For further information, refer to the Consolidated Financial Statementsconsolidated financial statements and footnotes included in our Annual Report on Form 10‑K for the year ended December 31, 2015.2016. The terms "Corporation," "Kimberly-Clark," "K-C," "we," "our" and "us" refer to Kimberly-Clark Corporation and its consolidated subsidiaries.

guidance is permitted as of one year priorrequired to the current effective date. The guidance permits two implementation approaches, one requiringbe adopted on either a full or modified retrospective application of the newbasis. As this standard with restatement of prior years and one requiring prospective application of the new standard with disclosure of results under old standards. The effects of this standardis not expected to have a material impact on our financial position, results of operations and cash flows areon either a full or modified retrospective basis, we do not yet known.plan to recast prior periods.

The following fair value information is based on a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The three levels in the hierarchy used to measure fair value are:

A financial instrument's level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement.

During the three months ended March 31, 20162017 and for the full year 2015,2016, there were no significant transfers among level 1, 2, or 3 fair value determinations.

Redeemable preferred securities of subsidiaries are measured on a recurring basis at fair value and were $64$58 at both March 31, 20162017 and December 31, 2015.2016. They are not traded in active markets. For certain redeemable securities, fair values were calculated using a floating rate pricing model that compared the stated spread to the fair value spread to determine the price at which each of the financial instruments should trade. The model used the following inputs to calculate fair values: face value, current LIBOR rate, unobservable fair value credit spread, stated spread, maturity date and interest or dividend payment dates. The fair value of the remaining redeemable securities was based on various inputs, including an independent third-party appraisal, adjusted for current market conditions. Measurement of the redeemable preferred securities is considered a level 3 measurement.

The following table includes the fair value of our financial instruments for which disclosure of fair value is required:

There are no adjustments required to be made to net income for purposes of computing EPS. A reconciliation of theThe average number of common shares outstanding is reconciled to those used in the basic and diluted EPS computations as follows:

Options outstanding that were not included in the computation of diluted EPS because their exercise price was greater than the average market price of the common shares were insignificant.

Set forth below is a reconciliation for the three months ended March 31, 20162017 of the carrying amount of total stockholders' equity (deficit) from the beginning of the period to the end of the period.

During the three months ended March 31, 2016,2017, we repurchased 1.12.4 million shares at a total cost of $150$300 pursuant to a share repurchase program authorized by our Board of Directors.

Net unrealized currency gains or losses resulting from the translation of assets and liabilities of foreign subsidiaries, except those in highly inflationary economies, are recorded in accumulated other comprehensive income ("AOCI"). For these operations, changes in exchange rates generally do not affect cash flows; therefore, unrealized translation isadjustments are recorded in AOCI rather than net income. Upon sale or substantially complete liquidation of any of these subsidiaries, the applicable unrealized translation would be removed from AOCI and reported as part of the gain or loss on the sale or liquidation.

Also included in unrealized translation amounts are the effects of foreign exchange rate changes on intercompany balances of a long-term investment nature and transactions designated as hedges of net foreign investments.

The change in net unrealized currency translation for the three months ended March 31, 20162017 was primarily due to the weakeningstrengthening of most foreign currencies versus the U.S. dollar, versus most foreign currencies, including the South Korean won, Australian dollar, Brazilian real the euro, the South Korean won and the CanadianTaiwan dollar.

The changes in the components of AOCI attributable to Kimberly-Clark, net of tax, are as follows:

As a multinational enterprise, we are exposed to financial risks, such as changes in foreign currency exchange rates, interest rates, and commodity prices. We employ a number of practices to manage these risks, including operating and financing activities and, where appropriate, the use of derivative instruments. We enter into derivative instruments to hedge a portion of forecasted cash flows denominated in foreign currencies for non-U.S. operations' purchases of raw materials, which are priced in U.S. dollars, and imports of intercompany finished goods and work-in-process priced predominantly in U.S. dollars and euros. The derivative instruments used to manage these exposures are designated and qualify as cash flow hedges. The foreign currency exposure on certain non-functional currency denominated monetary assets and liabilities, primarily intercompany loans and accounts payable, is hedged with primarily undesignated derivative instruments.

Interest rate risk is managed using a portfolio of variable-variable and fixed-rate debt composed of short-short and long-term instruments. Interest rate swap contracts may be used to facilitate the maintenance of the desired ratio of variable-variable and fixed-rate debt and are designated and qualify as fair value hedges. From time to time, we also hedge the anticipated issuance of fixed-rate debt, using forward-starting swaps, and these contracts are designated as cash flow hedges.

We use derivative instruments, such as forward swap contracts, to hedge a limited portion of our exposure to market risk arising from changes in prices of certain commodities. These derivatives are designated as cash flow hedges of specific quantities of the underlying commodity expected to be purchased in future months.

Translation adjustments result from translating foreign entities' financial statements into U.S. dollars from their functional currencies. The risk to any particular entity's net assets is reduced to the extent that the entity is financed with local currency borrowing. Translation exposure, which results from changes in translation rates between functional currencies and the U.S. dollar,

Set forth below is a summary of the designated and undesignated fair values of our derivative instruments:

The derivative assets are included in the Consolidated Balance Sheetconsolidated balance sheet in other current assets and other assets, as appropriate. The derivative liabilities are included in the Consolidated Balance Sheetconsolidated balance sheet in accrued expenses and other liabilities, as appropriate.

Derivative instruments that are designated and qualify as fair value hedges are predominantly used to manage interest rate risk. The fair values of these derivative instruments are recorded as an asset or liability, as appropriate, with the offset recorded in current earnings. The offset to the change in fair values of the related hedged items also is recorded in current earnings. Any realized gain or loss on the derivatives that hedge interest rate risk is amortized to interest expense over the life of the related debt. AtAs of March 31, 2016, the aggregate notional values of2017, there were no outstanding interest rate contracts designated as fair value hedges were $375.hedges. Fair value hedges resulted in no significant ineffectiveness in the three months ended March 31, 2017 and 2016, and 2015. For the three months ended March 31, 2016 and 2015, gains or losses recognized in interest expense for interest rate swaps were not significant. For the three month periods ended March 31, 20162017 and 2015,2016, no gain or loss was recognized in earnings as a result of a hedged firm commitment no longer qualifying as a fair value hedge.

Gains or losses on undesignated foreign exchange hedging instruments are immediately recognized in other (income) and expense, net. A loss of $3 and a gain of $28 and a loss of $155 were recorded in the three month periodsmonths ended March 31, 20162017 and 2015,2016, respectively. The effect on earnings from the use of these non-designated derivatives is substantially neutralized by the transactional gains and losses recorded on the underlying assets and liabilities. At March 31, 2016,2017, the notional amount of these undesignated derivative instruments was $1.8 billion.

We are organized into operating segments based on product groupings. These operating segments have been aggregated into three reportable global business segments: Personal Care, Consumer Tissue and K-C Professional. The reportable segments were determined in accordance with how our chief operating decision maker and our executive managers develop and execute global strategies to drive growth and profitability. These strategies include global plans for branding and product positioning, technology, research and development programs, cost reductions including supply chain management, and capacity and capital investments for each of these businesses. Segment management is evaluated on several factors, including operating profit. Segment operating profit excludes other (income) and expense, net and income and expense not associated with the business segments.

The following schedules present informationInformation concerning consolidated operations by business segment:segment is presented in the following tables:

This management's discussion and analysis of financial condition and results of operations is intended to provide investors with an understanding of our recent performance, financial condition and prospects.  The following will be discussed and analyzed:

We describe our business outside North America in two groups – Developing and Emerging Markets ("D&E") and Developed Markets. D&E markets comprise Eastern Europe, the Middle East and Africa, Latin America and Asia-Pacific, excluding Australia and South Korea. Developed Markets consist of Western and Central Europe, Australia and South Korea.

Throughout this MD&A, we refer to financial measures that have not been calculated in accordance with accounting principles generally accepted in the U.S., or GAAP, and are therefore referred to as non-GAAP financial measures. These measures include adjusted operating profit, adjusted net income, adjusted earnings per share adjusted other (income) and expense, net, and adjusted effective tax rate. We believe these measures provide our investors with additional information about our underlying results and trends, as well as insight tointo some of the financial measures used to evaluate management.

Non-GAAP financial measures are not meant to be considered in isolation or as a substitute for the comparable GAAP measures, and they should be read only in conjunction with our consolidated financial statements prepared in accordance with GAAP.  There are limitations to these non-GAAP financial measures because they are not prepared in accordance with GAAP and may not be comparable to similarly titled measures of other companies due to potential differences in methods of calculation and items being excluded.  We compensate for these limitations by using these non-GAAP financial measures as a supplement to the GAAP measures and by providing reconciliations of the non-GAAP and comparable GAAP financial measures.

The non-GAAP financial measures exclude the following itemscharges in 2016 for the relevant time periods2014 Organization Restructuring as indicated in the reconciliations included later in this MD&A:

This section presents a discussion and analysis of our first quarter 20162017 net sales, operating profit and other information relevant to an understanding of the results of operations.

First quarter net sales of $2.2$2.3 billion decreased 4increased 2 percent compared to prior year. UnfavorableChanges in currency rates reduced netincreased sales by 92 percent. Sales volumes increased 32 percent, andwhile changes in product mix improved net selling prices decreased sales by 12 percent. First quarter operating profit of $449 decreased 1 percent compared to prior year.$481 increased 7 percent. The comparison was impacted by unfavorable currency effects and increased marketing, research and general spending on a local currency basis. This was mostly offset by organic net salesbenefited from volume growth, cost savings and favorable currency effects, partially offset by lower net selling prices and input costs.cost inflation.

Net sales in North America increased 3decreased 1 percent compareddue to prior year. Saleslower sales volumes. Total volumes improved 5 percent, while the combined impact of changes in net selling price and product mix reduced net sales by 1 percent. Currency was unfavorable 1 percent. Adult care volumes increased double-digits, with benefits from category growth, innovations and market share gains. Baby wipesinfant and child care decreased low-single digits, as a mid-single digit decline in Huggies diapers was partially offset by a mid-single digit increase in child care. Baby wipes volumes each roseincreased mid-single digits, including benefits from innovation. Femininewhile feminine care volumes advanced low-single digits and diaper volumes were even with year-ago levels.decreased mid-single digits.

Net sales in developing and emerging markets decreased 11increased 9 percent including an approximate18a 3 percent impactincrease from unfavorablefavorable currency rates. ChangesSales volumes increased 9 percent, while changes in sales volumes, net selling prices and product mix each improved netdecreased sales by 23 percent. The volume growthincrease included gains in China, Eastern Europe and portions of Latin America. Sales volumes were downAmerica, led by Brazil. The decline in Brazil, as comparisons were impacted by difficult economic conditions and strong growth in the base period. The higher net selling prices were driven by Latin America and Eastern Europe in response to weaker currency rates and local cost inflation. Net selling prices declinedwas primarily in China due to increased promotion activity.and secondarily in Eastern Europe.

Net sales in developed markets outside North America decreased 78 percent, includingdespite a 91 percent impactbenefit from unfavorable changes infavorable currency rates. Sales volumes rose 2 percent, driven by Australia. Changes in product mix improved net sales by 2 percent, while lower net selling prices reduced netdecreased sales by 2 percent.

First quarter net sales of $1.5 billion decreased by 53 percent compared to prior year. Currency rates were unfavorable by 5 percent. HigherSales volumes decreased 2 percent and changes in net selling prices increased net sales by 1 percent, while changes in product mix reduced netdecreased sales by 1 percent. First quarter operating profit of $280$275 decreased by 4 percent compared to prior year.2 percent. The comparison was impacted by unfavorable currencies, partiallylower net selling prices and volumes, mostly offset by cost savings and lower marketing, research and general spending.

First quarter net sales of $0.8 billion increased 1 percent. Changes in foreign currency rates benefited sales 1 percent. Changes in product mix increased sales by 1 percent, while lower net selling prices decreased sales by 1 percent. First quarter operating profit of $146 decreased 3 percent. The comparison was impacted by lower net selling prices and input cost inflation, mostly offset by cost savings.

Net sales in North America increased 1decreased 2 percent compareddue to prior year. Saleslower net selling prices. Overall sales volumes increasedwere even with the year-ago period, as low-single digit declines in washroom and wiper products were offset by 3 percent, while changesgains in product mix decreased net sales by 2 percent. Sales volumes improved in all product categories, led by paper towels.other categories.

Net sales in developing and emerging markets decreased 14increased 7 percent including a 145 percent negative impactbenefit from changes in currency rates. Changes in net selling prices increased net sales by about 5 percent, while sales volumes decreased 4 percent. The combined impact of changes in net selling prices and product mix improved sales by 3 percent, while sales volumes mostly occurred in Latin America.decreased 1 percent.

Net sales in developed markets outside North America decreased 9 percent. Currency rates were unfavorable by 7 percent. Sales volumes decreasedincreased 2 percent primarily in Western/Central Europe. Changes in net selling prices reduced net sales by 1despite an approximate 3 percent while product mix improved net sales by 1 percent.

Cash provided by operations was $553$436 for the first three months of 2016,2017, compared to $20$553 in the prior year. The increasedecrease was driven by lower pension contributions andmainly due to higher tax payments. First quarter defined benefit pension plan contributions were $30payments in 2016 and $435 in 2015. We expect to contribute up to $100 to our defined benefit pension plans for the full year 2016.2017.

During the first three months of 2016,2017, our capital spending was $220$215 compared to $284$220 in the prior year. We anticipate that full-year 20162017 capital spending will be between $950$850 and $1,050.$950.

Our short-term debt, which consists of U.S. commercial paper with original maturities up to 90 days and/or other similar short-term debt issued by non-U.S. subsidiaries, was $400$368 as of March 31, 20162017 (included in debt payable within one year on the Consolidated Balance Sheet)consolidated balance sheet). The average month-end balance of short-term debt for the first quarter of 20162017 was $805.$353. These short-term borrowings provide supplemental funding for supporting our operations. The level of short-term debt generally fluctuates depending upon the amount of operating cash flows and the timing of customer receipts and payments for items such as pension contributions, dividends and income taxes.

At March 31, 2016,2017, total debt was $7.9$7.8 billion compared to $7.8$7.6 billion at December 31, 2015.2016.

We maintain a $2.0 billion revolving credit facility which expires in 2019.2021. This facility, currently unused, supports our commercial paper program, and would provide liquidity in the event our access to the commercial paper markets is unavailable for any reason.

We repurchase shares of Kimberly-Clark common stock from time to time pursuant to publicly announced share repurchase programs. During the first three months of 2016,2017, we repurchased 1.12.4 million shares of our common stock at a cost of $150$300 through a broker in the open market. We are targeting full-year 20162017 share repurchases of $600$800 to $900,$1 billion, subject to market conditions.

Certain matters contained in this report concerning the business outlook, including the anticipated costs, scope, timing and financial and other effects of the 2014 Organization Restructuring, the anticipated cost savings from the company’sour FORCE program, cash flow and uses of cash, growth initiatives, innovations, marketing and other spending, cost savings and reductions, net sales, anticipated currency rates and exchange risks, raw material, energy and other input costs, effective tax rate, contingencies and anticipated transactions of Kimberly-Clark, including dividends, share repurchases and pension contributions, constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 and are based upon management's expectations and beliefs concerning future events impacting Kimberly-Clark.  There can be no assurance that these future events will occur as

The assumptions used as a basis for the forward-looking statements include many estimates that, among other things, depend on the achievement of future cost savings and projected volume increases. In addition, many factors outside our control, including fluctuations in foreign currency exchange rates, the prices and availability of our raw materials, potential competitive pressures on selling prices for our products, energy costs and retail trade customer actions, as well as general economic and political conditions globally and in the markets in which we do business, could affect the realization of these estimates.

For a description of certain factors that could cause our future results to differ from those expressed in these forward-looking statements, see Item 1A of our Annual Report on Form 10-K for the year ended December 31, 20152016 entitled "Risk Factors." Other factors not presently known to us or that we presently consider immaterial could also affect our business operations and financial results.

As of March 31, 2016,2017, an evaluation was performed under the supervision and with the participation of management, including the Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures. Based on that evaluation, management, including the Chief Executive Officer and Chief Financial Officer, concluded that our disclosure controls and procedures were effective as of March 31, 2016.2017. There were no changes in our internal control over financial reporting during the quarter covered by this report that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

We repurchase shares of Kimberly-Clark common stock from time to time pursuant to publicly announced share repurchase programs. All our share repurchases during the first quarter of 20162017 were made through a broker in the open market.

The following table contains information for shares repurchased during the first quarter of 2016.2017. None of the shares in this table were repurchased directly from any of our officers or directors.