Annual report pursuant to Section 13 and 15(d)

CASH AND INVESTMENTS (Tables)

v3.8.0.1
CASH AND INVESTMENTS (Tables)
12 Months Ended
Dec. 31, 2017
Investments and Cash [Abstract]  
Schedule of Unrealized Loss on Investments [Table Text Block]
The following table presents the age of gross unrealized losses and fair value by investment category for all securities in a loss position as of December 31, 2017 (in millions):
 
Less Than 12 Months
 
12 Months or More
 
Total
 
Fair Value
 
Unrealized Losses
 
Fair Value
 
Unrealized Losses
 
Fair Value
 
Unrealized Losses
U.S. government and agency debt securities
$
183

 
$
(2
)
 
$
90

 
$
(1
)
 
$
273

 
$
(3
)
Mortgage and asset-backed debt securities
36

 

 
25

 

 
61

 

Corporate debt securities
101

 
(1
)
 
70

 

 
171

 
(1
)
Non-U.S. government debt securities
8

 

 

 

 
8

 

Total marketable securities
$
328

 
$
(3
)
 
$
185

 
$
(1
)
 
$
513

 
$
(4
)
Summary of Marketable Securities
The following is a summary of marketable securities classified as trading and available-for-sale at December 31, 2017 and 2016 (in millions):
 
Cost
 
Unrealized
Gains
 
Unrealized
Losses
 
Estimated
Fair Value
2017
 
 
 
 
 
 
 
Current trading marketable securities:
 
 
 
 
 
 
 
Corporate debt securities
$
75

 
$

 
$

 
$
75

Carbon credit investments(1)
77

 
16

 

 
93

Total trading marketable securities
152

 
16

 

 
168

 
 
 
 
 
 
 
 
Current available-for-sale marketable securities:
 
 
 
 
 
 
 
U.S. government and agency debt securities
286

 

 
(3
)
 
283

Mortgage and asset-backed debt securities
86

 

 

 
86

Corporate debt securities
201

 
1

 
(1
)
 
201

Equity securities
2

 

 

 
2

Non-U.S. government debt securities
9

 

 

 
9

Total available-for-sale marketable securities
584

 
1

 
(4
)
 
581

 
 
 
 
 
 
 
 
Total current marketable securities
$
736

 
$
17

 
$
(4
)
 
$
749

 
 
 
 
 
 
 
 
 
Cost
 
Unrealized
Gains
 
Unrealized
Losses
 
Estimated
Fair Value
2016
 
 
 
 
 
 
 
Current trading marketable securities:
 
 
 
 
 
 
 
Corporate debt securities
$
427

 
$

 
$

 
$
427

Carbon credit investments(1)
80

 
10

 

 
90

Total trading marketable securities
507

 
10

 

 
517

 
 
 
 
 
 
 
 
Current available-for-sale marketable securities:
 
 
 
 
 
 
 
U.S. government and agency debt securities
314

 

 
(2
)
 
312

Mortgage and asset-backed debt securities
90

 
1

 

 
91

Corporate debt securities
167

 

 
(1
)
 
166

Equity securities
2

 

 

 
2

Non-U.S. government debt securities
3

 

 

 
3

Total available-for-sale marketable securities
576

 
1

 
(3
)
 
574

 
 
 
 
 
 
 
 
Total current marketable securities
$
1,083

 
$
11

 
$
(3
)
 
$
1,091

 
 
 
 
 
 
 
 
(1) These investments are hedged with forward contracts that are not designated in hedging relationships. See note 15 for offsetting statement of consolidated income impact.
Amortized Cost and Estimated Fair Value of Marketable Securities by Contractual Maturity
The amortized cost and estimated fair value of marketable securities at December 31, 2017, 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
$
112

 
$
112

Due after one year through three years
453

 
449

Due after three years through five years
21

 
21

Due after five years
73

 
74

 
659

 
656

Equity and carbon credit investment securities
77

 
93

 
$
736

 
$
749

Investments Measured at Fair Value on a Recurring Basis
The following table presents information about our investments measured at fair value on a recurring basis as of December 31, 2017 and 2016, 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)
 
Total
2017
 
 
 
 
 
 
 
Marketable securities:
 
 
 
 
 
 
 
U.S. government and agency debt securities
$
283

 
$

 
$

 
$
283

Mortgage and asset-backed debt securities

 
86

 

 
86

Corporate debt securities

 
276

 

 
276

Equity securities

 
2

 

 
2

Non-U.S. government debt securities

 
9

 

 
9

Carbon credit investments
93

 

 

 
93

Total marketable securities
376

 
373

 

 
749

Other non-current investments
19

 

 
6

 
25

Total
$
395

 
$
373

 
$
6

 
$
774

 
 
 
 
 
 
 
 
 
Quoted Prices in
Active Markets 
for Identical
Assets
(Level 1)
 
Significant Other
Observable Inputs
(Level 2)
 
Significant
Unobservable
Inputs
(Level 3)
 
Total
2016
 
 
 
 
 
 
 
Marketable securities:
 
 
 
 
 
 
 
U.S. government and agency debt securities
$
312

 
$

 
$

 
$
312

Mortgage and asset-backed debt securities

 
91

 

 
91

Corporate debt securities

 
593

 

 
593

Equity securities

 
2

 

 
2

Non-U.S. government debt securities

 
3

 

 
3

Carbon credit investments
90

 

 

 
90

Total marketable securities
402

 
689

 

 
1,091

Other non-current investments
18

 

 
13

 
31

Total
$
420

 
$
689

 
$
13

 
$
1,122

Changes in Level 3 Instruments Measured on a Recurring Basis
The following table presents the changes in the above Level 3 instruments measured on a recurring basis for the years ended December 31, 2017 and 2016 (in millions).
 
Marketable
Securities
 
Other
Investments
 
Total
Balance on January 1, 2016
$

 
$
32

 
$
32

Transfers into (out of) Level 3

 

 

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

 
(19
)
 
(19
)
Included in accumulated other comprehensive income (pre-tax)

 

 

Purchases

 

 

Settlements

 

 

Balance on December 31, 2016
$

 
$
13

 
$
13

Transfers into (out of) Level 3

 

 

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

 
(7
)
 
(7
)
Included in accumulated other comprehensive income (pre-tax)

 

 

Purchases

 

 

Settlements

 

 

Balance on December 31, 2017
$

 
$
6

 
$
6