Quarterly report pursuant to Section 13 or 15(d)

CASH AND INVESTMENTS (Tables)

v2.4.0.6
CASH AND INVESTMENTS (Tables)
 3 Months Ended 9 Months Ended
Sep. 30, 2012
Sep. 30, 2012
Marketable Securities [Abstract]    
Available-for-sale Securities  
The following is a summary of marketable securities classified as available-for-sale as of September 30, 2012 and December 31, 2011 (in millions):
 
Cost
 
Unrealized
Gains
 
Unrealized
Losses
 
Estimated
Fair Value
September 30, 2012
 
 
 
 
 
 
 
Current marketable securities:
 
 
 
 
 
 
 
U.S. government and agency debt securities
$
242

 
$
3

 
$
—

 
$
245

Mortgage and asset-backed debt securities
152

 
4

 
—

 
156

Corporate debt securities
157

 
6

 
—

 
163

U.S. state and local municipal debt securities
15

 
—

 
—

 
15

Other debt and equity securities
7

 
—

 
—

 
7

Total marketable securities
$
573

 
$
13

 
$
—

 
$
586

 
 
 
 
 
 
 
 
 
Cost
 
Unrealized
Gains
 
Unrealized
Losses
 
Estimated
Fair Value
December 31, 2011
 
 
 
 
 
 
 
Current marketable securities:
 
 
 
 
 
 
 
U.S. government and agency debt securities
$
184

 
$
3

 
$
—

 
$
187

Mortgage and asset-backed debt securities
188

 
4

 
(1
)
 
191

Corporate debt securities
835

 
4

 
(2
)
 
837

U.S. state and local municipal debt securities
15

 
—

 
—

 
15

Other debt and equity securities
10

 
1

 
—

 
11

Total marketable securities
$
1,232

 
$
12

 
$
(3
)
 
$
1,241

Investments Classified by Contractual Maturity Date  
The amortized cost and estimated fair value of marketable securities at September 30, 2012, by contractual maturity, are shown below (in millions). Actual maturities may differ from contractual maturities because the issuers of the securities may have the right to prepay obligations without prepayment penalties.
 
Cost
 
Estimated
Fair Value
Due in one year or less
$
43

 
$
43

Due after one year through three years
242

 
244

Due after three years through five years
52

 
53

Due after five years
234

 
244

 
571

 
584

Equity securities
2

 
2

 
$
573

 
$
586

Fair Value, Assets Measured on Recurring Basis  
The following table presents information about our investments measured at fair value on a recurring basis as of September 30, 2012 and December 31, 2011, and indicates the fair value hierarchy of the valuation techniques utilized to determine such fair value (in millions):
 
Quoted Prices
in Active
Markets for
Identical
Assets
(Level 1)
 
Significant Other
Observable Inputs
(Level 2)
 
Significant
Unobservable
Inputs
(Level 3)
 
Balance 
September 30, 2012
 
 
 
 
 
 
 
Marketable Securities:
 
 
 
 
 
 
 
U.S. government and agency debt securities
$
245

 
$
—

 
$
—

 
$
245

Mortgage and asset-backed debt securities
—

 
156

 
—

 
156

Corporate debt securities
—

 
163

 
—

 
163

U.S. state and local municipal debt securities
—

 
15

 
—

 
15

Other debt and equity securities
—

 
7

 
—

 
7

Total marketable securities
245

 
341

 
—

 
586

Other investments
19

 
—

 
177

 
196

Total
$
264

 
$
341

 
$
177

 
$
782

 

 
Quoted Prices
in Active
Markets for
Identical
Assets
(Level 1)
 
Significant Other
Observable Inputs
(Level 2)
 
Significant
Unobservable
Inputs
(Level 3)
 
Balance 
December 31, 2011
 
 
 
 
 
 
 
Marketable Securities:
 
 
 
 
 
 
 
U.S. government and agency debt securities
$
187

 
$
—

 
$
—

 
$
187

Mortgage and asset-backed debt securities
—

 
191

 
—

 
191

Corporate debt securities
—

 
837

 
—

 
837

U.S. state and local municipal debt securities
—

 
15

 
—

 
15

Other debt and equity securities
—

 
11

 
—

 
11

Total marketable securities
187

 
1,054

 
—

 
1,241

Other investments
17

 
—

 
217

 
234

Total
$
204

 
$
1,054

 
$
217

 
$
1,475

Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation
The following table presents the changes in the above Level 3 instruments measured on a recurring basis for the three months ended September 30, 2012 and 2011 (in millions):
 
Marketable
Securities
 
Other
Investments
 
Total
Balance on July 1, 2012
$
—

 
$
190

 
$
190

Transfers into (out of) Level 3
—

 
—

 
—

Net realized and unrealized gains (losses):
 
 
 
 
 
Included in earnings (in investment income)
—

 
(13
)
 
(13
)
Included in accumulated other comprehensive income (pre-tax)
—

 
—

 
—

Purchases
—

 
—

 
—

Sales
—

 
—

 
—

Balance on September 30, 2012
$
—

 
$
177

 
$
177

 
 
 
 
 
 
 
Marketable
Securities
 
Other
Investments
 
Total
Balance on July 1, 2011
$
—

 
$
240

 
$
240

Transfers into (out of) Level 3
—

 
—

 
—

Net realized and unrealized gains (losses):
 
 
 
 
 
Included in earnings (in investment income)
—

 
(12
)
 
(12
)
Included in accumulated other comprehensive income (pre-tax)
—

 
—

 
—

Purchases
—

 
—

 
—

Sales
—

 
—

 
—

Balance on September 30, 2011
$
—

 
$
228

 
$
228

The following table presents the changes in the above Level 3 instruments measured on a recurring basis for the nine months ended September 30, 2012 and 2011 (in millions):
 
Marketable
Securities
 
Other
Investments
 
Total
Balance on January 1, 2012
$
—

 
$
217

 
$
217

Transfers into (out of) Level 3
—

 
—

 
—

Net realized and unrealized gains (losses):

 

 

Included in earnings (in investment income)
—

 
(40
)
 
(40
)
Included in accumulated other comprehensive income (pre-tax)
—

 
—

 
—

Purchases
—

 
—

 
—

Sales
—

 
—

 
—

Balance on September 30, 2012
$
—

 
$
177

 
$
177

 
 
 
 
 
 
 
Marketable
Securities

 
Other
Investments

 
Total
Balance on January 1, 2011
$
138

 
$
267

 
$
405

Transfers into (out of) Level 3
—

 
—

 
—

Net realized and unrealized gains (losses):

 

 

Included in earnings (in investment income)
—

 
(39
)
 
(39
)
Included in accumulated other comprehensive income (pre-tax)
—

 
—

 
—

Purchases
—

 
—

 
—

Sales
(138
)
 
—

 
(138
)
Balance on September 30, 2011
$
—

 
$
228

 
$
228