    
Entity Public Float     $ 235.9
Entity Central Index Key 0001141391    
Current Fiscal Year End Date --12-31    
Document Fiscal Year Focus 2019    
Document Fiscal Period Focus FY    
Amendment Flag false    
Class A Common Stock      
Title of 12(b) Security Class A Common Stock, par value $0.0001 per share    
Trading Symbol MA    
Security Exchange Name NYSE    
Entity Common Stock, Shares Outstanding   994,281,310  
One Point One Percent Notes Due 2022 [Member]      
Title of 12(b) Security 1.100% Notes due 2022    
Trading Symbol MA22    
Security Exchange Name NYSE    
Two Point One Percent Notes Due 2027 [Member]      
Title of 12(b) Security 2.100% Notes due 2027    
Trading Symbol MA27    
Security Exchange Name NYSE    
Two Point Five Percent Notes Due 2030 [Member]      
Title of 12(b) Security 2.500% Notes due 2030    
Trading Symbol MA30    
Security Exchange Name NYSE    
Class B Common Stock      
Entity Common Stock, Shares Outstanding   10,827,654  
v3.19.3.a.u2
Consolidated Statement of Operations - USD ($)
shares in Millions, $ in Millions
12 Months Ended
Dec. 31, 2019
Dec. 31, 2018
Dec. 31, 2017
Income Statement [Abstract]      
Net revenue $ 16,883 $ 14,950 $ 12,497
Operating Expenses      
General and administrative 5,763 5,174 4,653
Advertising and marketing 934 907 771
Depreciation and amortization 522 459 436
Provision for litigation 0 1,128 15
Total operating expenses 7,219 7,668 5,875
Operating income 9,664 7,282 6,622
Other Income (Expense)      
Investment income 97 122 56
Gains (losses) on equity investments, net 167 0 0
Interest expense (224) (186) (154)
Other income (expense), net 27 (14) (2)
Total other income (expense) 67 (78) (100)
Income before income taxes 9,731 7,204 6,522
Income tax expense 1,613 1,345 2,607
Net Income $ 8,118 $ 5,859 $ 3,915
Basic Earnings per Share $ 7.98 $ 5.63 $ 3.67
Basic weighted-average shares outstanding 1,017 1,041 1,067
Diluted Earnings per Share $ 7.94 $ 5.60 $ 3.65
Diluted weighted-average shares outstanding 1,022 1,047 1,072
v3.19.3.a.u2
Consolidated Statement of Comprehensive Income - USD ($)
$ in Millions
12 Months Ended
Dec. 31, 2019
Dec. 31, 2018
Dec. 31, 2017
Statement of Comprehensive Income [Abstract]      
Net Income $ 8,118 $ 5,859 $ 3,915
Other comprehensive income (loss):      
Foreign currency translation adjustments 10 (319) 565
Income tax effect 13 40 2
Foreign currency translation adjustments, net of income tax effect 23 (279) 567
Translation adjustments on net investment hedge 36 96 (236)
Income tax effect (8) (21) 83
Translation adjustments on net investment hedge, net of income tax effect 28 75 (153)
Cash flow hedges 14 0 0
Income tax effect (3) 0 0
Cash flow hedges, net of income tax effect 11 0 0
Defined benefit pension and other postretirement plans (22) (18) 15
Income tax effect 3 3 (1)
Defined benefit pension and other postretirement plans, net of income tax effect (19) (15) 14
Investment securities available-for-sale 3 (3) (3)
Income tax effect (1) 1 2
Investment securities available-for-sale, net of income tax effect 2 (2) (1)
Other comprehensive income (loss), net of income tax effect 45 (221) 427
Comprehensive Income $ 8,163 $ 5,638 $ 4,342
v3.19.3.a.u2
Consolidated Balance Sheet - USD ($)
$ in Millions
Dec. 31, 2019
Dec. 31, 2018
Assets    
Cash and cash equivalents $ 6,988 $ 6,682
Restricted cash for litigation settlement 584 553
Investments 688 1,696
Accounts receivable 2,514 2,276
Settlement due from customers 2,995 2,452
Restricted security deposits held for customers 1,370 1,080
Prepaid expenses and other current assets 1,763 1,432
Total current assets 16,902 16,171
Property, equipment and right-of-use assets, net 1,828 921
Deferred income taxes 543 570
Goodwill 4,021 2,904
Other intangible assets, net 1,417 991
Other assets 4,525 3,303
Total Assets 29,236 24,860
Liabilities, Redeemable Non-controlling Interests and Equity    
Accounts payable 489 537
Settlement due to customers 2,714 2,189
Restricted security deposits held for customers 1,370 1,080
Accrued litigation 914 1,591
Accrued expenses 5,489 4,747
Current portion of long-term debt 0 500
Other current liabilities 928 949
Total current liabilities 11,904 11,593
Long-term debt 8,527 5,834
Deferred income taxes 85 67
Other liabilities 2,729 1,877
Total Liabilities 23,245 19,371
Commitments and Contingencies
Redeemable non-controlling interests 74 71
Stockholders’ Equity    
Additional paid-in-capital 4,787 4,580
Class A treasury stock, at cost, 395 and 368 shares, respectively (32,205) (25,750)
Retained earnings 33,984 27,283
Accumulated other comprehensive income (loss) (673) (718)
Mastercard Incorporated Stockholders' Equity 5,893 5,395
Non-controlling interests 24 23
Total Equity 5,917 5,418
Total Liabilities, Redeemable Non-controlling Interests and Equity 29,236 24,860
Class A Common Stock    
Stockholders’ Equity    
Common stock value 0 0
Total Equity 0 0
Class B Common Stock    
Stockholders’ Equity    
Common stock value 0 0
Total Equity $ 0 $ 0
v3.19.3.a.u2
Consolidated Balance Sheet (Parenthetical) - $ / shares
Dec. 31, 2019
Dec. 31, 2018
Class A treasury stock, shares 395,000,000 368,000,000
Class A Common Stock    
Common stock, par value $ 0.0001 $ 0.0001
Common stock, authorized shares 3,000,000,000 3,000,000,000
Common stock, issued 1,391,000,000 1,387,000,000
Common stock, outstanding 996,000,000 1,019,000,000
Class B Common Stock    
Common stock, par value $ 0.0001 $ 0.0001
Common stock, authorized shares 1,200,000,000 1,200,000,000
Common stock, issued 11,000,000 12,000,000
Common stock, outstanding 11,000,000 12,000,000
v3.19.3.a.u2
Consolidated Statement of Changes in Equity - USD ($)
$ in Millions
Total
Retained Earnings
Accumulated Other Comprehensive Income (Loss)
Additional Paid-In Capital
Class A Treasury Stock
Mastercard Incorporated Stockholders' Equity
Non- Controlling Interests
Class A Common Stock
Class B Common Stock
Beginning balance at Dec. 31, 2016 $ 5,684 $ 19,418 $ (924) $ 4,183 $ (17,021) $ 5,656 $ 28 $ 0 $ 0
Net income 3,915 3,915       3,915      
Activity related to non-controlling interests 1           1    
Redeemable non-controlling interest adjustments (2) (2)       (2)      
Other comprehensive income (loss) 427   427     427      
Dividends (967) (967)       (967)      
Purchases of treasury stock (3,747)       (3,747) (3,747)      
Shared-based payments 186     182 4 186      
Ending balance at Dec. 31, 2017 5,497 22,364 (497) 4,365 (20,764) 5,468 29 0 0
Net income 5,859 5,859       5,859      
Activity related to non-controlling interests (6)           (6)    
Redeemable non-controlling interest adjustments (3) (3)       (3)      
Other comprehensive income (loss) (221)   (221)     (221)      
Dividends (1,120) (1,120)       (1,120)      
Purchases of treasury stock (4,991)       (4,991) (4,991)      
Shared-based payments 220     215 5 220      
Ending balance at Dec. 31, 2018 5,418 27,283 (718) 4,580 (25,750) 5,395 23 0 0
Net income 8,118 8,118       8,118      
Activity related to non-controlling interests 1           1    
Redeemable non-controlling interest adjustments (9) (9)       (9)      
Other comprehensive income (loss) 45   45     45      
Dividends (1,408) (1,408)       (1,408)      
Purchases of treasury stock (6,463)     0 (6,463) (6,463)      
Shared-based payments 215     207 8 215      
Ending balance at Dec. 31, 2019 $ 5,917 $ 33,984 $ (673) $ 4,787 $ (32,205) $ 5,893 $ 24 $ 0 $ 0
v3.19.3.a.u2
Consolidated Statement of Cash Flows - USD ($)
$ in Millions
12 Months Ended
Dec. 31, 2019
Dec. 31, 2018
Dec. 31, 2017
Operating Activities      
Net income $ 8,118 $ 5,859 $ 3,915
Adjustments to reconcile net income to net cash provided by operating activities:      
Amortization of customer and merchant incentives 1,141 1,235 1,001
Depreciation and amortization 522 459 437
(Gains) losses on equity investments, net (167) 0 0
Share-based compensation 250 196 176
Deferred income taxes (7) (244) 86
Venezuela charge 0 0 167
Other 24 31 59
Changes in operating assets and liabilities:      
Accounts receivable (246) (317) (445)
Income taxes receivable (202) (120) (8)
Settlement due from customers (444) (1,078) (281)
Prepaid expenses (1,661) (1,769) (1,402)
Accrued litigation and legal settlements (662) 869 (12)
Restricted security deposits held for customers 290 (6) 94
Accounts payable (42) 101 290
Settlement due to customers 477 849 394
Accrued expenses 657 439 589
Long-term taxes payable 2 (20) 577
Net change in other assets and liabilities 133 (261) 27
Net cash provided by operating activities 8,183 6,223 5,664
Investing Activities      
Purchases of investment securities available-for-sale (643) (1,300) (714)
Purchases of investments held-to-maturity (215) (509) (1,145)
Proceeds from sales of investment securities available-for-sale 1,098 604 304
Proceeds from maturities of investment securities available-for-sale 376 379 500
Proceeds from maturities of investments held-to-maturity 383 929 1,020
Purchases of property and equipment (422) (330) (300)
Capitalized software (306) (174) (123)
Purchases of equity investments (467) (91) (147)
Acquisition of businesses, net of cash acquired (1,440) 0 (1,175)
Other investing activities (4) (14) (1)
Net cash used in investing activities (1,640) (506) (1,781)
Financing Activities      
Purchases of treasury stock (6,497) (4,933) (3,762)
Dividends paid (1,345) (1,044) (942)
Proceeds from debt 2,724 991 0
Payment of debt (500) 0 (64)
Contingent consideration paid (199) 0 0
Tax withholdings related to share-based payments (161) (80) (47)
Cash proceeds from exercise of stock options 126 104 57
Other financing activities (15) (4) (6)
Net cash used in financing activities (5,867) (4,966) (4,764)
Effect of exchange rate changes on cash, cash equivalents, restricted cash and restricted cash equivalents (44) (6) 200
Net increase (decrease) in cash, cash equivalents, restricted cash and restricted cash equivalents 632 745 (681)
Cash, cash equivalents, restricted cash and restricted cash equivalents - beginning of period 8,337 7,592 8,273
Cash, cash equivalents, restricted cash and restricted cash equivalents - end of period $ 8,969 $ 8,337 $ 7,592
v3.19.3.a.u2
Summary of Significant Accounting Policies
12 Months Ended
Dec. 31, 2019
Accounting Policies [Abstract]  
Summary of Significant Accounting Policies
Organization
Mastercard Incorporated and its consolidated subsidiaries, including Mastercard International Incorporated (“Mastercard International” and together with Mastercard Incorporated, “Mastercard” or the “Company”), is a technology company in the global payments industry that connects consumers, financial institutions, merchants, governments, digital partners, businesses and other organizations worldwide, enabling them to use electronic forms of payment instead of cash and checks. The Company makes payments easier and more efficient by providing a wide range of payment solutions and services through its family of well-known brands, including Mastercard®, Maestro® and Cirrus®. The Company is a multi-rail network that offers customers one partner to turn to for their domestic and cross-border payment needs. Through its unique and proprietary global payments network, which is referred to as the core network, the Company switches (authorizes, clears and settles) payment transactions and delivers related products and services. Mastercard has additional payment capabilities that include automated clearing house (“ACH”) transactions (both batch and real-time account-based payments). The Company also provides integrated value-added offerings such as cyber and intelligence products, information and analytics services, consulting, loyalty and reward programs and processing. The Company’s payment solutions offer customers choice and flexibility and are designed to ensure safety and security for the global payments system.
A typical transaction on the Company’s core network involves four participants in addition to the Company: account holder (a person or entity who holds a card or uses another device enabled for payment), issuer (the account holder’s financial institution), merchant and acquirer (the merchant’s financial institution). The Company does not issue cards, extend credit, determine or receive revenue from interest rates or other fees charged to account holders by issuers, or establish the rates charged by acquirers in connection with merchants’ acceptance of the Company’s products. In most cases, account holder relationships belong to, and are managed by, the Company’s financial institution customers.
Significant Accounting Policies
Consolidation and basis of presentation - The consolidated financial statements include the accounts of Mastercard and its majority-owned and controlled entities, including any variable interest entities (“VIEs”) for which the Company is the primary beneficiary. Investments in VIEs for which the Company is not considered the primary beneficiary are not consolidated and are accounted for as equity method or measurement alternative method investments and recorded in other assets on the consolidated balance sheet.  At December 31, 2019 and 2018, there were no significant VIEs which required consolidation and the investments were not considered material to the consolidated financial statements. The Company consolidates acquisitions as of the date in which the Company has obtained a controlling financial interest. Intercompany transactions and balances have been eliminated in consolidation. Certain prior period amounts have been reclassified to conform to the 2019 presentation. The Company follows accounting principles generally accepted in the United States of America (“GAAP”).
Prior to December 31, 2017, the Company included the financial results from its Venezuela subsidiaries in the consolidated financial statements using the consolidation method of accounting. In 2017, due to foreign exchange regulations restricting access to U.S. dollars in Venezuela, an other-than-temporary lack of exchangeability between the Venezuelan bolivar and U.S. dollar impacted the Company’s ability to manage risk, process cross-border transactions and satisfy U.S. dollar denominated liabilities related to operations in Venezuela.  As a result of these factors, Mastercard concluded that effective December 31, 2017, it did not meet the accounting criteria for consolidation of these Venezuelan subsidiaries, and therefore would transition to the measurement alternative method of accounting as of December 31, 2017. This accounting change resulted in a pre-tax charge of $167 million ($108 million after tax or $0.10 per diluted share) that was recorded in general and administrative expenses on the consolidated statement of operations for the year ended December 31, 2017.
Non-controlling interests represent the equity interest not owned by the Company and are recorded for consolidated entities in which the Company owns less than 100% of the interests. Changes in a parent’s ownership interest while the parent retains its controlling interest are accounted for as equity transactions, and upon loss of control, retained ownership interests are remeasured at fair value, with any gain or loss recognized in earnings. For 2019, 2018 and 2017, net losses from non-controlling interests were not material and, as a result, amounts are included on the consolidated statement of operations within other income (expense).
Use of estimates - The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting periods. Future events and their effects cannot be predicted with certainty; accordingly, accounting estimates require the exercise of judgment. The accounting estimates used in the preparation of the Company’s consolidated financial statements may change as new events occur, as more experience is
acquired, as additional information is obtained and as the Company’s operating environment changes. Actual results may differ from these estimates.
Revenue recognition - Revenue is recognized to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the Company expects to be entitled to in exchange for those goods or services. Revenue is primarily generated by charging fees to issuers, acquirers and other stakeholders for providing switching services, as well as by assessing customers based primarily on the dollar volume of activity, or gross dollar volume, on the products that carry the Company’s brands. Revenue is generally derived from transactional information accumulated by Mastercard’s systems or reported by customers.
Volume-based revenue (domestic assessments and cross-border volume fees) is recorded as revenue in the period it is earned, which is when the related volume is generated on the cards. Certain volume-based revenue is based upon information reported by customers. Transaction-based revenue (transaction processing) is primarily based on the number and type of transactions and is recognized as revenue in the same period in which the related transactions occur. Other payment-related products and services are recognized as revenue in the period in which the related services are performed or transactions occur.
Mastercard has business agreements with certain customers that provide for rebates or other support when the customers meet certain volume hurdles as well as other support incentives, which are tied to performance. Rebates and incentives are recorded as a reduction of gross revenue primarily when volume- and transaction-based revenues are recognized over the contractual term. Rebates and incentives are calculated based upon estimated customer performance and the terms of the related business agreements. In addition, Mastercard may make payments to a customer directly related to entering into an agreement, which are generally capitalized and amortized over the life of the agreement on a straight-line basis.
Contract assets include unbilled consideration typically resulting from executed data analytic and consulting services performed for customers in connection with Mastercard’s payment network service arrangements. Collection for these services typically occurs over the contractual term. Contract assets are included in prepaid expenses and other current assets and other assets on the consolidated balance sheet.
The Company defers the recognition of revenue when consideration has been received prior to the satisfaction of performance obligations. As these performance obligations are satisfied, revenue is subsequently recognized. Deferred revenue is primarily derived from data analytic and consulting services. Deferred revenue is included in other current liabilities and other liabilities on the consolidated balance sheet.
Business combinations - The Company accounts for business combinations under the acquisition method of accounting. The Company measures the tangible and intangible identifiable assets acquired, liabilities assumed and any non-controlling interest in the acquiree, at fair value as of the acquisition date. Acquisition-related costs are expensed as incurred and are included in general and administrative expenses. Any excess purchase price over the fair value of net assets acquired, including identifiable intangible assets, is recorded as goodwill. Measurement period adjustments, if any, to the preliminary estimated fair value of the intangibles assets as of the acquisition date will be recorded in goodwill.
Goodwill and other intangible assets - Indefinite-lived intangible assets consist of goodwill, which represents the synergies expected to arise after the acquisition date and the assembled workforce, and customer relationships. Finite-lived intangible assets consist of capitalized software costs, trademarks, tradenames, customer relationships and other intangible assets. Intangible assets with finite useful lives are amortized over their estimated useful lives, on a straight-line basis, which range from one to twenty years. Capitalized software includes internal and external costs incurred directly related to the design, development and testing phases of each capitalized software project.
Impairment of assets - Goodwill and indefinite-lived intangible assets are not amortized but tested annually for impairment at the reporting unit level in the fourth quarter, or sooner when circumstances indicate an impairment may exist.  The impairment evaluation for goodwill utilizes a qualitative assessment to determine whether it is more likely than not that goodwill is impaired. The qualitative factors may include, but are not limited to, macroeconomic conditions, industry and market conditions, operating environment, financial performance and other relevant events. If it is determined that it is more likely than not that goodwill is impaired, then the Company is required to perform a quantitative goodwill impairment test. If the fair value of a reporting unit exceeds the carrying value, goodwill is not impaired. If the fair value of the reporting unit is less than its carrying value, then goodwill is impaired and the excess of the reporting unit’s carrying value over the fair value is recognized as an impairment charge.
The impairment test for indefinite-lived intangible assets consists of a qualitative assessment to evaluate relevant events and circumstances that could affect the significant inputs used to determine the fair value of indefinite-lived intangible assets.  If the qualitative assessment indicates that it is more likely than not that indefinite-lived intangible assets are impaired, then a quantitative assessment is required. 
Long-lived assets, other than goodwill and indefinite-lived intangible assets, are tested for impairment whenever events or circumstances indicate that their carrying amount may not be recoverable. If the carrying value of the asset cannot be recovered from estimated
future cash flows, undiscounted and without interest, the fair value of the asset is calculated using the present value of estimated net future cash flows. If the carrying amount of the asset exceeds its fair value, an impairment is recorded.
Impairment charges, if any, are recorded in general and administrative expenses on the consolidated statement of operations.
Litigation - The Company is a party to certain legal and regulatory proceedings with respect to a variety of matters. The Company evaluates the likelihood of an unfavorable outcome of all legal or regulatory proceedings to which it is a party and accrues a loss contingency when the loss is probable and reasonably estimable. Loss contingencies are recorded in provision for litigation on the consolidated statement of operations. These judgments are subjective based on the status of the legal or regulatory proceedings, the merits of its defenses and consultation with in-house and external legal counsel. Legal costs are expensed as incurred and recorded in general and administrative expenses on the consolidated statement of operations.
Settlement and other risk management - Mastercard’s rules guarantee the settlement of many of the transactions between its customers. Settlement exposure is the outstanding settlement risk to customers under Mastercard’s rules due to the difference in timing between the payment transaction date and subsequent settlement. While the term and amount of the guarantee are unlimited, the duration of settlement exposure is short term and typically limited to a few days.
The Company also enters into agreements in the ordinary course of business under which the Company agrees to indemnify third parties against damages, losses and expenses incurred in connection with legal and other proceedings arising from relationships or transactions with the Company. As the extent of the Company’s obligations under these agreements depends entirely upon the occurrence of future events, the Company’s potential future liability under these agreements is not determinable.
The Company accounts for each of its guarantees by recording the guarantee at its fair value at the inception or modification date through earnings.
Income taxes - The Company follows an asset and liability based approach in accounting for income taxes as required under GAAP. Deferred income tax assets and liabilities are recorded to reflect the tax consequences on future years of temporary differences between the financial statement carrying amounts and income tax bases of assets and liabilities. Deferred income taxes are displayed separately as noncurrent assets and liabilities on the consolidated balance sheet. Valuation allowances are provided against assets which are not more likely than not to be realized. The Company recognizes all material tax positions, including uncertain tax positions in which it is more likely than not that the position will be sustained based on its technical merits and if challenged by the relevant taxing authorities. At each balance sheet date, unresolved uncertain tax positions are reassessed to determine whether subsequent developments require a change in the amount of recognized tax benefit. The allowance for uncertain tax positions is recorded in other current and noncurrent liabilities on the consolidated balance sheet. The Company records interest expense related to income tax matters as interest expense on the consolidated statement of operations. The Company includes penalties related to income tax matters in the income tax provision.
Cash and cash equivalents - Cash and cash equivalents include certain investments with daily liquidity and with an original maturity of three months or less from the date of purchase. Cash equivalents are recorded at cost, which approximates fair value.
Restricted cash - The Company classifies cash and cash equivalents as restricted when it is unavailable for withdrawal or use in its general operations. The Company has the following types of restricted cash and restricted cash equivalents which are included in the reconciliation of beginning-of-period and end-of-period amounts shown on the consolidated statement of cash flows:
Restricted cash for litigation settlement - The Company has restricted cash for litigation within a qualified settlement fund related to the settlement agreement for the U.S. merchant class litigation. The funds continue to be restricted for payments until the litigation matter is resolved.
Restricted security deposits held for customers - The Company requires collateral from certain customers for settlement of their transactions. The majority of collateral for settlement is in the form of standby letters of credit and bank guarantees which are not recorded on the consolidated balance sheet. Additionally, the Company holds cash deposits and certificates of deposit from certain customers as collateral for settlement of their transactions, which are recorded as assets on the consolidated balance sheet. These assets are fully offset by corresponding liabilities included on the consolidated balance sheet. These security deposits are typically held for the duration of the agreement with the customers.
Other restricted cash balances - The Company has other restricted cash balances which include contractually restricted deposits, as well as cash balances that are restricted based on the Company’s intention with regard to usage. These funds are classified on the consolidated balance sheet within prepaid expenses and other current assets and other assets.
Fair value - The Company measures certain financial assets and liabilities at fair value on a recurring basis by estimating the price that would be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants. The Company classifies these recurring fair value measurements into a three-level hierarchy (“Valuation Hierarchy”).
The Valuation Hierarchy is based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date. A financial instrument’s categorization within the Valuation Hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The three levels of the Valuation Hierarchy are as follows: 
Level 1 - inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets
Level 2 - inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets and liabilities in inactive markets and inputs that are observable for the asset or liability
Level 3 - inputs to the valuation methodology are unobservable and cannot be directly corroborated by observable market data
Certain assets are measured at fair value on a nonrecurring basis. The Company’s non-financial assets measured at fair value on a nonrecurring basis include property, equipment and right-of-use assets, goodwill and other intangible assets. These assets are subject to fair value adjustments in certain circumstances, such as when there is evidence of impairment.
The valuation methods for goodwill and other intangible assets acquired in business combinations involve assumptions concerning comparable company multiples, discount rates, growth projections and other assumptions of future business conditions. The Company uses various valuation techniques to determine fair value, primarily discounted cash flows analysis, relief-from-royalty, and multi-period excess earnings for estimating the fair value of its intangible assets. As the assumptions employed to measure these assets are based on management’s judgment using internal and external data, these fair value determinations are classified in Level 3 of the Valuation Hierarchy.
Contingent consideration - Certain business combinations involve the potential for future payment of consideration that is contingent upon the achievement of performance milestones. These liabilities are classified within Level 3 of the Valuation Hierarchy as the inputs used to measure fair value are unobservable and require management’s judgment. The fair value of the contingent consideration at the acquisition date and subsequent periods is determined utilizing an income approach based on a Monte Carlo technique and is recorded in other current liabilities and other liabilities on the consolidated balance sheet. Changes to projected performance milestones of the acquired businesses could result in a higher or lower contingent consideration liability. The changes in fair value as a result of updated assumptions will be recorded in general and administrative expenses on the consolidated statement of operations.
Investment securities - The Company classifies investments as available-for-sale or held-to-maturity at the date of acquisition.
Available-for-sale debt securities:
Available-for-sale securities that are available to meet the Company’s current operational needs are classified as current assets and the securities that are not available for current operational needs are classified as non-current assets on the consolidated balance sheet.
The investments in debt securities are carried at fair value, with unrealized gains and losses, net of tax, recorded as a separate component of accumulated other comprehensive income (loss) on the consolidated statement of comprehensive income. Net realized gains and losses on debt securities are recognized in investment income on the consolidated statement of operations. The specific identification method is used to determine realized gains and losses.
The Company evaluates its debt securities for other-than-temporary impairment on an ongoing basis. When there has been a decline in fair value of a debt security below the amortized cost basis, the Company recognizes an other-than-temporary impairment if: (1) it has the intent to sell the security; (2) it is more likely than not that it will be required to sell the security before recovery of the amortized cost basis; or (3) it does not expect to recover the entire amortized cost basis of the security. The credit loss component of the impairment would be recognized in other income (expense), net on the consolidated statement of operations while the non-credit loss would remain in accumulated other comprehensive income (loss) until realized from a sale or an other-than-temporary impairment.
Held-to-maturity securities:
Time deposits - The Company classifies time deposits with original maturities greater than three months as held-to-maturity. Held-to-maturity securities that mature within one year are classified as current assets within investments on the consolidated balance sheet while held-to-maturity securities with maturities of greater than one year are classified as non-current assets. Time deposits are carried at amortized cost on the consolidated balance sheet and are intended to be held until maturity.
Equity investments - The Company holds equity securities of publicly traded and privately held companies.
Marketable equity securities - Marketable equity securities are strategic investments in publicly traded companies and are measured at fair value using quoted prices in their respective active markets with changes recorded through gain (losses) on equity investments, net on the consolidated statement of operations. Securities that are not for use in current operations are classified in other assets on the consolidated balance sheet.
Nonmarketable equity investments - The Company’s nonmarketable equity investments, which are reported in other assets on the consolidated balance sheet, include investments in privately held companies without readily determinable market values. The Company uses discounted cash flows and market assumptions to estimate the fair value of its nonmarketable equity investments when certain events or circumstances indicate that impairment may exist. The Company’s nonmarketable equity investments are accounted for under the equity method or measurement alternative method.
Equity method - The Company accounts for investments in common stock or in-substance common stock under the equity method of accounting when it has the ability to exercise significant influence over the investee, generally when it holds between 20% and 50% ownership in the entity. In addition, investments in flow-through entities such as limited partnerships and limited liability companies are also accounted for under the equity method when the Company has the ability to exercise significant influence over the investee, generally when the investment ownership percentage is equal to or greater than 5% of the outstanding ownership interest. The excess of the cost over the underlying net equity of investments accounted for under the equity method is allocated to identifiable tangible and intangible assets and liabilities based on fair values at the date of acquisition. The amortization of the excess of the cost over the underlying net equity of investments and Mastercard’s share of net earnings or losses of entities accounted for under the equity method of accounting is included in other income (expense), net on the consolidated statement of operations.
Measurement alternative method - The Company accounts for investments in common stock or in-substance common stock under the measurement alternative method of accounting when it does not exercise significant influence, generally when it holds less than 20% ownership in the entity or when the interest in a limited partnership or limited liability company is less than 5% and the Company has no significant influence over the operation of the investee. Investments in companies that Mastercard does not control, but that are not in the form of common stock or in-substance common stock, are also accounted for under the measurement alternative method of accounting. Measurement alternative investments are measured at cost, less any impairment and adjusted for changes resulting from observable price changes in orderly transactions for identical or similar investments of the same issuer. Fair value adjustments, as well as impairments, are included in gain (losses) on equity investments, net on the consolidated statement of operations.
Derivative and hedging instruments - The Company’s derivative financial instruments are recorded as either assets or liabilities on the balance sheet and measured at fair value. The Company’s foreign exchange and interest rate derivative contracts are included in Level 2 of the Valuation Hierarchy as the fair value of the contracts are based on inputs, which are observable based on broker quotes for the same or similar instruments. As the Company does not designate foreign exchange contracts as hedging instruments, realized and unrealized gains and losses from the change in fair value of the contracts are recognized immediately in current-period earnings. The Company’s foreign exchange contracts are not entered into for trading or speculative purposes.
The Company’s derivatives that are designated as hedging instruments are required to meet established accounting criteria. In addition, an effectiveness assessment is required to demonstrate that the derivative is expected to be highly effective at offsetting changes in fair value or cash flows of the underlying exposure both at inception of the hedging relationship and on an ongoing basis. The method of assessing hedge effectiveness and measuring hedge results is formally documented at hedge inception and assessed at least quarterly throughout the designated hedge period. For cash flow hedges, the fair value adjustments are recorded, net of tax, in other comprehensive income (loss). Any gains and losses deferred in other comprehensive income (loss) are then recognized in current-period earnings when earnings are affected by the variability of cash flows of the hedged forecasted transaction.
The Company has numerous investments in its foreign subsidiaries.  The net assets of these subsidiaries are exposed to volatility in foreign currency exchange rates.  The Company uses foreign currency denominated debt to hedge a portion of its net investment in foreign operations against adverse movements in exchange rates. The effective portion of the foreign currency gains and losses related to the foreign currency denominated debt are reported in accumulated other comprehensive income (loss) on the consolidated balance sheet as part of the cumulative translation adjustment component of equity. The Company evaluates the effectiveness of the net investment hedge each quarter.
Settlement due from/due to customers - The Company operates systems for clearing and settling payment transactions among customers. Net settlements are generally cleared daily among customers through settlement cash accounts by wire transfer or other bank clearing means. However, some transactions may not settle until subsequent business days, resulting in amounts due from and due to customers.
Property, equipment and right-of-use assets - Property and equipment are stated at cost less accumulated depreciation and amortization. Depreciation and amortization is computed using the straight-line method over the estimated useful lives of the assets. Depreciation of leasehold improvements and amortization of finance leases is included in depreciation and amortization expense on the consolidated statement of operations. Operating lease amortization expense is included in general and administrative expenses on the consolidated statement of operations.
The useful lives of the Company’s assets are as follows:
Asset Category
 
Estimated Useful Life
Buildings
 
30 years
Building equipment
 
10 - 15 years
Furniture and fixtures and equipment
 
3 - 5 years
Leasehold improvements
 
Shorter of life of improvement or lease term
Right-of-use assets
 
Shorter of life of the asset or lease term

The Company determines if a contract is, or contains, a lease at contract inception. The Company’s right-of-use (“ROU”) assets are primarily related to operating leases for office space, automobiles and other equipment. Leases are included in property, equipment and right-of-use assets, other current liabilities and other liabilities on the consolidated balance sheet.
ROU assets represent the right to use an underlying asset for the lease term and lease liabilities represent the obligation to make lease payments arising from the lease. ROU assets and lease liabilities are recognized at the commencement date based on the present value of lease payments over the lease term. In addition, ROU assets include initial direct costs incurred by the lessee as well as any lease payments made at or before the commencement date, and exclude lease incentives. As most of the Company's leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments. The incremental borrowing rate is determined by using the rate of interest that the Company would pay to borrow on a collateralized basis an amount equal to the lease payments for a similar term and in a similar economic environment. Lease terms include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Leases with a term of one year or less are excluded from ROU assets and liabilities.
The Company excludes variable lease payments in measuring ROU assets and lease liabilities, other than those that depend on an index, a rate or are in-substance fixed payments. Lease and nonlease components are generally accounted for separately. When available, consideration is allocated to the separate lease and nonlease components in a lease contract on a relative standalone price basis using observable standalone prices.
Pension and other postretirement plans - The Company recognizes the funded status of its single-employer defined benefit pension plans and postretirement plans as assets or liabilities on its consolidated balance sheet and recognizes changes in the funded status in the year in which the changes occur through accumulated other comprehensive income (loss). The funded status is measured as the difference between the fair value of plan assets and the projected benefit obligation at December 31, the measurement date. Overfunded plans, if any, are aggregated and recorded in other assets, while underfunded plans are aggregated and recorded as accrued expenses and other liabilities on the consolidated balance sheet.
Net periodic pension and postretirement benefit cost/(income), excluding the service cost component, is recognized in other income (expense) on the consolidated statement of operations. These costs include interest cost, expected return on plan assets, amortization of prior service costs or credits and gains or losses previously recognized as a component of accumulated other comprehensive income (loss). The service cost component is recognized in general and administrative expenses on the consolidated statement of operations.
Defined contribution plans - The Company’s contributions to defined contribution plans are recorded as employees render service to the Company. The charge is recorded in general and administrative expenses on the consolidated statement of operations.
Advertising and marketing - Expenses incurred to promote Mastercard’s brand, products and services are recognized in advertising and marketing on the consolidated statement of operations. The timing of recognition is dependent on the type of advertising or marketing expense.
Foreign currency remeasurement and translation - Monetary assets and liabilities are remeasured to functional currencies using current exchange rates in effect at the balance sheet date. Non-monetary assets and liabilities are recorded at historical exchange rates. Revenue and expense accounts are remeasured at the weighted-average exchange rate for the period. Resulting exchange gains and losses related to remeasurement are included in general and administrative expenses on the consolidated statement of operations.
Where a non-U.S. currency is the functional currency, translation from that functional currency to U.S. dollars is performed for balance sheet accounts using current exchange rates in effect at the balance sheet date and for revenue and expense accounts using a weighted-
average exchange rate for the period. Resulting translation adjustments are reported as a component of accumulated other comprehensive income (loss).
Treasury stock - The Company records the repurchase of shares of its common stock at cost on the trade date of the transaction. These shares are considered treasury stock, which is a reduction to stockholders’ equity. Treasury stock is included in authorized and issued shares but excluded from outstanding shares.
Share-based payments - The Company measures share-based compensation expense at the grant date, based on the estimated fair value of the award and uses the straight-line method of attribution, net of estimated forfeitures, for expensing awards over the requisite employee service period. The Company estimates the fair value of its non-qualified stock option awards (“Options”) using a Black-Scholes valuation model. The fair value of restricted stock units (“RSUs”) is determined and fixed on the grant date based on the Company’s stock price, adjusted for the exclusion of dividend equivalents. The Monte Carlo simulation valuation model is used to determine the grant date fair value of performance stock units (“PSUs”) granted. All share-based compensation expenses are recorded in general and administrative expenses on the consolidated statement of operations.
Redeemable non-controlling interests - The Company’s business combinations may include provisions allowing non-controlling equity owners the ability to require the Company to purchase additional interests in the subsidiary at their discretion. The interests are initially recorded at fair value and in subsequent reporting periods are accreted or adjusted to the estimated redemption value. The adjustments to the redemption value are recorded to retained earnings or additional paid-in capital on the consolidated balance sheet. The redeemable non-controlling interests are considered temporary and reported outside of permanent equity on the consolidated balance sheet at the greater of the carrying amount adjusted for the non-controlling interest’s share of net income (loss) or its redemption value.
Earnings per share - The Company calculates basic earnings per share (“EPS”) by dividing net income by the weighted-average number of common shares outstanding during the year. Diluted EPS is calculated by dividing net income by the weighted-average number of common shares outstanding during the year, adjusted for the potentially dilutive effect of stock options and unvested stock units using the treasury stock method. The Company may be required to calculate EPS using the two-class method as a result of its redeemable non-controlling interests. If redemption value exceeds the fair value of the redeemable non-controlling interests, the excess would be a reduction to net income for the EPS calculation.
Accounting pronouncements adopted
Leases - In February 2016, the Financial Accounting Standards Board (the “FASB”) issued accounting guidance that changed how companies account for and present lease arrangements. This guidance requires companies to recognize lease assets and liabilities for both finance and operating leases on the consolidated balance sheet. The Company adopted this guidance effective January 1, 2019, under the modified retrospective transition method with the available practical expedients.
The following table summarizes the impact of the changes made to the January 1, 2019 consolidated balance sheet for the adoption of the new accounting standard pertaining to leases. The prior periods have not been restated and have been reported under the accounting standard in effect for those periods.
 
 
Balance at December 31, 2018
 
Impact of lease standard
 
Balance at
January 1, 2019
 
 
(in millions)
Assets
 
 
 
 
 
 
Property, equipment and right-of-use assets, net
 
$
921

 
$
375

 
$
1,296

Liabilities
 
 
 
 
 
 
Other current liabilities
 
949

 
72

 
1,021

Other liabilities
 
1,877

 
303

 
2,180


For a more detailed discussion on lease arrangements, refer to Note 10 (Property, Equipment and Right-of-Use Assets).
Comprehensive income - In February 2018, the FASB issued accounting guidance that allows for a one-time reclassification from accumulated other comprehensive income (loss) to retained earnings for stranded tax effects resulting from U.S. tax reform. The Company adopted this guidance effective January 1, 2019, electing to retain the stranded tax effects in accumulated other comprehensive income (loss). The adoption did not result in a material impact on the Company’s consolidated financial statements.
Revenue recognition - In May 2014, the FASB issued accounting guidance that provides a single, comprehensive revenue recognition model for all contracts with customers and supersedes most of the existing revenue recognition requirements. Under this guidance, an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The Company adopted this guidance effective January 1, 2018 under the modified retrospective transition method, applying the standard to contracts not completed as of January 1, 2018 and considered the aggregate amount of modifications.
This revenue guidance impacts the timing of certain customer incentives recognized in the Company’s consolidated statement of operations, as they are recognized over the life of the contract. Previously, such incentives were recognized when earned by the customer. This revenue guidance also impacts the Company’s accounting recognition for certain market development fund contributions and expenditures. Historically, these items were recorded on a net basis in net revenue and will now be recognized on a gross basis, resulting in an increase to both revenues and expenses.
The following tables summarize the impact of the revenue standard on the Company’s consolidated statement of operations and consolidated balance sheet:
 
 
Year Ended December 31, 2018
 
 
Balances excluding revenue standard
 
Impact of revenue standard
 
As reported
 
 
(in millions)
Net Revenue
 
$
14,471

 
$
479

 
$
14,950

Operating Expenses
 
 
 
 
 
 
Advertising and marketing
 
743

 
164

 
907

Income before income taxes
 
6,889

 
315

 
7,204

Income tax expense
 
1,278

 
67

 
1,345

Net Income
 
5,611

 
248

 
5,859

 
 
December 31, 2018
 
 
Balances excluding revenue standard
 
Impact of revenue standard
 
As reported
 
 
(in millions)
Assets
 
 
 
 
 
 
Accounts receivable
 
$
2,214

 
$
62

 
$
2,276

Prepaid expenses and other current assets
 
1,176

 
256

 
1,432

Deferred income taxes
 
666

 
(96
)
 
570

Other assets
 
2,388

 
915

 
3,303

Liabilities
 
 
 
 
 
 
Accounts payable
 
959

 
(422
)
 
537

Accrued expenses
 
4,375

 
372

 
4,747

Other current liabilities
 
1,085

 
(136
)
 
949

Other liabilities
 
1,145

 
732

 
1,877

Equity
 
 
 
 
 
 
Retained earnings
 
26,692

 
591

 
27,283

For a more detailed discussion on revenue recognition, refer to Note 3 (Revenue).
Intra-entity asset transfers - In October 2016, the FASB issued accounting guidance to simplify the accounting for income tax consequences of intra-entity transfers of assets other than inventory. Under this guidance, companies are required to recognize the income tax consequences of an intra-entity asset transfer when the transfer occurs. This guidance must be applied on a modified retrospective basis through a cumulative-effect adjustment to retained earnings as of the period of adoption. The guidance is effective for periods beginning after December 15, 2017. The Company adopted this guidance effective January 1, 2018. See the section in this note entitled Cumulative Effect of the Adopted Accounting Pronouncements for a summary of the cumulative impact of adopting this standard as of January 1, 2018.
Cumulative effect of the 2018 adopted accounting pronouncements
The following table summarizes the cumulative impact of the changes made to the January 1, 2018 consolidated balance sheet for the adoption of the new accounting standards pertaining to revenue recognition and intra-entity asset transfers. The prior periods have not been restated and have been reported under the accounting standards in effect for those periods.
 
 
Balance at December 31, 2017
 
Impact of revenue standard
 
Impact of intra-entity asset transfers standard
 
Balance at
January 1, 2018
 
 
(in millions)
Assets
 
 
 
 
 
 
 
 
Accounts receivable
 
$
1,969

 
$
44

 
$

 
$
2,013

Prepaid expenses and other current assets
 
1,040

 
181

 
(17
)
 
1,204

Deferred income taxes
 
250

 
(69
)
 
186

 
367

Other assets
 
2,298

 
690

 
(352
)
 
2,636

Liabilities
 
 
 
 
 
 
 
 
Accounts payable
 
933

 
(495
)
 

 
438

Accrued expenses
 
3,931

 
391

 

 
4,322

Other current liabilities
 
792

 
(44
)
 

 
748

Other liabilities
 
1,438

 
628

 

 
2,066

Equity
 
 
 
 
 
 
 
 
Retained earnings
 
22,364

 
366

 
(183
)
 
22,547

Accounting pronouncements not yet adopted
Implementation costs incurred in a hosting arrangement that is a service contract - In August 2018, the FASB issued accounting guidance which aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. This guidance is effective for periods beginning after December 15, 2019. Companies are required to adopt this guidance either retrospectively or by prospectively applying the guidance to all implementation costs incurred after the date of adoption. The Company will adopt this guidance effective January 1, 2020 by applying the prospective approach as of the date of adoption and this guidance will not have a material impact on its consolidated financial statements.
Disclosure requirements for fair value measurement - In August 2018, the FASB issued accounting guidance which modifies disclosure requirements for fair value measurements by removing, modifying and adding certain disclosures. This guidance is effective for periods beginning after December 15, 2019. Companies are required to adopt the guidance for certain added disclosures prospectively for only the most recent interim or annual period presented in the initial fiscal year of adoption and all other amendments retrospectively to all periods presented upon their effective date. The Company will adopt this guidance effective January 1, 2020 and the impact will not be material.
v3.19.3.a.u2
Acquisitions Business Combination (Notes)
12 Months Ended
Dec. 31, 2019
Business Combinations [Abstract]  
Business Combination Disclosure
In 2019 and 2017, the Company acquired several businesses in separate transactions for total consideration of $1.5 billion in each year, representing both cash and contingent consideration. There were no acquisitions in 2018. These acquisitions align with the Company’s strategy to grow, diversify and build the Company’s business. Refer to Note 1 (Summary of Significant Accounting Policies) for the valuation techniques Mastercard utilizes to fair value the respective components of business combinations. The residual value allocated to goodwill is primarily attributable to the synergies expected to arise after the acquisition date and a portion of the goodwill is expected to be deductible for tax purposes.
The Company is evaluating and finalizing the purchase accounting for businesses acquired during 2019. In 2018, the Company finalized the purchase accounting for businesses acquired during 2017. The preliminary estimated and final fair values of the purchase price allocations in aggregate, as of the acquisition dates, are noted below for 2019 and 2017, respectively. There were no acquisitions in 2018.
 
 
2019
 
2017
 
 
(in millions)
Assets:
 
 
 
 
Cash and cash equivalents
 
$
54

 
$
111

Other current assets
 
143

 
110

Other intangible assets
 
395

 
488

Goodwill
 
1,076

 
1,135

Other assets
 
48

 
91

Total assets
 
1,716

 
1,935

 
 
 
 
 
Liabilities:
 
 
 
 
Other current liabilities
 
121

 
234

Deferred income taxes
 
52

 
64

Other liabilities
 
32

 
66

Total liabilities
 
205

 
364

 
 
 
 
 
Net assets acquired
 
$
1,511

 
$
1,571


The following table summarizes the identified intangible assets acquired for 2019 and 2017:
 
 
2019
 
2017
 
2019
 
2017
 
 
Acquisition Date Fair Value
 
Weighted-Average Useful Life
 
 
(in millions)
 
(in years)
Developed technologies
 
$
199

 
$
319

 
7.7
 
7.5
Customer relationships
 
178

 
166

 
12.6
 
9.9
Other
 
18

 
3

 
5.0
 
1.4
Other intangible assets
 
$
395

 
$
488

 
9.7
 
8.3

Pro forma information related to the acquisitions was not included because the impact on the Company's consolidated results of operations was not considered to be material.
The businesses acquired in 2019 were not individually significant to Mastercard. For the businesses acquired in 2017, the largest acquisition relates to Vocalink, a payment systems and ATM switching platform operator, located principally in the U.K. On April 28, 2017, Mastercard acquired 92.4% controlling interest in Vocalink for cash consideration of £719 million ($929 million). In addition, the Vocalink sellers earned additional contingent consideration of £169 million ($219 million) upon meeting 2018 revenue targets in accordance with terms of the purchase agreement. Refer to Note 8 (Fair Value Measurements) for additional information related to the fair value of contingent consideration.
A majority of Vocalink’s shareholders have retained a 7.6% ownership for at least three years, which is recorded as redeemable non-controlling interests on the consolidated balance sheet. These remaining shareholders have a put option to sell their ownership interest to Mastercard on the third and fifth anniversaries of the transaction and quarterly thereafter (the “Third Anniversary Option” and “Fifth Anniversary Option”, respectively).  The Third Anniversary Option is exercisable at a fixed price of £58 million (approximately $76 million as of December 31, 2019) (“Fixed Price”). The Fifth Anniversary Option is exercisable at the greater of the Fixed Price or fair value. Additionally, Mastercard has a call option to purchase the remaining interest from Vocalink’s shareholders on the fifth anniversary of the transaction and quarterly thereafter, which is exercisable at the greater of the Fixed Price or fair value. The fair value of the redeemable non-controlling interests was determined utilizing a market approach, which extrapolated the consideration transferred that was discounted for lack of control and marketability.
Pending Acquisition
In August 2019, Mastercard entered into a definitive agreement to acquire the majority of the Corporate Services business of Nets Denmark A/S, for €2.85 billion (approximately $3.19 billion as of December 31, 2019) after adjusting for cash and certain other liabilities at closing. The pending acquisition primarily comprises the clearing and instant payment services, and e-billing solutions of Nets Denmark A/S’s Corporate Services business. While the Company anticipates completing the acquisition in the first half of 2020, the transaction is subject to regulatory approval and other customary closing conditions.
v3.19.3.a.u2
Revenue (Notes)
12 Months Ended
Dec. 31, 2019
Revenue from Contract with Customer [Abstract]  
Revenue
Mastercard’s business model involves four participants in addition to the Company: account holders, issuers (the account holders’ financial institutions), merchants and acquirers (the merchants’ financial institutions). Revenue from contracts with customers is recognized when services are performed in an amount that reflects the consideration to which the Company expects to be entitled to in exchange for those services. Revenue recognized from domestic assessments, cross-border volume fees and transaction processing are derived from Mastercard’s payment network services. Revenue is primarily generated by charging fees to issuers, acquirers and other stakeholders for providing switching services, as well as by assessing customers based primarily on the dollar volume of activity, or gross dollar volume, on the products that carry the Company’s brands. Revenue is generally derived from transactional information accumulated by Mastercard’s systems or reported by customers. In addition, the Company recognizes revenue from other payment-related products and services in the period in which the related transactions occur or services are performed.
The price structure for Mastercard’s products and services is dependent on the nature of volumes, types of transactions and type of products and services offered to customers. Net revenue can be impacted by the following:
domestic or cross-border transactions
geographic region or country in which the transaction occurs
volumes/transactions subject to tiered rates
processed or not processed by the Company
amount of usage of the Company’s other products or services
amount of rebates and incentives provided to customers
The Company classifies its net revenue into the following five categories:
Domestic assessments are fees charged to issuers and acquirers based primarily on the dollar volume of activity on cards and other devices that carry the Company’s brands where the merchant country and the country of issuance are the same. Revenue from domestic assessments is recorded as revenue in the period it is earned, which is when the related volume is generated on the cards or other devices that carry the Company’s brands.
Cross-border volume fees are charged to issuers and acquirers based primarily on the dollar volume of activity on cards and other devices that carry the Company’s brands where the merchant country and the country of issuance are different. Revenue from cross-border volume is recorded as revenue in the period it is earned, which is when the related volume is generated on the cards or other devices that carry the Company’s brands.
Transaction processing revenue is recognized for both domestic and cross-border transactions in the period in which the related transactions occur. Transaction processing includes the following:
Switched transaction revenue is generated from the following products and services:
Authorization is the process by which a transaction is routed to the issuer for approval. In certain circumstances, such as when the issuer’s systems are unavailable or cannot be contacted, Mastercard or others approve such transactions on behalf of the issuer in accordance with either the issuer’s instructions or applicable rules (also known as “stand-in”).
Clearing is the determination and exchange of financial transaction information between issuers and acquirers after a transaction has been successfully conducted at the point of interaction. Transactions are cleared among customers through Mastercard’s central and regional processing systems.
Settlement is facilitating the exchange of funds between parties.
Connectivity fees are charged to issuers, acquirers and other financial institutions for network access, equipment and the transmission of authorization and settlement messages. These fees are based on the size of the data being transmitted and the number of connections to the Company’s network.
Other processing fees include issuer and acquirer processing solutions; payment gateways for e-commerce merchants; mobile gateways for mobile-initiated transactions; and safety and security.
Other revenues consist of value-added service offerings that are typically sold with the Company’s payment service offerings and are recognized in the period in which the related services are performed or transactions occur. Other revenues include the following:
Data analytics and consulting fees.
Cyber and intelligence fees are for products and services offered to prevent, detect and respond to fraud and to ensure the safety of transactions made primarily on Mastercard products.
Loyalty and rewards solutions fees are charged to issuers for benefits provided directly to consumers with Mastercard-branded cards, such as access to a global airline lounge network, global and local concierge services, individual insurance coverages, emergency card replacement, emergency cash advance services and a 24-hour cardholder service center. Loyalty and reward solution fees also include rewards campaigns and management services.
Program management services provided to prepaid card issuers consist of foreign exchange margin, commissions, load fees and ATM withdrawal fees paid by cardholders on the sale and encashment of prepaid cards.
Batch and real-time account-based payment services relating to ACH transactions and other ACH related services.
Other payment-related products and services, including account and transaction enhancement services, rules compliance and publications.
Rebates and incentives (contra-revenue) are provided to customers that meet certain volume targets and can be in the form of a rebate or other support incentives, which are tied to performance.  Rebates and incentives are recorded as a reduction of gross revenue primarily when volume- and transaction-based revenues are recognized over the contractual term.  In addition, Mastercard may make incentive payments to a customer directly related to entering into an agreement, which are generally capitalized and amortized over the life of the agreement on a straight-line basis.
The Company’s disaggregated net revenue by source and geographic region were as follows for the years ended December 31:
 
 
2019
 
2018
 
 
(in millions)
Revenue by source:
 
 
 
 
Domestic assessments
 
$
6,781

 
$
6,138

Cross-border volume fees
 
5,606

 
4,954

Transaction processing
 
8,469

 
7,391

Other revenues
 
4,124

 
3,348

Gross revenue
 
24,980

 
21,831

Rebates and incentives (contra-revenue)
 
(8,097
)
 
(6,881
)
Net revenue
 
$
16,883

 
$
14,950

 
 
 
 
 
Net revenue by geographic region:
 
 
 
 
North American Markets
 
$
5,843

 
$
5,312

International Markets
 
10,869

 
9,514

Other 1
 
171

 
124

Net revenue
 
$
16,883

 
$
14,950

1 
Includes revenues managed by corporate functions.
Receivables from contracts with customers of $2.3 billion and $2.1 billion as of December 31, 2019 and 2018, respectively, are recorded within accounts receivable on the consolidated balance sheet. The Company’s customers are generally billed weekly, however the frequency is dependent upon the nature of the performance obligation and the underlying contractual terms. The Company does not typically offer extended payment terms to customers.
Contract assets are included in prepaid expenses and other current assets and other assets on the consolidated balance sheet at December 31, 2019 in the amounts of $48 million and $152 million, respectively. The comparable amounts included in prepaid expenses and other current assets and other assets at December 31, 2018 were $40 million and $92 million, respectively.
Deferred revenue is included in other current liabilities and other liabilities on the consolidated balance sheet at December 31, 2019 in the amounts of $238 million and $106 million, respectively. The comparable amounts included in other current liabilities and other
liabilities at December 31, 2018 were $218 million and $101 million, respectively. In 2019 and 2018, revenue recognized from the satisfaction of such performance obligations was $904 million in each year.
The Company’s remaining performance periods for its contracts with customers for its payment network services are typically long-term in nature (generally up to 10 years). As a payment network service provider, the Company provides its customers with continuous access to its global payment processing network and stands ready to provide transaction processing and related services over the contractual term. Consideration is variable as the Company generates revenues from assessing its customers based on the GDV of activity on the products that carry the Company’s brands. The Company has elected the optional exemption to not disclose the remaining performance obligations related to its payment network services. The Company also earns revenues from other value-added services comprised of both batch and real-time account-based payment services, consulting fees, loyalty programs and other payment-related products and services. At December 31, 2019, the estimated aggregate consideration allocated to unsatisfied performance obligations for these other value-added services is $1.3 billion, which is expected to be recognized through 2022. The estimated remaining performance obligations related to these revenues are subject to change and are affected by several factors, including modifications and terminations and are not expected to be material to any future annual period.
v3.19.3.a.u2
Earnings Per Share
12 Months Ended
Dec. 31, 2019
Earnings Per Share [Abstract]  
Earnings Per Share
The components of basic and diluted EPS for common shares for each of the years ended December 31 were as follows:
 
 
2019
 
2018
 
2017
 
 
(in millions, except per share data)
Numerator
 
 
 
 
 
 
Net income
 
$
8,118

 
$
5,859

 
$
3,915

Denominator
 
 
 
 
 
 
Basic weighted-average shares outstanding
 
1,017

 
1,041

 
1,067

Dilutive stock options and stock units
 
5

 
6

 
5

Diluted weighted-average shares outstanding 1
 
1,022

 
1,047

 
1,072

Earnings per Share
 
 
 
 
 
 
Basic
 
$
7.98

 
$
5.63

 
$
3.67

Diluted
 
$
7.94

 
$
5.60

 
$
3.65


Note: Table may not sum due to rounding.
1 
For the years presented, the calculation of diluted EPS excluded a minimal amount of anti-dilutive share-based payment awards.
v3.19.3.a.u2
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents (Notes)
12 Months Ended
Dec. 31, 2019
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents [Abstract]  
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents
The following table provides a reconciliation of cash, cash equivalents, restricted cash and restricted cash equivalents reported on the consolidated balance sheet that total to the amounts shown on the consolidated statement of cash flows for the years ended December 31:
 
 
2019
 
2018
 
2017
 
2016
 
 
(in millions)
Cash and cash equivalents
 
$
6,988

 
$
6,682

 
$
5,933

 
$
6,721

Restricted cash and restricted cash equivalents
 
 
 
 
 
 
 
 
Restricted cash for litigation settlement
 
584

 
553

 
546

 
543

Restricted security deposits held for customers
 
1,370

 
1,080

 
1,085

 
991

Prepaid expenses and other current assets
 
27

 
22

 
28

 
3

Other assets
 

 

 

 
15

Cash, cash equivalents, restricted cash and restricted cash equivalents
 
$
8,969

 
$
8,337

 
$
7,592

 
$
8,273


v3.19.3.a.u2
Supplemental Cash Flows
12 Months Ended
Dec. 31, 2019
Supplemental Cash Flow Information [Abstract]  
Supplemental Cash Flows
The following table includes supplemental cash flow disclosures for each of the years ended December 31:
 
 
2019
 
2018
 
2017
 
 
(in millions)
Cash paid for income taxes, net of refunds
 
$
1,644

 
$
1,790

 
$
1,893

Cash paid for interest
 
199

 
153

 
135

Cash paid for legal settlements
 
668

 
260

 
47

Non-cash investing and financing activities
 
 
 
 
 
 
Dividends declared but not yet paid
 
403

 
340

 
263

Accrued property, equipment and right-of-use assets
 
468

 
10

 
30

Fair value of assets acquired, net of cash acquired
 
1,662

 

 
1,825

Fair value of liabilities assumed related to acquisitions
 
205

 

 
365


v3.19.3.a.u2
Investments (Notes)
12 Months Ended
Dec. 31, 2019
Investments, Debt and Equity Securities [Abstract]  
Investments
The Company’s investments on the consolidated balance sheet include both available-for-sale and held-to-maturity securities (see Investments section below). The Company classifies its investments in equity securities of publicly traded and privately held companies within other assets on the consolidated balance sheet (see Equity Investments section below).
Investments
Investments on the consolidated balance sheet consisted of the following at December 31:
 
 
2019
 
2018
 
 
(in millions)
Available-for-sale securities
 
$
591

 
$
1,432

Held-to-maturity securities
 
97

 
264

Total investments
 
$
688

 
$
1,696


Available-for-Sale Securities
The major classes of the Company’s available-for-sale investment securities and their respective amortized cost basis and fair values were as follows:
 
 
December 31, 2019
 
December 31, 2018
 
 
Amortized Cost
 
Gross Unrealized Gain
 
Gross Unrealized Loss
 
Fair Value
 
Amortized Cost
 
Gross Unrealized Gain
 
Gross Unrealized Loss
 
Fair Value
 
 
(in millions)
Municipal securities
 
$
15

 
$

 
$

 
$
15

 
$
15

 
$

 
$

 
$
15

Government and agency securities
 
108

 

 

 
108

 
157

 

 

 
157

Corporate securities
 
381

 
1

 

 
382

 
1,044

 
1

 
(2
)
 
1,043

Asset-backed securities
 
85

 
1

 

 
86

 
217

 

 

 
217

Total
 
$
589

 
$
2

 
$

 
$
591

 
$
1,433

 
$
1

 
$
(2
)
 
$
1,432


The Company’s available-for-sale investment securities held at December 31, 2019 and 2018, primarily carried a credit rating of A- or better with unrealized gains and losses recorded as a separate component of other comprehensive income (loss) on the consolidated statement of comprehensive income. The municipal securities are comprised of state tax-exempt bonds and are diversified across states and sectors. Government and agency securities include U.S. government bonds, U.S. government sponsored agency bonds and foreign government bonds with similar credit quality to that of the U.S. government bonds. Corporate securities are comprised of commercial paper and corporate bonds. The asset-backed securities are investments in bonds which are collateralized primarily by automobile loan receivables.
The maturity distribution based on the contractual terms of the Company’s investment securities at December 31, 2019 was as follows:
 
 
Available-For-Sale
 
 
Amortized
Cost
 
Fair Value
 
 
(in millions)
Due within 1 year
 
$
180

 
$
181

Due after 1 year through 5 years
 
409

 
410

Total
 
$
589

 
$
591


Investment income on the consolidated statement of operations primarily consists of interest income generated from cash, cash equivalents, time deposits, and realized gains and losses on the Company’s debt securities. The realized gains and losses from the sale of available-for-sale securities for 2019, 2018 and 2017 were not significant.
Held-to-Maturity Securities
The Company classifies time deposits with maturities greater than three months but less than one year as held-to-maturity. Time deposits are carried at amortized cost on the consolidated balance sheet and are intended to be held until maturity. The cost of these securities approximates fair value.
Equity Investments
Included in other assets on the consolidated balance sheet are equity investments with readily determinable fair values (“Marketable securities”) and equity investments without readily determinable fair values (“Nonmarketable securities”). Marketable securities are publicly traded companies and are measured using unadjusted quoted prices in their respective active markets. Nonmarketable securities that do not qualify for equity method accounting are measured at cost, less any impairment and adjusted for changes resulting from observable price changes in orderly transactions for the identical or similar investments of the same issuer (“measurement alternative”).
The following table is a summary of the activity related to the Company’s equity investments:
 
 
Balance at December 31, 2018
 
Purchases (Sales), net1
 
Changes in Fair Value2
 
Balance at December 31, 2019
 
 
(in millions)
Marketable securities
 
$

 
$
362

 
$
117

 
$
479

Nonmarketable securities
 
337

 
48

 
50

 
435

Total equity investments
 
$
337

 
$
410

 
$
167

 
$
914

1 
Includes impact of balance sheet foreign currency translation
2 
Recorded in gains (losses) on equity investments, net on the consolidated statement of operations

At December 31, 2019, the total carrying value of Nonmarketable securities included $317 million of measurement alternative investments and $118 million of equity method investments. At December 31, 2018, the total carrying value of Nonmarketable securities included $232 million of measurement alternative investments and $105 million of equity method investments.
v3.19.3.a.u2
Fair Value Measurements
12 Months Ended
Dec. 31, 2019
Financial Instruments, Financial Liabilities, Balance Sheet Groupings [Abstract]  
Fair Value Measurements
The Company classifies its fair value measurements of financial instruments into a three-level hierarchy within the Valuation Hierarchy. Financial instruments are categorized for fair value measurement purposes as recurring or non-recurring in nature. There were no transfers made among the three levels in the Valuation Hierarchy for 2019 and 2018.
Financial Instruments - Recurring Measurements
The distribution of the Company’s financial instruments measured at fair value on a recurring basis within the Valuation Hierarchy were as follows:
 
 
December 31, 2019
 
December 31, 2018
 
 
Quoted Prices
in Active
Markets
(Level 1)
 
Significant
Other
Observable
Inputs
(Level 2)
 
Significant
Unobservable
Inputs
(Level 3)
 
Total
 
Quoted Prices
in Active
Markets
(Level 1)
 
Significant
Other
Observable
Inputs
(Level 2)
 
Significant
Unobservable
Inputs
(Level 3)
 
Total
 
 
(in millions)
Assets
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Investment securities available for sale 1:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Municipal securities
 
$

 
$
15

 
$

 
$
15

 
$

 
$
15

 
$

 
$
15

Government and agency securities
 
66

 
42

 

 
108

 
65

 
92

 

 
157

Corporate securities
 

 
382

 

 
382

 

 
1,043

 

 
1,043

Asset-backed securities
 

 
86

 

 
86

 

 
217

 

 
217

Derivative instruments 2:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Foreign exchange contracts
 

 
12

 

 
12

 

 
35

 

 
35

Interest rate contracts
 

 
14

 

 
14

 

 

 

 

Marketable securities 3:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equity securities
 
479

 

 

 
479

 

 

 

 

Deferred compensation plan 4:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Deferred compensation assets
 
67

 

 

 
67

 
54

 

 

 
54

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Liabilities
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Derivative instruments 2:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Foreign exchange derivative liabilities
 
$

 
$
(32
)
 
$

 
$
(32
)
 
$

 
$
(6
)
 
$

 
$
(6
)
Deferred compensation plan 5:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Deferred compensation liabilities
 
(67
)
 

 

 
(67
)
 
(54
)
 

 

 
(54
)

1 
The Company’s U.S. government securities are classified within Level 1 of the Valuation Hierarchy as the fair values are based on unadjusted quoted prices for identical assets in active markets. The fair value of the Company’s available-for-sale municipal securities, government and agency securities, corporate securities and asset-backed securities are based on observable inputs such as quoted prices, benchmark yields and issuer spreads for similar assets in active markets and are therefore included in Level 2 of the Valuation Hierarchy.
2 
The Company’s foreign exchange and interest rate derivative asset and liability contracts have been classified within Level 2 of the Valuation Hierarchy as the fair value is based on observable inputs such as broker quotes relating to foreign currency exchange rates for similar derivative instruments. See Note 23 (Derivative and Hedging Instruments) for further details.
3 
The Company’s Marketable securities are publicly held and classified within Level 1 of the Valuation Hierarchy as the fair values are based on unadjusted quoted prices in their respective active markets.
4 
The Company has a nonqualified deferred compensation plan where assets are invested primarily in mutual funds held in a rabbi trust, which is restricted for payments to participants of the plan. The Company has elected to use the fair value option for these mutual funds, which are measured using quoted prices of identical instruments in active markets and are included in prepaid expenses and other current assets on the consolidated balance sheet.
5 
The deferred compensation liabilities are measured at fair value based on the quoted prices of identical instruments to the investment vehicles selected by the participants. These are included in other liabilities on the consolidated balance sheet.
Financial Instruments - Non-Recurring Measurements
Nonmarketable Securities
The Company’s Nonmarketable securities are recorded at fair value on a non-recurring basis in periods after initial recognition under the equity method or measurement alternative method. Nonmarketable securities are classified within Level 3 of the Valuation Hierarchy due to the absence of quoted market prices, the inherent lack of liquidity and unobservable inputs used to measure fair value that require management’s judgment. The Company uses discounted cash flows and market assumptions to estimate the fair value of its Nonmarketable securities when certain events or circumstances indicate that impairment may exist. See Note 7 (Investments) for further details.
Debt
The Company estimates the fair value of its long-term debt based on market quotes. These debt instruments are not traded in active markets and are classified as Level 2 of the Valuation Hierarchy. At December 31, 2019, the carrying value and fair value of total long-term debt (including the current portion) was $8.5 billion and $9.2 billion, respectively. At December 31, 2018, the carrying value and fair value of long-term debt (including the current portion) was $6.3 billion and $6.5 billion, respectively. See Note 15 (Debt) for further details.
Other Financial Instruments
Certain financial instruments are carried on the consolidated balance sheet at cost or amortized cost basis, which approximates fair value due to their short-term, highly liquid nature. These instruments include cash and cash equivalents, restricted cash, time deposits, accounts receivable, settlement due from customers, restricted security deposits held for customers, accounts payable, settlement due to customers and other accrued liabilities.
Contingent Consideration
The contingent consideration attributable to acquisitions made in 2017 was primarily based on the achievement of 2018 revenue targets and was measured at fair value on a recurring basis. This contingent consideration liability of $219 million was included in other current liabilities on the consolidated balance sheet at December 31, 2018. This liability was classified within Level 3 of the Valuation Hierarchy due to the absence of quoted market prices and unobservable inputs used to measure fair value that require management’s judgment. During 2019, the Company paid $219 million to settle the contingent consideration.
v3.19.3.a.u2
Prepaid Expenses and Other Assets
12 Months Ended
Dec. 31, 2019
Prepaid Expense and Other Assets [Abstract]  
Prepaid Expenses and Other Assets
Prepaid expenses and other current assets consisted of the following at December 31:
 
 
2019
 
2018
 
 
(in millions)
Customer and merchant incentives
 
$
872

 
$
778

Prepaid income taxes
 
105

 
51

Other
 
786

 
603

Total prepaid expenses and other current assets
 
$
1,763

 
$
1,432


Other assets consisted of the following at December 31:
 
 
2019
 
2018
 
 
(in millions)
Customer and merchant incentives
 
$
2,838

 
$
2,458

Equity investments
 
914

 
337

Income taxes receivable
 
460

 
298

Other
 
313

 
210

Total other assets
 
$
4,525

 
$
3,303


Customer and merchant incentives represent payments made to customers and merchants under business agreements. Costs directly related to entering into such an agreement are generally deferred and amortized over the life of the agreement.
See Note 7 (Investments) for further information on the Company’s equity investments.
v3.19.3.a.u2
Property, Equipment and Right-of-Use Assets
12 Months Ended
Dec. 31, 2019
Property, Plant and Equipment [Abstract]  
Property, Equipment and Right-of-Use Assets
Property, equipment and right-of-use assets consisted of the following at December 31:
 
 
2019
 
2018
 
 
(in millions)
Building, building equipment and land
 
$
505

 
$
481

Equipment
 
1,218

 
987

Furniture and fixtures
 
92

 
85

Leasehold improvements
 
303

 
215

Operating lease right-of-use assets
 
810

 

Property, equipment and right-of-use assets
 
2,928

 
1,768

Less accumulated depreciation and amortization
 
(1,100
)
 
(847
)
Property, equipment and right-of-use assets, net
 
$
1,828

 
$
921


Depreciation and amortization expense for the above property, equipment and right-of-use assets was $336 million, $209 million and $185 million for 2019, 2018 and 2017, respectively.
The increase in property, equipment and right-of-use assets at December 31, 2019 from December 31, 2018 was primarily due to the impact from the adoption of the new accounting standard pertaining to lease arrangements as of January 1, 2019 as well as leases that commenced in 2019. See Note 1 (Summary of Significant Accounting Policies) for additional information of the accounting policy under the new leasing standard.
Operating lease ROU assets and operating lease liabilities are recorded on the consolidated balance sheet as follows:
 
 
December 31,
2019
 
 
(in millions)
Balance sheet location
 
 
Property, equipment and right-of-use assets, net
 
$
711

Other current liabilities
 
106

Other liabilities
 
656


Operating lease amortization expense for 2019 was $99 million. As of December 31, 2019, weighted-average remaining lease term of operating leases was 9.5 years and weighted-average discount rate for operating leases was 2.9%.
The following table summarizes the maturity of the Company’s operating lease liabilities at December 31, 2019 based on lease term:
 
 
Operating Leases
 
 
(in millions)
2020
 
$
112

2021
 
113

2022
 
103

2023
 
90

2024
 
79

Thereafter
 
376

Total operating lease payments
 
873

Less: Interest
 
(111
)
Present value of operating lease liabilities
 
$
762


As of December 31, 2019, the Company has entered into additional operating leases as a lessee, primarily for real estate. These leases have not yet commenced and will result in ROU assets and corresponding lease liabilities of approximately $23 million. These operating leases are expected to commence in fiscal year 2020, with lease terms between one and ten years.
The following disclosures relate to periods prior to adoption of the new lease accounting standard, including those operating leases entered into during 2018, but not yet commenced:
At December 31, 2018, the Company had the following future minimum payments due under non‐cancelable leases:
 
 
Operating Leases
 
 
(in millions)
2019
 
$
72

2020
 
75

2021
 
76

2022
 
68

2023
 
58

Thereafter
 
327

Total
 
$
676


Consolidated rental expense for the Company’s leased office space was $94 million and $77 million for 2018 and 2017, respectively. Consolidated lease expense for automobiles, computer equipment and office equipment was $20 million and $22 million for 2018 and 2017, respectively.
v3.19.3.a.u2
Goodwill
12 Months Ended
Dec. 31, 2019
Goodwill and Intangible Assets Disclosure [Abstract]  
Goodwill
The changes in the carrying amount of goodwill for the years ended December 31 were as follows:
 
 
2019
 
2018
 
 
(in millions)
Beginning balance
 
$
2,904

 
$
3,035

Additions
 
1,076

 
2

Foreign currency translation
 
41

 
(133
)
Ending balance
 
$
4,021

 
$
2,904


The Company performed its annual qualitative assessment of goodwill during the fourth quarter of 2019 and determined a quantitative assessment was not necessary. The Company concluded that goodwill was not impaired and had no accumulated impairment losses at December 31, 2019.
v3.19.3.a.u2
Other Intangible Assets
12 Months Ended
Dec. 31, 2019
Intangible Assets, Net (Excluding Goodwill) [Abstract]  
Other Intangible Assets
The following table sets forth net intangible assets, other than goodwill, at December 31:
 
 
2019
 
2018
 
 
Gross Carrying Amount
 
Accumulated Amortization
 
Net Carrying Amount
 
Gross Carrying Amount
 
Accumulated Amortization
 
Net Carrying Amount
 
 
(in millions)
Finite-lived intangible assets
 
 
 
 
 
 
 
 
 
 
 
 
Capitalized software
 
$
1,884

 
$
(988
)
 
$
896

 
$
1,514

 
$
(898
)
 
$
616

Customer relationships
 
621

 
(264
)
 
357

 
439

 
(232
)
 
207

Other
 
44

 
(44
)
 

 
46

 
(45
)
 
1

Total
 
2,549

 
(1,296
)
 
1,253

 
1,999

 
(1,175
)
 
824

Indefinite-lived intangible assets
 
 
 
 
 
 
 
 
 
 
 
 
Customer relationships
 
164

 

 
164

 
167

 

 
167

Total
 
$
2,713

 
$
(1,296
)
 
$
1,417

 
$
2,166

 
$
(1,175
)
 
$
991


The increase in the gross carrying amount of amortized intangible assets in 2019 was primarily related to the businesses acquired in 2019. See Note 2 (Acquisitions) for further details. Certain intangible assets are denominated in foreign currencies. As such, the change in intangible assets includes a component attributable to foreign currency translation. Based on the qualitative assessment performed in 2019, it was determined that the Company’s indefinite-lived intangible assets were not impaired.
Amortization on the assets above amounted to $285 million, $250 million and $252 million in 2019, 2018 and 2017, respectively. The following table sets forth the estimated future amortization expense on finite-lived intangible assets on the consolidated balance sheet at December 31, 2019 for the years ending December 31:
 
 
(in millions)
2020
 
$
300

2021
 
243

2022
 
164

2023
 
115

2024 and thereafter
 
431

 
 
$
1,253


v3.19.3.a.u2
Accrued Expenses and Accrued Litigation
12 Months Ended
Dec. 31, 2019
Accrued Liabilities [Abstract]  
Accrued Expenses and Accrued Litigation
Accrued expenses consisted of the following at December 31:
 
 
2019
 
2018
 
 
(in millions)
Customer and merchant incentives
 
$
3,892

 
$
3,275

Personnel costs
 
713

 
744

Income and other taxes
 
332

 
158

Other
 
552

 
570

Total accrued expenses
 
$
5,489

 
$
4,747


Customer and merchant incentives represent amounts to be paid to customers under business agreements. As of December 31, 2019 and 2018, the Company’s provision for litigation was $914 million and $1,591 million, respectively. These amounts are not included in the accrued expenses table above and are separately reported as accrued litigation on the consolidated balance sheet. See Note 21 (Legal and Regulatory Proceedings) for additional information regarding the Company’s accrued litigation.
v3.19.3.a.u2
Pension, Postretirement and Savings Plans
12 Months Ended
Dec. 31, 2019
Defined Benefit Plan [Abstract]  
Pension, Postretirement and Savings Plans
The Company and certain of its subsidiaries maintain various pension and other postretirement plans that cover substantially all employees worldwide.
Defined Contribution Plans
The Company sponsors defined contribution retirement plans. The primary plan is the Mastercard Savings Plan, a 401(k) plan for substantially all of the Company’s U.S. employees, which is subject to the provisions of the Employee Retirement Income Security Act of 1974, as amended. In addition, the Company has several defined contribution plans outside of the U.S. The Company’s total expense for its defined contribution plans was $127 million, $98 million and $84 million in 2019, 2018 and 2017, respectively.
Defined Benefit and Other Postretirement Plans
The Company sponsors pension and postretirement plans for certain non-U.S. employees (the “non-U.S. Plans”) that cover various benefits specific to their country of employment. Additionally, Vocalink has a defined benefit pension plan (the “Vocalink Plan”) which was permanently closed to new entrants and future accruals as of July 21, 2013, however, plan participants’ obligations are adjusted for future salary changes. The Company has agreed to make contributions of £15 million (approximately $19 million as of December 31, 2019) annually until September 2022. The term “Pension Plans” includes the non-U.S. Plans and the Vocalink Plan.
The Company maintains a postretirement plan providing health coverage and life insurance benefits for substantially all of its U.S. employees hired before July 1, 2007 (the “Postretirement Plan”).
The Company uses a December 31 measurement date for the Pension Plans and its Postretirement Plan (collectively the “Plans”). The Company recognizes the funded status of its Plans, measured as the difference between the fair value of the plan assets and the projected benefit obligation, in the consolidated balance sheet. The following table sets forth the Plans’ funded status, key assumptions and amounts recognized in the Company’s consolidated balance sheet at December 31:
 
 
Pension Plans
 
Postretirement Plan
 
 
2019
 
2018
 
2019
 
2018
 
 
($ in millions)
Change in benefit obligation
 
 
 
 
 
 
 
 
Benefit obligation at beginning of year
 
$
438

 
$
468

 
$
57

 
$
61

Service cost
 
11

 
9

 
1

 
1

Interest cost
 
13

 
12

 
2

 
2

Actuarial (gain) loss
 
73

 
(7
)
 
9

 
(2
)
Benefits paid
 
(15
)
 
(22
)
 
(5
)
 
(5
)
Transfers in
 
2

 
1

 

 

Foreign currency translation
 
9

 
(23
)
 

 

Benefit obligation at end of year
 
531

 
438

 
64

 
57

 
 
 
 
 
 
 
 
 
Change in plan assets
 
 
 
 
 
 
 
 
Fair value of plan assets at beginning of year
 
410

 
427

 

 

Actual (loss) gain on plan assets
 
79

 
(8
)
 

 

Employer contributions
 
32

 
33

 
5

 
5

Benefits paid
 
(15
)
 
(23
)
 
(5
)
 
(5
)
Transfers in
 
2

 
2

 

 

Foreign currency translation
 
10

 
(21
)
 

 

Fair value of plan assets at end of year
 
518

 
410

 

 

Funded status at end of year
 
$
(13
)
 
$
(28
)
 
$
(64
)
 
$
(57
)
 
 
 
 
 
 
 
 
 
Amounts recognized on the consolidated balance sheet consist of:
 
 
 
 
 
 
 
 
Other liabilities, short-term
 

 

 
(3
)
 
(3
)
Other liabilities, long-term
 
(13
)
 
(28
)
 
(61
)
 
(54
)
 
 
$
(13
)
 
$
(28
)
 
$
(64
)
 
$
(57
)
 
 
 
 
 
 
 
 
 
Accumulated other comprehensive income consists of:
 
 
 
 
 
 
 
 
Net actuarial (gain) loss
 
$
7

 
$
(5
)
 
$
2

 
$
(7
)
Prior service credit
 
1

 
1

 
(5
)
 
(6
)
Balance at end of year
 
$
8

 
$
(4
)
 
$
(3
)
 
$
(13
)
 
 
 
 
 
 
 
 
 
Weighted-average assumptions used to determine end of year benefit obligations
 
 
 
 
 
 
 
 
Discount rate
 
 
 
 
 
 
 
 
Non-U.S. Plans
 
0.70
%
 
1.80
%
 
*

 
*

Vocalink Plan
 
2.00
%
 
3.10
%
 
*

 
*

Postretirement Plan
 
*

 
*

 
3.25
%
 
4.25
%
 
 
 
 
 
 
 
 
 
Rate of compensation increase
 
 
 
 
 
 
 
 
Non-U.S. Plans
 
1.50
%
 
2.60
%
 
*

 
*

Vocalink Plan
 
2.50
%
 
4.00
%
 
*

 
*

Postretirement Plan
 
*

 
*

 
3.00
%
 
3.00
%
* Not applicable
All of the Pension Plans had benefit obligations in excess of plan assets at December 31, 2019 and 2018. Information on the Pension Plans were as follows:
 
 
2019
 
2018
 
 
(in millions)
Projected benefit obligation
 
$
531

 
$
438

Accumulated benefit obligation
 
524

 
430

Fair value of plan assets
 
518

 
410


For the year ended December 31, 2019, the Company’s projected benefit obligation related to its Pension Plans increased $93 million primarily attributable to actuarial losses related to lower discount rate assumptions. For the year ended December 31, 2018, the Company’s projected benefit obligation related to its Pension Plans decreased $30 million primarily attributable to foreign currency translation and benefits paid.
Components of net periodic benefit cost recorded in earnings were as follows for the Plans for each of the years ended December 31:
 
 
Pension Plans
 
Postretirement Plan
 
 
2019
 
2018
 
2017
 
2019
 
2018
 
2017
 
 
(in millions)
Service cost
 
$
11

 
$
9

 
$
9

 
$
1

 
$
1

 
$
1

Interest cost
 
13

 
12

 
8

 
2

 
2

 
2

Expected return on plan assets
 
(18
)
 
(20
)
 
(13
)
 

 

 

Amortization of actuarial loss
 
1

 

 

 

 

 

Amortization of prior service credit
 

 

 

 
(1
)
 
(2
)
 
(2
)
Net periodic benefit cost
 
$
7

 
$
1

 
$
4

 
$
2

 
$
1

 
$
1


The service cost component is recognized in general and administrative expenses on the consolidated statement of operations. Net periodic benefit cost, excluding the service cost component, is recognized in other income (expense) on the consolidated statement of operations.
Other changes in plan assets and benefit obligations recognized in other comprehensive income for the years ended December 31 were as follows:
 
 
Pension Plans
 
Postretirement Plan
 
 
2019
 
2018
 
2017
 
2019
 
2018
 
2017
 
 
(in millions)
Current year actuarial loss (gain)
 
$
12

 
$
17

 
$
(22
)
 
$
9

 
$
(2
)
 
$
5

Current year prior service credit
 

 
1

 

 

 

 

Amortization of prior service credit
 

 

 

 
1

 
2

 
2

Total other comprehensive loss (income)
 
$
12

 
$
18

 
$
(22
)
 
$
10

 
$

 
$
7

Total net periodic benefit cost and other comprehensive loss (income)
 
$
19

 
$
19

 
$
(18
)
 
$
12

 
$
1

 
$
8


Assumptions
Weighted-average assumptions used to determine net periodic benefit cost were as follows for the years ended December 31:
 
 
Pension Plans
 
Postretirement Plan
 
 
2019
 
2018
 
2017
 
2019
 
2018
 
2017
Discount rate
 
 
 
 
 
 
 
 
 
 
 
 
Non-U.S. Plans
 
1.80
%
 
1.80
%
 
1.60
%
 
*

 
*

 
*

Vocalink Plan
 
2.00
%
 
2.80
%
 
2.50
%
 
*

 
*

 
*

Postretirement Plan
 
*

 
*

 
*

 
4.25
%
 
3.50
%
 
4.00
%
Expected return on plan assets
 
 
 
 
 
 
 
 
 
 
 
 
Non-U.S. Plans
 
2.10
%
 
3.00
%
 
3.25
%
 
*

 
*

 
*

Vocalink Plan
 
3.75
%
 
4.75
%
 
4.75
%
 
*

 
*

 
*

Rate of compensation increase
 
 
 
 
 
 
 
 
 
 
 
 
Non-U.S. Plans
 
1.50
%
 
2.60
%
 
2.59
%
 
*

 
*

 
*

Vocalink Plan
 
2.50
%
 
3.85
%
 
3.95
%
 
*

 
*

 
*

Postretirement Plan
 
*

 
*

 
*

 
3.00
%
 
3.00
%
 
3.00
%
* Not applicable
The Company’s discount rate assumptions are based on yield curves derived from high quality corporate bonds, which are matched to the expected cash flows of each respective plan. The expected return on plan assets assumptions are derived using the current and expected asset allocations of the Pension Plans’ assets and considering historical as well as expected returns on various classes of plan assets. The rates of compensation increases are determined by the Company, based upon its long-term plans for such increases.
The following additional assumptions were used at December 31 in accounting for the Postretirement Plan:
 
 
2019
 
2018
Health care cost trend rate assumed for next year
 
6.00
%
 
6.00
%
Ultimate trend rate
 
5.00
%
 
5.00
%
Year that the rate reaches the ultimate trend rate
 
2

 
2


Assets
Plan assets are managed taking into account the timing and amount of future benefit payments. The Vocalink Plan assets are managed within the following target asset allocations: fixed income 36%, U.K. government securities 25%, equity 25%, real estate 9% and cash and cash equivalents 5%. For the non-U.S. Plans, the assets are concentrated primarily in insurance contracts.
The Valuation Hierarchy of the Pension Plans’ assets is determined using a consistent application of the categorization measurements for the Company’s financial instruments. See Note 1 (Summary of Significant Accounting Policies) for additional information.
The following tables set forth by level, within the Valuation Hierarchy, the Pension Plans’ assets at fair value:
 
 
December 31, 2019
 
December 31, 2018
 
 
Quoted Prices in Active Markets (Level 1)
 
Significant Other Observable Inputs (Level 2)
 
Significant
Unobservable
Inputs
(Level 3)
 
Fair Value
 
Quoted Prices in Active Markets (Level 1)
 
Significant Other Observable Inputs (Level 2)
 
Significant
Unobservable
Inputs
(Level 3)
 
Fair Value
 
 
(in millions)
Cash and cash equivalents 1
 
$
16

 
$

 
$

 
$
16

 
$
22

 
$

 
$

 
$
22

Government and agency securities 2
 

 

 

 

 

 
88

 

 
88

Mutual funds 3
 
153

 
193

 

 
346

 
154

 
30

 

 
184

Insurance contracts 4
 

 
75

 

 
75

 

 
57

 

 
57

Asset-backed securities 5
 

 

 

 

 

 

 
34

 
34

Other 6
 

 

 

 

 

 
25

 

 
25

Total
 
$
169

 
$
268

 
$

 
$
437

 
$
176

 
$
200

 
$
34

 
$
410

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Investments at Net Asset Value (“NAV”) 7
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Mutual funds
 
 
 
 
 
 
 
36

 
 
 
 
 
 
 

Other
 
 
 
 
 
 
 
45

 
 
 
 
 
 
 

Total Plan Assets
 
 
 
 
 
 
 
$
518

 
 
 
 
 
 
 
$
410


1 
Cash and cash equivalents are valued at quoted market prices, which represent the net asset value of the shares held by the Plans.
2 
Governmental and agency securities are valued at unit values provided by investment managers, which are based on the fair value of the underlying investments utilizing public information, independent external valuation from third-party services or third-party advisors.
3 
Certain mutual funds are valued at quoted market prices, which represent the value of the shares held by the Plans, and are therefore included in Level 1. Certain other mutual funds are valued at unit values provided by investment managers, which are based on the fair value of the underlying investments utilizing public information, independent external valuation from third-party services or third-party advisors, and are therefore included in Level 2.
4 
Insurance contracts are valued at unit values provided by investment managers, which are based on the fair value of the underlying investments utilizing public information, independent external valuation from third-party services or third-party advisors.
5 
Asset-backed securities are classified as Level 3 due to a lack of observable inputs in measuring fair value. These assets were sold during 2019.
6 
Other represents hedge fund pooled vehicles which are based on the fair value of the underlying investments utilizing public information, independent external valuation from third-party services or third-party advisors, and are therefore included in Level 2.
7 
Mutual funds (comprised primarily of credit investments) and other investments (comprised primarily of real estate investments) are valued using the NAV provided by the administrator as a practical expedient, and therefore these investments are not included in the valuation hierarchy. These investments have quarterly redemption frequencies with redemption notice periods ranging from 60 to 90 days.
The following table summarizes expected benefit payments (as of December 31, 2019) through 2029 for the Pension Plans and the Postretirement Plan, including those payments expected to be paid from the Company’s general assets. Actual benefit payments may differ from expected benefit payments.
 
 
Pension Plans
 
Postretirement Plan
 
 
(in millions)
2020
 
$
17

 
$
4

2021
 
11

 
4

2022
 
12

 
4

2023
 
13

 
4

2024
 
15

 
4

2025 - 2029
 
70

 
20


v3.19.3.a.u2
Debt (Notes)
12 Months Ended
Dec. 31, 2019
Debt Instruments [Abstract]  
Debt
Long-term debt consisted of the following at December 31:
Notes
 
Issuance
Date
 
Interest Payment Terms
 
Maturity
Date
 
Aggregate Principal Amount
 
Stated Interest Rate
 
Effective
Interest Rate
 
2019
 
2018
 
 
 
 
 
 
 
 
(in millions, except percentages)
2019 USD Notes
 
May 2019
 
Semi-annually
 
2029
 
$
1,000

 
2.950
%
 
3.030
%
 
$
1,000

 
$

 
 
 
 
 
 
2049
 
1,000

 
3.650
%
 
3.689
%
 
1,000

 

 
 
December 2019
 
Semi-annually
 
2025
 
750

 
2.000
%
 
2.147
%
 
750

 
$

 
 
 
 
 
 
 
 
$
2,750

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2018 USD Notes
 
February 2018
 
Semi-annually
 
2028
 
$
500

 
3.500
%
 
3.598
%
 
500

 
500

 
 
 
 
 
 
2048
 
500

 
3.950
%
 
3.990
%
 
500

 
500

 
 
 
 
 
 
 
 
$
1,000

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2016 USD Notes
 
November 2016
 
Semi-annually
 
2021
 
$
650

 
2.000
%
 
2.236
%
 
650

 
650

 
 
 
 
 
 
2026
 
750

 
2.950
%
 
3.044
%
 
750

 
750

 
 
 
 
 
 
2046
 
600

 
3.800
%
 
3.893
%
 
600

 
600

 
 
 
 
 
 
 
 
$
2,000

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2015 Euro Notes
 
December 2015
 
Annually
 
2022
 
700

 
1.100
%
 
1.265
%
 
785

 
801

 
 
 
 
 
 
2027
 
800

 
2.100
%
 
2.189
%
 
896

 
916

 
 
 
 
 
 
2030
 
150

 
2.500
%
 
2.562
%
 
169

 
172

 
 
 
 
 
 
 
 
1,650

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2014 USD Notes
 
March 2014
 
Semi-annually
 
2019
 
$
500

 
2.000
%
 
2.178
%
 

 
500

 
 
 
 
 
 
2024
 
1,000

 
3.375
%
 
3.484
%
 
1,000

 
1,000

 
 
 
 
 
 
 
 
$
1,500

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
8,600

 
6,389

Less: Unamortized discount and debt issuance costs
 
(73
)
 
(55
)
Total debt outstanding
 
$
8,527

 
$
6,334

Less: Current portion1 
 

 
(500
)
Long-term debt
 
$
8,527

 
$
5,834


1 
Relates to the 2014 USD Notes, which was classified in current liabilities as of December 31, 2018, matured and was paid during 2019
In May 2019, the Company issued $1 billion principal amount of notes due June 2029 and $1 billion principal amount of notes due June 2049 and in December 2019, the Company issued $750 million principal amount of notes due March 2025 (collectively the “2019 USD Notes”). The net proceeds from the issuance of the 2019 USD Notes, after deducting the original issue discount, underwriting discount and offering expenses, were $2.724 billion.
The net proceeds, after deducting the original issue discount, underwriting discount and offering expenses, from the issuance of the 2018 USD Notes were $991 million.
The outstanding debt, described above, is not subject to any financial covenants and it may be redeemed in whole, or in part, at the Company’s option at any time for a specified make-whole amount. These notes are senior unsecured obligations and would rank equally with any future unsecured and unsubordinated indebtedness. The proceeds of the notes are to be used for general corporate purposes.
Scheduled annual maturities of the principal portion of long-term debt outstanding at December 31, 2019 are summarized below.
 
 
(in millions)
2020
 
$

2021
 
650

2022
 
785

2023
 

2024
 
1,000

Thereafter
 
6,165

Total
 
$
8,600


On November 14, 2019, the Company increased its commercial paper program (the “Commercial Paper Program”) from $4.5 billion to $6 billion under which the Company is authorized to issue unsecured commercial paper notes with maturities of up to 397 days from the date of issuance. The Commercial Paper Program is available in U.S. dollars.
In conjunction with the Commercial Paper Program, the Company entered into a committed five-year unsecured $6 billion revolving credit facility (the “Credit Facility”) on November 14, 2019. The Credit Facility, which expires on November 14, 2024, amended and restated the Company’s prior $4.5 billion credit facility which was set to expire on November 15, 2023. Borrowings under the Credit Facility are available in U.S. dollars and/or euros. The facility fee under the Credit Facility is determined according to the Company’s credit rating and is payable on the average daily commitment, regardless of usage, per annum. In addition to the facility fee, interest rates on borrowings under the Credit Facility would be based on prevailing market interest rates plus applicable margins that fluctuate based on the Company’s credit rating. The Credit Facility contains customary representations, warranties, affirmative and negative covenants, events of default and indemnification provisions. The Company was in compliance in all material respects with the covenants of the Credit Facility at December 31, 2019 and 2018.
Borrowings under the Commercial Paper Program and the Credit Facility are used to provide liquidity for general corporate purposes, including providing liquidity in the event of one or more settlement failures by the Company’s customers. The Company may borrow and repay amounts under the Commercial Paper Program and Credit Facility from time to time. The Company had no borrowings under the Credit Facility and the Commercial Paper Program at December 31, 2019 and 2018.
v3.19.3.a.u2
Stockholders' Equity
12 Months Ended
Dec. 31, 2019
Stockholders' Equity Note [Abstract]  
Stockholders' Equity
Classes of Capital Stock
Mastercard’s amended and restated certificate of incorporation authorizes the following classes of capital stock:
Class
 
Par Value Per Share
 
Authorized Shares
(in millions)
 
Dividend and Voting Rights
A
 
$0.0001
 
3,000

 
One vote per share
Dividend rights
B
 
$0.0001
 
1,200

 
Non-voting
Dividend rights
Preferred
 
$0.0001
 
300

 
No shares issued or outstanding at December 31, 2019 and 2018. Dividend and voting rights are to be determined by the Board of Directors of the Company upon issuance.

Dividends
The Company declared a quarterly cash dividend on its Class A and Class B Common Stock during each of the four quarters of 2019, 2018 and 2017. For the years ended December 31, 2019, 2018 and 2017, the Company declared total per share dividends of $1.39, $1.08, and $0.91, respectively, resulting in total annual dividends of $1,408 million, $1,120 million and $967 million, respectively.
Ownership and Governance Structure
Equity ownership and voting power of the Company’s shares were allocated as follows as of December 31:
 
 
2019
 
2018
 
 
Equity Ownership
 
General Voting Power
 
Equity Ownership
 
General Voting Power
Public Investors (Class A stockholders)
 
87.8
%
 
88.8
%
 
88.0
%
 
89.0
%
Principal or Affiliate Customers (Class B stockholders)
 
1.1
%
 
%
 
1.1
%
 
%
Mastercard Foundation (Class A stockholders)
 
11.1
%
 
11.2
%
 
10.9
%
 
11.0
%

Class B Common Stock Conversions
Shares of Class B common stock are convertible on a one-for-one basis into shares of Class A common stock.  Entities eligible to hold Mastercard’s Class B common stock are defined in the Company’s amended and restated certificate of incorporation (generally the Company’s principal or affiliate customers), and they are restricted from retaining ownership of shares of Class A common stock.  Class B stockholders are required to subsequently sell or otherwise transfer any shares of Class A common stock received pursuant to such a conversion. 
Mastercard Foundation
In connection and simultaneously with its 2006 initial public offering (the “IPO”), the Company issued and donated 135 million newly authorized shares of Class A common stock to Mastercard Foundation. Mastercard Foundation is a private charitable foundation incorporated in Canada that is controlled by directors who are independent of the Company and its principal customers. Under the terms of the donation, Mastercard Foundation became able to resell the donated shares in May 2010 to the extent necessary to meet charitable disbursement requirements dictated by Canadian tax law. Under Canadian tax law, Mastercard Foundation is generally required to disburse at least 3.5% of its assets not used in administration each year for qualified charitable disbursements. However, Mastercard Foundation obtained permission from the Canadian tax authorities to defer the giving requirements until 2021. Mastercard Foundation, at its discretion, may decide to meet its disbursement obligations on an annual basis or to settle previously accumulated obligations during any given year. Mastercard Foundation will be permitted to sell all of its remaining shares beginning May 1, 2027, subject to certain conditions.
Stock Repurchase Programs
The Company’s Board of Directors have approved share repurchase programs authorizing the Company to repurchase shares of its Class A Common Stock.  These programs become effective after the completion of the previously authorized share repurchase program. 
The following table summarizes the Company’s share repurchase authorizations of its Class A common stock through December 31, 2019, as well as historical purchases:
Board authorization dates
 
December 2019
 
December
2018
 
December
2017
 
December
2016
 
December
2015
 
 
Date program became effective
 
January 2020
 
January 2019
 
March 2018
 
April 2017
 
February 2016
 
Total
 
 
(in millions, except average price data)
Board authorization
 
$
8,000

 
$
6,500

 
$
4,000

 
$
4,000

 
$
4,000

 
$
26,500

Dollar-value of shares repurchased in 2017
 
$

 
$

 
$

 
$
2,766

 
$
996

 
$
3,762

Remaining authorization at December 31, 2017
 
$

 
$

 
$
4,000

 
$
1,234

 
$

 
$
5,234

Dollar-value of shares repurchased in 2018
 
$

 
$

 
$
3,699

 
$
1,234

 
$

 
$
4,933

Remaining authorization at December 31, 2018
 
$

 
$
6,500

 
$
301

 
$

 
$

 
$
6,801

Dollar-value of shares repurchased in 2019
 
$

 
$
6,196

 
$
301

 
$

 
$

 
$
6,497

Remaining authorization at December 31, 2019
 
$
8,000

 
$
304

 
$

 
$

 
$

 
$
8,304

 
 
 
 
 
 
 
 
 
 
 
 
 
Shares repurchased in 2017
 

 

 

 
21.0

 
9.1

 
30.1

Average price paid per share in 2017
 
$

 
$

 
$

 
$
131.97

 
$
109.16

 
$
125.05

Shares repurchased in 2018
 

 

 
19.0

 
7.2

 

 
26.2

Average price paid per share in 2018
 
$

 
$

 
$
194.77

 
$
171.11

 
$

 
$
188.26

Shares repurchased in 2019
 

 
24.8

 
1.6

 

 

 
26.4

Average price paid per share in 2019
 
$

 
$
249.58

 
$
188.38

 
$

 
$

 
$
245.89

Cumulative shares repurchased through December 31, 2019
 

 
24.8

 
20.6

 
28.2

 
40.4

 
114.0

Cumulative average price paid per share
 
$

 
$
249.58

 
$
194.27

 
$
141.99

 
$
99.10

 
$
159.68


The following table presents the changes in the Company’s outstanding Class A and Class B common stock for the years ended December 31:
 
 
Outstanding Shares
 
 
Class A
 
Class B
 
 
(in millions)
Balance at December 31, 2016
 
1,062.4

 
19.3

Purchases of treasury stock
 
(30.1
)
 

Share-based payments
 
2.2

 

Conversion of Class B to Class A common stock
 
5.2

 
(5.2
)
Balance at December 31, 2017
 
1,039.7

 
14.1

Purchases of treasury stock
 
(26.2
)
 

Share-based payments
 
2.8

 

Conversion of Class B to Class A common stock
 
2.3

 
(2.3
)
Balance at December 31, 2018
 
1,018.6

 
11.8

Purchases of treasury stock
 
(26.4
)
 

Share-based payments
 
3.2

 

Conversion of Class B to Class A common stock
 
0.6

 
(0.6
)
Balance at December 31, 2019
 
996.0

 
11.2


v3.19.3.a.u2
Accumulated Other Comprehensive Income (Loss)
12 Months Ended
Dec. 31, 2019
Statement of Comprehensive Income [Abstract]  
Accumulated Other Comprehensive Income (Loss)
The changes in the balances of each component of accumulated other comprehensive income (loss), net of tax, for the years ended December 31, 2019 and 2018 were as follows:
 
 
Foreign Currency Translation Adjustments 1
 
Translation Adjustments on Net Investment Hedge 2
 
Cash Flow Hedges 3
 
Defined Benefit Pension and Other Postretirement Plans 4
 
Investment Securities Available-for-Sale 5
 
Accumulated Other Comprehensive Income (Loss)
 
 
(in millions)
Balance at December 31, 2017
 
$
(382
)
 
$
(141
)
 
$

 
$
25

 
$
1

 
$
(497
)
Other comprehensive income (loss)
 
(279
)
 
75

 

 
(15
)
 
(2
)
 
(221
)
Balance at December 31, 2018
 
(661
)
 
(66
)
 

 
10

 
(1
)
 
(718
)
Other comprehensive income (loss)
 
23

 
28

 
11

 
(19
)
 
2

 
45

Balance at December 31, 2019
 
$
(638
)
 
$
(38
)
 
$
11

 
$
(9
)
 
$
1

 
$
(673
)

1 
During 2018, the increase in the accumulated other comprehensive loss related to foreign currency translation adjustments was driven primarily by the depreciation of the euro, British pound and Brazilian real. During 2019, the decrease in the accumulated other comprehensive loss related to foreign currency translation adjustments was driven primarily by the appreciation of the British pound partially offset by the depreciation of the euro.
2 
The Company uses foreign currency denominated debt to hedge a portion of its net investment in foreign operations against adverse movements in exchange rates. Changes in the value of the debt are recorded in accumulated other comprehensive income (loss). During 2018 and 2019, the decreases in the accumulated other comprehensive loss related to the net investment hedge were driven by the depreciation of the euro. See Note 23 (Derivative and Hedging Instruments) for additional information.
3 
In 2019, the Company entered into treasury rate locks which are accounted for as cash flow hedges. During 2019, in connection with these cash flow hedges, the Company recorded unrealized gains, net of tax, of $11 million in accumulated other comprehensive income (loss). See Note 23 (Derivative and Hedging Instruments) for additional information.
4 
During 2018, the decrease in the accumulated other comprehensive gain related to the Company’s Plans was driven primarily by an actuarial loss within the Vocalink Plan. During 2019, the decrease in the accumulated other comprehensive gain related to the Company’s Plans was primarily driven by actuarial losses within the Vocalink and non-U.S. Plans. During 2018 and 2019, amounts reclassified from accumulated other comprehensive income (loss) to earnings, were not material. See Note 14 (Pension, Postretirement and Savings Plans) for additional information.
5 
During 2018 and 2019, gains and losses on available-for-sale investment securities, reclassified from accumulated other comprehensive income (loss) to investment income, were not material. See Note 7 (Investments) for additional information.
v3.19.3.a.u2
Share-Based Payments
12 Months Ended
Dec. 31, 2019
Share-based Payment Arrangement, Additional Disclosure [Abstract]  
Share-based Payments
In May 2006, the Company implemented the Mastercard Incorporated 2006 Long Term Incentive Plan, which was amended and restated as of June 5, 2012 (the “LTIP”). The LTIP is a stockholder-approved plan that permits the grant of various types of equity awards to employees. The Company has granted Options, RSUs and PSUs under the LTIP. The Company uses the straight-line method of attribution for expensing all equity awards. Compensation expense is recorded net of estimated forfeitures, with estimates adjusted as appropriate.
There are approximately 116 million shares of Class A common stock authorized for equity awards under the LTIP. Although the LTIP permits the issuance of shares of Class B common stock, no such shares have been authorized for issuance. Shares issued as a result of Option exercises and the conversions of RSUs and PSUs were funded primarily with the issuance of new shares of Class A common stock.
Stock Options
Stock Options expire ten years from the date of grant and vest ratably over four years. For Options granted, a participant’s unvested awards are forfeited upon termination. However, in the event a participant terminates employment due to disability or retirement more than six months (seven months for those granted on or after March 1, 2017) after receiving the award, the participant retains all of their awards without providing additional service to the Company. Retirement eligibility is dependent upon age and years of service. Compensation expense continues to be recognized over the vesting period as stated in the LTIP.
The fair value of each Option is estimated on the date of grant using a Black-Scholes option pricing model. The following table presents the weighted-average assumptions used in the valuation and the resulting weighted-average fair value per option granted for the years ended December 31:
 
 
2019
 
2018
 
2017
Risk-free rate of return
 
2.6
%
 
2.7
%
 
2.0
%
Expected term (in years)
 
6.00

 
6.00

 
5.00

Expected volatility
 
19.6
%
 
19.7
%
 
19.3
%
Expected dividend yield
 
0.6
%
 
0.6
%
 
0.8
%
Weighted-average fair value per Option granted
 
$
53.09

 
$
40.90

 
$
21.23


The risk-free rate of return was based on the U.S. Treasury yield curve in effect on the date of grant. The expected term and the expected volatility were based on historical Mastercard information. The expected dividend yields were based on the Company’s expected annual dividend rate on the date of grant.
The following table summarizes the Company’s option activity for the year ended December 31, 2019:
 
 
Options
 
Weighted-Average Exercise Price
 
Weighted-Average Remaining Contractual Term
 
Aggregate Intrinsic Value
 
 
(in millions)
 
 
 
(in years)
 
(in millions)
Outstanding at January 1, 2019
 
7.6

 
$
93

 
 
 
 
Granted
 
0.9

 
$
227

 
 
 
 
Exercised
 
(1.8
)
 
$
71

 
 
 
 
Forfeited/expired
 
(0.1
)
 
$
148

 
 
 
 
Outstanding at December 31, 2019
 
6.6

 
$
117

 
6.2
 
$
1,206

Exercisable at December 31, 2019
 
3.9

 
$
86

 
5.1
 
$
836

Options vested and expected to vest at December 31, 2019
 
6.6

 
$
116

 
6.2
 
$
1,200


As of December 31, 2019, there was $34 million of total unrecognized compensation cost related to non-vested Options. The cost is expected to be recognized over a weighted-average period of 2.3 years.
Restricted and Performance Stock Units
RSUs and PSUs generally vest after three years. For all RSUs and PSUs granted prior to March 2017, a participant’s unvested awards are forfeited upon termination of employment. For all RSUs and PSUs granted on or after March 1, 2017, in the event of termination due to job elimination (as defined by the Company), a participant will retain a pro-rata portion of the unvested awards for services performed through the date of termination. In the event a participant terminates employment due to disability or retirement more than six months (seven months for those granted on or after March 1, 2017) after receiving the award, the participant retains all of their awards without providing additional service to the Company. Compensation expense is recognized over the shorter of the vesting periods stated in the LTIP or the date the individual becomes eligible to retire but not less than six months (or seven months for grants awarded on or after March 1, 2017).
The following table summarizes the Company’s RSU activity for the year ended December 31, 2019:
 
 
Units
 
Weighted-Average Grant-Date Fair Value
 
Aggregate Intrinsic Value
 
 
(in millions)
 
 
 
(in millions)
Outstanding at January 1, 2019
 
3.7

 
$
117

 
 
Granted
 
1.0

 
$
226

 
 
Converted
 
(1.6
)
 
$
93

 
 
Forfeited
 
(0.2
)
 
$
154

 
 
Outstanding at December 31, 2019
 
2.9

 
$
166

 
$
852

RSUs expected to vest at December 31, 2019
 
2.8

 
$
165

 
$
824


The fair value of each RSU is the closing stock price on the New York Stock Exchange of the Company’s Class A common stock on the date of grant, adjusted for the exclusion of dividend equivalents. Upon vesting, a portion of the RSU award may be withheld to satisfy the minimum statutory withholding taxes. The remaining RSUs will be settled in shares of the Company’s Class A common stock after the vesting period. As of December 31, 2019, there was $180 million of total unrecognized compensation cost related to non-vested RSUs. The cost is expected to be recognized over a weighted-average period of 1.8 years.
The following table summarizes the Company’s PSU activity for the year ended December 31, 2019:
 
 
Units
 
Weighted-Average
Grant-Date Fair Value
 
Aggregate Intrinsic Value
 
 
(in millions)
 
 
 
(in millions)
Outstanding at January 1, 2019
 
0.6

 
$
120

 
 
Granted
 
0.1

 
$
231

 
 
Converted
 
(0.4
)
 
$
92

 
 
Other1
 
0.2

 
$
126

 
 
Outstanding at December 31, 2019
 
0.5

 
$
167

 
$
162

PSUs expected to vest at December 31, 2019
 
0.5

 
$
167

 
$
162


1 
Represents additional shares issued in March 2019 related to the 2016 PSU grant based on performance and market conditions achieved over the three-year measurement period. These shares vested upon issuance.
Since 2013, PSUs containing performance and market conditions have been issued. Performance measures used to determine the actual number of shares that vest after three years include net revenue growth, EPS growth and relative total shareholder return (“TSR”).  Relative TSR is considered a market condition, while net revenue and EPS growth are considered performance conditions.  The Monte Carlo simulation valuation model is used to determine the grant-date fair value. 
Compensation expenses for PSUs are recognized over the requisite service period if it is probable that the performance target will be achieved and subsequently adjusted if the probability assessment changes. As of December 31, 2019, there was $13 million of total unrecognized compensation cost related to non-vested PSUs. The cost is expected to be recognized over a weighted-average period of 1.8 years.
Additional Information
The following table includes additional share-based payment information for each of the years ended December 31:
 
 
2019
 
2018
 
2017
 
 
(in millions, except weighted-average fair value)
Share-based compensation expense: Options, RSUs and PSUs
 
$
250

 
$
196

 
$
176

Income tax benefit recognized for equity awards
 
53

 
41

 
57

Income tax benefit realized related to Options exercised
 
69

 
53

 
36

 
 
 
 
 
 
 
Options:
 
 
 
 
 
 
Total intrinsic value of Options exercised
 
317

 
242

 
106

RSUs:
 
 
 
 
 
 
Weighted-average grant-date fair value of awards granted
 
226

 
171

 
112

Total intrinsic value of RSUs converted into shares of Class A common stock
 
394

 
194

 
131

PSUs:
 
 
 
 
 
 
Weighted-average grant-date fair value of awards granted
 
231

 
226

 
126

Total intrinsic value of PSUs converted into shares of Class A common stock
 
85

 
40

 
13

v3.19.3.a.u2
Commitments
12 Months Ended
Dec. 31, 2019
Commitments and Contingencies Disclosure [Abstract]  
Commitments
At December 31, 2019, the Company had the following future minimum payments due under noncancelable agreements, primarily related to sponsorships to promote the Mastercard brand and licensing arrangements. The Company has accrued $20 million of these future payments as of December 31, 2019.
 
 
(in millions)
2020
 
$
404

2021
 
224

2022
 
132

2023
 
42

2024
 
17

Thereafter
 

Total
 
$
819


v3.19.3.a.u2
Income Taxes
12 Months Ended
Dec. 31, 2019
Income Tax Disclosure [Abstract]  
Income Taxes
Components of Income and Income tax expense
The domestic and foreign components of income before income taxes for the years ended December 31 are as follows:
 
 
2019
 
2018
 
2017
 
 
(in millions)
United States
 
$
4,213

 
$
3,510

 
$
3,482

Foreign
 
5,518

 
3,694

 
3,040

Income before income taxes
 
$
9,731

 
$
7,204

 
$
6,522


The total income tax provision for the years ended December 31 is comprised of the following components:
 
 
2019
 
2018
 
2017
 
 
(in millions)
Current
 
 
 
 
 
 
Federal
 
$
642

 
$
649

 
$
1,704

State and local
 
81

 
69

 
65

Foreign
 
897

 
871

 
752

 
 
1,620

 
1,589

 
2,521

Deferred
 
 
 
 
 
 
Federal
 
40

 
(228
)
 
134

State and local
 

 
(11
)
 
1

Foreign
 
(47
)
 
(5
)
 
(49
)
 
 
(7
)
 
(244
)
 
86

Income tax expense
 
$
1,613

 
$
1,345

 
$
2,607


Effective Income Tax Rate
A reconciliation of the effective income tax rate to the U.S. federal statutory income tax rate for the years ended December 31, is as follows:
 
 
2019
 
2018
 
2017
 
 
Amount
 
Percent
 
Amount
 
Percent
 
Amount
 
Percent
 
 
(in millions, except percentages)
Income before income taxes
 
$
9,731

 
 
 
$
7,204

 
 
 
$
6,522

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Federal statutory tax
 
2,044

 
21.0
 %
 
1,513

 
21.0
 %
 
2,283

 
35.0
 %
State tax effect, net of federal benefit
 
65

 
0.7
 %
 
46

 
0.6
 %
 
43

 
0.7
 %
Foreign tax effect
 
(208
)
 
(2.1
)%
 
(92
)
 
(1.3
)%
 
(380
)
 
(5.8
)%
European Commission fine
 

 
 %
 
194

 
2.7
 %
 

 
 %
Foreign tax credits1
 
(32
)
 
(0.3
)%
 
(110
)
 
(1.5
)%
 
(27
)
 
(0.4
)%
Transition Tax
 
(30
)
 
(0.3
)%
 
22

 
0.3
 %
 
629

 
9.6
 %
Remeasurement of deferred taxes
 

 
 %
 
(7
)
 
(0.1
)%
 
157

 
2.4
 %
Windfall benefit
 
(129
)
 
(1.3
)%
 
(72
)
 
(1.0
)%
 
(43
)
 
(0.7
)%
Other, net
 
(97
)

(1.1
)%

(149
)

(2.0
)%

(55
)

(0.8
)%
Income tax expense
 
$
1,613

 
16.6
 %
 
$
1,345

 
18.7
 %
 
$
2,607

 
40.0
 %

1 
Included within the impact of the foreign tax credits is $27 million for 2019 and $90 million for 2018 of tax benefits relating to the carryback of certain foreign tax credits.
The effective income tax rates for the years ended December 31, 2019, 2018 and 2017 were 16.6%, 18.7% and 40.0%, respectively. The effective income tax rate for 2019 was lower than the effective income tax rate for 2018, primarily due to the nondeductible nature of the fine issued by the European Commission in 2018 and a discrete tax benefit related to a favorable court ruling in 2019. These 2019 benefits were partially offset by discrete tax benefits in 2018 primarily related to foreign tax credits generated in 2018 as a result of U.S. tax reform, which can be carried back and utilized in 2017 under transition rules issued by the Department of the Treasury and the Internal Revenue Service.
The effective income tax rate for 2018 was lower than the effective income tax rate for 2017 primarily due to additional tax expense of $873 million in 2017 attributable to U.S. tax reform (which included provisional amounts of $825 million related to the one-time deemed repatriation tax on accumulated foreign earnings (the “Transition Tax”), the remeasurement of the Company’s net deferred tax asset balance in the U.S. and the recognition of a deferred tax liability related to a change in assertion regarding the indefinite reinvestment of a substantial amount of the Company’s foreign earnings, as well as $48 million due to a foregone foreign tax credit benefit on 2017 repatriations). Additionally, the lower effective income tax rate in 2018 was due to a lower 2018 statutory tax rate in the U.S. and Belgium, a more favorable geographic mix of earnings and discrete tax benefits, relating primarily to $90 million of foreign tax credits generated in 2018, which can be carried back and utilized in 2017 under transition rules issued by the Department of the Treasury and the Internal Revenue Service, along with provisions for legal matters in the United States. These benefits were partially offset by the
nondeductible nature of the fine issued by the European Commission. See Note 21 (Legal and Regulatory Proceedings) for further discussion of the European Commission fine and U.S. merchant class litigation.
Singapore Income Tax Rate
In connection with the expansion of the Company’s operations in the Asia Pacific, Middle East and Africa region, the Company’s subsidiary in Singapore, Mastercard Asia Pacific Pte. Ltd. (“MAPPL”) received an incentive grant from the Singapore Ministry of Finance in 2010. The incentive had provided MAPPL with, among other benefits, a reduced income tax rate for the 10-year period commencing January 1, 2010 on taxable income in excess of a base amount. The Company continued to explore business opportunities in this region, resulting in an expansion of the incentives being granted by the Ministry of Finance, including a further reduction to the income tax rate on taxable income in excess of a revised fixed base amount commencing July 1, 2011 and continuing through December 31, 2025. Without the incentive grant, MAPPL would have been subject to the statutory income tax rate on its earnings. For 2019, 2018 and 2017, the impact of the incentive grant received from the Ministry of Finance resulted in a reduction of MAPPL’s income tax liability of $300 million, or $0.29 per diluted share, $212 million, or $0.20 per diluted share, and $104 million, or $0.10 per diluted share, respectively.
Indefinite Reinvestment
During 2019 and 2018, the Company repatriated approximately $2.5 billion and $3.3 billion, respectively. As of December 31, 2019 and 2018 the Company had approximately $3.5 billion and $2.5 billion, respectively, of accumulated earnings to be repatriated in the future, for which immaterial deferred tax benefits were recorded. The tax effect is primarily related to the estimated foreign exchange impact recognized when earnings are repatriated. The Company expects that foreign withholding taxes associated with these future repatriated earnings will not be material. Earnings of approximately $0.8 billion remain permanently reinvested and the Company estimates that immaterial U.S. federal and state and local income tax benefit would result, primarily from foreign exchange, if these earnings were to be repatriated.
Deferred Taxes
Deferred tax assets and liabilities represent the expected future tax consequences of temporary differences between the carrying amounts and the tax basis of assets and liabilities. The components of deferred tax assets and liabilities at December 31 are as follows:
 
 
2019
 
2018
 
 
(in millions)
Deferred Tax Assets
 
 
 
 
Accrued liabilities
 
$
354

 
$
297

Compensation and benefits
 
214

 
210

State taxes and other credits
 
41

 
30

Net operating and capital losses
 
119

 
104

U.S. foreign tax credits1
 
145

 

Intangible assets
 
157

 
170

Other items
 
94

 
115

Less: Valuation allowance
 
(205
)
 
(94
)
Total Deferred Tax Assets
 
919

 
832

 
 
 
 
 
Deferred Tax Liabilities
 
 
 
 
Prepaid expenses and other accruals
 
83

 
89

Goodwill and intangible assets
 
187

 
125

Property, plant and equipment
 
128

 
97

Other items
 
63

 
18

Total Deferred Tax Liabilities
 
461

 
329

 
 
 
 
 
Net Deferred Tax Assets
 
$
458

 
$
503

1 
A deferred tax asset has been established in 2019 for $145 million related to foreign taxes paid in the current period, which are not expected to be utilized as credits in the current or future period, with a corresponding full valuation allowance.
The valuation allowance balance at December 31, 2019 primarily relates to the Company’s ability to recognize future tax benefits associated with the carry forward of U.S. foreign tax credits generated in the current period and certain foreign net operating losses. The valuation allowance balance at December 31, 2018 relates primarily to the Company’s ability to recognize tax benefits associated
with certain foreign net operating losses. The recognition of the foreign tax credits is dependent upon the realization of future foreign source income in the appropriate foreign tax credit basket in accordance with U.S. federal income tax law. The recognition of the foreign losses is dependent upon the future taxable income in such jurisdictions and the ability under tax law in these jurisdictions to utilize net operating losses following a change in control.
A reconciliation of the beginning and ending balance for the Company’s unrecognized tax benefits for the years ended December 31, is as follows:
 
 
2019
 
2018
 
2017
 
 
(in millions)
Beginning balance
 
$
164

 
$
183

 
$
169

Additions:
 
 
 
 
 
 
Current year tax positions
 
22

 
23

 
21

Prior year tax positions
 
37

 
5

 
9

Reductions:
 
 
 
 
 
 
Prior year tax positions
 
(11
)
 
(17
)
 
(1
)
Settlements with tax authorities
 
(2
)
 
(18
)
 
(4
)
Expired statute of limitations
 
(7
)
 
(12
)
 
(11
)
Ending balance
 
$
203

 
$
164

 
$
183


The unrecognized tax benefit of $203 million, if recognized, would reduce the effective income tax rate. In 2019, there was an increase to the Company’s unrecognized tax benefits primarily due to various U.S. and non-U.S. tax issues, compared to a reduction in the prior year primarily due to a favorable court decision and settlements with tax authorities in multiple jurisdictions. Further, the information gained related to these matters was considered in measuring uncertain tax benefits recognized for the periods subsequent to the periods settled.
The Company is subject to tax in the U.S., Belgium, Singapore, the United Kingdom and various other foreign jurisdictions, as well as state and local jurisdictions. Uncertain tax positions are reviewed on an ongoing basis and are adjusted after considering facts and circumstances, including progress of tax audits, developments in case law and closing of statutes of limitation.  Within the next twelve months, the Company believes that the resolution of certain federal, foreign and state and local examinations are reasonably possible and that a change in estimate, reducing unrecognized tax benefits, may occur.  While such a change may be significant, it is not possible to provide a range of the potential change until the examinations progress further or the related statutes of limitation expire. The Company has effectively settled its U.S. federal income tax obligations through 2011. With limited exception, the Company is no longer subject to state and local or foreign examinations by tax authorities for years before 2010.
At December 31, 2019 and 2018, the Company had a net income tax-related interest payable of $13 million and $8 million, respectively, in its consolidated balance sheet. Tax-related interest income/(expense) in 2019, 2018 and 2017 was not material. In addition, as of December 31, 2019 and 2018, the amounts the Company has recognized for penalties payable in its consolidated balance sheet were not material.
v3.19.3.a.u2
Legal and Regulatory Proceedings
12 Months Ended
Dec. 31, 2019
Legal and Regulatory Proceedings [Abstract]  
Legal and Regulatory Proceedings
Mastercard is a party to legal and regulatory proceedings with respect to a variety of matters in the ordinary course of business.  Some of these proceedings are based on complex claims involving substantial uncertainties and unascertainable damages.  Accordingly, except as discussed below, it is not possible to determine the probability of loss or estimate damages, and therefore, Mastercard has not established reserves for any of these proceedings.  When the Company determines that a loss is both probable and reasonably estimable, Mastercard records a liability and discloses the amount of the liability if it is material. When a material loss contingency is only reasonably possible, Mastercard does not record a liability, but instead discloses the nature and the amount of the claim, and an estimate of the loss or range of loss, if such an estimate can be made. Unless otherwise stated below with respect to these matters, Mastercard cannot provide an estimate of the possible loss or range of loss based on one or more of the following reasons: (1) actual or potential plaintiffs have not claimed an amount of monetary damages or the amounts are unsupportable or exaggerated, (2) the matters are in early stages, (3) there is uncertainty as to the outcome of pending appeals or motions, (4) there are significant factual issues to be resolved, (5) the existence in many such proceedings of multiple defendants or potential defendants whose share of any potential financial responsibility has yet to be determined and/or (6) there are novel legal issues presented. Furthermore, except as identified with respect to the matters below, Mastercard does not believe that the outcome of any individual existing legal or regulatory proceeding to which it is a party will have a material adverse effect on its results of operations, financial condition or overall business.  However, an adverse judgment or other outcome or settlement with respect to any proceedings discussed below could result in fines or payments by Mastercard and/or could require Mastercard to change its business practices. In addition, an adverse outcome in a regulatory proceeding could lead to the filing of civil damage claims and possibly result in significant damage awards. Any of these events could have a material adverse effect on Mastercard’s results of operations, financial condition and overall business.
Interchange Litigation and Regulatory Proceedings
Mastercard’s interchange fees and other practices are subject to regulatory, legal review and/or challenges in a number of jurisdictions, including the proceedings described below. When taken as a whole, the resulting decisions, regulations and legislation with respect to interchange fees and acceptance practices may have a material adverse effect on the Company’s prospects for future growth and its overall results of operations, financial position and cash flows.
United States. In June 2005, the first of a series of complaints were filed on behalf of merchants (the majority of the complaints were styled as class actions, although a few complaints were filed on behalf of individual merchant plaintiffs) against Mastercard International, Visa U.S.A., Inc., Visa International Service Association and a number of financial institutions. Taken together, the claims in the complaints were generally brought under both Sections 1 and 2 of the Sherman Act, which prohibit monopolization and attempts or conspiracies to monopolize a particular industry, and some of these complaints contain unfair competition law claims under state law. The complaints allege, among other things, that Mastercard, Visa, and certain financial institutions conspired to set the price of interchange fees, enacted point of sale acceptance rules (including the no surcharge rule) in violation of antitrust laws and engaged in unlawful tying and bundling of certain products and services. The cases were consolidated for pre-trial proceedings in the U.S. District Court for the Eastern District of New York in MDL No. 1720. The plaintiffs filed a consolidated class action complaint that seeks treble damages.
In July 2006, the group of purported merchant class plaintiffs filed a supplemental complaint alleging that Mastercard’s initial public offering of its Class A Common Stock in May 2006 (the “IPO”) and certain purported agreements entered into between Mastercard and financial institutions in connection with the IPO: (1) violate U.S. antitrust laws and (2) constituted a fraudulent conveyance because the financial institutions allegedly attempted to release, without adequate consideration, Mastercard’s right to assess them for Mastercard’s litigation liabilities. The class plaintiffs sought treble damages and injunctive relief including, but not limited to, an order reversing and unwinding the IPO.
In February 2011, Mastercard and Mastercard International entered into each of: (1) an omnibus judgment sharing and settlement sharing agreement with Visa Inc., Visa U.S.A. Inc. and Visa International Service Association and a number of financial institutions; and (2) a Mastercard settlement and judgment sharing agreement with a number of financial institutions.  The agreements provide for the apportionment of certain costs and liabilities which Mastercard, the Visa parties and the financial institutions may incur, jointly and/or severally, in the event of an adverse judgment or settlement of one or all of the cases in the merchant litigations.  Among a number of scenarios addressed by the agreements, in the event of a global settlement involving the Visa parties, the financial institutions and Mastercard, Mastercard would pay 12% of the monetary portion of the settlement. In the event of a settlement involving only Mastercard and the financial institutions with respect to their issuance of Mastercard cards, Mastercard would pay 36% of the monetary portion of such settlement. 
In October 2012, the parties entered into a definitive settlement agreement with respect to the merchant class litigation (including with respect to the claims related to the IPO) and the defendants separately entered into a settlement agreement with the individual merchant plaintiffs. The settlements included cash payments that were apportioned among the defendants pursuant to the omnibus judgment sharing and settlement sharing agreement described above. Mastercard also agreed to provide class members with a short-term reduction in default credit interchange rates and to modify certain of its business practices, including its “no surcharge” rule. The court
granted final approval of the settlement in December 2013, and objectors to the settlement appealed that decision to the U.S. Court of Appeals for the Second Circuit. In June 2016, the court of appeals vacated the class action certification, reversed the settlement approval and sent the case back to the district court for further proceedings. The court of appeals’ ruling was based primarily on whether the merchants were adequately represented by counsel in the settlement. As a result of the appellate court ruling, the district court divided the merchants’ claims into two separate classes - monetary damages claims (the “Damages Class”) and claims seeking changes to business practices (the “Rules Relief Class”). The court appointed separate counsel for each class.
In September 2018, the parties to the Damages Class litigation entered into a class settlement agreement to resolve the Damages Class claims. Mastercard increased its reserve by $237 million during 2018 to reflect both its expected financial obligation under the Damages Class settlement agreement and the filed and anticipated opt-out merchant cases. The time period during which Damages Class members were permitted to opt out of the class settlement agreement ended in July 2019 with merchants representing slightly more than 25% of the Damages Class interchange volume choosing to opt out of the settlement. The district court granted final approval of the settlement in December 2019. The district court’s settlement approval order has been appealed. Mastercard has commenced settlement negotiations with a number of the opt-out merchants and has reached settlements and/or agreements in principle to settle a number of these claims. The Damages Class settlement agreement does not relate to the Rules Relief Class claims. Separate settlement negotiations with the Rules Relief Class are ongoing.
As of December 31, 2019 and 2018, Mastercard had accrued a liability of $914 million as a reserve for both the Damages Class litigation and the filed and anticipated opt-out merchant cases. As of December 31, 2019 and 2018, Mastercard had $584 million and $553 million, respectively, in a qualified cash settlement fund related to the Damages Class litigation and classified as restricted cash on its consolidated balance sheet. During the first quarter of 2019, Mastercard increased its qualified cash settlement fund by $108 million in accordance with a January 2019 preliminary approval of the settlement. The Damages Class settlement agreement provided for a return to the defendants of a portion of the cash settlement fund, based upon the percentage of interchange volume represented by the opt out merchants. During the fourth quarter of 2019, $84 million of the qualified cash settlement fund was reclassified from restricted cash to cash and cash equivalents in accordance with the December 2019 final approval of the settlement.
The reserve as of December 31, 2019 for both the Damages Class litigation and the filed opt-out merchants represents Mastercard’s best estimate of its probable liabilities in these matters. The portion of the accrued liability relating to both the opt-out merchants and the Damages Class litigation settlement does not represent an estimate of a loss, if any, if the matters were litigated to a final outcome. Mastercard cannot estimate the potential liability if that were to occur.
Canada. In December 2010, a proposed class action complaint was commenced against Mastercard in Quebec on behalf of Canadian merchants. The suit essentially repeated the allegations and arguments of a previously filed application by the Canadian Competition Bureau to the Canadian Competition Tribunal (dismissed in Mastercard’s favor) concerning certain Mastercard rules related to point-of-sale acceptance, including the “honor all cards” and “no surcharge” rules. The Quebec suit sought compensatory and punitive damages in unspecified amounts, as well as injunctive relief. In the first half of 2011, additional purported class action lawsuits were commenced in British Columbia and Ontario against Mastercard, Visa and a number of large Canadian financial institutions. The British Columbia suit sought compensatory damages in unspecified amounts, and the Ontario suit sought compensatory damages of $5 billion on the basis of alleged conspiracy and various alleged breaches of the Canadian Competition Act. Additional purported class action complaints were commenced in Saskatchewan and Alberta with claims that largely mirror those in the other suits. In June 2017, Mastercard entered into a class settlement agreement to resolve all of the Canadian class action litigation. The settlement, which requires Mastercard to make a cash payment and modify its “no surcharge” rule, has received court approval in each Canadian province. Objectors to the settlement have sought to appeal the approval orders. Certain appellate courts have rejected the objectors’ appeals, while outstanding appeals remain in a few provinces. In 2017, Mastercard recorded a provision for litigation of $15 million related to this matter.
Europe. In July 2015, the European Commission (“EC”) issued a Statement of Objections related to Mastercard’s interregional interchange fees and central acquiring rule within the European Economic Area (the “EEA”). The Statement of Objections, which followed an investigation opened in 2013, included preliminary conclusions concerning the alleged anticompetitive effects of these practices. In December 2018, Mastercard announced the anticipated resolution of the EC’s investigation. With respect to interregional interchange fees, Mastercard made a settlement proposal whereby it would make changes to its interregional interchange fees. The EC issued a decision accepting the settlement in April 2019, with changes to interregional interchange fees going into effect in the fourth quarter of 2019. In addition, with respect to Mastercard’s historic central acquiring rule, the EC issued a negative decision in January 2019. The EC’s negative decision covers a period of time of less than two years before the rule’s modification. The rule was modified in late 2015 to comply with the requirements of the EEA Interchange Fee Regulation. The decision does not require any modification of Mastercard’s current business practices but included a fine of €571 million, which was paid in April 2019. Mastercard incurred a charge of $654 million in 2018 in relation to this matter.
Since May 2012, a number of United Kingdom (“U.K.”) retailers filed claims or threatened litigation against Mastercard seeking damages for alleged anti-competitive conduct with respect to Mastercard’s cross-border interchange fees and its U.K. and Ireland domestic
interchange fees (the “U.K. Merchant claimants”). In addition, Mastercard, has faced similar filed or threatened litigation by merchants with respect to interchange rates in other countries in Europe (the “Pan-European Merchant claimants”). In aggregate, the alleged damages claims from the U.K. and Pan-European Merchant claimants were in the amount of approximately £3 billion (approximately $4 billion as of December 31, 2019). Mastercard has resolved over £2 billion (approximately $3 billion as of December 31, 2019) of these damages claims through settlement or judgment. Since June 2015, Mastercard has recorded litigation provisions for settlements, judgments and legal fees relating to these claims, including charges of $237 million in 2018. As detailed below, Mastercard continues to litigate with the remaining U.K. and Pan-European Merchant claimants and it has submitted statements of defense disputing liability and damages claims.
In January 2017, Mastercard received a liability judgment in its favor on all significant matters in a separate action brought by ten of the U.K. Merchant claimants. Three of the U.K. Merchant claimants appealed the judgment, and these appeals were combined with Mastercard’s appeal of a 2016 judgment in favor of one U.K. merchant. In July 2018, the U.K. appellate court ruled against both Mastercard and Visa on two of the three legal issues being considered, concluding that U.K. interchange rates restricted competition and that they were not objectively necessary for the payment networks. The appellate court sent the cases back to trial for reconsideration on the remaining issue concerning the “lawful” level of interchange. The U.K. Supreme Court granted the parties permission to appeal the appellate court’s rulings and oral argument on the appeals was heard in January 2020. Mastercard expects the litigation process to be delayed pending the decision of the U.K. Supreme Court on the appeals.
In September 2016, a proposed collective action was filed in the United Kingdom on behalf of U.K. consumers seeking damages for intra-EEA and domestic U.K. interchange fees that were allegedly passed on to consumers by merchants between 1992 and 2008. The complaint, which seeks to leverage the European Commission’s 2007 decision on intra-EEA interchange fees, claims damages in an amount that exceeds £14 billion (approximately $17 billion as of December 31, 2019). In July 2017, the trial court denied the plaintiffs’ application for the case to proceed as a collective action. In April 2019, the U.K. appellate court granted the plaintiffs’ appeal of the trial court’s decision and sent the case back to the trial court for a re-hearing on the plaintiffs’ collective action application. Mastercard has been granted permission to appeal the appellate court ruling to the U.K. Supreme Court and oral argument on that appeal is scheduled to occur in May 2020.
ATM Non-Discrimination Rule Surcharge Complaints
In October 2011, a trade association of independent Automated Teller Machine (“ATM”) operators and 13 independent ATM operators filed a complaint styled as a class action lawsuit in the U.S. District Court for the District of Columbia against both Mastercard and Visa (the “ATM Operators Complaint”).  Plaintiffs seek to represent a class of non-bank operators of ATM terminals that operate in the United States with the discretion to determine the price of the ATM access fee for the terminals they operate. Plaintiffs allege that Mastercard and Visa have violated Section 1 of the Sherman Act by imposing rules that require ATM operators to charge non-discriminatory ATM surcharges for transactions processed over Mastercard’s and Visa’s respective networks that are not greater than the surcharge for transactions over other networks accepted at the same ATM.  Plaintiffs seek both injunctive and monetary relief equal to treble the damages they claim to have sustained as a result of the alleged violations and their costs of suit, including attorneys’ fees. 
Subsequently, multiple related complaints were filed in the U.S. District Court for the District of Columbia alleging both federal antitrust and multiple state unfair competition, consumer protection and common law claims against Mastercard and Visa on behalf of putative classes of users of ATM services (the “ATM Consumer Complaints”).  The claims in these actions largely mirror the allegations made in the ATM Operators Complaint, although these complaints seek damages on behalf of consumers of ATM services who pay allegedly inflated ATM fees at both bank and non-bank ATM operators as a result of the defendants’ ATM rules.  Plaintiffs seek both injunctive and monetary relief equal to treble the damages they claim to have sustained as a result of the alleged violations and their costs of suit, including attorneys’ fees. 
In January 2012, the plaintiffs in the ATM Operators Complaint and the ATM Consumer Complaints filed amended class action complaints that largely mirror their prior complaints. In February 2013, the district court granted Mastercard’s motion to dismiss the complaints for failure to state a claim. On appeal, the Court of Appeals reversed the district court’s order in August 2015 and sent the case back for further proceedings. In September 2019, the plaintiffs filed their motions for class certification in which the plaintiffs, in aggregate, allege over $1 billion in damages against all of the defendants. Mastercard intends to vigorously defend against both the plaintiffs’ liability and damages claims and to oppose class certification. Mastercard expects briefing on class certification to be completed in the second quarter of 2020.
U.S. Liability Shift Litigation
In March 2016, a proposed U.S. merchant class action complaint was filed in federal court in California alleging that Mastercard, Visa, American Express and Discover (the “Network Defendants”), EMVCo and a number of issuing banks (the “Bank Defendants”) engaged in a conspiracy to shift fraud liability for card present transactions from issuing banks to merchants not yet in compliance with the standards for EMV chip cards in the United States (the “EMV Liability Shift”), in violation of the Sherman Act and California law.  Plaintiffs allege damages equal to the value of all chargebacks for which class members became liable as a result of the EMV Liability Shift on October 1, 2015. The plaintiffs seek treble damages, attorney’s fees and costs and an injunction against future violations of governing law, and the defendants have filed a motion to dismiss. In September 2016, the court denied the Network Defendants’ motion to dismiss the complaint, but granted such a motion for EMVCo and the Bank Defendants. In May 2017, the court transferred the case to New York so that discovery could be coordinated with the U.S. merchant class interchange litigation described above. The plaintiffs have filed a renewed motion for class certification, following the district court’s denial of their initial motion.
Telephone Consumer Protection Class Action
Mastercard is a defendant in a Telephone Consumer Protection Act (“TCPA”) class action pending in Florida. The plaintiffs are individuals and businesses who allege that approximately 381,000 unsolicited faxes were sent to them advertising a Mastercard co-brand card issued by First Arkansas Bank (“FAB”). The TCPA provides for uncapped statutory damages of $500 per fax. Mastercard has asserted various defenses to the claims, and has notified FAB of an indemnity claim that it has (which FAB has disputed). In June 2018, the court granted Mastercard’s motion to stay the proceedings until the Federal Communications Commission (“FCC”) makes a decision on the application of the TCPA to online fax services. In December 2019, the FCC issued a declaratory ruling clarifying that the TCPA does not apply to faxes sent to online fax services that are received via e-mail. As a result of the ruling, the stay of the litigation was lifted in January 2020.
v3.19.3.a.u2
Settlement and Other Risk Management
12 Months Ended
Dec. 31, 2019
Settlement and Other Risk Management [Abstract]  
Settlement and Other Risk Management
Mastercard’s rules guarantee the settlement of many of the transactions between its customers (“settlement risk”). Settlement exposure is the settlement risk to customers under Mastercard’s rules due to the difference in timing between the payment transaction date and subsequent settlement. While the term and amount of the guarantee are unlimited, the duration of settlement exposure is short term and typically limited to a few days.
Gross settlement exposure is estimated using the average daily payment volume during the three months ended December 31, 2019 multiplied by the estimated number of days of exposure. The Company has global risk management policies and procedures, which include risk standards, to provide a framework for managing the Company’s settlement risk and exposure. In the event of a failed customer, Mastercard may pursue one or more remedies available under the Company’s rules to recover potential losses. Historically, the Company has experienced a low level of losses from customer failures.
As part of its policies, Mastercard requires certain customers that are not in compliance with the Company’s risk standards to post collateral, such as cash, letters of credit, or guarantees. This requirement is based on a review of the individual risk circumstances for each customer. Mastercard monitors its credit risk portfolio on a regular basis and the adequacy of collateral on hand. Additionally, from time to time, the Company reviews its risk management methodology and standards. As such, the amounts of estimated settlement exposure are revised as necessary.
The Company’s estimated settlement exposure was as follows at December 31:
 
 
2019
 
2018
 
 
(in millions)
Gross settlement exposure
 
$
55,800

 
$
49,666

Collateral held for settlement exposure
 
(4,772
)
 
(4,711
)
Net uncollateralized settlement exposure
 
$
51,028

 
$
44,955


Mastercard also provides guarantees to customers and certain other counterparties indemnifying them from losses stemming from failures of third parties to perform duties. This includes guarantees of Mastercard-branded travelers cheques issued, but not yet cashed of $367 million and $377 million at December 31, 2019 and 2018, respectively, of which $290 million and $297 million at December 31, 2019 and 2018, respectively, is mitigated by collateral arrangements. In addition, the Company enters into agreements in the ordinary course of business under which the Company agrees to indemnify third parties against damages, losses and expenses incurred in connection with legal and other proceedings arising from relationships or transactions with the Company. Certain indemnifications do not provide a stated maximum exposure. As the extent of the Company’s obligations under these agreements depends entirely upon the occurrence of future events, the Company’s potential future liability under these agreements is not determinable. Historically, payments made by the Company under these types of contractual arrangements have not been material.
v3.19.3.a.u2
Derivative and Hedging Instruments
12 Months Ended
Dec. 31, 2019
Foreign Currency Derivatives [Abstract]  
Derivative and Hedging Instruments
The Company monitors and manages its foreign currency and interest rate exposures as part of its overall risk management program which focuses on the unpredictability of financial markets and seeks to reduce the potentially adverse effects that the volatility of these markets may have on its operating results.  A primary objective of the Company’s risk management strategies is to reduce the financial impact that may arise from volatility in foreign currency exchange rates principally through the use of both foreign exchange derivative contracts (Derivatives) and foreign currency denominated debt (Net Investment Hedge). In addition, the Company may enter into interest rate derivative contracts to manage the effects of interest rate movements on the Company’s aggregate liability portfolio, including potential future debt issuances (Cash Flow Hedges).
Foreign Exchange Risk
Derivatives
The Company enters into foreign exchange derivative contracts to manage transactional currency exposure associated with anticipated receipts and disbursements which are valued based on currencies other than the functional currency of the entity. The Company may also enter into foreign exchange derivative contracts to offset possible changes in value due to foreign exchange fluctuations of assets and liabilities. The objective of these activities is to reduce the Company’s exposure to gains and losses resulting from fluctuations of foreign currencies against its functional currencies.
The Company’s foreign exchange derivative contracts are summarized below:
 
 
December 31, 2019
 
December 31, 2018
 
 
Notional
 
Estimated Fair
Value
 
Notional
 
Estimated Fair
Value
 
 
(in millions)
Commitments to purchase foreign currency
 
$
185

 
$
3

 
$
34

 
$
(1
)
Commitments to sell foreign currency
 
1,506

 
(25
)
 
1,066

 
26

Options to sell foreign currency
 
21

 
2

 
25

 
4

 
 
 
 
 
 
 
 
 
Balance sheet location
 
 
 
 
 
 
 
 
Prepaid expenses and other current assets 1
 
 
 
$
12

 
 
 
$
35

Other current liabilities 1
 
 
 
(32
)
 
 
 
(6
)

1 
The derivative contracts are subject to enforceable master netting arrangements, which contain various netting and setoff provisions.
The amount of gain (loss) recognized on the consolidated statement of operations for the contracts to purchase and sell foreign currency is summarized below:
 
 
Year Ended December 31,
 
 
2019
 
2018
 
2017
 
 
(in millions)
Foreign exchange derivative contracts
 
 
 
 
 
 
General and administrative
 
$
(39
)
 
$
53

 
$
(75
)

The fair value of the foreign exchange derivative contracts generally reflects the estimated amounts that the Company would receive (or pay), on a pre-tax basis, to terminate the contracts. The terms of the foreign exchange derivative contracts are generally less than 18 months. The Company had no deferred gains or losses related to foreign exchange contracts in accumulated other comprehensive income as of December 31, 2019 and 2018, as these contracts were not designated as hedging instruments for accounting.
The Company’s derivative financial instruments are subject to both market and counterparty credit risk. Market risk is the potential for economic losses to be incurred on market risk sensitive instruments arising from adverse changes in market factors such as foreign currency exchange rates, interest rates and other related variables. Counterparty credit risk is the risk of loss due to failure of the counterparty to perform its obligations in accordance with contractual terms. To mitigate counterparty credit risk, the Company enters into derivative contracts with a diversified group of selected financial institutions based upon their credit ratings and other factors. Generally, the Company does not obtain collateral related to derivatives because of the high credit ratings of the counterparties.
Net Investment Hedge
The Company uses foreign currency denominated debt to hedge a portion of its net investment in foreign operations against adverse movements in exchange rates, with changes in the value of the debt recorded within currency translation adjustment in accumulated other comprehensive income (loss). In 2015, the Company designated its €1.65 billion euro-denominated debt as a net investment hedge for a portion of its net investment in European operations. As of December 31, 2019, the Company had a net foreign currency transaction pre-tax loss of $84 million in accumulated other comprehensive income (loss) associated with hedging activity.
Interest Rate Risk
Cash Flow Hedges
The Company is exposed to interest rate volatility on future debt issuances. To manage this risk, in the fourth quarter of 2019, the Company entered into treasury rate locks to lock the benchmark rate on a portion of the interest payments related to forecasted debt issuances. These locks are linked to future interest payments on anticipated U.S. dollar debt issuances forecasted to occur during 2020 and are accounted for as cash flow hedges. The maximum length of time over which the Company has hedged its exposure to the variability in future cash flows is 30 years. As of December 31, 2019, the total notional amount of interest rate contracts outstanding was $1 billion. The Company did not have any derivative instruments relating to this program outstanding as of December 31, 2018.
As of December 31, 2019, in connection with these cash flow hedges, the Company recorded pre-tax net unrealized gains of $14 million in accumulated other comprehensive income. As of December 31, 2019, the fair value of these contracts was $14 million and is included in prepaid expenses and other current assets on the consolidated balance sheet.
v3.19.3.a.u2
Segment Reporting
12 Months Ended
Dec. 31, 2019
Segment Reporting [Abstract]  
Segment Reporting
Mastercard has concluded it has one reportable operating segment, “Payment Solutions.” Mastercard’s President and Chief Executive Officer has been identified as the chief operating decision-maker. All of the Company’s activities are interrelated, and each activity is dependent upon and supportive of the other. Accordingly, all significant operating decisions are based upon analysis of Mastercard at the consolidated level.
Revenue by geographic market is based on the location of the Company’s customer that issued the card, as well as the location of the merchant acquirer where the card is being used. Revenue generated in the U.S. was approximately 32% of total revenue in 2019, 33% in 2018 and 35% in 2017. No individual country, other than the U.S., generated more than 10% of total revenue in those periods. Mastercard did not have any individual customer that generated greater than 10% of net revenue in 2019, 2018 or 2017.
The following table reflects the geographical location of the Company’s property, equipment and right-of-use assets, net, as of December 31:
 
 
2019
 
2018
 
2017
 
 
(in millions)
United States
 
$
1,147

 
$
613

 
$
572

Other countries
 
681

 
308

 
257

Total
 
$
1,828

 
$
921

 
$
829


v3.19.3.a.u2
SUMMARY OF QUARTERLY DATA (Unaudited)
12 Months Ended
Dec. 31, 2019
Quarterly Financial Data [Abstract]  
SUMMARY OF QUARTERLY DATA (Unaudited)
 
 
 
2019 Quarter Ended
 
 
 
 
March 31
 
June 30
 
September 30
 
December 31  
 
2019 Total
 
 
(in millions, except per share data)
Net revenue
 
$
3,889

 
$
4,113

 
$
4,467

 
$
4,414

 
$
16,883

Operating income
 
2,213

 
2,397

 
2,655

 
2,399

 
9,664

Net income
 
1,862

 
2,048

 
2,108

 
2,100

 
8,118

Basic earnings per share
 
$
1.81

 
$
2.01

 
$
2.08

 
$
2.08

 
$
7.98

Basic weighted-average shares outstanding
 
1,026

 
1,020

 
1,013

 
1,008

 
1,017

Diluted earnings per share
 
$
1.80

 
$
2.00

 
$
2.07

 
$
2.07

 
$
7.94

Diluted weighted-average shares outstanding
 
1,032

 
1,025

 
1,019

 
1,013

 
1,022

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2018 Quarter Ended
 
 
 
 
March 31
 
June 30
 
September 30
 
December 31
 
2018 Total
 
 
(in millions, except per share data)
Net revenue
 
$
3,580

 
$
3,665

 
$
3,898

 
$
3,807

 
$
14,950

Operating income
 
1,825

 
1,936

 
2,287

 
1,234

 
7,282

Net income
 
1,492

 
1,569

 
1,899

 
899

 
5,859

Basic earnings per share
 
$
1.42

 
$
1.50

 
$
1.83

 
$
0.87

 
$
5.63

Basic weighted-average shares outstanding
 
1,051

 
1,043

 
1,037

 
1,032

 
1,041

Diluted earnings per share
 
$
1.41

 
$
1.50

 
$
1.82

 
$
0.87

 
$
5.60

Diluted weighted-average shares outstanding
 
1,057

 
1,049

 
1,043

 
1,038

 
1,047

Note: Tables may not sum due to rounding.
v3.19.3.a.u2
Summary of Significant Accounting Policies (Policy)
12 Months Ended
Dec. 31, 2019
Accounting Policies [Abstract]  
Organization
Organization
Mastercard Incorporated and its consolidated subsidiaries, including Mastercard International Incorporated (“Mastercard International” and together with Mastercard Incorporated, “Mastercard” or the “Company”), is a technology company in the global payments industry that connects consumers, financial institutions, merchants, governments, digital partners, businesses and other organizations worldwide, enabling them to use electronic forms of payment instead of cash and checks. The Company makes payments easier and more efficient by providing a wide range of payment solutions and services through its family of well-known brands, including Mastercard®, Maestro® and Cirrus®. The Company is a multi-rail network that offers customers one partner to turn to for their domestic and cross-border payment needs. Through its unique and proprietary global payments network, which is referred to as the core network, the Company switches (authorizes, clears and settles) payment transactions and delivers related products and services. Mastercard has additional payment capabilities that include automated clearing house (“ACH”) transactions (both batch and real-time account-based payments). The Company also provides integrated value-added offerings such as cyber and intelligence products, information and analytics services, consulting, loyalty and reward programs and processing. The Company’s payment solutions offer customers choice and flexibility and are designed to ensure safety and security for the global payments system.
A typical transaction on the Company’s core network involves four participants in addition to the Company: account holder (a person or entity who holds a card or uses another device enabled for payment), issuer (the account holder’s financial institution), merchant and acquirer (the merchant’s financial institution). The Company does not issue cards, extend credit, determine or receive revenue from interest rates or other fees charged to account holders by issuers, or establish the rates charged by acquirers in connection with merchants’ acceptance of the Company’s products. In most cases, account holder relationships belong to, and are managed by, the Company’s financial institution customers.
Consolidation and Basis of Presentation
Consolidation and basis of presentation - The consolidated financial statements include the accounts of Mastercard and its majority-owned and controlled entities, including any variable interest entities (“VIEs”) for which the Company is the primary beneficiary. Investments in VIEs for which the Company is not considered the primary beneficiary are not consolidated and are accounted for as equity method or measurement alternative method investments and recorded in other assets on the consolidated balance sheet.  At December 31, 2019 and 2018, there were no significant VIEs which required consolidation and the investments were not considered material to the consolidated financial statements. The Company consolidates acquisitions as of the date in which the Company has obtained a controlling financial interest. Intercompany transactions and balances have been eliminated in consolidation. Certain prior period amounts have been reclassified to conform to the 2019 presentation. The Company follows accounting principles generally accepted in the United States of America (“GAAP”).
Prior to December 31, 2017, the Company included the financial results from its Venezuela subsidiaries in the consolidated financial statements using the consolidation method of accounting. In 2017, due to foreign exchange regulations restricting access to U.S. dollars in Venezuela, an other-than-temporary lack of exchangeability between the Venezuelan bolivar and U.S. dollar impacted the Company’s ability to manage risk, process cross-border transactions and satisfy U.S. dollar denominated liabilities related to operations in Venezuela.  As a result of these factors, Mastercard concluded that effective December 31, 2017, it did not meet the accounting criteria for consolidation of these Venezuelan subsidiaries, and therefore would transition to the measurement alternative method of accounting as of December 31, 2017. This accounting change resulted in a pre-tax charge of $167 million ($108 million after tax or $0.10 per diluted share) that was recorded in general and administrative expenses on the consolidated statement of operations for the year ended December 31, 2017.
Non-controlling interests represent the equity interest not owned by the Company and are recorded for consolidated entities in which the Company owns less than 100% of the interests. Changes in a parent’s ownership interest while the parent retains its controlling interest are accounted for as equity transactions, and upon loss of control, retained ownership interests are remeasured at fair value, with any gain or loss recognized in earnings. For 2019, 2018 and 2017, net losses from non-controlling interests were not material and, as a result, amounts are included on the consolidated statement of operations within other income (expense).
Use of Estimates Policy
Use of estimates - The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting periods. Future events and their effects cannot be predicted with certainty; accordingly, accounting estimates require the exercise of judgment. The accounting estimates used in the preparation of the Company’s consolidated financial statements may change as new events occur, as more experience is
acquired, as additional information is obtained and as the Company’s operating environment changes. Actual results may differ from these estimates.
Revenue Recognition Policy
Revenue recognition - Revenue is recognized to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the Company expects to be entitled to in exchange for those goods or services. Revenue is primarily generated by charging fees to issuers, acquirers and other stakeholders for providing switching services, as well as by assessing customers based primarily on the dollar volume of activity, or gross dollar volume, on the products that carry the Company’s brands. Revenue is generally derived from transactional information accumulated by Mastercard’s systems or reported by customers.
Volume-based revenue (domestic assessments and cross-border volume fees) is recorded as revenue in the period it is earned, which is when the related volume is generated on the cards. Certain volume-based revenue is based upon information reported by customers. Transaction-based revenue (transaction processing) is primarily based on the number and type of transactions and is recognized as revenue in the same period in which the related transactions occur. Other payment-related products and services are recognized as revenue in the period in which the related services are performed or transactions occur.
Mastercard has business agreements with certain customers that provide for rebates or other support when the customers meet certain volume hurdles as well as other support incentives, which are tied to performance. Rebates and incentives are recorded as a reduction of gross revenue primarily when volume- and transaction-based revenues are recognized over the contractual term. Rebates and incentives are calculated based upon estimated customer performance and the terms of the related business agreements. In addition, Mastercard may make payments to a customer directly related to entering into an agreement, which are generally capitalized and amortized over the life of the agreement on a straight-line basis.
Contract assets include unbilled consideration typically resulting from executed data analytic and consulting services performed for customers in connection with Mastercard’s payment network service arrangements. Collection for these services typically occurs over the contractual term. Contract assets are included in prepaid expenses and other current assets and other assets on the consolidated balance sheet.
The Company defers the recognition of revenue when consideration has been received prior to the satisfaction of performance obligations. As these performance obligations are satisfied, revenue is subsequently recognized. Deferred revenue is primarily derived from data analytic and consulting services. Deferred revenue is included in other current liabilities and other liabilities on the consolidated balance sheet.
Business Combinations Policy Business combinations - The Company accounts for business combinations under the acquisition method of accounting. The Company measures the tangible and intangible identifiable assets acquired, liabilities assumed and any non-controlling interest in the acquiree, at fair value as of the acquisition date. Acquisition-related costs are expensed as incurred and are included in general and administrative expenses. Any excess purchase price over the fair value of net assets acquired, including identifiable intangible assets, is recorded as goodwill.
Intangible Assets and Impairment of Assets Policy
Goodwill and other intangible assets - Indefinite-lived intangible assets consist of goodwill, which represents the synergies expected to arise after the acquisition date and the assembled workforce, and customer relationships. Finite-lived intangible assets consist of capitalized software costs, trademarks, tradenames, customer relationships and other intangible assets. Intangible assets with finite useful lives are amortized over their estimated useful lives, on a straight-line basis, which range from one to twenty years. Capitalized software includes internal and external costs incurred directly related to the design, development and testing phases of each capitalized software project.
Impairment of assets - Goodwill and indefinite-lived intangible assets are not amortized but tested annually for impairment at the reporting unit level in the fourth quarter, or sooner when circumstances indicate an impairment may exist.  The impairment evaluation for goodwill utilizes a qualitative assessment to determine whether it is more likely than not that goodwill is impaired. The qualitative factors may include, but are not limited to, macroeconomic conditions, industry and market conditions, operating environment, financial performance and other relevant events. If it is determined that it is more likely than not that goodwill is impaired, then the Company is required to perform a quantitative goodwill impairment test. If the fair value of a reporting unit exceeds the carrying value, goodwill is not impaired. If the fair value of the reporting unit is less than its carrying value, then goodwill is impaired and the excess of the reporting unit’s carrying value over the fair value is recognized as an impairment charge.
The impairment test for indefinite-lived intangible assets consists of a qualitative assessment to evaluate relevant events and circumstances that could affect the significant inputs used to determine the fair value of indefinite-lived intangible assets.  If the qualitative assessment indicates that it is more likely than not that indefinite-lived intangible assets are impaired, then a quantitative assessment is required. 
Long-lived assets, other than goodwill and indefinite-lived intangible assets, are tested for impairment whenever events or circumstances indicate that their carrying amount may not be recoverable. If the carrying value of the asset cannot be recovered from estimated
future cash flows, undiscounted and without interest, the fair value of the asset is calculated using the present value of estimated net future cash flows. If the carrying amount of the asset exceeds its fair value, an impairment is recorded.
Impairment charges, if any, are recorded in general and administrative expenses on the consolidated statement of operations.
Litigation Policy
Litigation - The Company is a party to certain legal and regulatory proceedings with respect to a variety of matters. The Company evaluates the likelihood of an unfavorable outcome of all legal or regulatory proceedings to which it is a party and accrues a loss contingency when the loss is probable and reasonably estimable. Loss contingencies are recorded in provision for litigation on the consolidated statement of operations. These judgments are subjective based on the status of the legal or regulatory proceedings, the merits of its defenses and consultation with in-house and external legal counsel. Legal costs are expensed as incurred and recorded in general and administrative expenses on the consolidated statement of operations.
Settlement and Other Risk Management Policy
Settlement and other risk management - Mastercard’s rules guarantee the settlement of many of the transactions between its customers. Settlement exposure is the outstanding settlement risk to customers under Mastercard’s rules due to the difference in timing between the payment transaction date and subsequent settlement. While the term and amount of the guarantee are unlimited, the duration of settlement exposure is short term and typically limited to a few days.
The Company also enters into agreements in the ordinary course of business under which the Company agrees to indemnify third parties against damages, losses and expenses incurred in connection with legal and other proceedings arising from relationships or transactions with the Company. As the extent of the Company’s obligations under these agreements depends entirely upon the occurrence of future events, the Company’s potential future liability under these agreements is not determinable.
The Company accounts for each of its guarantees by recording the guarantee at its fair value at the inception or modification date through earnings.
Income Taxes Policy
Income taxes - The Company follows an asset and liability based approach in accounting for income taxes as required under GAAP. Deferred income tax assets and liabilities are recorded to reflect the tax consequences on future years of temporary differences between the financial statement carrying amounts and income tax bases of assets and liabilities. Deferred income taxes are displayed separately as noncurrent assets and liabilities on the consolidated balance sheet. Valuation allowances are provided against assets which are not more likely than not to be realized. The Company recognizes all material tax positions, including uncertain tax positions in which it is more likely than not that the position will be sustained based on its technical merits and if challenged by the relevant taxing authorities. At each balance sheet date, unresolved uncertain tax positions are reassessed to determine whether subsequent developments require a change in the amount of recognized tax benefit. The allowance for uncertain tax positions is recorded in other current and noncurrent liabilities on the consolidated balance sheet. The Company records interest expense related to income tax matters as interest expense on the consolidated statement of operations. The Company includes penalties related to income tax matters in the income tax provision.
Cash and Cash Equivalents and Restricted Cash Policy
Cash and cash equivalents - Cash and cash equivalents include certain investments with daily liquidity and with an original maturity of three months or less from the date of purchase. Cash equivalents are recorded at cost, which approximates fair value.
Restricted cash - The Company classifies cash and cash equivalents as restricted when it is unavailable for withdrawal or use in its general operations. The Company has the following types of restricted cash and restricted cash equivalents which are included in the reconciliation of beginning-of-period and end-of-period amounts shown on the consolidated statement of cash flows:
Restricted cash for litigation settlement - The Company has restricted cash for litigation within a qualified settlement fund related to the settlement agreement for the U.S. merchant class litigation. The funds continue to be restricted for payments until the litigation matter is resolved.
Restricted security deposits held for customers - The Company requires collateral from certain customers for settlement of their transactions. The majority of collateral for settlement is in the form of standby letters of credit and bank guarantees which are not recorded on the consolidated balance sheet. Additionally, the Company holds cash deposits and certificates of deposit from certain customers as collateral for settlement of their transactions, which are recorded as assets on the consolidated balance sheet. These assets are fully offset by corresponding liabilities included on the consolidated balance sheet. These security deposits are typically held for the duration of the agreement with the customers.
Other restricted cash balances - The Company has other restricted cash balances which include contractually restricted deposits, as well as cash balances that are restricted based on the Company’s intention with regard to usage. These funds are classified on the consolidated balance sheet within prepaid expenses and other current assets and other assets.
Fair Value Policy
Fair value - The Company measures certain financial assets and liabilities at fair value on a recurring basis by estimating the price that would be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants. The Company classifies these recurring fair value measurements into a three-level hierarchy (“Valuation Hierarchy”).
The Valuation Hierarchy is based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date. A financial instrument’s categorization within the Valuation Hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The three levels of the Valuation Hierarchy are as follows: 
Level 1 - inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets
Level 2 - inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets and liabilities in inactive markets and inputs that are observable for the asset or liability
Level 3 - inputs to the valuation methodology are unobservable and cannot be directly corroborated by observable market data
Certain assets are measured at fair value on a nonrecurring basis. The Company’s non-financial assets measured at fair value on a nonrecurring basis include property, equipment and right-of-use assets, goodwill and other intangible assets. These assets are subject to fair value adjustments in certain circumstances, such as when there is evidence of impairment.
The valuation methods for goodwill and other intangible assets acquired in business combinations involve assumptions concerning comparable company multiples, discount rates, growth projections and other assumptions of future business conditions. The Company uses various valuation techniques to determine fair value, primarily discounted cash flows analysis, relief-from-royalty, and multi-period excess earnings for estimating the fair value of its intangible assets. As the assumptions employed to measure these assets are based on management’s judgment using internal and external data, these fair value determinations are classified in Level 3 of the Valuation Hierarchy.
Contingent Consideration, Policy
Contingent consideration - Certain business combinations involve the potential for future payment of consideration that is contingent upon the achievement of performance milestones. These liabilities are classified within Level 3 of the Valuation Hierarchy as the inputs used to measure fair value are unobservable and require management’s judgment. The fair value of the contingent consideration at the acquisition date and subsequent periods is determined utilizing an income approach based on a Monte Carlo technique and is recorded in other current liabilities and other liabilities on the consolidated balance sheet. Changes to projected performance milestones of the acquired businesses could result in a higher or lower contingent consideration liability. The changes in fair value as a result of updated assumptions will be recorded in general and administrative expenses on the consolidated statement of operations.
Investment Securities Policy
Investment securities - The Company classifies investments as available-for-sale or held-to-maturity at the date of acquisition.
Available-for-sale debt securities:
Available-for-sale securities that are available to meet the Company’s current operational needs are classified as current assets and the securities that are not available for current operational needs are classified as non-current assets on the consolidated balance sheet.
The investments in debt securities are carried at fair value, with unrealized gains and losses, net of tax, recorded as a separate component of accumulated other comprehensive income (loss) on the consolidated statement of comprehensive income. Net realized gains and losses on debt securities are recognized in investment income on the consolidated statement of operations. The specific identification method is used to determine realized gains and losses.
The Company evaluates its debt securities for other-than-temporary impairment on an ongoing basis. When there has been a decline in fair value of a debt security below the amortized cost basis, the Company recognizes an other-than-temporary impairment if: (1) it has the intent to sell the security; (2) it is more likely than not that it will be required to sell the security before recovery of the amortized cost basis; or (3) it does not expect to recover the entire amortized cost basis of the security. The credit loss component of the impairment would be recognized in other income (expense), net on the consolidated statement of operations while the non-credit loss would remain in accumulated other comprehensive income (loss) until realized from a sale or an other-than-temporary impairment.
Held-to-maturity securities:
Time deposits - The Company classifies time deposits with original maturities greater than three months as held-to-maturity. Held-to-maturity securities that mature within one year are classified as current assets within investments on the consolidated balance sheet while held-to-maturity securities with maturities of greater than one year are classified as non-current assets. Time deposits are carried at amortized cost on the consolidated balance sheet and are intended to be held until maturity.
Equity investments - The Company holds equity securities of publicly traded and privately held companies.
Marketable equity securities - Marketable equity securities are strategic investments in publicly traded companies and are measured at fair value using quoted prices in their respective active markets with changes recorded through gain (losses) on equity investments, net on the consolidated statement of operations. Securities that are not for use in current operations are classified in other assets on the consolidated balance sheet.
Nonmarketable equity investments - The Company’s nonmarketable equity investments, which are reported in other assets on the consolidated balance sheet, include investments in privately held companies without readily determinable market values. The Company uses discounted cash flows and market assumptions to estimate the fair value of its nonmarketable equity investments when certain events or circumstances indicate that impairment may exist. The Company’s nonmarketable equity investments are accounted for under the equity method or measurement alternative method.
Equity method - The Company accounts for investments in common stock or in-substance common stock under the equity method of accounting when it has the ability to exercise significant influence over the investee, generally when it holds between 20% and 50% ownership in the entity. In addition, investments in flow-through entities such as limited partnerships and limited liability companies are also accounted for under the equity method when the Company has the ability to exercise significant influence over the investee, generally when the investment ownership percentage is equal to or greater than 5% of the outstanding ownership interest. The excess of the cost over the underlying net equity of investments accounted for under the equity method is allocated to identifiable tangible and intangible assets and liabilities based on fair values at the date of acquisition. The amortization of the excess of the cost over the underlying net equity of investments and Mastercard’s share of net earnings or losses of entities accounted for under the equity method of accounting is included in other income (expense), net on the consolidated statement of operations.
Measurement alternative method - The Company accounts for investments in common stock or in-substance common stock under the measurement alternative method of accounting when it does not exercise significant influence, generally when it holds less than 20% ownership in the entity or when the interest in a limited partnership or limited liability company is less than 5% and the Company has no significant influence over the operation of the investee. Investments in companies that Mastercard does not control, but that are not in the form of common stock or in-substance common stock, are also accounted for under the measurement alternative method of accounting. Measurement alternative investments are measured at cost, less any impairment and adjusted for changes resulting from observable price changes in orderly transactions for identical or similar investments of the same issuer. Fair value adjustments, as well as impairments, are included in gain (losses) on equity investments, net on the consolidated statement of operations.
Derivative Financial Instruments Policy
Derivative and hedging instruments - The Company’s derivative financial instruments are recorded as either assets or liabilities on the balance sheet and measured at fair value. The Company’s foreign exchange and interest rate derivative contracts are included in Level 2 of the Valuation Hierarchy as the fair value of the contracts are based on inputs, which are observable based on broker quotes for the same or similar instruments. As the Company does not designate foreign exchange contracts as hedging instruments, realized and unrealized gains and losses from the change in fair value of the contracts are recognized immediately in current-period earnings. The Company’s foreign exchange contracts are not entered into for trading or speculative purposes.
The Company’s derivatives that are designated as hedging instruments are required to meet established accounting criteria. In addition, an effectiveness assessment is required to demonstrate that the derivative is expected to be highly effective at offsetting changes in fair value or cash flows of the underlying exposure both at inception of the hedging relationship and on an ongoing basis. The method of assessing hedge effectiveness and measuring hedge results is formally documented at hedge inception and assessed at least quarterly throughout the designated hedge period. For cash flow hedges, the fair value adjustments are recorded, net of tax, in other comprehensive income (loss). Any gains and losses deferred in other comprehensive income (loss) are then recognized in current-period earnings when earnings are affected by the variability of cash flows of the hedged forecasted transaction.
The Company has numerous investments in its foreign subsidiaries.  The net assets of these subsidiaries are exposed to volatility in foreign currency exchange rates.  The Company uses foreign currency denominated debt to hedge a portion of its net investment in foreign operations against adverse movements in exchange rates. The effective portion of the foreign currency gains and losses related to the foreign currency denominated debt are reported in accumulated other comprehensive income (loss) on the consolidated balance sheet as part of the cumulative translation adjustment component of equity. The Company evaluates the effectiveness of the net investment hedge each quarter.
Settlement Due From/Due To Customers Policy
Settlement due from/due to customers - The Company operates systems for clearing and settling payment transactions among customers. Net settlements are generally cleared daily among customers through settlement cash accounts by wire transfer or other bank clearing means. However, some transactions may not settle until subsequent business days, resulting in amounts due from and due to customers.
Property, Equipment and Right-of-Use Assets Policy
Property, equipment and right-of-use assets - Property and equipment are stated at cost less accumulated depreciation and amortization. Depreciation and amortization is computed using the straight-line method over the estimated useful lives of the assets. Depreciation of leasehold improvements and amortization of finance leases is included in depreciation and amortization expense on the consolidated statement of operations. Operating lease amortization expense is included in general and administrative expenses on the consolidated statement of operations.
The useful lives of the Company’s assets are as follows:
Asset Category
 
Estimated Useful Life
Buildings
 
30 years
Building equipment
 
10 - 15 years
Furniture and fixtures and equipment
 
3 - 5 years
Leasehold improvements
 
Shorter of life of improvement or lease term
Right-of-use assets
 
Shorter of life of the asset or lease term

Leases Policy
The Company determines if a contract is, or contains, a lease at contract inception. The Company’s right-of-use (“ROU”) assets are primarily related to operating leases for office space, automobiles and other equipment. Leases are included in property, equipment and right-of-use assets, other current liabilities and other liabilities on the consolidated balance sheet.
ROU assets represent the right to use an underlying asset for the lease term and lease liabilities represent the obligation to make lease payments arising from the lease. ROU assets and lease liabilities are recognized at the commencement date based on the present value of lease payments over the lease term. In addition, ROU assets include initial direct costs incurred by the lessee as well as any lease payments made at or before the commencement date, and exclude lease incentives. As most of the Company's leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments. The incremental borrowing rate is determined by using the rate of interest that the Company would pay to borrow on a collateralized basis an amount equal to the lease payments for a similar term and in a similar economic environment. Lease terms include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Leases with a term of one year or less are excluded from ROU assets and liabilities.
The Company excludes variable lease payments in measuring ROU assets and lease liabilities, other than those that depend on an index, a rate or are in-substance fixed payments. Lease and nonlease components are generally accounted for separately. When available, consideration is allocated to the separate lease and nonlease components in a lease contract on a relative standalone price basis using observable standalone prices.
Pension and Other Postretirement Plans Policy
Pension and other postretirement plans - The Company recognizes the funded status of its single-employer defined benefit pension plans and postretirement plans as assets or liabilities on its consolidated balance sheet and recognizes changes in the funded status in the year in which the changes occur through accumulated other comprehensive income (loss). The funded status is measured as the difference between the fair value of plan assets and the projected benefit obligation at December 31, the measurement date. Overfunded plans, if any, are aggregated and recorded in other assets, while underfunded plans are aggregated and recorded as accrued expenses and other liabilities on the consolidated balance sheet.
Net periodic pension and postretirement benefit cost/(income), excluding the service cost component, is recognized in other income (expense) on the consolidated statement of operations. These costs include interest cost, expected return on plan assets, amortization of prior service costs or credits and gains or losses previously recognized as a component of accumulated other comprehensive income (loss). The service cost component is recognized in general and administrative expenses on the consolidated statement of operations.
Defined contribution plans - The Company’s contributions to defined contribution plans are recorded as employees render service to the Company. The charge is recorded in general and administrative expenses on the consolidated statement of operations.
Advertising and Marketing Policy Advertising and marketing - Expenses incurred to promote Mastercard’s brand, products and services are recognized in advertising and marketing on the consolidated statement of operations. The timing of recognition is dependent on the type of advertising or marketing expense
Foreign Currency Remeasurement and Translation Policy
Foreign currency remeasurement and translation - Monetary assets and liabilities are remeasured to functional currencies using current exchange rates in effect at the balance sheet date. Non-monetary assets and liabilities are recorded at historical exchange rates. Revenue and expense accounts are remeasured at the weighted-average exchange rate for the period. Resulting exchange gains and losses related to remeasurement are included in general and administrative expenses on the consolidated statement of operations.
Where a non-U.S. currency is the functional currency, translation from that functional currency to U.S. dollars is performed for balance sheet accounts using current exchange rates in effect at the balance sheet date and for revenue and expense accounts using a weighted-
average exchange rate for the period. Resulting translation adjustments are reported as a component of accumulated other comprehensive income (loss).
Treasury Stock Policy
Treasury stock - The Company records the repurchase of shares of its common stock at cost on the trade date of the transaction. These shares are considered treasury stock, which is a reduction to stockholders’ equity. Treasury stock is included in authorized and issued shares but excluded from outstanding shares.
Share-based Payments Policy Share-based payments - The Company measures share-based compensation expense at the grant date, based on the estimated fair value of the award and uses the straight-line method of attribution, net of estimated forfeitures, for expensing awards over the requisite employee service period. The Company estimates the fair value of its non-qualified stock option awards (“Options”) using a Black-Scholes valuation model. The fair value of restricted stock units (“RSUs”) is determined and fixed on the grant date based on the Company’s stock price, adjusted for the exclusion of dividend equivalents. The Monte Carlo simulation valuation model is used to determine the grant date fair value of performance stock units (“PSUs”) granted. All share-based compensation expenses are recorded in general and administrative expenses on the consolidated statement of operations.
Redeemable Noncontrolling Interests Policy Redeemable non-controlling interests - The Company’s business combinations may include provisions allowing non-controlling equity owners the ability to require the Company to purchase additional interests in the subsidiary at their discretion. The interests are initially recorded at fair value and in subsequent reporting periods are accreted or adjusted to the estimated redemption value. The adjustments to the redemption value are recorded to retained earnings or additional paid-in capital on the consolidated balance sheet. The redeemable non-controlling interests are considered temporary and reported outside of permanent equity on the consolidated balance sheet at the greater of the carrying amount adjusted for the non-controlling interest’s share of net income (loss) or its redemption value.
Earnings Per Share Policy
Earnings per share - The Company calculates basic earnings per share (“EPS”) by dividing net income by the weighted-average number of common shares outstanding during the year. Diluted EPS is calculated by dividing net income by the weighted-average number of common shares outstanding during the year, adjusted for the potentially dilutive effect of stock options and unvested stock units using the treasury stock method. The Company may be required to calculate EPS using the two-class method as a result of its redeemable non-controlling interests. If redemption value exceeds the fair value of the redeemable non-controlling interests, the excess would be a reduction to net income for the EPS calculation.
Recent Accounting Pronouncements Policy
Accounting pronouncements adopted
Leases - In February 2016, the Financial Accounting Standards Board (the “FASB”) issued accounting guidance that changed how companies account for and present lease arrangements. This guidance requires companies to recognize lease assets and liabilities for both finance and operating leases on the consolidated balance sheet. The Company adopted this guidance effective January 1, 2019, under the modified retrospective transition method with the available practical expedients.
The following table summarizes the impact of the changes made to the January 1, 2019 consolidated balance sheet for the adoption of the new accounting standard pertaining to leases. The prior periods have not been restated and have been reported under the accounting standard in effect for those periods.
 
 
Balance at December 31, 2018
 
Impact of lease standard
 
Balance at
January 1, 2019
 
 
(in millions)
Assets
 
 
 
 
 
 
Property, equipment and right-of-use assets, net
 
$
921

 
$
375

 
$
1,296

Liabilities
 
 
 
 
 
 
Other current liabilities
 
949

 
72

 
1,021

Other liabilities
 
1,877

 
303

 
2,180


For a more detailed discussion on lease arrangements, refer to Note 10 (Property, Equipment and Right-of-Use Assets).
Comprehensive income - In February 2018, the FASB issued accounting guidance that allows for a one-time reclassification from accumulated other comprehensive income (loss) to retained earnings for stranded tax effects resulting from U.S. tax reform. The Company adopted this guidance effective January 1, 2019, electing to retain the stranded tax effects in accumulated other comprehensive income (loss). The adoption did not result in a material impact on the Company’s consolidated financial statements.
Revenue recognition - In May 2014, the FASB issued accounting guidance that provides a single, comprehensive revenue recognition model for all contracts with customers and supersedes most of the existing revenue recognition requirements. Under this guidance, an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The Company adopted this guidance effective January 1, 2018 under the modified retrospective transition method, applying the standard to contracts not completed as of January 1, 2018 and considered the aggregate amount of modifications.
This revenue guidance impacts the timing of certain customer incentives recognized in the Company’s consolidated statement of operations, as they are recognized over the life of the contract. Previously, such incentives were recognized when earned by the customer. This revenue guidance also impacts the Company’s accounting recognition for certain market development fund contributions and expenditures. Historically, these items were recorded on a net basis in net revenue and will now be recognized on a gross basis, resulting in an increase to both revenues and expenses.
The following tables summarize the impact of the revenue standard on the Company’s consolidated statement of operations and consolidated balance sheet:
 
 
Year Ended December 31, 2018
 
 
Balances excluding revenue standard
 
Impact of revenue standard
 
As reported
 
 
(in millions)
Net Revenue
 
$
14,471

 
$
479

 
$
14,950

Operating Expenses
 
 
 
 
 
 
Advertising and marketing
 
743

 
164

 
907

Income before income taxes
 
6,889

 
315

 
7,204

Income tax expense
 
1,278

 
67

 
1,345

Net Income
 
5,611

 
248

 
5,859

 
 
December 31, 2018
 
 
Balances excluding revenue standard
 
Impact of revenue standard
 
As reported
 
 
(in millions)
Assets
 
 
 
 
 
 
Accounts receivable
 
$
2,214

 
$
62

 
$
2,276

Prepaid expenses and other current assets
 
1,176

 
256

 
1,432

Deferred income taxes
 
666

 
(96
)
 
570

Other assets
 
2,388

 
915

 
3,303

Liabilities
 
 
 
 
 
 
Accounts payable
 
959

 
(422
)
 
537

Accrued expenses
 
4,375

 
372

 
4,747

Other current liabilities
 
1,085

 
(136
)
 
949

Other liabilities
 
1,145

 
732

 
1,877

Equity
 
 
 
 
 
 
Retained earnings
 
26,692

 
591

 
27,283

For a more detailed discussion on revenue recognition, refer to Note 3 (Revenue).
Intra-entity asset transfers - In October 2016, the FASB issued accounting guidance to simplify the accounting for income tax consequences of intra-entity transfers of assets other than inventory. Under this guidance, companies are required to recognize the income tax consequences of an intra-entity asset transfer when the transfer occurs. This guidance must be applied on a modified retrospective basis through a cumulative-effect adjustment to retained earnings as of the period of adoption. The guidance is effective for periods beginning after December 15, 2017. The Company adopted this guidance effective January 1, 2018. See the section in this note entitled Cumulative Effect of the Adopted Accounting Pronouncements for a summary of the cumulative impact of adopting this standard as of January 1, 2018.
Cumulative effect of the 2018 adopted accounting pronouncements
The following table summarizes the cumulative impact of the changes made to the January 1, 2018 consolidated balance sheet for the adoption of the new accounting standards pertaining to revenue recognition and intra-entity asset transfers. The prior periods have not been restated and have been reported under the accounting standards in effect for those periods.
 
 
Balance at December 31, 2017
 
Impact of revenue standard
 
Impact of intra-entity asset transfers standard
 
Balance at
January 1, 2018
 
 
(in millions)
Assets
 
 
 
 
 
 
 
 
Accounts receivable
 
$
1,969

 
$
44

 
$

 
$
2,013

Prepaid expenses and other current assets
 
1,040

 
181

 
(17
)
 
1,204

Deferred income taxes
 
250

 
(69
)
 
186

 
367

Other assets
 
2,298

 
690

 
(352
)
 
2,636

Liabilities
 
 
 
 
 
 
 
 
Accounts payable
 
933

 
(495
)
 

 
438

Accrued expenses
 
3,931

 
391

 

 
4,322

Other current liabilities
 
792

 
(44
)
 

 
748

Other liabilities
 
1,438

 
628

 

 
2,066

Equity
 
 
 
 
 
 
 
 
Retained earnings
 
22,364

 
366

 
(183
)
 
22,547

Accounting pronouncements not yet adopted
Implementation costs incurred in a hosting arrangement that is a service contract - In August 2018, the FASB issued accounting guidance which aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. This guidance is effective for periods beginning after December 15, 2019. Companies are required to adopt this guidance either retrospectively or by prospectively applying the guidance to all implementation costs incurred after the date of adoption. The Company will adopt this guidance effective January 1, 2020 by applying the prospective approach as of the date of adoption and this guidance will not have a material impact on its consolidated financial statements.
Disclosure requirements for fair value measurement - In August 2018, the FASB issued accounting guidance which modifies disclosure requirements for fair value measurements by removing, modifying and adding certain disclosures. This guidance is effective for periods beginning after December 15, 2019. Companies are required to adopt the guidance for certain added disclosures prospectively for only the most recent interim or annual period presented in the initial fiscal year of adoption and all other amendments retrospectively to all periods presented upon their effective date. The Company will adopt this guidance effective January 1, 2020 and the impact will not be material.
v3.19.3.a.u2
Summary of Significant Accounting Policies (Tables)
12 Months Ended
Dec. 31, 2019
Accounting Policies [Abstract]  
Property, Equipment and Right-of-Use Assets [Table Text Block]
The useful lives of the Company’s assets are as follows:
Asset Category
 
Estimated Useful Life
Buildings
 
30 years
Building equipment
 
10 - 15 years
Furniture and fixtures and equipment
 
3 - 5 years
Leasehold improvements
 
Shorter of life of improvement or lease term
Right-of-use assets
 
Shorter of life of the asset or lease term

Property, equipment and right-of-use assets consisted of the following at December 31:
 
 
2019
 
2018
 
 
(in millions)
Building, building equipment and land
 
$
505

 
$
481

Equipment
 
1,218

 
987

Furniture and fixtures
 
92

 
85

Leasehold improvements
 
303

 
215

Operating lease right-of-use assets
 
810

 

Property, equipment and right-of-use assets
 
2,928

 
1,768

Less accumulated depreciation and amortization
 
(1,100
)
 
(847
)
Property, equipment and right-of-use assets, net
 
$
1,828

 
$
921


Financial statement Effects of New Accounting Pronouncements
The following table summarizes the impact of the changes made to the January 1, 2019 consolidated balance sheet for the adoption of the new accounting standard pertaining to leases. The prior periods have not been restated and have been reported under the accounting standard in effect for those periods.
 
 
Balance at December 31, 2018
 
Impact of lease standard
 
Balance at
January 1, 2019
 
 
(in millions)
Assets
 
 
 
 
 
 
Property, equipment and right-of-use assets, net
 
$
921

 
$
375

 
$
1,296

Liabilities
 
 
 
 
 
 
Other current liabilities
 
949

 
72

 
1,021

Other liabilities
 
1,877

 
303

 
2,180


The following tables summarize the impact of the revenue standard on the Company’s consolidated statement of operations and consolidated balance sheet:
 
 
Year Ended December 31, 2018
 
 
Balances excluding revenue standard
 
Impact of revenue standard
 
As reported
 
 
(in millions)
Net Revenue
 
$
14,471

 
$
479

 
$
14,950

Operating Expenses
 
 
 
 
 
 
Advertising and marketing
 
743

 
164

 
907

Income before income taxes
 
6,889

 
315

 
7,204

Income tax expense
 
1,278

 
67

 
1,345

Net Income
 
5,611

 
248

 
5,859

 
 
December 31, 2018
 
 
Balances excluding revenue standard
 
Impact of revenue standard
 
As reported
 
 
(in millions)
Assets
 
 
 
 
 
 
Accounts receivable
 
$
2,214

 
$
62

 
$
2,276

Prepaid expenses and other current assets
 
1,176

 
256

 
1,432

Deferred income taxes
 
666

 
(96
)
 
570

Other assets
 
2,388

 
915

 
3,303

Liabilities
 
 
 
 
 
 
Accounts payable
 
959

 
(422
)
 
537

Accrued expenses
 
4,375

 
372

 
4,747

Other current liabilities
 
1,085

 
(136
)
 
949

Other liabilities
 
1,145

 
732

 
1,877

Equity
 
 
 
 
 
 
Retained earnings
 
26,692

 
591

 
27,283

For a more detailed discussion on revenue recognition, refer to Note 3 (Revenue).
Intra-entity asset transfers - In October 2016, the FASB issued accounting guidance to simplify the accounting for income tax consequences of intra-entity transfers of assets other than inventory. Under this guidance, companies are required to recognize the income tax consequences of an intra-entity asset transfer when the transfer occurs. This guidance must be applied on a modified retrospective basis through a cumulative-effect adjustment to retained earnings as of the period of adoption. The guidance is effective for periods beginning after December 15, 2017. The Company adopted this guidance effective January 1, 2018. See the section in this note entitled Cumulative Effect of the Adopted Accounting Pronouncements for a summary of the cumulative impact of adopting this standard as of January 1, 2018.
Cumulative effect of the 2018 adopted accounting pronouncements
The following table summarizes the cumulative impact of the changes made to the January 1, 2018 consolidated balance sheet for the adoption of the new accounting standards pertaining to revenue recognition and intra-entity asset transfers. The prior periods have not been restated and have been reported under the accounting standards in effect for those periods.
 
 
Balance at December 31, 2017
 
Impact of revenue standard
 
Impact of intra-entity asset transfers standard
 
Balance at
January 1, 2018
 
 
(in millions)
Assets
 
 
 
 
 
 
 
 
Accounts receivable
 
$
1,969

 
$
44

 
$

 
$
2,013

Prepaid expenses and other current assets
 
1,040

 
181

 
(17
)
 
1,204

Deferred income taxes
 
250

 
(69
)
 
186

 
367

Other assets
 
2,298

 
690

 
(352
)
 
2,636

Liabilities
 
 
 
 
 
 
 
 
Accounts payable
 
933

 
(495
)
 

 
438

Accrued expenses
 
3,931

 
391

 

 
4,322

Other current liabilities
 
792

 
(44
)
 

 
748

Other liabilities
 
1,438

 
628

 

 
2,066

Equity
 
 
 
 
 
 
 
 
Retained earnings
 
22,364

 
366

 
(183
)
 
22,547

v3.19.3.a.u2
Acquisitions Business Combination (Tables)
12 Months Ended
Dec. 31, 2019
Business Combinations [Abstract]  
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed [Table Text Block] The preliminary estimated and final fair values of the purchase price allocations in aggregate, as of the acquisition dates, are noted below for 2019 and 2017, respectively. There were no acquisitions in 2018.
 
 
2019
 
2017
 
 
(in millions)
Assets:
 
 
 
 
Cash and cash equivalents
 
$
54

 
$
111

Other current assets
 
143

 
110

Other intangible assets
 
395

 
488

Goodwill
 
1,076

 
1,135

Other assets
 
48

 
91

Total assets
 
1,716

 
1,935

 
 
 
 
 
Liabilities:
 
 
 
 
Other current liabilities
 
121

 
234

Deferred income taxes
 
52

 
64

Other liabilities
 
32

 
66

Total liabilities
 
205

 
364

 
 
 
 
 
Net assets acquired
 
$
1,511

 
$
1,571


Schedule of Finite-Lived Intangible Assets Acquired as Part of Business Combination [Table Text Block]
The following table summarizes the identified intangible assets acquired for 2019 and 2017:
 
 
2019
 
2017
 
2019
 
2017
 
 
Acquisition Date Fair Value
 
Weighted-Average Useful Life
 
 
(in millions)
 
(in years)
Developed technologies
 
$
199

 
$
319

 
7.7
 
7.5
Customer relationships
 
178

 
166

 
12.6
 
9.9
Other
 
18

 
3

 
5.0
 
1.4
Other intangible assets
 
$
395

 
$
488

 
9.7
 
8.3

v3.19.3.a.u2
Revenue (Tables)
12 Months Ended
Dec. 31, 2019
Revenue from Contract with Customer [Abstract]  
Disaggregation of Revenue
The Company’s disaggregated net revenue by source and geographic region were as follows for the years ended December 31:
 
 
2019
 
2018
 
 
(in millions)
Revenue by source:
 
 
 
 
Domestic assessments
 
$
6,781

 
$
6,138

Cross-border volume fees
 
5,606

 
4,954

Transaction processing
 
8,469

 
7,391

Other revenues
 
4,124

 
3,348

Gross revenue
 
24,980

 
21,831

Rebates and incentives (contra-revenue)
 
(8,097
)
 
(6,881
)
Net revenue
 
$
16,883

 
$
14,950

 
 
 
 
 
Net revenue by geographic region:
 
 
 
 
North American Markets
 
$
5,843

 
$
5,312

International Markets
 
10,869

 
9,514

Other 1
 
171

 
124

Net revenue
 
$
16,883

 
$
14,950

1 
Includes revenues managed by corporate functions.
v3.19.3.a.u2
Earnings Per Share (Tables)
12 Months Ended
Dec. 31, 2019
Earnings Per Share [Abstract]  
Schedule of Basic and Diluted Earnings Per Share
The components of basic and diluted EPS for common shares for each of the years ended December 31 were as follows:
 
 
2019
 
2018
 
2017
 
 
(in millions, except per share data)
Numerator
 
 
 
 
 
 
Net income
 
$
8,118

 
$
5,859

 
$
3,915

Denominator
 
 
 
 
 
 
Basic weighted-average shares outstanding
 
1,017

 
1,041

 
1,067

Dilutive stock options and stock units
 
5

 
6

 
5

Diluted weighted-average shares outstanding 1
 
1,022

 
1,047

 
1,072

Earnings per Share
 
 
 
 
 
 
Basic
 
$
7.98

 
$
5.63

 
$
3.67

Diluted
 
$
7.94

 
$
5.60

 
$
3.65


Note: Table may not sum due to rounding.
1 
For the years presented, the calculation of diluted EPS excluded a minimal amount of anti-dilutive share-based payment awards.
v3.19.3.a.u2
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents (Tables)
12 Months Ended
Dec. 31, 2019
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents [Abstract]  
Schedule of Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents
The following table provides a reconciliation of cash, cash equivalents, restricted cash and restricted cash equivalents reported on the consolidated balance sheet that total to the amounts shown on the consolidated statement of cash flows for the years ended December 31:
 
 
2019
 
2018
 
2017
 
2016
 
 
(in millions)
Cash and cash equivalents
 
$
6,988

 
$
6,682

 
$
5,933

 
$
6,721

Restricted cash and restricted cash equivalents
 
 
 
 
 
 
 
 
Restricted cash for litigation settlement
 
584

 
553

 
546

 
543

Restricted security deposits held for customers
 
1,370

 
1,080

 
1,085

 
991

Prepaid expenses and other current assets
 
27

 
22

 
28

 
3

Other assets
 

 

 

 
15

Cash, cash equivalents, restricted cash and restricted cash equivalents
 
$
8,969

 
$
8,337

 
$
7,592

 
$
8,273


v3.19.3.a.u2
Supplemental Cash Flows (Tables)
12 Months Ended
Dec. 31, 2019
Supplemental Cash Flow Information [Abstract]  
Schedule of Supplemental Cash Flow Disclosures
The following table includes supplemental cash flow disclosures for each of the years ended December 31:
 
 
2019
 
2018
 
2017
 
 
(in millions)
Cash paid for income taxes, net of refunds
 
$
1,644

 
$
1,790

 
$
1,893

Cash paid for interest
 
199

 
153

 
135

Cash paid for legal settlements
 
668

 
260

 
47

Non-cash investing and financing activities
 
 
 
 
 
 
Dividends declared but not yet paid
 
403

 
340

 
263

Accrued property, equipment and right-of-use assets
 
468

 
10

 
30

Fair value of assets acquired, net of cash acquired
 
1,662

 

 
1,825

Fair value of liabilities assumed related to acquisitions
 
205

 

 
365


v3.19.3.a.u2
Investments (Tables)
12 Months Ended
Dec. 31, 2019
Investments, Debt and Equity Securities [Abstract]  
Investments On the Consolidated Balance Sheet
Investments on the consolidated balance sheet consisted of the following at December 31:
 
 
2019
 
2018
 
 
(in millions)
Available-for-sale securities
 
$
591

 
$
1,432

Held-to-maturity securities
 
97

 
264

Total investments
 
$
688

 
$
1,696


Unrealized Gain (Loss) on Investments
The major classes of the Company’s available-for-sale investment securities and their respective amortized cost basis and fair values were as follows:
 
 
December 31, 2019
 
December 31, 2018
 
 
Amortized Cost
 
Gross Unrealized Gain
 
Gross Unrealized Loss
 
Fair Value
 
Amortized Cost
 
Gross Unrealized Gain
 
Gross Unrealized Loss
 
Fair Value
 
 
(in millions)
Municipal securities
 
$
15

 
$

 
$

 
$
15

 
$
15

 
$

 
$

 
$
15

Government and agency securities
 
108

 

 

 
108

 
157

 

 

 
157

Corporate securities
 
381

 
1

 

 
382

 
1,044

 
1

 
(2
)
 
1,043

Asset-backed securities
 
85

 
1

 

 
86

 
217

 

 

 
217

Total
 
$
589

 
$
2

 
$

 
$
591

 
$
1,433

 
$
1

 
$
(2
)
 
$
1,432


Maturity Distribution Based on Contractual Terms of Investment Securities
The maturity distribution based on the contractual terms of the Company’s investment securities at December 31, 2019 was as follows:
 
 
Available-For-Sale
 
 
Amortized
Cost
 
Fair Value
 
 
(in millions)
Due within 1 year
 
$
180

 
$
181

Due after 1 year through 5 years
 
409

 
410

Total
 
$
589

 
$
591


Equity Method Investments
The following table is a summary of the activity related to the Company’s equity investments:
 
 
Balance at December 31, 2018
 
Purchases (Sales), net1
 
Changes in Fair Value2
 
Balance at December 31, 2019
 
 
(in millions)
Marketable securities
 
$

 
$
362

 
$
117

 
$
479

Nonmarketable securities
 
337

 
48

 
50

 
435

Total equity investments
 
$
337

 
$
410

 
$
167

 
$
914

1 
Includes impact of balance sheet foreign currency translation
2 
Recorded in gains (losses) on equity investments, net on the consolidated statement of operations
v3.19.3.a.u2
Fair Value Measurements (Tables)
12 Months Ended
Dec. 31, 2019
Financial Instruments, Financial Liabilities, Balance Sheet Groupings [Abstract]  
Distribution of Financial Instruments, Measured at Fair Value on a Recurring Basis
The distribution of the Company’s financial instruments measured at fair value on a recurring basis within the Valuation Hierarchy were as follows:
 
 
December 31, 2019
 
December 31, 2018
 
 
Quoted Prices
in Active
Markets
(Level 1)
 
Significant
Other
Observable
Inputs
(Level 2)
 
Significant
Unobservable
Inputs
(Level 3)
 
Total
 
Quoted Prices
in Active
Markets
(Level 1)
 
Significant
Other
Observable
Inputs
(Level 2)
 
Significant
Unobservable
Inputs
(Level 3)
 
Total
 
 
(in millions)
Assets
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Investment securities available for sale 1:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Municipal securities
 
$

 
$
15

 
$

 
$
15

 
$

 
$
15

 
$

 
$
15

Government and agency securities
 
66

 
42

 

 
108

 
65

 
92

 

 
157

Corporate securities
 

 
382

 

 
382

 

 
1,043

 

 
1,043

Asset-backed securities
 

 
86

 

 
86

 

 
217

 

 
217

Derivative instruments 2:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Foreign exchange contracts
 

 
12

 

 
12

 

 
35

 

 
35

Interest rate contracts
 

 
14

 

 
14

 

 

 

 

Marketable securities 3:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equity securities
 
479

 

 

 
479

 

 

 

 

Deferred compensation plan 4:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Deferred compensation assets
 
67

 

 

 
67

 
54

 

 

 
54

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Liabilities
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Derivative instruments 2:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Foreign exchange derivative liabilities
 
$

 
$
(32
)
 
$

 
$
(32
)
 
$

 
$
(6
)
 
$

 
$
(6
)
Deferred compensation plan 5:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Deferred compensation liabilities
 
(67
)
 

 

 
(67
)
 
(54
)
 

 

 
(54
)

1 
The Company’s U.S. government securities are classified within Level 1 of the Valuation Hierarchy as the fair values are based on unadjusted quoted prices for identical assets in active markets. The fair value of the Company’s available-for-sale municipal securities, government and agency securities, corporate securities and asset-backed securities are based on observable inputs such as quoted prices, benchmark yields and issuer spreads for similar assets in active markets and are therefore included in Level 2 of the Valuation Hierarchy.
2 
The Company’s foreign exchange and interest rate derivative asset and liability contracts have been classified within Level 2 of the Valuation Hierarchy as the fair value is based on observable inputs such as broker quotes relating to foreign currency exchange rates for similar derivative instruments. See Note 23 (Derivative and Hedging Instruments) for further details.
3 
The Company’s Marketable securities are publicly held and classified within Level 1 of the Valuation Hierarchy as the fair values are based on unadjusted quoted prices in their respective active markets.
4 
The Company has a nonqualified deferred compensation plan where assets are invested primarily in mutual funds held in a rabbi trust, which is restricted for payments to participants of the plan. The Company has elected to use the fair value option for these mutual funds, which are measured using quoted prices of identical instruments in active markets and are included in prepaid expenses and other current assets on the consolidated balance sheet.
5 
The deferred compensation liabilities are measured at fair value based on the quoted prices of identical instruments to the investment vehicles selected by the participants. These are included in other liabilities on the consolidated balance sheet
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Table Text Block] .
v3.19.3.a.u2
Prepaid Expenses and Other Assets (Tables)
12 Months Ended
Dec. 31, 2019
Prepaid Expense and Other Assets [Abstract]  
Schedule of Prepaid Expenses and Other Current Assets
Prepaid expenses and other current assets consisted of the following at December 31:
 
 
2019
 
2018
 
 
(in millions)
Customer and merchant incentives
 
$
872

 
$
778

Prepaid income taxes
 
105

 
51

Other
 
786

 
603

Total prepaid expenses and other current assets
 
$
1,763

 
$
1,432


Schedule of Other Assets, Noncurrent
Other assets consisted of the following at December 31:
 
 
2019
 
2018
 
 
(in millions)
Customer and merchant incentives
 
$
2,838

 
$
2,458

Equity investments
 
914

 
337

Income taxes receivable
 
460

 
298

Other
 
313

 
210

Total other assets
 
$
4,525

 
$
3,303


v3.19.3.a.u2
Property, Equipment and Right-of-Use Assets (Tables)
12 Months Ended
Dec. 31, 2019
Property, Plant and Equipment [Abstract]  
Property, Equipment and Right-of-Use Assets
The useful lives of the Company’s assets are as follows:
Asset Category
 
Estimated Useful Life
Buildings
 
30 years
Building equipment
 
10 - 15 years
Furniture and fixtures and equipment
 
3 - 5 years
Leasehold improvements
 
Shorter of life of improvement or lease term
Right-of-use assets
 
Shorter of life of the asset or lease term

Property, equipment and right-of-use assets consisted of the following at December 31:
 
 
2019
 
2018
 
 
(in millions)
Building, building equipment and land
 
$
505

 
$
481

Equipment
 
1,218

 
987

Furniture and fixtures
 
92

 
85

Leasehold improvements
 
303

 
215

Operating lease right-of-use assets
 
810

 

Property, equipment and right-of-use assets
 
2,928

 
1,768

Less accumulated depreciation and amortization
 
(1,100
)
 
(847
)
Property, equipment and right-of-use assets, net
 
$
1,828

 
$
921


Assets and Liabilities, Lessee [Table Text Block]
Operating lease ROU assets and operating lease liabilities are recorded on the consolidated balance sheet as follows:
 
 
December 31,
2019
 
 
(in millions)
Balance sheet location
 
 
Property, equipment and right-of-use assets, net
 
$
711

Other current liabilities
 
106

Other liabilities
 
656


Lessee, Operating Lease, Liability, Maturity [Table Text Block]
The following table summarizes the maturity of the Company’s operating lease liabilities at December 31, 2019 based on lease term:
 
 
Operating Leases
 
 
(in millions)
2020
 
$
112

2021
 
113

2022
 
103

2023
 
90

2024
 
79

Thereafter
 
376

Total operating lease payments
 
873

Less: Interest
 
(111
)
Present value of operating lease liabilities
 
$
762


Schedule of Future Minimum Rental Payments for Operating Leases [Table Text Block]
At December 31, 2018, the Company had the following future minimum payments due under non‐cancelable leases:
 
 
Operating Leases
 
 
(in millions)
2019
 
$
72

2020
 
75

2021
 
76

2022
 
68

2023
 
58

Thereafter
 
327

Total
 
$
676


v3.19.3.a.u2
Goodwill (Tables)
12 Months Ended
Dec. 31, 2019
Goodwill and Intangible Assets Disclosure [Abstract]  
Change in Carrying Amount of Goodwill
The changes in the carrying amount of goodwill for the years ended December 31 were as follows:
 
 
2019
 
2018
 
 
(in millions)
Beginning balance
 
$
2,904

 
$
3,035

Additions
 
1,076

 
2

Foreign currency translation
 
41

 
(133
)
Ending balance
 
$
4,021

 
$
2,904


v3.19.3.a.u2
Other Intangible Assets (Tables)
12 Months Ended
Dec. 31, 2019
Intangible Assets, Net (Excluding Goodwill) [Abstract]  
Schedule of Intangible Assets
The following table sets forth net intangible assets, other than goodwill, at December 31:
 
 
2019
 
2018
 
 
Gross Carrying Amount
 
Accumulated Amortization
 
Net Carrying Amount
 
Gross Carrying Amount
 
Accumulated Amortization
 
Net Carrying Amount
 
 
(in millions)
Finite-lived intangible assets
 
 
 
 
 
 
 
 
 
 
 
 
Capitalized software
 
$
1,884

 
$
(988
)
 
$
896

 
$
1,514

 
$
(898
)
 
$
616

Customer relationships
 
621

 
(264
)
 
357

 
439

 
(232
)
 
207

Other
 
44

 
(44
)
 

 
46

 
(45
)
 
1

Total
 
2,549

 
(1,296
)
 
1,253

 
1,999

 
(1,175
)
 
824

Indefinite-lived intangible assets
 
 
 
 
 
 
 
 
 
 
 
 
Customer relationships
 
164

 

 
164

 
167

 

 
167

Total
 
$
2,713

 
$
(1,296
)
 
$
1,417

 
$
2,166

 
$
(1,175
)
 
$
991


Schedule of Estimated Future Amortization Expense The following table sets forth the estimated future amortization expense on finite-lived intangible assets on the consolidated balance sheet at December 31, 2019 for the years ending December 31:
 
 
(in millions)
2020
 
$
300

2021
 
243

2022
 
164

2023
 
115

2024 and thereafter
 
431

 
 
$
1,253


v3.19.3.a.u2
Accrued Expenses and Accrued Litigation (Tables)
12 Months Ended
Dec. 31, 2019
Accrued Liabilities [Abstract]  
Accrued Expenses
Accrued expenses consisted of the following at December 31:
 
 
2019
 
2018
 
 
(in millions)
Customer and merchant incentives
 
$
3,892

 
$
3,275

Personnel costs
 
713

 
744

Income and other taxes
 
332

 
158

Other
 
552

 
570

Total accrued expenses
 
$
5,489

 
$
4,747


v3.19.3.a.u2
Pension, Postretirement and Savings Plans Pension, Postretirement and Savings Plans (Tables)
12 Months Ended
Dec. 31, 2019
Retirement Benefits [Abstract]  
Schedule of Changes in Projected Benefit Obligations [Table Text Block] The following table sets forth the Plans’ funded status, key assumptions and amounts recognized in the Company’s consolidated balance sheet at December 31:
 
 
Pension Plans
 
Postretirement Plan
 
 
2019
 
2018
 
2019
 
2018
 
 
($ in millions)
Change in benefit obligation
 
 
 
 
 
 
 
 
Benefit obligation at beginning of year
 
$
438

 
$
468

 
$
57

 
$
61

Service cost
 
11

 
9

 
1

 
1

Interest cost
 
13

 
12

 
2

 
2

Actuarial (gain) loss
 
73

 
(7
)
 
9

 
(2
)
Benefits paid
 
(15
)
 
(22
)
 
(5
)
 
(5
)
Transfers in
 
2

 
1

 

 

Foreign currency translation
 
9

 
(23
)
 

 

Benefit obligation at end of year
 
531

 
438

 
64

 
57

 
 
 
 
 
 
 
 
 
Change in plan assets
 
 
 
 
 
 
 
 
Fair value of plan assets at beginning of year
 
410

 
427

 

 

Actual (loss) gain on plan assets
 
79

 
(8
)
 

 

Employer contributions
 
32

 
33

 
5

 
5

Benefits paid
 
(15
)
 
(23
)
 
(5
)
 
(5
)
Transfers in
 
2

 
2

 

 

Foreign currency translation
 
10

 
(21
)
 

 

Fair value of plan assets at end of year
 
518

 
410

 

 

Funded status at end of year
 
$
(13
)
 
$
(28
)
 
$
(64
)
 
$
(57
)
 
 
 
 
 
 
 
 
 
Amounts recognized on the consolidated balance sheet consist of:
 
 
 
 
 
 
 
 
Other liabilities, short-term
 

 

 
(3
)
 
(3
)
Other liabilities, long-term
 
(13
)
 
(28
)
 
(61
)
 
(54
)
 
 
$
(13
)
 
$
(28
)
 
$
(64
)
 
$
(57
)
 
 
 
 
 
 
 
 
 
Accumulated other comprehensive income consists of:
 
 
 
 
 
 
 
 
Net actuarial (gain) loss
 
$
7

 
$
(5
)
 
$
2

 
$
(7
)
Prior service credit
 
1

 
1

 
(5
)
 
(6
)
Balance at end of year
 
$
8

 
$
(4
)
 
$
(3
)
 
$
(13
)
 
 
 
 
 
 
 
 
 
Weighted-average assumptions used to determine end of year benefit obligations
 
 
 
 
 
 
 
 
Discount rate
 
 
 
 
 
 
 
 
Non-U.S. Plans
 
0.70
%
 
1.80
%
 
*

 
*

Vocalink Plan
 
2.00
%
 
3.10
%
 
*

 
*

Postretirement Plan
 
*

 
*

 
3.25
%
 
4.25
%
 
 
 
 
 
 
 
 
 
Rate of compensation increase
 
 
 
 
 
 
 
 
Non-U.S. Plans
 
1.50
%
 
2.60
%
 
*

 
*

Vocalink Plan
 
2.50
%
 
4.00
%
 
*

 
*

Postretirement Plan
 
*

 
*

 
3.00
%
 
3.00
%
* Not applicable
Defined Benefit Plan, Plan with Projected Benefit Obligation in Excess of Plan Assets [Table Text Block]
All of the Pension Plans had benefit obligations in excess of plan assets at December 31, 2019 and 2018. Information on the Pension Plans were as follows:
 
 
2019
 
2018
 
 
(in millions)
Projected benefit obligation
 
$
531

 
$
438

Accumulated benefit obligation
 
524

 
430

Fair value of plan assets
 
518

 
410


Defined Benefit Plan, Net Periodic Benefit Cost (Credit)
Components of net periodic benefit cost recorded in earnings were as follows for the Plans for each of the years ended December 31:
 
 
Pension Plans
 
Postretirement Plan
 
 
2019
 
2018
 
2017
 
2019
 
2018
 
2017
 
 
(in millions)
Service cost
 
$
11

 
$
9

 
$
9

 
$
1

 
$
1

 
$
1

Interest cost
 
13

 
12

 
8

 
2

 
2

 
2

Expected return on plan assets
 
(18
)
 
(20
)
 
(13
)
 

 

 

Amortization of actuarial loss
 
1

 

 

 

 

 

Amortization of prior service credit
 

 

 

 
(1
)
 
(2
)
 
(2
)
Net periodic benefit cost
 
$
7

 
$
1

 
$
4

 
$
2

 
$
1

 
$
1


Schedule of Defined Benefit Plan Amounts Recognized in Other Comprehensive Income (Loss) [Table Text Block]
Other changes in plan assets and benefit obligations recognized in other comprehensive income for the years ended December 31 were as follows:
 
 
Pension Plans
 
Postretirement Plan
 
 
2019
 
2018
 
2017
 
2019
 
2018
 
2017
 
 
(in millions)
Current year actuarial loss (gain)
 
$
12

 
$
17

 
$
(22
)
 
$
9

 
$
(2
)
 
$
5

Current year prior service credit
 

 
1

 

 

 

 

Amortization of prior service credit
 

 

 

 
1

 
2

 
2

Total other comprehensive loss (income)
 
$
12

 
$
18

 
$
(22
)
 
$
10

 
$

 
$
7

Total net periodic benefit cost and other comprehensive loss (income)
 
$
19

 
$
19

 
$
(18
)
 
$
12

 
$
1

 
$
8


Defined Benefit Plan, Assumptions [Table Text Block]
Weighted-average assumptions used to determine net periodic benefit cost were as follows for the years ended December 31:
 
 
Pension Plans
 
Postretirement Plan
 
 
2019
 
2018
 
2017
 
2019
 
2018
 
2017
Discount rate
 
 
 
 
 
 
 
 
 
 
 
 
Non-U.S. Plans
 
1.80
%
 
1.80
%
 
1.60
%
 
*

 
*

 
*

Vocalink Plan
 
2.00
%
 
2.80
%
 
2.50
%
 
*

 
*

 
*

Postretirement Plan
 
*

 
*

 
*

 
4.25
%
 
3.50
%
 
4.00
%
Expected return on plan assets
 
 
 
 
 
 
 
 
 
 
 
 
Non-U.S. Plans
 
2.10
%
 
3.00
%
 
3.25
%
 
*

 
*

 
*

Vocalink Plan
 
3.75
%
 
4.75
%
 
4.75
%
 
*

 
*

 
*

Rate of compensation increase
 
 
 
 
 
 
 
 
 
 
 
 
Non-U.S. Plans
 
1.50
%
 
2.60
%
 
2.59
%
 
*

 
*

 
*

Vocalink Plan
 
2.50
%
 
3.85
%
 
3.95
%
 
*

 
*

 
*

Postretirement Plan
 
*

 
*

 
*

 
3.00
%
 
3.00
%
 
3.00
%
* Not applicable
Schedule of Health Care Cost Trend Rates [Table Text Block]
The following additional assumptions were used at December 31 in accounting for the Postretirement Plan:
 
 
2019
 
2018
Health care cost trend rate assumed for next year
 
6.00
%
 
6.00
%
Ultimate trend rate
 
5.00
%
 
5.00
%
Year that the rate reaches the ultimate trend rate
 
2

 
2


Schedule of Allocation of Plan Assets [Table Text Block]
The following tables set forth by level, within the Valuation Hierarchy, the Pension Plans’ assets at fair value:
 
 
December 31, 2019
 
December 31, 2018
 
 
Quoted Prices in Active Markets (Level 1)
 
Significant Other Observable Inputs (Level 2)
 
Significant
Unobservable
Inputs
(Level 3)
 
Fair Value
 
Quoted Prices in Active Markets (Level 1)
 
Significant Other Observable Inputs (Level 2)
 
Significant
Unobservable
Inputs
(Level 3)
 
Fair Value
 
 
(in millions)
Cash and cash equivalents 1
 
$
16

 
$

 
$

 
$
16

 
$
22

 
$

 
$

 
$
22

Government and agency securities 2
 

 

 

 

 

 
88

 

 
88

Mutual funds 3
 
153

 
193

 

 
346

 
154

 
30

 

 
184

Insurance contracts 4
 

 
75

 

 
75

 

 
57

 

 
57

Asset-backed securities 5
 

 

 

 

 

 

 
34

 
34

Other 6
 

 

 

 

 

 
25

 

 
25

Total
 
$
169

 
$
268

 
$

 
$
437

 
$
176

 
$
200

 
$
34

 
$
410

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Investments at Net Asset Value (“NAV”) 7
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Mutual funds
 
 
 
 
 
 
 
36

 
 
 
 
 
 
 

Other
 
 
 
 
 
 
 
45

 
 
 
 
 
 
 

Total Plan Assets
 
 
 
 
 
 
 
$
518

 
 
 
 
 
 
 
$
410


1 
Cash and cash equivalents are valued at quoted market prices, which represent the net asset value of the shares held by the Plans.
2 
Governmental and agency securities are valued at unit values provided by investment managers, which are based on the fair value of the underlying investments utilizing public information, independent external valuation from third-party services or third-party advisors.
3 
Certain mutual funds are valued at quoted market prices, which represent the value of the shares held by the Plans, and are therefore included in Level 1. Certain other mutual funds are valued at unit values provided by investment managers, which are based on the fair value of the underlying investments utilizing public information, independent external valuation from third-party services or third-party advisors, and are therefore included in Level 2.
4 
Insurance contracts are valued at unit values provided by investment managers, which are based on the fair value of the underlying investments utilizing public information, independent external valuation from third-party services or third-party advisors.
5 
Asset-backed securities are classified as Level 3 due to a lack of observable inputs in measuring fair value. These assets were sold during 2019.
6 
Other represents hedge fund pooled vehicles which are based on the fair value of the underlying investments utilizing public information, independent external valuation from third-party services or third-party advisors, and are therefore included in Level 2.
7 
Mutual funds (comprised primarily of credit investments) and other investments (comprised primarily of real estate investments) are valued using the NAV provided by the administrator as a practical expedient, and therefore these investments are not included in the valuation hierarchy. These investments have quarterly redemption frequencies with redemption notice periods ranging from 60 to 90 days.
Schedule of Expected Benefit Payments [Table Text Block]
The following table summarizes expected benefit payments (as of December 31, 2019) through 2029 for the Pension Plans and the Postretirement Plan, including those payments expected to be paid from the Company’s general assets. Actual benefit payments may differ from expected benefit payments.
 
 
Pension Plans
 
Postretirement Plan
 
 
(in millions)
2020
 
$
17

 
$
4

2021
 
11

 
4

2022
 
12

 
4

2023
 
13

 
4

2024
 
15

 
4

2025 - 2029
 
70

 
20


v3.19.3.a.u2
Debt (Tables)
12 Months Ended
Dec. 31, 2019
Debt Instruments [Abstract]  
Schedule of Debt
Long-term debt consisted of the following at December 31:
Notes
 
Issuance
Date
 
Interest Payment Terms
 
Maturity
Date
 
Aggregate Principal Amount
 
Stated Interest Rate
 
Effective
Interest Rate
 
2019
 
2018
 
 
 
 
 
 
 
 
(in millions, except percentages)
2019 USD Notes
 
May 2019
 
Semi-annually
 
2029
 
$
1,000

 
2.950
%
 
3.030
%
 
$
1,000

 
$

 
 
 
 
 
 
2049
 
1,000

 
3.650
%
 
3.689
%
 
1,000

 

 
 
December 2019
 
Semi-annually
 
2025
 
750

 
2.000
%
 
2.147
%
 
750

 
$

 
 
 
 
 
 
 
 
$
2,750

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2018 USD Notes
 
February 2018
 
Semi-annually
 
2028
 
$
500

 
3.500
%
 
3.598
%
 
500

 
500

 
 
 
 
 
 
2048
 
500

 
3.950
%
 
3.990
%
 
500

 
500

 
 
 
 
 
 
 
 
$
1,000

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2016 USD Notes
 
November 2016
 
Semi-annually
 
2021
 
$
650

 
2.000
%
 
2.236
%
 
650

 
650

 
 
 
 
 
 
2026
 
750

 
2.950
%
 
3.044
%
 
750

 
750

 
 
 
 
 
 
2046
 
600

 
3.800
%
 
3.893
%
 
600

 
600

 
 
 
 
 
 
 
 
$
2,000

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2015 Euro Notes
 
December 2015
 
Annually
 
2022
 
700

 
1.100
%
 
1.265
%
 
785

 
801

 
 
 
 
 
 
2027
 
800

 
2.100
%
 
2.189
%
 
896

 
916

 
 
 
 
 
 
2030
 
150

 
2.500
%
 
2.562
%
 
169

 
172

 
 
 
 
 
 
 
 
1,650

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2014 USD Notes
 
March 2014
 
Semi-annually
 
2019
 
$
500

 
2.000
%
 
2.178
%
 

 
500

 
 
 
 
 
 
2024
 
1,000

 
3.375
%
 
3.484
%
 
1,000

 
1,000

 
 
 
 
 
 
 
 
$
1,500

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
8,600

 
6,389

Less: Unamortized discount and debt issuance costs
 
(73
)
 
(55
)
Total debt outstanding
 
$
8,527

 
$
6,334

Less: Current portion1 
 

 
(500
)
Long-term debt
 
$
8,527

 
$
5,834


1 
Relates to the 2014 USD Notes, which was classified in current liabilities as of December 31, 2018, matured and was paid during 2019
Schedule of Maturities of Long-term Debt [Table Text Block]
Scheduled annual maturities of the principal portion of long-term debt outstanding at December 31, 2019 are summarized below.
 
 
(in millions)
2020
 
$

2021
 
650

2022
 
785

2023
 

2024
 
1,000

Thereafter
 
6,165

Total
 
$
8,600


v3.19.3.a.u2
Stockholders' Equity (Tables)
12 Months Ended
Dec. 31, 2019
Stockholders' Equity Note [Abstract]  
Schedule of Classes of Capital Stock
Mastercard’s amended and restated certificate of incorporation authorizes the following classes of capital stock:
Class
 
Par Value Per Share
 
Authorized Shares
(in millions)
 
Dividend and Voting Rights
A
 
$0.0001
 
3,000

 
One vote per share
Dividend rights
B
 
$0.0001
 
1,200

 
Non-voting
Dividend rights
Preferred
 
$0.0001
 
300

 
No shares issued or outstanding at December 31, 2019 and 2018. Dividend and voting rights are to be determined by the Board of Directors of the Company upon issuance.

Schedule of Ownership and Governance Structure
Equity ownership and voting power of the Company’s shares were allocated as follows as of December 31:
 
 
2019
 
2018
 
 
Equity Ownership
 
General Voting Power
 
Equity Ownership
 
General Voting Power
Public Investors (Class A stockholders)
 
87.8
%
 
88.8
%
 
88.0
%
 
89.0
%
Principal or Affiliate Customers (Class B stockholders)
 
1.1
%
 
%
 
1.1
%
 
%
Mastercard Foundation (Class A stockholders)
 
11.1
%
 
11.2
%
 
10.9
%
 
11.0
%

Schedule of Share Repurchases and Authorizations
The following table summarizes the Company’s share repurchase authorizations of its Class A common stock through December 31, 2019, as well as historical purchases:
Board authorization dates
 
December 2019
 
December
2018
 
December
2017
 
December
2016
 
December
2015
 
 
Date program became effective
 
January 2020
 
January 2019
 
March 2018
 
April 2017
 
February 2016
 
Total
 
 
(in millions, except average price data)
Board authorization
 
$
8,000

 
$
6,500

 
$
4,000

 
$
4,000

 
$
4,000

 
$
26,500

Dollar-value of shares repurchased in 2017
 
$

 
$

 
$

 
$
2,766

 
$
996

 
$
3,762

Remaining authorization at December 31, 2017
 
$

 
$

 
$
4,000

 
$
1,234

 
$

 
$
5,234

Dollar-value of shares repurchased in 2018
 
$

 
$

 
$
3,699

 
$
1,234

 
$

 
$
4,933

Remaining authorization at December 31, 2018
 
$

 
$
6,500

 
$
301

 
$

 
$

 
$
6,801

Dollar-value of shares repurchased in 2019
 
$

 
$
6,196

 
$
301

 
$

 
$

 
$
6,497

Remaining authorization at December 31, 2019
 
$
8,000

 
$
304

 
$

 
$

 
$

 
$
8,304

 
 
 
 
 
 
 
 
 
 
 
 
 
Shares repurchased in 2017
 

 

 

 
21.0

 
9.1

 
30.1

Average price paid per share in 2017
 
$

 
$

 
$

 
$
131.97

 
$
109.16

 
$
125.05

Shares repurchased in 2018
 

 

 
19.0

 
7.2

 

 
26.2

Average price paid per share in 2018
 
$

 
$

 
$
194.77

 
$
171.11

 
$

 
$
188.26

Shares repurchased in 2019
 

 
24.8

 
1.6

 

 

 
26.4

Average price paid per share in 2019
 
$

 
$
249.58

 
$
188.38

 
$

 
$

 
$
245.89

Cumulative shares repurchased through December 31, 2019
 

 
24.8

 
20.6

 
28.2

 
40.4

 
114.0

Cumulative average price paid per share
 
$

 
$
249.58

 
$
194.27

 
$
141.99

 
$
99.10

 
$
159.68


Schedule of Changes in Common Stock Outstanding [Table Text Block]
The following table presents the changes in the Company’s outstanding Class A and Class B common stock for the years ended December 31:
 
 
Outstanding Shares
 
 
Class A
 
Class B
 
 
(in millions)
Balance at December 31, 2016
 
1,062.4

 
19.3

Purchases of treasury stock
 
(30.1
)
 

Share-based payments
 
2.2

 

Conversion of Class B to Class A common stock
 
5.2

 
(5.2
)
Balance at December 31, 2017
 
1,039.7

 
14.1

Purchases of treasury stock
 
(26.2
)
 

Share-based payments
 
2.8

 

Conversion of Class B to Class A common stock
 
2.3

 
(2.3
)
Balance at December 31, 2018
 
1,018.6

 
11.8

Purchases of treasury stock
 
(26.4
)
 

Share-based payments
 
3.2

 

Conversion of Class B to Class A common stock
 
0.6

 
(0.6
)
Balance at December 31, 2019
 
996.0

 
11.2


v3.19.3.a.u2
Accumulated Other Comprehensive Income (Loss) (Tables)
12 Months Ended
Dec. 31, 2019
Statement of Comprehensive Income [Abstract]  
Schedule of Accumulated Other Comprehensive Income (Loss)
The changes in the balances of each component of accumulated other comprehensive income (loss), net of tax, for the years ended December 31, 2019 and 2018 were as follows:
 
 
Foreign Currency Translation Adjustments 1
 
Translation Adjustments on Net Investment Hedge 2
 
Cash Flow Hedges 3
 
Defined Benefit Pension and Other Postretirement Plans 4
 
Investment Securities Available-for-Sale 5
 
Accumulated Other Comprehensive Income (Loss)
 
 
(in millions)
Balance at December 31, 2017
 
$
(382
)
 
$
(141
)
 
$

 
$
25

 
$
1

 
$
(497
)
Other comprehensive income (loss)
 
(279
)
 
75

 

 
(15
)
 
(2
)
 
(221
)
Balance at December 31, 2018
 
(661
)
 
(66
)
 

 
10

 
(1
)
 
(718
)
Other comprehensive income (loss)
 
23

 
28

 
11

 
(19
)
 
2

 
45

Balance at December 31, 2019
 
$
(638
)
 
$
(38
)
 
$
11

 
$
(9
)
 
$
1

 
$
(673
)

1 
During 2018, the increase in the accumulated other comprehensive loss related to foreign currency translation adjustments was driven primarily by the depreciation of the euro, British pound and Brazilian real. During 2019, the decrease in the accumulated other comprehensive loss related to foreign currency translation adjustments was driven primarily by the appreciation of the British pound partially offset by the depreciation of the euro.
2 
The Company uses foreign currency denominated debt to hedge a portion of its net investment in foreign operations against adverse movements in exchange rates. Changes in the value of the debt are recorded in accumulated other comprehensive income (loss). During 2018 and 2019, the decreases in the accumulated other comprehensive loss related to the net investment hedge were driven by the depreciation of the euro. See Note 23 (Derivative and Hedging Instruments) for additional information.
3 
In 2019, the Company entered into treasury rate locks which are accounted for as cash flow hedges. During 2019, in connection with these cash flow hedges, the Company recorded unrealized gains, net of tax, of $11 million in accumulated other comprehensive income (loss). See Note 23 (Derivative and Hedging Instruments) for additional information.
4 
During 2018, the decrease in the accumulated other comprehensive gain related to the Company’s Plans was driven primarily by an actuarial loss within the Vocalink Plan. During 2019, the decrease in the accumulated other comprehensive gain related to the Company’s Plans was primarily driven by actuarial losses within the Vocalink and non-U.S. Plans. During 2018 and 2019, amounts reclassified from accumulated other comprehensive income (loss) to earnings, were not material. See Note 14 (Pension, Postretirement and Savings Plans) for additional information.
5 
During 2018 and 2019, gains and losses on available-for-sale investment securities, reclassified from accumulated other comprehensive income (loss) to investment income, were not material. See Note 7 (Investments) for additional information.
v3.19.3.a.u2
Share-Based Payments (Tables)
12 Months Ended
Dec. 31, 2019
Share-based Payment Arrangement, Additional Disclosure [Abstract]  
Schedule of Weighted-Average Assumptions Used in the Valuation of Stock Option Awards The following table presents the weighted-average assumptions used in the valuation and the resulting weighted-average fair value per option granted for the years ended December 31:
 
 
2019
 
2018
 
2017
Risk-free rate of return
 
2.6
%
 
2.7
%
 
2.0
%
Expected term (in years)
 
6.00

 
6.00

 
5.00

Expected volatility
 
19.6
%
 
19.7
%
 
19.3
%
Expected dividend yield
 
0.6
%
 
0.6
%
 
0.8
%
Weighted-average fair value per Option granted
 
$
53.09

 
$
40.90

 
$
21.23


Summary of Stock Option Activity
The following table summarizes the Company’s option activity for the year ended December 31, 2019:
 
 
Options
 
Weighted-Average Exercise Price
 
Weighted-Average Remaining Contractual Term
 
Aggregate Intrinsic Value
 
 
(in millions)
 
 
 
(in years)
 
(in millions)
Outstanding at January 1, 2019
 
7.6

 
$
93

 
 
 
 
Granted
 
0.9

 
$
227

 
 
 
 
Exercised
 
(1.8
)
 
$
71

 
 
 
 
Forfeited/expired
 
(0.1
)
 
$
148

 
 
 
 
Outstanding at December 31, 2019
 
6.6

 
$
117

 
6.2
 
$
1,206

Exercisable at December 31, 2019
 
3.9

 
$
86

 
5.1
 
$
836

Options vested and expected to vest at December 31, 2019
 
6.6

 
$
116

 
6.2
 
$
1,200


Summary of Restricted Stock Unit Activity
The following table summarizes the Company’s RSU activity for the year ended December 31, 2019:
 
 
Units
 
Weighted-Average Grant-Date Fair Value
 
Aggregate Intrinsic Value
 
 
(in millions)
 
 
 
(in millions)
Outstanding at January 1, 2019
 
3.7

 
$
117

 
 
Granted
 
1.0

 
$
226

 
 
Converted
 
(1.6
)
 
$
93

 
 
Forfeited
 
(0.2
)
 
$
154

 
 
Outstanding at December 31, 2019
 
2.9

 
$
166

 
$
852

RSUs expected to vest at December 31, 2019
 
2.8

 
$
165

 
$
824


Summary of Performance Stock Unit Activity
The following table summarizes the Company’s PSU activity for the year ended December 31, 2019:
 
 
Units
 
Weighted-Average
Grant-Date Fair Value
 
Aggregate Intrinsic Value
 
 
(in millions)
 
 
 
(in millions)
Outstanding at January 1, 2019
 
0.6

 
$
120

 
 
Granted
 
0.1

 
$
231

 
 
Converted
 
(0.4
)
 
$
92

 
 
Other1
 
0.2

 
$
126

 
 
Outstanding at December 31, 2019
 
0.5

 
$
167

 
$
162

PSUs expected to vest at December 31, 2019
 
0.5

 
$
167

 
$
162


1 
Represents additional shares issued in March 2019 related to the 2016 PSU grant based on performance and market conditions achieved over the three-year measurement period. These shares vested upon issuance.
Schedule of Compensation Cost for Share-based Payment Arrangements, Allocation of Share-based Compensation Costs by Plan
The following table includes additional share-based payment information for each of the years ended December 31:
 
 
2019
 
2018
 
2017
 
 
(in millions, except weighted-average fair value)
Share-based compensation expense: Options, RSUs and PSUs
 
$
250

 
$
196

 
$
176

Income tax benefit recognized for equity awards
 
53

 
41

 
57

Income tax benefit realized related to Options exercised
 
69

 
53

 
36

 
 
 
 
 
 
 
Options:
 
 
 
 
 
 
Total intrinsic value of Options exercised
 
317

 
242

 
106

RSUs:
 
 
 
 
 
 
Weighted-average grant-date fair value of awards granted
 
226

 
171

 
112

Total intrinsic value of RSUs converted into shares of Class A common stock
 
394

 
194

 
131

PSUs:
 
 
 
 
 
 
Weighted-average grant-date fair value of awards granted
 
231

 
226

 
126

Total intrinsic value of PSUs converted into shares of Class A common stock
 
85

 
40

 
13

v3.19.3.a.u2
Commitments (Tables)
12 Months Ended
Dec. 31, 2019
Commitments and Contingencies Disclosure [Abstract]  
Future Minimum Payments Due Under Non-Cancelable Agreements
At December 31, 2019, the Company had the following future minimum payments due under noncancelable agreements, primarily related to sponsorships to promote the Mastercard brand and licensing arrangements. The Company has accrued $20 million of these future payments as of December 31, 2019.
 
 
(in millions)
2020
 
$
404

2021
 
224

2022
 
132

2023
 
42

2024
 
17

Thereafter
 

Total
 
$
819


v3.19.3.a.u2
Income Taxes (Tables)
12 Months Ended
Dec. 31, 2019
Income Tax Disclosure [Abstract]  
Schedule of Domestic and Foreign Income Before Income Taxes
The domestic and foreign components of income before income taxes for the years ended December 31 are as follows:
 
 
2019
 
2018
 
2017
 
 
(in millions)
United States
 
$
4,213

 
$
3,510

 
$
3,482

Foreign
 
5,518

 
3,694

 
3,040

Income before income taxes
 
$
9,731

 
$
7,204

 
$
6,522


Components of Income Tax Provision
The total income tax provision for the years ended December 31 is comprised of the following components:
 
 
2019
 
2018
 
2017
 
 
(in millions)
Current
 
 
 
 
 
 
Federal
 
$
642

 
$
649

 
$
1,704

State and local
 
81

 
69

 
65

Foreign
 
897

 
871

 
752

 
 
1,620

 
1,589

 
2,521

Deferred
 
 
 
 
 
 
Federal
 
40

 
(228
)
 
134

State and local
 

 
(11
)
 
1

Foreign
 
(47
)
 
(5
)
 
(49
)
 
 
(7
)
 
(244
)
 
86

Income tax expense
 
$
1,613

 
$
1,345

 
$
2,607


Schedule of Effective Income Tax Rate Reconciliation
A reconciliation of the effective income tax rate to the U.S. federal statutory income tax rate for the years ended December 31, is as follows:
 
 
2019
 
2018
 
2017
 
 
Amount
 
Percent
 
Amount
 
Percent
 
Amount
 
Percent
 
 
(in millions, except percentages)
Income before income taxes
 
$
9,731

 
 
 
$
7,204

 
 
 
$
6,522

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Federal statutory tax
 
2,044

 
21.0
 %
 
1,513

 
21.0
 %
 
2,283

 
35.0
 %
State tax effect, net of federal benefit
 
65

 
0.7
 %
 
46

 
0.6
 %
 
43

 
0.7
 %
Foreign tax effect
 
(208
)
 
(2.1
)%
 
(92
)
 
(1.3
)%
 
(380
)
 
(5.8
)%
European Commission fine
 

 
 %
 
194

 
2.7
 %
 

 
 %
Foreign tax credits1
 
(32
)
 
(0.3
)%
 
(110
)
 
(1.5
)%
 
(27
)
 
(0.4
)%
Transition Tax
 
(30
)
 
(0.3
)%
 
22

 
0.3
 %
 
629

 
9.6
 %
Remeasurement of deferred taxes
 

 
 %
 
(7
)
 
(0.1
)%
 
157

 
2.4
 %
Windfall benefit
 
(129
)
 
(1.3
)%
 
(72
)
 
(1.0
)%
 
(43
)
 
(0.7
)%
Other, net
 
(97
)

(1.1
)%

(149
)

(2.0
)%

(55
)

(0.8
)%
Income tax expense
 
$
1,613

 
16.6
 %
 
$
1,345

 
18.7
 %
 
$
2,607

 
40.0
 %

1 
Included within the impact of the foreign tax credits is $27 million for 2019 and $90 million for 2018 of tax benefits relating to the carryback of certain foreign tax credits.
Schedule of Deferred Tax Assets and Liabilities The components of deferred tax assets and liabilities at December 31 are as follows:
 
 
2019
 
2018
 
 
(in millions)
Deferred Tax Assets
 
 
 
 
Accrued liabilities
 
$
354

 
$
297

Compensation and benefits
 
214

 
210

State taxes and other credits
 
41

 
30

Net operating and capital losses
 
119

 
104

U.S. foreign tax credits1
 
145

 

Intangible assets
 
157

 
170

Other items
 
94

 
115

Less: Valuation allowance
 
(205
)
 
(94
)
Total Deferred Tax Assets
 
919

 
832

 
 
 
 
 
Deferred Tax Liabilities
 
 
 
 
Prepaid expenses and other accruals
 
83

 
89

Goodwill and intangible assets
 
187

 
125

Property, plant and equipment
 
128

 
97

Other items
 
63

 
18

Total Deferred Tax Liabilities
 
461

 
329

 
 
 
 
 
Net Deferred Tax Assets
 
$
458

 
$
503

1 
A deferred tax asset has been established in 2019 for $145 million related to foreign taxes paid in the current period, which are not expected to be utilized as credits in the current or future period, with a corresponding full valuation allowance.
Reconciliation of Beginning and Ending Tax Benefits
A reconciliation of the beginning and ending balance for the Company’s unrecognized tax benefits for the years ended December 31, is as follows:
 
 
2019
 
2018
 
2017
 
 
(in millions)
Beginning balance
 
$
164

 
$
183

 
$
169

Additions:
 
 
 
 
 
 
Current year tax positions
 
22

 
23

 
21

Prior year tax positions
 
37

 
5

 
9

Reductions:
 
 
 
 
 
 
Prior year tax positions
 
(11
)
 
(17
)
 
(1
)
Settlements with tax authorities
 
(2
)
 
(18
)
 
(4
)
Expired statute of limitations
 
(7
)
 
(12
)
 
(11
)
Ending balance
 
$
203

 
$
164

 
$
183


v3.19.3.a.u2
Settlement and Other Risk Management (Tables)
12 Months Ended
Dec. 31, 2019
Settlement and Other Risk Management [Abstract]  
Estimated Settlement Exposure and Portion of Uncollateralized Settlement Exposure for MasterCard-Branded Transactions
The Company’s estimated settlement exposure was as follows at December 31:
 
 
2019
 
2018
 
 
(in millions)
Gross settlement exposure
 
$
55,800

 
$
49,666

Collateral held for settlement exposure
 
(4,772
)
 
(4,711
)
Net uncollateralized settlement exposure
 
$
51,028

 
$
44,955


v3.19.3.a.u2
Derivative and Hedging Instruments (Tables)
12 Months Ended
Dec. 31, 2019
Foreign Currency Derivatives [Abstract]  
Derivative contract summary
The Company’s foreign exchange derivative contracts are summarized below:
 
 
December 31, 2019
 
December 31, 2018
 
 
Notional
 
Estimated Fair
Value
 
Notional
 
Estimated Fair
Value
 
 
(in millions)
Commitments to purchase foreign currency
 
$
185

 
$
3

 
$
34

 
$
(1
)
Commitments to sell foreign currency
 
1,506

 
(25
)
 
1,066

 
26

Options to sell foreign currency
 
21

 
2

 
25

 
4

 
 
 
 
 
 
 
 
 
Balance sheet location
 
 
 
 
 
 
 
 
Prepaid expenses and other current assets 1
 
 
 
$
12

 
 
 
$
35

Other current liabilities 1
 
 
 
(32
)
 
 
 
(6
)

1 
The derivative contracts are subject to enforceable master netting arrangements, which contain various netting and setoff provisions.
Gain (loss) recognized in income for the contracts to purchase and sell foreign currency summary
The amount of gain (loss) recognized on the consolidated statement of operations for the contracts to purchase and sell foreign currency is summarized below:
 
 
Year Ended December 31,
 
 
2019
 
2018
 
2017
 
 
(in millions)
Foreign exchange derivative contracts
 
 
 
 
 
 
General and administrative
 
$
(39
)
 
$
53

 
$
(75
)

v3.19.3.a.u2
Segment Reporting Schedule of Property Plant and Equipment, Net by Geographic Region (Tables)
12 Months Ended
Dec. 31, 2019
Segment Reporting [Abstract]  
Schedule of Property, Plant and Equipment, Net by Geographical Location
The following table reflects the geographical location of the Company’s property, equipment and right-of-use assets, net, as of December 31:
 
 
2019
 
2018
 
2017
 
 
(in millions)
United States
 
$
1,147

 
$
613

 
$
572

Other countries
 
681

 
308

 
257

Total
 
$
1,828

 
$
921

 
$
829


v3.19.3.a.u2
SUMMARY OF QUARTERLY DATA (Unaudited) (Tables)
12 Months Ended
Dec. 31, 2019
Quarterly Financial Data [Abstract]  
Schedule of Selected Quarterly Financial Data
 
 
 
2019 Quarter Ended
 
 
 
 
March 31
 
June 30
 
September 30
 
December 31  
 
2019 Total
 
 
(in millions, except per share data)
Net revenue
 
$
3,889

 
$
4,113

 
$
4,467

 
$
4,414

 
$
16,883

Operating income
 
2,213

 
2,397

 
2,655

 
2,399

 
9,664

Net income
 
1,862

 
2,048

 
2,108

 
2,100

 
8,118

Basic earnings per share
 
$
1.81

 
$
2.01

 
$
2.08

 
$
2.08

 
$
7.98

Basic weighted-average shares outstanding
 
1,026

 
1,020

 
1,013

 
1,008

 
1,017

Diluted earnings per share
 
$
1.80

 
$
2.00

 
$
2.07

 
$
2.07

 
$
7.94

Diluted weighted-average shares outstanding
 
1,032

 
1,025

 
1,019

 
1,013

 
1,022

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2018 Quarter Ended
 
 
 
 
March 31
 
June 30
 
September 30
 
December 31
 
2018 Total
 
 
(in millions, except per share data)
Net revenue
 
$
3,580

 
$
3,665

 
$
3,898

 
$
3,807

 
$
14,950

Operating income
 
1,825

 
1,936

 
2,287

 
1,234

 
7,282

Net income
 
1,492

 
1,569

 
1,899

 
899

 
5,859

Basic earnings per share
 
$
1.42

 
$
1.50

 
$
1.83

 
$
0.87

 
$
5.63

Basic weighted-average shares outstanding
 
1,051

 
1,043

 
1,037

 
1,032

 
1,041

Diluted earnings per share
 
$
1.41

 
$
1.50

 
$
1.82

 
$
0.87

 
$
5.60

Diluted weighted-average shares outstanding
 
1,057

 
1,049

 
1,043

 
1,038

 
1,047

Note: Tables may not sum due to rounding.
v3.19.3.a.u2
Summary of Significant Accounting Policies Narrative (Details) - USD ($)
$ / shares in Units, $ in Millions
12 Months Ended
Dec. 31, 2019
Dec. 31, 2018
Dec. 31, 2017
Venezuela charge $ 0 $ 0 $ (167)
Buildings      
Property, Equipment and Right-of-Use Assets [Abstract]      
Estimated Useful Life 30 years    
Minimum      
Organization, Consolidation and Presentation of Financial Statements [Abstract]      
Equity Method Investment, Ownership Percentage 20.00%    
Minimum | Building equipment      
Property, Equipment and Right-of-Use Assets [Abstract]      
Estimated Useful Life 10 years    
Minimum | Furniture and fixtures and equipment      
Property, Equipment and Right-of-Use Assets [Abstract]      
Estimated Useful Life 3 years    
Maximum      
Organization, Consolidation and Presentation of Financial Statements [Abstract]      
Noncontrolling Interest, Ownership Percentage by Parent 100.00%    
Equity Method Investment, Ownership Percentage 50.00%    
Historical Cost Method Ownership Percentage 20.00%    
Maximum | Building equipment      
Property, Equipment and Right-of-Use Assets [Abstract]      
Estimated Useful Life 15 years    
Maximum | Furniture and fixtures and equipment      
Property, Equipment and Right-of-Use Assets [Abstract]      
Estimated Useful Life 5 years    
Other | Minimum      
Finite-Lived Intangible Assets, Estimated Useful Life 1 year    
Other | Maximum      
Finite-Lived Intangible Assets, Estimated Useful Life 20 years    
Venezuela Subsidiaries      
Venezuela charge     167
Venezuela charge (after tax)     $ 108
Venezuela charge per diluted share (in dollars per share)     $ 0.10
Partnership | Minimum      
Organization, Consolidation and Presentation of Financial Statements [Abstract]      
Equity Method Investment, Ownership Percentage 5.00%    
Partnership | Maximum      
Organization, Consolidation and Presentation of Financial Statements [Abstract]      
Historical Cost Method Ownership Percentage 5.00%    
v3.19.3.a.u2
Summary of Significant Accounting Policies - Cumulative Effect of the Adopted Accounting Pronouncements (Details) - USD ($)
$ in Millions
Dec. 31, 2019
Jan. 01, 2019
Dec. 31, 2018
Jan. 01, 2018
Dec. 31, 2017
New Accounting Pronouncements or Change in Accounting Principle [Line Items]          
Property, equipment and right-of-use assets, net $ 1,828 $ 1,296 $ 921   $ 829
Other current liabilities 928 1,021 949 $ 748 792
Other liabilities 2,729 2,180 1,877 2,066 1,438
Accounts receivable       2,013 1,969
Accounts receivable 2,514   2,276    
Prepaid expenses and other current assets 1,763   1,432 1,204 1,040
Deferred income taxes 543   570 367 250
Other assets 4,525   3,303 2,636 2,298
Accounts payable 489   537 438 933
Accrued expenses 5,489   4,747 4,322 3,931
Retained earnings $ 33,984   27,283 22,547 $ 22,364
Accounting Standards Update 2016-02          
New Accounting Pronouncements or Change in Accounting Principle [Line Items]          
Property, equipment and right-of-use assets, net   375      
Other current liabilities   72      
Other liabilities   $ 303      
Accounting Standards Update 2014-09 | Impact of revenue standard          
New Accounting Pronouncements or Change in Accounting Principle [Line Items]          
Other current liabilities     (136) (44)  
Other liabilities     732 628  
Accounts receivable       44  
Accounts receivable     62    
Prepaid expenses and other current assets     256 181  
Deferred income taxes     (96) (69)  
Other assets     915 690  
Accounts payable     (422) (495)  
Accrued expenses     372 391  
Retained earnings     $ 591 366  
Accounting Standards Update 2016-16          
New Accounting Pronouncements or Change in Accounting Principle [Line Items]          
Other current liabilities       0  
Other liabilities       0  
Accounts receivable       0  
Prepaid expenses and other current assets       (17)  
Deferred income taxes       186  
Other assets       (352)  
Accounts payable       0  
Accrued expenses       0  
Retained earnings       $ (183)  
v3.19.3.a.u2
Summary of Significant Accounting Policies - Financial Statement Effects of Topic 606 (Details) - USD ($)
$ in Millions
3 Months Ended 12 Months Ended
Dec. 31, 2019
Sep. 30, 2019
Jun. 30, 2019
Mar. 31, 2019
Dec. 31, 2018
Sep. 30, 2018
Jun. 30, 2018
Mar. 31, 2018
Dec. 31, 2019
Dec. 31, 2018
Dec. 31, 2017
Jan. 01, 2019
Jan. 01, 2018
Revenue, Initial Application Period Cumulative Effect Transition [Line Items]                          
Net revenue $ 4,414 $ 4,467 $ 4,113 $ 3,889 $ 3,807 $ 3,898 $ 3,665 $ 3,580 $ 16,883 $ 14,950 $ 12,497    
Advertising and marketing                 934 907 771    
Income before income taxes                 9,731 7,204 6,522    
Income tax expense                 1,613 1,345 2,607    
Net Income 2,100 $ 2,108 $ 2,048 $ 1,862 899 $ 1,899 $ 1,569 $ 1,492 8,118 5,859 3,915    
Accounts receivable 2,514       2,276       2,514 2,276      
Prepaid expenses and other current assets 1,763       1,432       1,763 1,432 1,040   $ 1,204
Deferred income taxes 543       570       543 570 250   367
Other assets 4,525       3,303       4,525 3,303 2,298   2,636
Accounts payable 489       537       489 537 933   438
Accrued expenses 5,489       4,747       5,489 4,747 3,931   4,322
Other current liabilities 928       949       928 949 792 $ 1,021 748
Other liabilities 2,729       1,877       2,729 1,877 1,438 $ 2,180 2,066
Retained earnings $ 33,984       27,283       $ 33,984 27,283 $ 22,364   22,547
Balances excluding revenue standard                          
Revenue, Initial Application Period Cumulative Effect Transition [Line Items]                          
Net revenue                   14,471      
Advertising and marketing                   743      
Income before income taxes                   6,889      
Income tax expense                   1,278      
Net Income                   5,611      
Accounts receivable         2,214         2,214      
Prepaid expenses and other current assets         1,176         1,176      
Deferred income taxes         666         666      
Other assets         2,388         2,388      
Accounts payable         959         959      
Accrued expenses         4,375         4,375      
Other current liabilities         1,085         1,085      
Other liabilities         1,145         1,145      
Retained earnings         26,692         26,692      
Impact of revenue standard | Accounting Standards Update 2014-09                          
Revenue, Initial Application Period Cumulative Effect Transition [Line Items]                          
Net revenue                   479      
Advertising and marketing                   164      
Income before income taxes                   315      
Income tax expense                   67      
Net Income                   248      
Accounts receivable         62         62      
Prepaid expenses and other current assets         256         256     181
Deferred income taxes         (96)         (96)     (69)
Other assets         915         915     690
Accounts payable         (422)         (422)     (495)
Accrued expenses         372         372     391
Other current liabilities         (136)         (136)     (44)
Other liabilities         732         732     628
Retained earnings         $ 591         $ 591     $ 366
v3.19.3.a.u2
Acquisitions Narrative (Details)
€ in Millions, £ in Millions, $ in Millions
1 Months Ended 12 Months Ended
Dec. 31, 2019
USD ($)
Apr. 28, 2017
GBP (£)
Apr. 28, 2017
USD ($)
Aug. 31, 2019
EUR (€)
Dec. 31, 2019
USD ($)
Dec. 31, 2017
USD ($)
Dec. 31, 2018
USD ($)
Apr. 28, 2017
USD ($)
Business Acquisition [Line Items]                
Total consideration, representing both cash and contingent consideration         $ 1,500 $ 1,500    
Redeemable non-controlling interests $ 74       74   $ 71  
Goodwill 4,021       4,021 3,035 $ 2,904  
2017 Acquisitions                
Business Acquisition [Line Items]                
Cash and cash equivalents           111    
Other current assets           110    
Other intangible assets           488    
Goodwill 1,135       1,135      
Other assets           91    
Total assets           1,935    
Other current liabilities           234    
Deferred income taxes           64    
Other liabilities           66    
Total liabilities           364    
Total fair value of businesses acquired           $ 1,571    
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life           8 years 3 months 18 days    
VocaLink Holdings Limited                
Business Acquisition [Line Items]                
Redeemable non-controlling interests 76 £ 58     76      
Vocalink controlling interest   92.40%           92.40%
Cash consideration for Vocalink   £ 719 $ 929          
Vocalink contingent consideration   £ 169           $ 219
Vocalink's shareholders retained ownership   7.60%           7.60%
Vocalink's shareholders retained ownership minimum holding period   3 years 3 years          
2019 Acquisitions [Member]                
Business Acquisition [Line Items]                
Cash and cash equivalents 54       54      
Other current assets 143       143      
Other intangible assets 395       395      
Goodwill 1,076       1,076      
Other assets 48       48      
Total assets 1,716       1,716      
Other current liabilities 121       121      
Deferred income taxes 52       52      
Other liabilities 32       32      
Total liabilities 205       205      
Total fair value of businesses acquired 1,511       $ 1,511      
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life         9 years 8 months 12 days      
Nets Denmark A/S, Corporate Services [Member]                
Business Acquisition [Line Items]                
Business Combination, Commitments To Acquire Businesses, Consideration 3,190     € 2,850        
Developed technologies | 2017 Acquisitions                
Business Acquisition [Line Items]                
Other intangible assets           $ 319    
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life           7 years 6 months    
Developed technologies | 2019 Acquisitions [Member]                
Business Acquisition [Line Items]                
Other intangible assets 199       $ 199      
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life         7 years 8 months 12 days      
Customer relationships | 2017 Acquisitions                
Business Acquisition [Line Items]                
Other intangible assets           $ 166    
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life           9 years 10 months 24 days    
Customer relationships | 2019 Acquisitions [Member]                
Business Acquisition [Line Items]                
Other intangible assets 178       $ 178      
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life         12 years 7 months 6 days      
Other | 2017 Acquisitions                
Business Acquisition [Line Items]                
Other intangible assets           $ 3    
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life           1 year 4 months 24 days    
Other | 2019 Acquisitions [Member]                
Business Acquisition [Line Items]                
Other intangible assets $ 18       $ 18      
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life         5 years      
v3.19.3.a.u2
Revenue (Details) - USD ($)
$ in Millions
3 Months Ended 12 Months Ended
Dec. 31, 2019
Sep. 30, 2019
Jun. 30, 2019
Mar. 31, 2019
Dec. 31, 2018
Sep. 30, 2018
Jun. 30, 2018
Mar. 31, 2018
Dec. 31, 2019
Dec. 31, 2018
Dec. 31, 2017
Disaggregation of Revenue [Line Items]                      
Gross revenue                 $ 24,980 $ 21,831  
Rebates and incentives (contra-revenue)                 (8,097) (6,881)  
Net revenue $ 4,414 $ 4,467 $ 4,113 $ 3,889 $ 3,807 $ 3,898 $ 3,665 $ 3,580 16,883 14,950 $ 12,497
North American Markets                      
Disaggregation of Revenue [Line Items]                      
Net revenue                 5,843 5,312  
International Markets                      
Disaggregation of Revenue [Line Items]                      
Net revenue                 10,869 9,514  
Other                      
Disaggregation of Revenue [Line Items]                      
Net revenue                 171 124  
Domestic assessments                      
Disaggregation of Revenue [Line Items]                      
Gross revenue                 6,781 6,138  
Cross-border volume fees                      
Disaggregation of Revenue [Line Items]                      
Gross revenue                 5,606 4,954  
Transaction processing                      
Disaggregation of Revenue [Line Items]                      
Gross revenue                 8,469 7,391  
Other revenues                      
Disaggregation of Revenue [Line Items]                      
Gross revenue                 $ 4,124 $ 3,348  
v3.19.3.a.u2
Revenue Narrative (Details) - USD ($)
$ in Millions
12 Months Ended
Dec. 31, 2019
Dec. 31, 2018
Disaggregation of Revenue [Line Items]    
Revenue recognized on performance obligations $ 904 $ 904
Revenue, Remaining Performance Obligation, Amount 1,300  
Accounts Receivable    
Disaggregation of Revenue [Line Items]    
Contract assets 2,300 2,100
Prepaid expenses and other current assets    
Disaggregation of Revenue [Line Items]    
Contract assets 48 40
Other Assets    
Disaggregation of Revenue [Line Items]    
Contract assets 152 92
Other Current Liabilities    
Disaggregation of Revenue [Line Items]    
Deferred revenue 238 218
Other liabilities    
Disaggregation of Revenue [Line Items]    
Deferred revenue $ 106 $ 101
Network Services    
Disaggregation of Revenue [Line Items]    
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period 10 years  
v3.19.3.a.u2
Earnings Per Share Schedule of Basic and Diluted Earnings Per Share (Details) - USD ($)
$ / shares in Units, shares in Millions, $ in Millions
3 Months Ended 12 Months Ended
Dec. 31, 2019
Sep. 30, 2019
Jun. 30, 2019
Mar. 31, 2019
Dec. 31, 2018
Sep. 30, 2018
Jun. 30, 2018
Mar. 31, 2018
Dec. 31, 2019
Dec. 31, 2018
Dec. 31, 2017
Numerator:                      
Net income $ 2,100 $ 2,108 $ 2,048 $ 1,862 $ 899 $ 1,899 $ 1,569 $ 1,492 $ 8,118 $ 5,859 $ 3,915
Denominator:                      
Basic weighted-average shares outstanding 1,008 1,013 1,020 1,026 1,032 1,037 1,043 1,051 1,017 1,041 1,067
Dilutive stock options and stock units                 5 6 5
Diluted weighted-average shares outstanding 1,013 1,019 1,025 1,032 1,038 1,043 1,049 1,057 1,022 1,047 1,072
Earnings per Share                      
Basic $ 2.08 $ 2.08 $ 2.01 $ 1.81 $ 0.87 $ 1.83 $ 1.50 $ 1.42 $ 7.98 $ 5.63 $ 3.67
Diluted $ 2.07 $ 2.07 $ 2.00 $ 1.80 $ 0.87 $ 1.82 $ 1.50 $ 1.41 $ 7.94 $ 5.60 $ 3.65
v3.19.3.a.u2
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents (Details) - USD ($)
$ in Millions
Dec. 31, 2019
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents [Abstract]        
Cash and cash equivalents $ 6,988 $ 6,682 $ 5,933 $ 6,721
Restricted Cash and Cash Equivalents Items [Line Items]        
Cash, cash equivalents, restricted cash and restricted cash equivalents 8,969 8,337 7,592 8,273
Restricted cash for litigation settlement        
Restricted Cash and Cash Equivalents Items [Line Items]        
Restricted cash and restricted cash equivalents 584 553 546 543
Restricted security deposits held for customers        
Restricted Cash and Cash Equivalents Items [Line Items]        
Restricted cash and restricted cash equivalents 1,370 1,080 1,085 991
Prepaid expenses and other current assets        
Restricted Cash and Cash Equivalents Items [Line Items]        
Restricted cash and restricted cash equivalents 27 22 28 3
Other assets        
Restricted Cash and Cash Equivalents Items [Line Items]        
Restricted cash and restricted cash equivalents $ 0 $ 0 $ 0 $ 15
v3.19.3.a.u2
Supplemental Cash Flows (Non-Cash Investing and Financing Information) (Details) - USD ($)
$ in Millions
12 Months Ended
Dec. 31, 2019
Dec. 31, 2018
Dec. 31, 2017
Supplemental Cash Flow Information [Abstract]      
Cash paid for income taxes, net of refunds $ 1,644 $ 1,790 $ 1,893
Cash paid for interest 199 153 135
Cash paid for legal settlements 668 260 47
Dividends declared but not yet paid 403 340 263
Accrued property, equipment and right-of-use assets 468 10 30
Fair value of assets acquired, net of cash acquired 1,662 0 1,825
Fair value of liabilities assumed related to acquisitions $ 205 $ 0 $ 365
v3.19.3.a.u2
Investments - Investments (Details) - USD ($)
$ in Millions
Dec. 31, 2019
Dec. 31, 2018
Investments, Debt and Equity Securities [Abstract]    
Available-for-sale securities $ 591 $ 1,432
Held-to-maturity securities 97 264
Investments $ 688 $ 1,696
v3.19.3.a.u2
Investments - Available-for-Sale Investment Securities, Unrealized Gains and Losses (Details) - USD ($)
$ in Millions
Dec. 31, 2019
Dec. 31, 2018
Investment Identifier [Line Items]    
Amortized Cost $ 589 $ 1,433
Gross Unrealized Gain 2 1
Gross Unrealized Loss 0 (2)
Fair Value 591 1,432
Municipal securities    
Investment Identifier [Line Items]    
Amortized Cost 15 15
Gross Unrealized Gain 0 0
Gross Unrealized Loss 0 0
Fair Value 15 15
Government and agency securities    
Investment Identifier [Line Items]    
Amortized Cost 108 157
Gross Unrealized Gain 0 0
Gross Unrealized Loss 0 0
Fair Value 108 157
Corporate securities    
Investment Identifier [Line Items]    
Amortized Cost 381 1,044
Gross Unrealized Gain 1 1
Gross Unrealized Loss 0 (2)
Fair Value 382 1,043
Asset-backed securities    
Investment Identifier [Line Items]    
Amortized Cost 85 217
Gross Unrealized Gain 1 0
Gross Unrealized Loss 0 0
Fair Value $ 86 $ 217
v3.19.3.a.u2
Investments - Maturity Distribution Based on Contractual Terms of Investment Securities (Details) - USD ($)
$ in Millions
Dec. 31, 2019
Dec. 31, 2018
Available-For-Sale Amortized Cost    
Due within 1 year $ 180  
Due after 1 year through 5 years 409  
Total 589  
Available-For-Sale Fair Value    
Due within 1 year 181  
Due after 1 year through 5 years 410  
Total $ 591 $ 1,432
v3.19.3.a.u2
Investments - Equity Investments (Details) - USD ($)
$ in Millions
12 Months Ended
Dec. 31, 2019
Dec. 31, 2018
Increase (Decrease) In Equity Investments [Roll Forward]    
Marketable securities, beginning balance $ 0  
Marketable securities, Purchases (Sales), Net 362  
Marketable securities, Changes in Fair Value 117  
Marketable securities, ending balance 479  
Nonmarketable securities, beginning balance 337  
Nonmarketable Securities, Purchases (Sales), Net 48  
Nonmarketable Securities, Gains (Losses) 50  
Nonmarketable securities, ending balance 435  
Total equity investments, beginning balance 337  
Total equity investments, Purchases (Sales), net 410  
Total equity investments, Changes in Fair Value 167  
Total equity investments, ending balance 914  
Alternative Investment 317 $ 232
Alternative Investment, Equity Method Investment $ 118 $ 105
v3.19.3.a.u2
Fair Value Measurements - Distribution of Financial Instruments, Measured at Fair Value on a Recurring Basis (Details) - USD ($)
$ in Millions
Dec. 31, 2019
Dec. 31, 2018
Fair Value, Option, Quantitative Disclosures [Line Items]    
Deferred compensation assets $ 67 $ 54
Foreign exchange derivative liabilities (32) (6)
Deferred compensation liabilities (67) (54)
Fair Value, Inputs, Level 1    
Fair Value, Option, Quantitative Disclosures [Line Items]    
Deferred compensation assets 67 54
Foreign exchange derivative liabilities 0 0
Deferred compensation liabilities (67) (54)
Fair Value, Inputs, Level 2    
Fair Value, Option, Quantitative Disclosures [Line Items]    
Deferred compensation assets 0 0
Foreign exchange derivative liabilities (32) (6)
Deferred compensation liabilities 0 0
Fair Value, Inputs, Level 3    
Fair Value, Option, Quantitative Disclosures [Line Items]    
Deferred compensation assets 0 0
Foreign exchange derivative liabilities 0 0
Deferred compensation liabilities 0 0
Municipal securities    
Fair Value, Option, Quantitative Disclosures [Line Items]    
Investment securities available for sale 15 15
Municipal securities | Fair Value, Inputs, Level 1    
Fair Value, Option, Quantitative Disclosures [Line Items]    
Investment securities available for sale 0 0
Municipal securities | Fair Value, Inputs, Level 2    
Fair Value, Option, Quantitative Disclosures [Line Items]    
Investment securities available for sale 15 15
Municipal securities | Fair Value, Inputs, Level 3    
Fair Value, Option, Quantitative Disclosures [Line Items]    
Investment securities available for sale 0 0
Government and agency securities    
Fair Value, Option, Quantitative Disclosures [Line Items]    
Investment securities available for sale 108 157
Government and agency securities | Fair Value, Inputs, Level 1    
Fair Value, Option, Quantitative Disclosures [Line Items]    
Investment securities available for sale 66 65
Government and agency securities | Fair Value, Inputs, Level 2    
Fair Value, Option, Quantitative Disclosures [Line Items]    
Investment securities available for sale 42 92
Government and agency securities | Fair Value, Inputs, Level 3    
Fair Value, Option, Quantitative Disclosures [Line Items]    
Investment securities available for sale 0 0
Corporate securities    
Fair Value, Option, Quantitative Disclosures [Line Items]    
Investment securities available for sale 382 1,043
Corporate securities | Fair Value, Inputs, Level 1    
Fair Value, Option, Quantitative Disclosures [Line Items]    
Investment securities available for sale 0 0
Corporate securities | Fair Value, Inputs, Level 2    
Fair Value, Option, Quantitative Disclosures [Line Items]    
Investment securities available for sale 382 1,043
Corporate securities | Fair Value, Inputs, Level 3    
Fair Value, Option, Quantitative Disclosures [Line Items]    
Investment securities available for sale 0 0
Asset-backed securities    
Fair Value, Option, Quantitative Disclosures [Line Items]    
Investment securities available for sale 86 217
Asset-backed securities | Fair Value, Inputs, Level 1    
Fair Value, Option, Quantitative Disclosures [Line Items]    
Investment securities available for sale 0 0
Asset-backed securities | Fair Value, Inputs, Level 2    
Fair Value, Option, Quantitative Disclosures [Line Items]    
Investment securities available for sale 86 217
Asset-backed securities | Fair Value, Inputs, Level 3    
Fair Value, Option, Quantitative Disclosures [Line Items]    
Investment securities available for sale 0 0
Equity securities    
Fair Value, Option, Quantitative Disclosures [Line Items]    
Investment securities available for sale 479 0
Equity securities | Fair Value, Inputs, Level 1    
Fair Value, Option, Quantitative Disclosures [Line Items]    
Investment securities available for sale 479 0
Equity securities | Fair Value, Inputs, Level 2    
Fair Value, Option, Quantitative Disclosures [Line Items]    
Investment securities available for sale 0 0
Equity securities | Fair Value, Inputs, Level 3    
Fair Value, Option, Quantitative Disclosures [Line Items]    
Investment securities available for sale 0 0
Foreign exchange contracts    
Fair Value, Option, Quantitative Disclosures [Line Items]    
Foreign exchange contracts 12 35
Foreign exchange contracts | Fair Value, Inputs, Level 1    
Fair Value, Option, Quantitative Disclosures [Line Items]    
Foreign exchange contracts 0 0
Foreign exchange contracts | Fair Value, Inputs, Level 2    
Fair Value, Option, Quantitative Disclosures [Line Items]    
Foreign exchange contracts 12 35
Foreign exchange contracts | Fair Value, Inputs, Level 3    
Fair Value, Option, Quantitative Disclosures [Line Items]    
Foreign exchange contracts 0 0
Interest rate contracts    
Fair Value, Option, Quantitative Disclosures [Line Items]    
Foreign exchange contracts 14 0
Interest rate contracts | Fair Value, Inputs, Level 1    
Fair Value, Option, Quantitative Disclosures [Line Items]    
Foreign exchange contracts 0 0
Interest rate contracts | Fair Value, Inputs, Level 2    
Fair Value, Option, Quantitative Disclosures [Line Items]    
Foreign exchange contracts 14 0
Interest rate contracts | Fair Value, Inputs, Level 3    
Fair Value, Option, Quantitative Disclosures [Line Items]    
Foreign exchange contracts $ 0 $ 0
v3.19.3.a.u2
Fair Value Measurements - Narrative Fair Value (Details) - USD ($)
$ in Millions
12 Months Ended
Dec. 31, 2019
Dec. 31, 2018
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]    
Debt, Long-term and Short-term, Combined Amount $ 8,527 $ 6,334
Long-term debt, carrying value 8,527 5,834
Fair Value    
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]    
Long-term debt, fair value 9,200 6,500
Contingent Consideration | Fair Value, Inputs, Level 3    
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]    
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Liability Value   $ 219
Contingent Consideration [Roll Forward]    
Contingent consideration attributable to acquisitions $ 219  
v3.19.3.a.u2
Prepaid Expenses and Other Assets Schedule of Prepaid Expenses (Details) - USD ($)
$ in Millions
Dec. 31, 2019
Dec. 31, 2018
Jan. 01, 2018
Dec. 31, 2017
Prepaid Expense and Other Assets [Abstract]        
Customer and merchant incentives $ 872 $ 778    
Prepaid income taxes 105 51    
Other 786 603    
Total prepaid expenses and other current assets $ 1,763 $ 1,432 $ 1,204 $ 1,040
v3.19.3.a.u2
Prepaid Expenses and Other Assets Schedule of Other Assets (Details) - USD ($)
$ in Millions
Dec. 31, 2019
Dec. 31, 2018
Jan. 01, 2018
Dec. 31, 2017
Prepaid Expense and Other Assets [Abstract]        
Customer and merchant incentives $ 2,838 $ 2,458    
Equity investments 914 337    
Income taxes receivable 460 298    
Other 313 210    
Total other assets $ 4,525 $ 3,303 $ 2,636 $ 2,298
v3.19.3.a.u2
Property, Plant and Equipment (Details) - USD ($)
$ in Millions
Dec. 31, 2019
Jan. 01, 2019
Dec. 31, 2018
Dec. 31, 2017
Property, Plant and Equipment [Line Items]        
Property, equipment and right-of-use assets $ 2,928   $ 1,768  
Less accumulated depreciation and amortization (1,100)   (847)  
Property, equipment and right-of-use assets, net 1,828 $ 1,296 921 $ 829
Building, building equipment and land        
Property, Plant and Equipment [Line Items]        
Property, equipment and right-of-use assets 505   481  
Equipment        
Property, Plant and Equipment [Line Items]        
Property, equipment and right-of-use assets 1,218   987  
Furniture and fixtures        
Property, Plant and Equipment [Line Items]        
Property, equipment and right-of-use assets 92   85  
Leasehold improvements        
Property, Plant and Equipment [Line Items]        
Property, equipment and right-of-use assets 303   215  
Operating lease right-of-use assets        
Property, Plant and Equipment [Line Items]        
Property, equipment and right-of-use assets $ 810   $ 0  
v3.19.3.a.u2
Property, Equipment and Right-of-Use Assets - Narrative (Details) - USD ($)
$ in Millions
12 Months Ended
Dec. 31, 2019
Dec. 31, 2018
Dec. 31, 2017
Property, Equipment and Right-of-Use Assets [Line Items]      
Depreciation expense including amortization for capital leases $ 336 $ 209 $ 185
Operating lease amortization expense $ 99    
Weighted-average remaining lease term of operating lease 9 years 6 months    
Weighted-average discount rate for operating leases 2.90%    
Leases not yet commenced $ 23    
Lease office space rental expense   94 77
Lease expense   $ 20 $ 22
Maximum      
Property, Equipment and Right-of-Use Assets [Line Items]      
Leases not yet commenced, term 10 years    
Minimum      
Property, Equipment and Right-of-Use Assets [Line Items]      
Leases not yet commenced, term 1 year    
v3.19.3.a.u2
Property, Equipment and Right-of-Use Assets - Operating Right-of-Use Assets and Operating Lease Liabilities (Details)
$ in Millions
Dec. 31, 2019
USD ($)
Property, Plant and Equipment [Abstract]  
Property, equipment and right-of-use assets, net $ 711
Other current liabilities 106
Other liabilities $ 656
v3.19.3.a.u2
Property, Equipment and Right-of-Use Assets - Maturities of Operating Lease Liabilities (Details) - USD ($)
$ in Millions
Dec. 31, 2019
Dec. 31, 2018
Operating Leases after Adoption of ASC Topic 842:    
2020 $ 112  
2021 113  
2022 103  
2023 90  
2024 79  
Thereafter 376  
Total operating lease payments 873  
Less: Interest (111)  
Present value of operating lease liabilities $ 762  
Operating Leases before Adoption of ASC Topic 842:    
2019   $ 72
2020   75
2021   76
2022   68
2023   58
Thereafter   327
Total   $ 676
v3.19.3.a.u2
Change in Carrying Amount of Goodwill (Details) - USD ($)
$ in Millions
12 Months Ended
Dec. 31, 2019
Dec. 31, 2018
Goodwill [Roll Forward]    
Beginning balance $ 2,904 $ 3,035
Additions 1,076 2
Foreign currency translation 41 (133)
Ending balance $ 4,021 $ 2,904
v3.19.3.a.u2
Other Intangible Assets (Schedule of Intangible Assets) (Details) - USD ($)
$ in Millions
Dec. 31, 2019
Dec. 31, 2018
Gross Carrying Amount $ 2,549 $ 1,999
Accumulated Amortization (1,296) (1,175)
Net Carrying Amount 1,253 824
Unamortized intangible assets:    
Intangible Assets, Gross (Excluding Goodwill) 2,713 2,166
Accumulated Amortization (1,296) (1,175)
Net Carrying Amount 1,417 991
Capitalized software    
Gross Carrying Amount 1,884 1,514
Accumulated Amortization (988) (898)
Net Carrying Amount 896 616
Customer relationships    
Gross Carrying Amount 621 439
Accumulated Amortization (264) (232)
Net Carrying Amount 357 207
Unamortized intangible assets:    
Customer relationships 164 167
Other    
Gross Carrying Amount 44 46
Accumulated Amortization (44) (45)
Net Carrying Amount $ 0 $ 1
v3.19.3.a.u2
Other Intangible Assets (Narrative) (Details) - USD ($)
$ in Millions
12 Months Ended
Dec. 31, 2019
Dec. 31, 2018
Dec. 31, 2017
Intangible Assets, Net (Excluding Goodwill) [Abstract]      
Amortization expense on intangible assets $ 285 $ 250 $ 252
v3.19.3.a.u2
Other Intangible Assets (Schedule of Estimated Future Amortization Expense) (Details) - USD ($)
$ in Millions
Dec. 31, 2019
Dec. 31, 2018
Intangible Assets, Net (Excluding Goodwill) [Abstract]    
2020 $ 300  
2021 243  
2022 164  
2023 115  
2024 and thereafter 431  
Net Carrying Amount $ 1,253 $ 824
v3.19.3.a.u2
Accrued Expenses and Accrued Litigation (Details) - USD ($)
$ in Millions
Dec. 31, 2019
Dec. 31, 2018
Jan. 01, 2018
Dec. 31, 2017
Accrued Liabilities [Abstract]        
Customer and merchant incentives $ 3,892 $ 3,275    
Personnel costs 713 744    
Income and other taxes 332 158    
Other 552 570    
Total accrued expenses $ 5,489 $ 4,747 $ 4,322 $ 3,931
v3.19.3.a.u2
Accrued Expenses and Accrued Litigation Accrued Expenses and Accrued Litigation (Narrative) (Details) - USD ($)
$ in Millions
Dec. 31, 2019
Dec. 31, 2018
Accrued Liabilities [Abstract]    
Accrued litigation $ 914 $ 1,591
v3.19.3.a.u2
Pension, Postretirement and Savings Plans Narrative (Details)
£ in Millions, $ in Millions
12 Months Ended
Dec. 31, 2019
USD ($)
Dec. 31, 2018
USD ($)
Dec. 31, 2017
USD ($)
Dec. 31, 2019
GBP (£)
Dec. 31, 2019
USD ($)
Document Period End Date Dec. 31, 2019        
Defined Benefit Plan, Plan Assets, Amount   $ 410     $ 437
Total expense related to defined contribution plans $ 127 98 $ 84    
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward]          
Projected benefit obligation increase (decrease) $ 93 $ (30)      
Health care cost trend rate assumed for next year   6.00%   6.00% 6.00%
Ultimate trend rate   5.00%   5.00% 5.00%
Year that the rate reaches the ultimate trend rate 2 years 2 years      
Defined Benefit Plan, Expected Future Benefit Payment, 2020         $ 17
Defined Benefit Plan, Expected Future Benefit Payment, 2021         11
Defined Benefit Plan, Expected Future Benefit Payment, 2022         12
Defined Benefit Plan, Expected Future Benefit Payment, 2023         13
Defined Benefit Plan, Expected Future Benefit Payment, 2024         15
Defined Benefit Plan, Expected Future Benefit Payment, 2025-2029         70
Cash and cash equivalents          
Defined Benefit Plan, Plan Assets, Amount   $ 22     16
Government and agency securities          
Defined Benefit Plan, Plan Assets, Amount   88     0
Mutual funds          
Defined Benefit Plan, Plan Assets, Amount   184     346
Asset-backed securities          
Defined Benefit Plan, Plan Assets, Amount   34     0
Insurance contracts          
Defined Benefit Plan, Plan Assets, Amount   57     75
Other          
Defined Benefit Plan, Plan Assets, Amount   25     0
Other Postretirement Benefits Plan          
Defined Benefit Plan, Plan Assets, Amount   0 0   0
Defined Benefit Plan, Change in Benefit Obligation [Roll Forward]          
Benefit Obligation, beginning $ 57 61      
Service cost 1 1 1    
Interest cost 2 2 2    
Actuarial (gain) loss 9 (2)      
Benefits paid (5) (5)      
Transfers in 0 0      
Foreign currency translation 0 0      
Benefit Obligation, ending 64 57 61    
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward]          
Actual (loss) gain on plan assets 0 0      
Employer contributions 5 5      
Benefits paid (5) (5)      
Transfers in 0 0      
Foreign currency translation 0 0      
Funded status at end of year   (57)     (64)
Other liabilities, short-term   (3)     (3)
Other liabilities, long-term   (54)     (61)
Total amounts recognized on the consolidated balance sheet   (57)     (64)
Net actuarial (gain) loss   (7)     2
Prior service credit   (6)     (5)
Balance at end of year   $ (13)     $ (3)
Weighted-average assumptions used to determine end of year benefit obligations, Discount Rate   4.25%   3.25% 3.25%
Weighted-average assumptions used to determine end of year benefit obligations, rate of compensation increase   3.00%   3.00% 3.00%
Expected return on plan assets 0 $ 0 0    
Amortization of actuarial loss 0 0 0    
Amortization of prior service credit (1) (2) (2)    
Net periodic benefit cost 2 1 1    
Current year actuarial loss (gain) 9 (2) 5    
Current year prior service credit 0 0 0    
Amortization of prior service credit 1 2 2    
Total other comprehensive loss (income) 10 0 7    
Total net periodic benefit cost and other comprehensive loss (income) $ 12 $ 1 $ 8    
Weighted-average assumptions used to determine end of year net periodic benefit, Discount rate 4.25% 3.50% 4.00%    
Weighted-average assumptions used to determine end of year net periodic benefit, Rate of compensation increase 3.00% 3.00% 3.00%    
Defined Benefit Plan, Expected Future Benefit Payment, 2020         $ 4
Defined Benefit Plan, Expected Future Benefit Payment, 2021         4
Defined Benefit Plan, Expected Future Benefit Payment, 2022         4
Defined Benefit Plan, Expected Future Benefit Payment, 2023         4
Defined Benefit Plan, Expected Future Benefit Payment, 2024         4
Defined Benefit Plan, Expected Future Benefit Payment, 2025-2029         20
Pension Plan          
Defined Benefit Plan, Plan Assets, Amount   $ 410 $ 427   518
Defined Benefit Plan, Change in Benefit Obligation [Roll Forward]          
Benefit Obligation, beginning $ 438 468      
Service cost 11 9 9    
Interest cost 13 12 8    
Actuarial (gain) loss 73 (7)      
Benefits paid (15) (22)      
Transfers in 2 1      
Foreign currency translation 9 (23)      
Benefit Obligation, ending 531 438 468    
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward]          
Actual (loss) gain on plan assets 79 (8)      
Employer contributions 32 33      
Benefits paid (15) (23)      
Transfers in 2 2      
Foreign currency translation 10 (21)      
Funded status at end of year   (28)     (13)
Other liabilities, short-term   0     0
Other liabilities, long-term   (28)     (13)
Total amounts recognized on the consolidated balance sheet   (28)     (13)
Net actuarial (gain) loss   (5)     7
Prior service credit   1     1
Balance at end of year   (4)     8
Projected benefit obligation   438     531
Accumulated benefit obligation   430     524
Defined Benefit Plan, Plan with Accumulated Benefit Obligation in Excess of Plan Assets, Plan Assets         $ 518
Expected return on plan assets (18) (20) (13)    
Amortization of actuarial loss 1 0 0    
Amortization of prior service credit 0 0 0    
Net periodic benefit cost 7 1 4    
Current year actuarial loss (gain) 12 17 (22)    
Current year prior service credit 0 1 0    
Amortization of prior service credit 0 0 0    
Total other comprehensive loss (income) 12 18 (22)    
Total net periodic benefit cost and other comprehensive loss (income) $ 19 $ 19 $ (18)    
Pension Plan | Other countries          
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward]          
Weighted-average assumptions used to determine end of year benefit obligations, Discount Rate   1.80%   0.70% 0.70%
Weighted-average assumptions used to determine end of year benefit obligations, rate of compensation increase   2.60%   1.50% 1.50%
Weighted-average assumptions used to determine end of year net periodic benefit, Discount rate 1.80% 1.80% 1.60%    
Weighted-average assumptions used to determine end of year net periodic benefit, Expected return on plan assets 2.10% 3.00% 3.25%    
Weighted-average assumptions used to determine end of year net periodic benefit, Rate of compensation increase 1.50% 2.60% 2.59%    
Fair Value, Inputs, Level 1          
Defined Benefit Plan, Plan Assets, Amount   $ 176     $ 169
Fair Value, Inputs, Level 1 | Cash and cash equivalents          
Defined Benefit Plan, Plan Assets, Amount   22     16
Fair Value, Inputs, Level 1 | Government and agency securities          
Defined Benefit Plan, Plan Assets, Amount   0     0
Fair Value, Inputs, Level 1 | Mutual funds          
Defined Benefit Plan, Plan Assets, Amount   154     153
Fair Value, Inputs, Level 1 | Asset-backed securities          
Defined Benefit Plan, Plan Assets, Amount   0     0
Fair Value, Inputs, Level 1 | Insurance contracts          
Defined Benefit Plan, Plan Assets, Amount   0     0
Fair Value, Inputs, Level 1 | Other          
Defined Benefit Plan, Plan Assets, Amount   0     0
Fair Value, Inputs, Level 2          
Defined Benefit Plan, Plan Assets, Amount   200     268
Fair Value, Inputs, Level 2 | Cash and cash equivalents          
Defined Benefit Plan, Plan Assets, Amount   0     0
Fair Value, Inputs, Level 2 | Government and agency securities          
Defined Benefit Plan, Plan Assets, Amount   88     0
Fair Value, Inputs, Level 2 | Mutual funds          
Defined Benefit Plan, Plan Assets, Amount   30     193
Fair Value, Inputs, Level 2 | Asset-backed securities          
Defined Benefit Plan, Plan Assets, Amount   0     0
Fair Value, Inputs, Level 2 | Insurance contracts          
Defined Benefit Plan, Plan Assets, Amount   57     75
Fair Value, Inputs, Level 2 | Other          
Defined Benefit Plan, Plan Assets, Amount   25     0
Fair Value, Inputs, Level 3          
Defined Benefit Plan, Plan Assets, Amount   34     0
Fair Value, Inputs, Level 3 | Cash and cash equivalents          
Defined Benefit Plan, Plan Assets, Amount   0     0
Fair Value, Inputs, Level 3 | Government and agency securities          
Defined Benefit Plan, Plan Assets, Amount   0     0
Fair Value, Inputs, Level 3 | Mutual funds          
Defined Benefit Plan, Plan Assets, Amount   0     0
Fair Value, Inputs, Level 3 | Asset-backed securities          
Defined Benefit Plan, Plan Assets, Amount   34     0
Fair Value, Inputs, Level 3 | Insurance contracts          
Defined Benefit Plan, Plan Assets, Amount   0     0
Fair Value, Inputs, Level 3 | Other          
Defined Benefit Plan, Plan Assets, Amount   0     0
Investments at Net Asset Value (NAV)          
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward]          
Assets, Fair Value Disclosure   $ 410     518
Vocalink Plan          
Expected future employer contributions       £ 15 $ 19
Vocalink Plan | Non-government fixed income          
Plan assets, target allocation (percent)       36.00% 36.00%
Vocalink Plan | Cash and cash equivalents          
Plan assets, target allocation (percent)       5.00% 5.00%
Vocalink Plan | Government and agency securities          
Plan assets, target allocation (percent)       25.00% 25.00%
Vocalink Plan | Other          
Plan assets, target allocation (percent)       9.00% 9.00%
Vocalink Plan | Equity Securities          
Plan assets, target allocation (percent)       25.00% 25.00%
Vocalink Plan | Pension Plan          
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward]          
Weighted-average assumptions used to determine end of year benefit obligations, Discount Rate   3.10%   2.00% 2.00%
Weighted-average assumptions used to determine end of year benefit obligations, rate of compensation increase   4.00%   2.50% 2.50%
Weighted-average assumptions used to determine end of year net periodic benefit, Discount rate 2.00% 2.80% 2.50%    
Weighted-average assumptions used to determine end of year net periodic benefit, Expected return on plan assets 3.75% 4.75% 4.75%    
Weighted-average assumptions used to determine end of year net periodic benefit, Rate of compensation increase 2.50% 3.85% 3.95%    
Other | Investments at Net Asset Value (NAV)          
Alternative Investment   $ 0     $ 45
Mutual funds | Investments at Net Asset Value (NAV)          
Alternative Investment   $ 0     $ 36
v3.19.3.a.u2
Debt (Details)
€ in Millions
1 Months Ended
Dec. 31, 2019
USD ($)
Feb. 28, 2018
USD ($)
Dec. 03, 2019
USD ($)
Nov. 14, 2019
USD ($)
May 31, 2019
USD ($)
Dec. 31, 2018
USD ($)
Nov. 30, 2016
USD ($)
Dec. 31, 2015
EUR (€)
Mar. 31, 2014
USD ($)
Less: Unamortized discount and debt issuance costs $ (73,000,000)         $ (55,000,000)      
Debt, Long-term and Short-term, Combined Amount 8,527,000,000         6,334,000,000      
Current portion of long-term debt 0         500,000,000      
Long-term debt 8,527,000,000         5,834,000,000      
Long-term Debt, Maturities, Repayments of Principal in 2020 0                
Long-term Debt, Maturities, Repayments of Principal in 2021 650,000,000                
Long-term Debt, Maturities, Repayments of Principal in 2022 785,000,000                
Long-term Debt, Maturities, Repayments of Principal in 2023 0                
Long-term Debt, Maturities, Repayments of Principal in 2024 1,000,000,000                
Thereafter 6,165,000,000                
Aggregate principal amount 8,600,000,000         6,389,000,000      
Commercial Paper Program 6,000,000,000     $ 4,500,000,000          
Revolving Credit Facility                  
Credit Facility $ 6,000,000,000     $ 4,500,000,000          
Senior Notes | 2029 Notes [Member]                  
Aggregate Principal Amount         $ 1,000,000,000        
Stated Interest Rate 2.95%                
Effective Interest Rate 3.03%                
Aggregate principal amount $ 1,000,000,000         0      
Senior Notes | 2049 Notes [Member]                  
Aggregate Principal Amount         $ 1,000,000,000        
Stated Interest Rate 3.65%                
Effective Interest Rate 3.689%                
Aggregate principal amount $ 1,000,000,000         0      
Senior Notes | 2025 Notes [Member]                  
Aggregate Principal Amount     $ 750,000,000            
Stated Interest Rate 2.00%                
Effective Interest Rate 2.147%                
Aggregate principal amount $ 750,000,000         0      
Senior Notes | 2019 USD Notes                  
Aggregate Principal Amount 2,750,000,000                
Proceeds from issuance of long-term debt $ 2,724,000,000                
Senior Notes | 2028 Notes                  
Aggregate Principal Amount   $ 500,000,000              
Stated Interest Rate 3.50%                
Effective Interest Rate 3.598%                
Aggregate principal amount $ 500,000,000         500,000,000      
Senior Notes | 2048 Notes                  
Aggregate Principal Amount   500,000,000              
Stated Interest Rate 3.95%                
Effective Interest Rate 3.99%                
Aggregate principal amount $ 500,000,000         500,000,000      
Senior Notes | 2018 USD Notes                  
Aggregate Principal Amount   1,000,000,000              
Proceeds from issuance of long-term debt   $ 991,000,000              
Senior Notes | 2016 issued USD Notes maturing in 2021                  
Aggregate Principal Amount             $ 650,000,000    
Stated Interest Rate 2.00%                
Effective Interest Rate 2.236%                
Aggregate principal amount $ 650,000,000         650,000,000      
Senior Notes | 2016 issued USD Notes maturing in 2026                  
Aggregate Principal Amount             750,000,000    
Stated Interest Rate 2.95%                
Effective Interest Rate 3.044%                
Aggregate principal amount $ 750,000,000         750,000,000      
Senior Notes | 2016 issued USD Notes maturing in 2046                  
Aggregate Principal Amount             600,000,000    
Stated Interest Rate 3.80%                
Effective Interest Rate 3.893%                
Aggregate principal amount $ 600,000,000         600,000,000      
Senior Notes | 2016 USD Notes                  
Aggregate Principal Amount             $ 2,000,000,000    
Senior Notes | 2015 issued Euro Notes maturing in 2022                  
Aggregate Principal Amount | €               € 700  
Stated Interest Rate 1.10%                
Effective Interest Rate 1.265%                
Aggregate principal amount $ 785,000,000         801,000,000      
Senior Notes | 2015 issued Euro Notes maturing in 2027                  
Aggregate Principal Amount | €               800  
Stated Interest Rate 2.10%                
Effective Interest Rate 2.189%                
Aggregate principal amount $ 896,000,000         916,000,000      
Senior Notes | 2015 issued Euro Notes maturing in 2030                  
Aggregate Principal Amount | €               150  
Stated Interest Rate 2.50%                
Effective Interest Rate 2.562%                
Aggregate principal amount $ 169,000,000         172,000,000      
Senior Notes | 2015 Euro Notes                  
Aggregate Principal Amount | €               € 1,650  
Senior Notes | 2014 USD Notes                  
Aggregate Principal Amount                 $ 1,500,000,000
Senior Notes | 2014 issued USD Notes maturing in 2019                  
Aggregate Principal Amount                 500,000,000
Stated Interest Rate 2.00%                
Effective Interest Rate 2.178%                
Aggregate principal amount $ 0         500,000,000      
Senior Notes | 2014 issued USD Notes maturing in 2024                  
Aggregate Principal Amount                 $ 1,000,000,000
Stated Interest Rate 3.375%                
Effective Interest Rate 3.484%                
Aggregate principal amount $ 1,000,000,000         $ 1,000,000,000      
v3.19.3.a.u2
Stockholders' Equity (Narrative) (Details) - USD ($)
$ / shares in Units, shares in Millions, $ in Millions
5 Months Ended 12 Months Ended
May 31, 2006
Dec. 31, 2019
Dec. 31, 2018
Dec. 31, 2017
Dividends declared (in dollars per share)   $ 1.39 $ 1.08 $ 0.91
Annual dividends declared   $ 1,408 $ 1,120 $ 967
Mastercard Foundation        
Required Disbursement by charitable entity 3.50%      
Class A Common Stock | Mastercard Foundation        
Issuance and donation of shares 135      
v3.19.3.a.u2
Stockholders' Equity (Schedule of Classes of Capital Stock) (Details) - $ / shares
12 Months Ended
Dec. 31, 2019
Dec. 31, 2018
Preferred Stock, Shares Issued 0 0
Preferred Stock, Shares Outstanding 0 0
Public Investors (Class A Stockholders)    
Equity Ownership 87.80% 88.00%
General Voting Power 88.80% 89.00%
Principal or Affiliate Members (Class B Stockholders)    
Equity Ownership 1.10% 1.10%
General Voting Power 0.00% 0.00%
The MasterCard Foundation (Class A Stockholders)    
Equity Ownership 11.10% 10.90%
General Voting Power 11.20% 11.00%
Class A Common Stock    
Common Stock, Par Value Per Share $ 0.0001 $ 0.0001
Common Stock, Authorized Shares 3,000,000,000 3,000,000,000
Class B Common Stock    
Common Stock, Par Value Per Share $ 0.0001 $ 0.0001
Common Stock, Authorized Shares 1,200,000,000 1,200,000,000
Preferred Stock    
Preferred Stock, Par Value Per Share $ 0.0001  
Preferred Stock, Authorized Shares 300,000,000  
v3.19.3.a.u2
Stockholders' Equity (Schedule of Share Repurchase Authorizations) (Details) - Class A Common Stock - USD ($)
$ / shares in Units, shares in Millions, $ in Millions
1 Months Ended 12 Months Ended 13 Months Ended 25 Months Ended 37 Months Ended 49 Months Ended 61 Months Ended
Dec. 31, 2019
Dec. 31, 2019
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2019
Dec. 31, 2019
Dec. 31, 2019
Dec. 31, 2019
Dec. 31, 2019
Dec. 31, 2016
Dec. 31, 2015
Class of Stock [Line Items]                      
Board Authorization $ 26,500 $ 26,500     $ 26,500 $ 26,500 $ 26,500 $ 26,500 $ 26,500    
Dollar-value of shares repurchased   6,497 $ 4,933 $ 3,762              
Remaining authorization 8,304 $ 8,304 $ 6,801 $ 5,234 8,304 8,304 8,304 8,304 $ 8,304    
Shares repurchased   26.4 26.2 30.1         114.0    
Average price paid per share   $ 245.89 $ 188.26 $ 125.05         $ 159.68    
December 2015 Share Repurchase Plan                      
Class of Stock [Line Items]                      
Board Authorization                     $ 4,000
Dollar-value of shares repurchased   $ 0 $ 0 $ 996              
Remaining authorization 0 $ 0 $ 0 $ 0 0 0 0 $ 0 $ 0    
Shares repurchased   0.0 0.0 9.1       40.4      
Average price paid per share   $ 0 $ 0 $ 109.16       $ 99.10      
December 2016 Share Repurchase Plan                      
Class of Stock [Line Items]                      
Board Authorization                   $ 4,000  
Dollar-value of shares repurchased   $ 0 $ 1,234 $ 2,766              
Remaining authorization 0 $ 0 $ 0 $ 1,234 0 0 $ 0 $ 0 0    
Shares repurchased   0.0 7.2 21.0     28.2        
Average price paid per share   $ 0 $ 171.11 $ 131.97     $ 141.99        
December 2017 Share Repurchase Plan                      
Class of Stock [Line Items]                      
Board Authorization       $ 4,000              
Dollar-value of shares repurchased   $ 301 $ 3,699                
Remaining authorization 0 $ 0 $ 301 $ 4,000 0 $ 0 $ 0 0 0    
Shares repurchased   1.6 19.0     20.6          
Average price paid per share   $ 188.38 $ 194.77     $ 194.27          
December 2018 Share Repurchase Plan                      
Class of Stock [Line Items]                      
Board Authorization     $ 6,500                
Dollar-value of shares repurchased   $ 6,196                  
Remaining authorization 304 $ 304 $ 6,500   $ 304 $ 304 304 304 304    
Shares repurchased   24.8     24.8            
Average price paid per share   $ 249.58 $ 0   $ 249.58            
December 2019 Share Repurchase Plan                      
Class of Stock [Line Items]                      
Board Authorization 8,000 $ 8,000     $ 8,000 8,000 8,000 8,000 8,000    
Remaining authorization $ 8,000 $ 8,000     $ 8,000 $ 8,000 $ 8,000 $ 8,000 $ 8,000    
Average price paid per share $ 0                    
v3.19.3.a.u2
Stockholders' Equity Statement of Changes in Common Shares Outstanding (Details) - shares
shares in Millions
12 Months Ended 61 Months Ended
Dec. 31, 2019
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2019
Class A Common Stock        
Increase (Decrease) in Stockholders' Equity [Roll Forward]        
Purchases of treasury stock (26.4) (26.2) (30.1) (114.0)
Common Stock | Class A Common Stock        
Increase (Decrease) in Stockholders' Equity [Roll Forward]        
Balance 1,018.6 1,039.7 1,062.4  
Purchases of treasury stock (26.4) (26.2) (30.1)  
Share-based payments 3.2 2.8 2.2  
Conversion of Class B to Class A common stock 0.6 2.3 5.2  
Balance 996.0 1,018.6 1,039.7 996.0
Common Stock | Class B Common Stock        
Increase (Decrease) in Stockholders' Equity [Roll Forward]        
Balance 11.8 14.1 19.3  
Conversion of Class B to Class A common stock (0.6) (2.3) (5.2)  
Balance 11.2 11.8 14.1 11.2
v3.19.3.a.u2
Accumulated Other Comprehensive Income (Loss) (Details) - USD ($)
$ in Millions
12 Months Ended
Dec. 31, 2019
Dec. 31, 2018
Dec. 31, 2017
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward]      
Beginning balance $ 5,418 $ 5,497 $ 5,684
Other comprehensive income (loss) 45 (221) 427
Ending balance 5,917 5,418 5,497
Foreign Currency Translation Adjustments      
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward]      
Beginning balance (661) (382)  
Other comprehensive income (loss) 23 (279)  
Ending balance (638) (661) (382)
Translation Adjustments on Net Investment Hedge      
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward]      
Beginning balance (66) (141)  
Other comprehensive income (loss) 28 75  
Ending balance (38) (66) (141)
Cash Flow Hedges      
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward]      
Beginning balance 0 0  
Other comprehensive income (loss) 11 0  
Ending balance 11 0 0
Defined Benefit Pension and Other Postretirement Plans      
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward]      
Beginning balance 10 25  
Other comprehensive income (loss) (19) (15)  
Ending balance (9) 10 25
Investment Securities Available-for-Sale      
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward]      
Beginning balance (1) 1  
Other comprehensive income (loss) 2 (2)  
Ending balance 1 (1) 1
Accumulated Other Comprehensive Income (Loss)      
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward]      
Beginning balance (718) (497)  
Ending balance $ (673) $ (718) $ (497)
v3.19.3.a.u2
Share-Based Payments (Details) - USD ($)
shares in Millions, $ in Millions
2 Months Ended 12 Months Ended
Feb. 28, 2017
Dec. 31, 2019
Long-Term Incentive Plan | Class A Common Stock    
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Shares reserve for future issuance   116
Stock Option    
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period   10 years
Share-Based Compensation Arrangement by Share-Based Payment Award, Award Vesting Period   4 years
Unrecognized compensation cost   $ 34
Period over which unrecognized cost will be recognized, in years   2 years 3 months 18 days
Restricted Stock Units (RSUs)    
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Share-Based Compensation Arrangement by Share-Based Payment Award, Award Vesting Period   3 years
Unrecognized compensation cost   $ 180
Period over which unrecognized cost will be recognized, in years   1 year 9 months 18 days
Performance Shares    
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Share-Based Compensation Arrangement by Share-Based Payment Award, Award Vesting Period   3 years
Performance Shares | Vesting period for retirement or disability    
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Share-Based Compensation Arrangement by Share-Based Payment Award, Award Vesting Period 6 months 7 months
Performance Shares | Minimum vesting from date of retirement eligibility    
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Share-Based Compensation Arrangement by Share-Based Payment Award, Award Vesting Period 6 months 7 months
Performance-Based Restricted Stock    
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Unrecognized compensation cost   $ 13
Period over which unrecognized cost will be recognized, in years   1 year 9 months 18 days
v3.19.3.a.u2
Share-Based Payments (Schedule of Weighted-Average Assumptions Used in the Valuation of Awards) (Details) - $ / shares
12 Months Ended
Dec. 31, 2019
Dec. 31, 2018
Dec. 31, 2017
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Risk-free rate of return 2.60% 2.70% 2.00%
Expected term (in years) 6 years 6 years 5 years
Expected volatility 19.60% 19.70% 19.30%
Expected dividend yield 0.60% 0.60% 0.80%
Weighted-average fair value per option granted $ 53.09 $ 40.90 $ 21.23
Restricted Stock Units (RSUs)      
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period 3 years    
Performance stock units      
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period 3 years    
Stock Option      
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period 4 years    
v3.19.3.a.u2
Share-Based Payments (Summary of Stock Option Activity) (Details) - USD ($)
$ / shares in Units, shares in Millions, $ in Millions
2 Months Ended 12 Months Ended
Feb. 28, 2017
Dec. 31, 2019
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward]    
Options outstanding at January 1, 2019   7.6
Options granted   0.9
Options exercised   (1.8)
Options forfeited/expired   (0.1)
Options outstanding at December 31, 2019   6.6
Options exercisable at December 31, 2019   3.9
Options vested and expected to vest at December 31, 2019   6.6
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Abstract]    
Weighted-average exercise price, options outstanding at January 1, 2019   $ 93
Weighted-average exercise price, options granted   227
Weighted-average exercise price, options exercised   71
Weighted-average exercise price, options forfeited/expired   148
Weighted-average exercise price, options outstanding at December 31, 2019   117
Weighted-average exercise price, options exercisable at December 31, 2019   86
Weighted-average exercise price, options vested and expected to vest at December 31, 2019   $ 116
Weighted-average remaining contractual term, options outstanding at December 31, 2019, in years   6 years 2 months 12 days
Weighted-average remaining contractual term, options exercisable at December 31, 2019, in years   5 years 1 month 6 days
Weighted-average remaining contractual term, options vested and expected to vest at December 31, 2019, in years   6 years 2 months 12 days
Aggregate intrinsic value, options outstanding at December 31, 2019   $ 1,206
Aggregate intrinsic value, options exercisable at December 31, 2019   836
Aggregate intrinsic value, options vested and expected to vest at December 31, 2019   1,200
Stock Option    
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Share-based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Amount   $ 34
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period   10 years
Share-based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Period for Recognition   2 years 3 months 18 days
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Abstract]    
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period   4 years
Performance Shares    
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Abstract]    
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period   3 years
Vesting period for retirement or disability | Performance Shares    
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Abstract]    
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period 6 months 7 months
v3.19.3.a.u2
Share-Based Payments (Summary of Restricted Stock Unit Activity) (Details) - USD ($)
$ / shares in Units, shares in Millions, $ in Millions
2 Months Ended 12 Months Ended
Feb. 28, 2017
Dec. 31, 2019
Dec. 31, 2018
Dec. 31, 2017
Restricted Stock Units (RSUs)        
Share-based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Amount   $ 180    
Share-based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Period for Recognition   1 year 9 months 18 days    
Outstanding at January 1, 2019   3.7    
Granted   1.0    
Converted   (1.6)    
Forfeited   (0.2)    
Outstanding at December 31, 2019   2.9 3.7  
Units vested and expected to vest at December 31, 2019   2.8    
Weighted-average grant-date fair value, units outstanding at January 1, 2019   $ 117    
Weighted-average grant-date fair value, granted   226 $ 171 $ 112
Weighted-average grant-date fair value, converted   93    
Weighted-average grant-date fair value, forfeited/expired   154    
Weighted-average grant-date fair value, units outstanding at December 31, 2019   166 $ 117  
Weighted-average grant-date fair value, units vested and expected to vest at December 31, 2019   $ 165    
Aggregate intrinsic value, units outstanding at December 31, 2019   $ 852    
Aggregate intrinsic value, units vested and expected to vest at December 31, 2019   $ 824    
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period   3 years    
Performance stock units        
Outstanding at January 1, 2019   0.6    
Granted   0.1    
Converted   (0.4)    
Outstanding at December 31, 2019   0.5 0.6  
Units vested and expected to vest at December 31, 2019   0.5    
Weighted-average grant-date fair value, units outstanding at January 1, 2019   $ 120    
Weighted-average grant-date fair value, granted   231 $ 226 $ 126
Weighted-average grant-date fair value, converted   92    
Weighted-average grant-date fair value, units outstanding at December 31, 2019   167 $ 120  
Weighted-average grant-date fair value, units vested and expected to vest at December 31, 2019   $ 167    
Aggregate intrinsic value, units outstanding at December 31, 2019   $ 162    
Aggregate intrinsic value, units vested and expected to vest at December 31, 2019   $ 162    
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period   3 years    
Equity Option [Member]        
Share-based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Amount   $ 34    
Share-based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Period for Recognition   2 years 3 months 18 days    
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period   4 years    
Minimum vesting from date of retirement eligibility | Performance stock units        
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period 6 months 7 months    
v3.19.3.a.u2
Share-Based Payments (Summary of Performance Stock Unit Activity) (Details) - USD ($)
$ / shares in Units, shares in Millions, $ in Millions
12 Months Ended
Dec. 31, 2019
Dec. 31, 2018
Dec. 31, 2017
Equity Option [Member]      
Share-based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Amount $ 34    
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period 10 years    
Share-based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Period for Recognition 2 years 3 months 18 days    
Performance-Based Restricted Stock      
Share-based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Amount $ 13    
Share-based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Period for Recognition 1 year 9 months 18 days    
Performance stock units      
Outstanding at January 1, 2019 0.6    
Granted 0.1    
Converted (0.4)    
Other 0.2    
Outstanding at December 31, 2019 0.5 0.6  
RSUs units expected to vest at December 31, 2019 0.5    
Weighted-average grant-date fair value, units outstanding at January 1, 2019 $ 120    
Weighted-average grant-date fair value, granted 231 $ 226 $ 126
Weighted-average grant-date fair value, converted 92    
Weighted-average grant-date fair value, other 126    
Weighted-average grant-date fair value, units outstanding at December 31, 2019 167 $ 120  
Weighted-average grant-date fair value, units expected to vest at December 31, 2019 $ 167    
Aggregate intrinsic value, units outstanding at December 31, 2019 $ 162    
Aggregate intrinsic value, units expected to vest at December 31, 2019 $ 162    
v3.19.3.a.u2
Share-Based Payments Schedule of Additional Share-Based Payment Information (Details) - USD ($)
$ / shares in Units, $ in Millions
12 Months Ended
Dec. 31, 2019
Dec. 31, 2018
Dec. 31, 2017
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Share-based compensation expense: Options, RSUs and PSUs $ 250 $ 196 $ 176
Income tax benefit recognized for equity awards 53 41 57
Share-based Payment Arrangement, Exercise of Option, Tax Benefit 69 53 36
Total intrinsic value of stock options exercised $ 317 $ 242 $ 106
Restricted Stock Units (RSUs)      
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Weighted-average grant-date fair value of awards granted $ 226 $ 171 $ 112
Total intrinsic value of units converted into shares of Class A common stock $ 394 $ 194 $ 131
Performance stock units      
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Weighted-average grant-date fair value of awards granted $ 231 $ 226 $ 126
Total intrinsic value of units converted into shares of Class A common stock $ 85 $ 40 $ 13
v3.19.3.a.u2
Commitments Narrative (Details)
$ in Millions
Dec. 31, 2019
USD ($)
Commitments and Contingencies Disclosure [Abstract]  
Future minimum payments operating leases, sponsorship, licensing and other agreements, accrued $ 20
v3.19.3.a.u2
Commitments Future Minimum Payments Due Under Non-Cancelable Agreements (Details)
$ in Millions
Dec. 31, 2019
USD ($)
Sponsorship, Licensing & Other  
2020 $ 404
2021 224
2022 132
2023 42
2024 17
Thereafter 0
Total $ 819
v3.19.3.a.u2
Income Taxes Narrative (Details) - USD ($)
$ / shares in Units, $ in Millions
12 Months Ended
Jan. 01, 2010
Dec. 31, 2019
Dec. 31, 2018
Dec. 31, 2017
Tax Credit Carryforward [Line Items]        
U.S. foreign tax credits1   $ 145 $ 0  
Effective income tax rate   16.60% 18.70% 40.00%
Effective Income Tax Rate Reconciliation, Tax Cuts and Jobs Act, Amount       $ 873
Tax Cuts and Jobs Act, Incomplete Accounting, Provisional Income Tax Expense (Benefit)       825
Other foreign tax credit benefits   $ 27 $ 90  
Income tax expense   1,613 1,345 2,607
Transition Tax   (30) 22 629
Effective income Tax Rate On Taxable Income In Excess Of Base Amount Period In Effect 10 years      
Impact Of Incentive Grant Received Reducing Income Tax Liability Value   $ 300 $ 212 $ 104
Earning Per Share Diluted Impact Of Incentive Grant Received Reducing Income Tax Liability   $ 0.29 $ 0.20 $ 0.10
Foreign Earnings Repatriated   $ 2,500 $ 3,300  
Foreign Earnings Expected to be Repatriated   3,500 2,500  
Earnings permanently reinvested   800    
Unrecognized tax benefits that would reduce the effective tax rate   203    
Net tax-related interest payable   $ 13 $ 8  
Foregone foreign tax credit benefit on current year repatriations        
Tax Credit Carryforward [Line Items]        
Income tax expense       $ 48
v3.19.3.a.u2
Income Taxes Schedule of Domestic and Foreign Earnings (Loss) Before Income Taxes (Details) - USD ($)
$ in Millions
12 Months Ended
Dec. 31, 2019
Dec. 31, 2018
Dec. 31, 2017
Income Tax Disclosure [Abstract]      
United States $ 4,213 $ 3,510 $ 3,482
Foreign 5,518 3,694 3,040
Income before income taxes $ 9,731 $ 7,204 $ 6,522
v3.19.3.a.u2
Income Taxes Components of Income Tax Provision (Details) - USD ($)
$ in Millions
12 Months Ended
Dec. 31, 2019
Dec. 31, 2018
Dec. 31, 2017
Current      
Federal $ 642 $ 649 $ 1,704
State and local 81 69 65
Foreign 897 871 752
Current 1,620 1,589 2,521
Deferred      
Federal 40 (228) 134
State and local 0 (11) 1
Foreign (47) (5) (49)
Deferred (7) (244) 86
Income tax expense $ 1,613 $ 1,345 $ 2,607
v3.19.3.a.u2
Income Taxes Schedule of Effective Income Tax Rate Reconciliation (Details) - USD ($)
$ in Millions
12 Months Ended
Dec. 31, 2019
Dec. 31, 2018
Dec. 31, 2017
Amount      
Income before income taxes $ 9,731 $ 7,204 $ 6,522
Federal statutory tax 2,044 1,513 2,283
State tax effect, net of federal benefit 65 46 43
Foreign tax effect (208) (92) (380)
European Commission fine 0 194 0
Foreign tax credits (32) (110) (27)
Transition Tax (30) 22 629
Remeasurement of deferred taxes 0 (7) 157
Windfall benefit (129) (72) (43)
Other, net (97) (149) (55)
Income tax expense $ 1,613 $ 1,345 $ 2,607
Percent      
Federal statutory tax 21.00% 21.00% 35.00%
State tax effect, net of federal benefit 0.70% 0.60% 0.70%
Foreign tax effect (2.10%) (1.30%) (5.80%)
European Commission fine 0.00% 2.70% 0.00%
Foreign tax credits (0.30%) (1.50%) (0.40%)
Transition Tax (0.003) 0.003 0.096
Remeasurement of deferred taxes 0.00% (0.10%) 2.40%
Windfall benefit (1.30%) (1.00%) (0.70%)
Other, net (1.10%) (2.00%) (0.80%)
Income tax expense 16.60% 18.70% 40.00%
Foreign Earnings Repatriated $ (2,500) $ (3,300)  
Other foreign tax credit benefits 27 90  
Foreign Earnings Expected to be Repatriated $ 3,500 $ 2,500  
v3.19.3.a.u2
Income Taxes Schedule of Deferred Tax Assets and Liabilities (Details) - USD ($)
$ in Millions
Dec. 31, 2019
Dec. 31, 2018
Income Tax Disclosure [Abstract]    
Accrued liabilities $ 354 $ 297
Compensation and benefits 214 210
State taxes and other credits 41 30
Net operating losses 119 104
U.S. foreign tax credits1 145 0
Intangible assets 157 170
Other items 94 115
Less: Valuation allowance (205) (94)
Total Deferred Tax Assets 919 832
Prepaid expenses and other accruals 83 89
Intangible assets 187 125
Property, plant and equipment 128 97
Other items 63 18
Deferred Tax Liabilities, Gross 461 329
Net Deferred Tax Assets $ 458 $ 503
v3.19.3.a.u2
Income Taxes Reconciliation of Beginning and Ending Tax Benefits (Details) - USD ($)
$ in Millions
12 Months Ended
Dec. 31, 2019
Dec. 31, 2018
Dec. 31, 2017
Income Tax Disclosure [Abstract]      
Beginning balance $ 164 $ 183 $ 169
Current year tax positions 22 23 21
Prior year tax positions 37 5 9
Prior year tax positions (11) (17) (1)
Settlements with tax authorities (2) (18) (4)
Expired statute of limitations (7) (12) (11)
Ending balance $ 203 $ 164 $ 183
v3.19.3.a.u2
Legal and Regulatory Proceedings (Details)
€ in Millions, £ in Billions
1 Months Ended 3 Months Ended 12 Months Ended 30 Months Ended 92 Months Ended
Sep. 30, 2019
USD ($)
Apr. 30, 2019
EUR (€)
Jul. 31, 2018
claimant
Jan. 31, 2017
claimant
Oct. 31, 2011
plaintiff
Feb. 28, 2011
Dec. 31, 2019
USD ($)
Mar. 31, 2019
USD ($)
Dec. 31, 2019
GBP (£)
fax
claimant
Dec. 31, 2019
USD ($)
fax
claimant
Dec. 31, 2018
USD ($)
Dec. 31, 2017
USD ($)
Jun. 30, 2019
claimant
Dec. 31, 2019
GBP (£)
Dec. 31, 2019
USD ($)
Legal And Regulatory                              
Loss Contingency, Unsolicited Advertisements | fax                 381,000 381,000          
Provision for litigation                   $ 0 $ 1,128,000,000 $ 15,000,000      
Cash paid for legal settlements                   668,000,000 260,000,000 47,000,000      
Accrued litigation             $ 914,000,000     914,000,000 1,591,000,000       $ 914,000,000
Restricted cash for litigation settlement             584,000,000     584,000,000 553,000,000       584,000,000
Increase in Restricted Cash             84,000,000 $ 108,000,000              
Loss Contingency, Damages Sought, Per Claim                   500          
Event Involving Visa Parties, Member Banks and Mastercard                              
Legal And Regulatory                              
Percent of settlement Mastercard would pay           12.00%                  
Event Involving Member Banks and Mastercard                              
Legal And Regulatory                              
Percent of settlement Mastercard would pay           36.00%                  
Canadian Competition Bureau                              
Legal And Regulatory                              
Amount of damages sought (that exceeds)                   5,000,000,000          
Canadian Merchant Litigation                              
Legal And Regulatory                              
Provision for litigation                       $ 15,000,000      
U.S. Merchant Lawsuit Settlement                              
Legal And Regulatory                              
Accrued litigation             $ 914,000,000     $ 914,000,000 914,000,000       $ 914,000,000
Maximum | U.S. Merchant Litigation - Class Litigation                              
Legal And Regulatory                              
Percentage of Opt Out Merchants to Terminate             25.00%     25.00%         25.00%
U.S. Merchant Lawsuit Settlement                              
Legal And Regulatory                              
Provision for litigation                     237,000,000        
European Commission                              
Legal And Regulatory                              
Provision for litigation                     654,000,000        
Cash paid for legal settlements | €   € 571                          
Proposed U.K. Interchange Collective Action                              
Legal And Regulatory                              
Amount of damages sought (that exceeds)                 £ 14 $ 17,000,000,000          
U.K. Merchant Lawsuit Settlement                              
Legal And Regulatory                              
Amount of damages sought (that exceeds)                           £ 3 $ 4,000,000,000
Loss Contingency, Damages Resolved, Value                           £ 2 $ 3,000,000,000
U.K. Merchant Lawsuit Settlement and Pan-European Merchant Litigation [Domain]                              
Legal And Regulatory                              
Provision for litigation                     $ 237,000,000        
U.K. Merchant claimants                              
Legal And Regulatory                              
Number of claimants in case | claimant       10                      
Number of plaintiffs in case | claimant       10                      
ATM Operators Complaint                              
Legal And Regulatory                              
Amount of damages sought (that exceeds) $ 1,000,000,000                            
Number of claimants in case | plaintiff         13                    
Number of plaintiffs in case | plaintiff         13                    
Appealing judgment | U.K. Merchant claimants                              
Legal And Regulatory                              
Loss Contingency, Claims Settled, Number | claimant                         3    
Judicial Ruling | 2016 U.K. Merchant Claimants | Unfavorable Regulatory Action                              
Legal And Regulatory                              
Loss Contingency, Claims Settled, Number | claimant                 1 1          
Judicial Ruling | 2017 U.K. Merchant Claimants                              
Legal And Regulatory                              
Loss Contingency, Claims Settled, Number | claimant     3                        
Judicial Ruling | 2017 U.K. Merchant Claimants | Unfavorable Regulatory Action                              
Legal And Regulatory                              
Loss Contingency, Claims Settled, Number | claimant     2                        
v3.19.3.a.u2
Settlement and Other Risk Management Narrative (Details) - USD ($)
$ in Millions
Dec. 31, 2019
Dec. 31, 2018
Settlement and Other Risk Management [Abstract]    
Travelers cheques outstanding, notional value $ 367 $ 377
Travelers cheques covered by collateral arrangements $ 290 $ 297
v3.19.3.a.u2
Settlement and Other Risk Management Estimated Settlement Exposure and Portion of Uncollateralized Settlement Exposure for MasterCard-Branded Transactions (Details) - Guarantee Obligations - USD ($)
$ in Millions
Dec. 31, 2019
Dec. 31, 2018
Risks Inherent in Servicing Assets and Servicing Liabilities [Line Items]    
Gross settlement exposure $ 55,800 $ 49,666
Collateral held for settlement exposure (4,772) (4,711)
Net uncollateralized settlement exposure $ 51,028 $ 44,955
v3.19.3.a.u2
Derivative and Hedging Instruments Classification of Outstanding Forward Contracts (Details) - USD ($)
$ in Millions
Dec. 31, 2019
Dec. 31, 2018
Prepaid Expenses and Other Current Assets    
Foreign Exchange Risk Management    
Forward contracts to purchase and sell foreign currency - Balance sheet location - Accounts receivable $ 12 $ 35
Other Current Liabilities    
Foreign Exchange Risk Management    
Forward contracts to purchase and sell foreign currency - Balance sheet location - Other current liabilities (32) (6)
Commitments to purchase foreign currency | Foreign Exchange Forward    
Foreign Exchange Risk Management    
Commitments to purchase/sell foreign currency, Notional 185 34
Commitments to purchase/sell foreign currency, Estimated Fair Value 3 (1)
Commitments to sell foreign currency | Foreign Exchange Forward    
Foreign Exchange Risk Management    
Commitments to purchase/sell foreign currency, Notional 1,506 1,066
Commitments to purchase/sell foreign currency, Estimated Fair Value (25) 26
Commitments to sell foreign currency | Foreign Exchange Option    
Foreign Exchange Risk Management    
Commitments to purchase/sell foreign currency, Notional 21 25
Commitments to purchase/sell foreign currency, Estimated Fair Value $ 2 $ 4
v3.19.3.a.u2
Derivative and Hedging Instruments Foreign Exchange Risk Management (Details)
€ in Millions, $ in Millions
12 Months Ended
Dec. 31, 2019
USD ($)
Dec. 31, 2018
USD ($)
Dec. 31, 2017
USD ($)
Dec. 31, 2015
EUR (€)
Foreign Exchange Risk Management        
Terms of the foreign currency forward contracts 18 months      
Net foreign currency transaction pre-tax loss in accumulated other comprehensive income $ 84      
Cash flow hedges 14 $ 0 $ 0  
Foreign exchange contracts | General and Administrative        
Foreign Exchange Risk Management        
Gain (loss) for contracts to purchase and sell foreign currency (39) $ 53 $ (75)  
Net Investment Hedging        
Foreign Exchange Risk Management        
Euro-denominated debt designated as hedge of net investment in European foreign operations denominated in euros | €       € 1,650
Cash Flow Hedging | Interest Rate Risk        
Foreign Exchange Risk Management        
Notional amount 1,000      
Cash flow hedges $ 14      
v3.19.3.a.u2
Segment Reporting (Details) - USD ($)
$ in Millions
Dec. 31, 2019
Jan. 01, 2019
Dec. 31, 2018
Dec. 31, 2017
Schedule of Property, Plant and Equipment, by Geographical Segment        
Property, equipment and right-of-use assets, net $ 1,828 $ 1,296 $ 921 $ 829
United States        
Schedule of Property, Plant and Equipment, by Geographical Segment        
Property, equipment and right-of-use assets, net 1,147   613 572
Other countries        
Schedule of Property, Plant and Equipment, by Geographical Segment        
Property, equipment and right-of-use assets, net $ 681   $ 308 $ 257
v3.19.3.a.u2
Segment Reporting (Narrative) (Details)
12 Months Ended
Dec. 31, 2019
Dec. 31, 2018
Dec. 31, 2017
Segment Reporting [Abstract]      
Percentage of revenue generated in the U.S. 32.00% 33.00% 35.00%
v3.19.3.a.u2
SUMMARY OF QUARTERLY DATA (Unaudited) (Details) - USD ($)
$ / shares in Units, shares in Millions, $ in Millions
3 Months Ended 12 Months Ended
Dec. 31, 2019
Sep. 30, 2019
Jun. 30, 2019
Mar. 31, 2019
Dec. 31, 2018
Sep. 30, 2018
Jun. 30, 2018
Mar. 31, 2018
Dec. 31, 2019
Dec. 31, 2018
Dec. 31, 2017
Quarterly Financial Data [Abstract]                      
Net revenue $ 4,414 $ 4,467 $ 4,113 $ 3,889 $ 3,807 $ 3,898 $ 3,665 $ 3,580 $ 16,883 $ 14,950 $ 12,497
Operating income 2,399 2,655 2,397 2,213 1,234 2,287 1,936 1,825 9,664 7,282 6,622
Net income $ 2,100 $ 2,108 $ 2,048 $ 1,862 $ 899 $ 1,899 $ 1,569 $ 1,492 $ 8,118 $ 5,859 $ 3,915
Basic Earnings per Share $ 2.08 $ 2.08 $ 2.01 $ 1.81 $ 0.87 $ 1.83 $ 1.50 $ 1.42 $ 7.98 $ 5.63 $ 3.67
Basic weighted-average shares outstanding 1,008 1,013 1,020 1,026 1,032 1,037 1,043 1,051 1,017 1,041 1,067
Diluted earnings per share $ 2.07 $ 2.07 $ 2.00 $ 1.80 $ 0.87 $ 1.82 $ 1.50 $ 1.41 $ 7.94 $ 5.60 $ 3.65
Diluted weighted-average shares outstanding 1,013 1,019 1,025 1,032 1,038 1,043 1,049 1,057 1,022 1,047 1,072
v3.19.3.a.u2
Label Element Value
Accounting Standards Update 2014-09 [Member]  
Cumulative Effect of New Accounting Principle in Period of Adoption us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption $ 366,000,000
Accounting Standards Update 2016-16 [Member]  
Cumulative Effect of New Accounting Principle in Period of Adoption us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption $ (183,000,000)