Delta Airlines 2015 Annual Report Download - page 88

TableofContents
Benefit Plan Assets Measured at Fair Value on a Recurring Basis
BenefitPlanAssets.Benefitplanassetsrelatetoourdefinedbenefitpensionplansandcertainofourpostemploymentbenefitplansthatarefundedthrough
trusts.Thefollowingtableshowsourbenefitplanassetsbyassetclass.Theseinvestmentsarepresentednetoftherelatedbenefitobligationinpension,
postretirementandrelatedbenefitsontheConsolidatedBalanceSheets.SeeNote2foradescriptionofthelevelswithinthefairvaluehierarchyandassociated
valuationtechniquesusedtomeasurefairvalue.

December31,2015

December31,2014
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Valuation
Technique(inmillions) Level1 Level2 Level3 Total

Level1 Level2 Level3 Total

Equitiesandequity-relatedinstruments $ 2,067 $ 50 $ 101 $ 2,218

$ 699 $ 1,486 $ — $ 2,185

(a)
Fixedincomeandfixedincome-related
instruments
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







Sovereignfixedincome 8 78 — 86

— — — —

(a)(b)
Credit-relatedfixedincome — 761 97 858

— 470 124 594

(a)(b)
Otherfixedincome 8 143 23 174

18 617 — 635

(a)(b)
Privateequity — — 1,030 1,030

— — 1,213 1,213

(a)(b)
Realassets — — 635 635

— — 663 663

(a)(b)
Hedgefunds — 19 2,971 2,990
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31 — 2,214 2,245

(a)(b)
Cashequivalents — 1,700 — 1,700
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4 2,428 — 2,432

(a)
Other — 2 337 339
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— — 384 384

(a)(b)
Totalbenefitplanassets $ 2,083 $ 2,753 $ 5,194 $ 10,030

$ 752 $ 5,001 $ 4,598 $ 10,351
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
EquitiesandEquity-RelatedInstruments.Investmentsincludecommonstock,commingledfundsinvestedincommonstockandequity-relatedinstruments.
Commonstockisvaluedattheclosingpricereportedontheactivemarketonwhichtheindividualsecuritiesaretraded.Commingledfundsarevaluedusingthenet
assetvaluedividedbythenumberofsharesoutstanding,whichisbasedonquotedmarketpricesoftheunderlyingassetsownedbythefund.Equity-related
instrumentsincludeinvestmentsinsecuritiestradedonexchanges,includinglistedfuturesandoptions,whicharevaluedatthelastreportedsalepricesonthelast
businessdayoftheyearor,ifnotavailable,thelastreportedbidprices.Over-the-countersecuritiesarevaluedatthebidpricesortheaverageofthebidandask
pricesonthelastbusinessdayoftheyearfrompublishedsourcesor,ifnotavailable,fromothersourcesconsideredreliable,generallybrokerquotes.
FixedIncomeandFixedIncome-RelatedInstruments.Investmentsincludecorporatebonds,governmentbonds,collateralizedmortgageobligationsandother
asset-backedsecurities.Theseinvestmentsaregenerallyvaluedatthebidpriceortheaverageofthebidandaskprice.Pricesarebasedonpricingmodels,quoted
pricesofsecuritieswithsimilarcharacteristicsorbrokerquotes.Fixedincome-relatedinstrumentsincludeinvestmentsinsecuritiestradedonexchanges,including
listedfuturesandoptions,whicharevaluedatthelastreportedsalepricesonthelastbusinessdayoftheyearor,ifnotavailable,thelastreportedbidprices.Over-
the-countersecuritiesarevaluedatthebidpricesortheaverageofthebidandaskpricesonthelastbusinessdayoftheyearfrompublishedsourcesor,ifnot
available,fromothersourcesconsideredreliable,generallybrokerquotes.
PrivateEquityandRealAssets.Realassetsincluderealestate,energy,timberlandandagriculture.Thevaluationofprivateequityandrealassetsrequires
significantjudgmentduetotheabsenceofquotedmarketpricesaswellastheinherentlackofliquidityandthelong-termnatureoftheseassets.Investmentsare
valuedbasedonvaluationmodelswhereoneormoreofthesignificantinputsintothemodelcannotbeobservedandwhichrequirethedevelopmentof
assumptions.Wealsoassessthepotentialforadjustmenttothefairvalueoftheseinvestmentsduetothelagintheavailabilityofdata.Inthesecases,wesolicit
preliminaryvaluationupdatesfromtheinvestmentmanagersandusethatinformationandcorroboratingdatafrompublicmarketstodetermineanyneeded
adjustmentstoestimatefairvalue.
HedgeFunds.Ourhedgefundinvestmentsareprimarilymadethroughsharesoflimitedpartnershipsorsimilarstructuresforwhichaliquidsecondarymarket
doesnotexist.HedgefundsareprimarilyconsideredLevel3assets.Hedgefundsaretypicallyvaluedmonthlybythird-partyadministratorsthathavebeen
appointedbythefunds'generalpartners.
CashEquivalents.Theseinvestmentsprimarilyconsistofhigh-quality,short-termobligationsthatareapartofinstitutionalmoneymarketmutualfunds.The
funds'market-basednetassetvaluepershareiscalculatedusingcurrentmarketquotationsoranappropriatesubstitutethatreflectscurrentmarketconditions.
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