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101
Note 19 – Fair Value Measurements
The following table presents our assets and liabilities that are measured at fair value on a recurring basis
and are categorized using the fair value hierarchy. The fair value hierarchy has three levels based on the
reliability of the inputs used to determine fair value. Level 1 refers to fair values determined based on
quoted prices in active markets for identical assets. Level 2 refers to fair values estimated using significant
other observable inputs and Level 3 includes fair values estimated using significant unobservable inputs.
December 31, 2014 December 31, 2013
Total Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3
Assets
Money market funds $3,826 $3,826 $3,783 $3,783
Available-for-sale
investments 778 6 $2
Derivatives 25 $25 86 $86
Total assets $3,858 $3,833 $25 $3,877 $3,789 $86 $2
Liabilities
Derivatives ($217) ($217)($79) ($79)
Total liabilities ($217) ($217)($79) ($79)
Money market funds and available-for-sale equity securities are valued using a market approach based
on the quoted market prices of identical instruments. Available-for-sale debt investments are primarily
valued using an income approach based on benchmark yields, reported trades and broker/dealer quotes.
Derivatives include foreign currency, commodity and interest rate contracts. Our foreign currency forward
contracts are valued using an income approach based on the present value of the forward rate less the
contract rate multiplied by the notional amount. Commodity derivatives are valued using an income
approach based on the present value of the commodity index prices less the contract rate multiplied by
the notional amount. The fair value of our interest rate swaps is derived from a discounted cash flow
analysis based on the terms of the contract and the interest rate curve.
Certain assets have been measured at fair value on a nonrecurring basis using significant unobservable
inputs (Level 3). The following table presents the nonrecurring losses recognized for the years ended
December 31 due to long-lived asset impairment, and the fair value and asset classification of the related
assets as of the impairment date:
2014 2013
Fair
Value
Total
Losses
Fair
Value
Total
Losses
Operating lease equipment $187 ($170) $216 ($81)
Property, plant and equipment 19 (15) 40 (15)
Other assets and Acquired intangible assets (17)
Total $206 ($202) $256 ($96)
The fair value of the impaired operating lease equipment is derived by calculating a median collateral value
from a consistent group of third party aircraft value publications. The values provided by the third party
aircraft publications are derived from their knowledge of market trades and other market factors.
Management reviews the publications quarterly to assess the continued appropriateness and consistency
with market trends. Under certain circumstances, we adjust values based on the attributes and condition
of the specific aircraft or equipment, usually when the features or use of the aircraft vary significantly from