3M 2011 Annual Report Download - page 92

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86
partnership interests’ cash flows. REITS are valued at the closing price reported in the active market in which it is
traded.
Absolute return consists of private partnership interests in hedge funds, insurance contracts, derivative instruments,
hedge fund of funds, and bank loan funds. Insurance consists of insurance contracts, which are valued using cash
surrender values which is the amount the plan would receive if the contract was cashed out at year end. Derivative
instruments consist of interest rate swaps that are used to help manage risks. Hedge funds are valued at the NAV as
determined by the independent administrator or custodian of the fund.
Other items to reconcile to fair value of plan assets is the net of interest receivable, amounts due for securities sold,
amounts payable for securities purchased and interest payable.
The following table sets forth a summary of changes in the fair values of the international pension plans level 3
assets for the years ended December 31, 2011 and 2010:
Fair Value Measurement Using Significant Unobservable Inputs (Level 3)
(Millions) Equities
Fixed
Income
Private
Equity
Absolute
Return Total
Beginning balance at January 1, 2010 .......... $ 14 $ 22 $ 59 $ 375 $ 470
Net transfers into / (out of) level 3 ................. 97 17
—
—
114
Foreign currency exchange ........................... 2 — 4 (18) (12 )
Purchases, sales, issuances and settlements,
net .............................................................. (15 ) — 7 10 2
Realized gain/(loss) ....................................... (18 ) — (3)
—
(21 )
Change in unrealized gains/(losses) relating to
instruments still held at the reporting date . 18 (5 ) 3 (23) (7 )
Ending balance at December 31, 2010 ......... 98 34 70 344 546
Net transfers into / (out of) level 3 ................. (93 ) — (21) 18 (96 )
Foreign currency exchange ........................... — (1 ) (1) (10) (12 )
Purchases, sales, issuances and settlements,
net .............................................................. — — 17 3 20
Realized gain/(loss) ....................................... — —
—
1 1
Change in unrealized gains/(losses) relating to
instruments still held at the reporting date . — 6 2 14 22
Ending balance at December 31, 2011 ......... $ 5 $ 39 $ 67 $ 370 $ 481