Amgen 2011 Annual Report Download - page 161

AMGEN INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Fair value measurement as of December 31, 2010, using:
Quoted prices in
active markets for
identical assets
(Level 1)
Significant other
observable
inputs
(Level 2)
Significant
unobservable
inputs
(Level 3) Total
Assets:
Available-for-sale investments:
U.S. Treasury securities ................. $5,080 $ — $ — $ 5,080
Other government-related debt securities:
Obligations of U.S. government agencies
and FDIC-guaranteed bank debt ....... — 2,208 — 2,208
Foreign and other .................... — 852 — 852
Corporate debt securities: ................
Financial ........................... — 2,296 — 2,296
Industrial ........................... — 2,507 — 2,507
Other .............................. — 316 — 316
Mortgage- and asset-backed securities ...... — 841 — 841
Money market mutual funds .............. 3,030 — — 3,030
Other short-term interest-bearing securities . . — 147 — 147
Equity securities ....................... 48 — — 48
Derivatives:
Foreign currency contracts ............... — 154 — 154
Interest rate swap contracts ............... — 195 — 195
Total assets ..................... $8,158 $9,516 $ — $ 17,674
Liabilities:
Derivatives:
Foreign currency contracts ............... $ — $ 103 $— $ 103
Total liabilities ................... $ — $ 103 $— $ 103
The fair values of our U.S. Treasury securities, money market mutual funds and equity securities are based
on quoted market prices in active markets with no valuation adjustment.
Substantially all of our other government related and corporate debt securities are investment grade with
maturity dates of five years or less from the balance sheet date. Our other government related debt securities
portfolio is composed of securities with weighted-average credit ratings of AA+ by Standard & Poor’s (S&P) and
AAA or equivalent by Moody’s Investors Service, Inc. (Moody’s) or Fitch, Inc. (Fitch); and our corporate debt
securities portfolio has a weighted-average credit rating of A- by S&P and A or equivalent by Moody’s or Fitch.
We estimate the fair values of these securities by taking into consideration valuations obtained from third-party
pricing services. The pricing services utilize industry standard valuation models, including both income- and
market-based approaches, for which all significant inputs are observable, either directly or indirectly, to estimate
fair value. These inputs include reported trades of and broker/dealer quotes on the same or similar securities;
issuer credit spreads; benchmark securities; and other observable inputs.
Our mortgage and asset backed securities portfolio is composed entirely of senior tranches, with credit
ratings of AAA or equivalent by S&P, Moody’s or Fitch. We estimate the fair values of these securities by taking
into consideration valuations obtained from third-party pricing services. The pricing services utilize industry
standard valuation models, including both income- and market-based approaches, for which all significant inputs
are observable, either directly or indirectly, to estimate fair value. These inputs include reported trades of and
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