ADT 2012 Annual Report Download - page 182

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Equity securities consist primarily of publicly traded U.S. and non-U.S. equities. Publicly traded securities
are valued at the last trade or closing price reported in the active market in which the individual securities are
traded. Certain equity securities are held within commingled funds which are valued at the unitized net asset
value (“NAV”) or percentage of the net asset value as determined by the custodian of the fund. These values are
based on the fair value of the underlying net assets owned by the fund.
Fixed income securities consist primarily of government and agency securities, corporate debt securities,
and mortgage and other asset-backed securities. When available, fixed income securities are valued at the closing
price reported in the active market in which the individual security is traded. Government and agency securities
and corporate debt securities are valued using the most recent bid prices or occasionally the mean of the latest bid
and ask prices when markets are less liquid. Asset-backed securities including mortgage backed securities are
valued using broker/dealer quotes when available. When quotes are not available, fair value is determined
utilizing a discounted cash flow approach, which incorporates other observable inputs such as cash flows,
underlying security structure and market information including interest rates and bid evaluations of comparable
securities. Certain fixed income securities are held within commingled funds which are valued utilizing NAV
determined by the custodian of the fund. These values are based on the fair value of the underlying net assets
owned by the fund.
Cash and cash equivalents consist primarily of short-term commercial paper, bonds and other cash or cash-
like instruments including settlement proceeds due from brokers, stated at cost, which approximates fair value.
The following tables set forth a summary of pension plan assets valued using NAV or its equivalent as of
September 28, 2012 and September 30, 2011 ($ in millions):
September 28, 2012
Investment
Fair
Value
Redemption
Frequency Redemption Notice Period
U.S. equity securities .......... $21 Daily 1 day, 5 days
Non-U.S. equity securities ...... 10 Daily 3 days
Government and government
agency securities ........... 10 Daily 2 days
Corporate debt securities ....... 10 Daily 2 days
$51
September 30, 2011
Investment
Fair
Value
Redemption
Frequency Redemption Notice Period
U.S. equity securities .......... $ 5 Daily 1 day
Non-U.S. equity securities ...... 1 Daily, Semi-monthly 1 day, 5 days
Government and government
agency securities ........... 4 Daily 1 day
Corporate debt securities ....... 4 Daily 1 day, 2 days, 3 days
Mortgage and other asset-backed
securities ................. 1 Daily 1 day, 3 days
$15
The strategy of the Company’s investment managers with regard to the investments valued using NAV or its
equivalent is to either match or exceed relevant benchmarks associated with the respective asset category. None
of the investments valued using NAV or its equivalent contain any redemption restrictions or unfunded
commitments.
90