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90
NOTE 10 – FINANCIAL INSTRUMENTS
Investments
The Company’s investments in marketable securities are primarily classified as available-for-sale securities.
Investing Results
In millions 2013 2012 2011
Proceeds from sales of available-for-sale securities $ 486 $ 514 $ 764
Gross realized gains $ 66 $ 40 $ 44
Gross realized losses $ (4) $ (11) $ (14)
The following table summarizes the contractual maturities of the Company’s investments in debt securities:
Contractual Maturities of Debt Securities
at December 31, 2013
In millions Amortized Cost Fair Value
Within one year $ 17 $ 16
One to five years 533 567
Six to ten years 519 527
After ten years 134 149
Total $ 1,203 $ 1,259
At December 31, 2013, the Company had $1,581 million ($1,701 million at December 31, 2012) of held-to-maturity securities
(primarily Treasury Bills) classified as cash equivalents as these securities had maturities of three months or less at the time of
purchase. The Company’s investments in held-to-maturity securities are held at amortized cost, which approximates fair value.
At December 31, 2013, the Company had investments in money market funds of $1,331 million classified as cash equivalents
($252 million at December 31, 2012).
The net unrealized gain/loss from mark-to-market adjustments recognized in earnings on trading securities held at the end of
the year was a $13 million loss in 2013, a $1 million gain in 2012 and a $13 million gain in 2011.
The following table provides the fair value and gross unrealized losses of the Company’s investments that were deemed to be
temporarily impaired at December 31, 2013 and 2012, aggregated by investment category:
Temporarily Impaired Securities at December 31 (1)
2013 2012
Less than 12 months Less than 12 months
In millions
Fair
Value
Unrealized
Losses
Fair
Value
Unrealized
Losses
Government debt (2) $ 160 $ (8) $ — $ —
Corporate bonds 213 (7) 22 (1)
Equity securities 144 (4) 30 (2)
Total temporarily impaired securities $ 517 $ (19) $ 52 $ (3)
(1) Unrealized losses of 12 months or more were less than $1 million.
(2) U.S. Treasury obligations, U.S. agency obligations, agency mortgage-backed securities and other
municipalities' obligations.
Portfolio managers regularly review the Company’s holdings to determine if any investments are other-than-temporarily
impaired. The analysis includes reviewing the amount of the impairment, as well as the length of time it has been impaired. In
addition, specific guidelines for each instrument type are followed to determine if an other-than-temporary impairment has
occurred.
For debt securities, the credit rating of the issuer, current credit rating trends, the trends of the issuer’s overall sector, the ability
of the issuer to pay expected cash flows and the length of time the security has been in a loss position are considered in
determining whether unrealized losses represent an other-than-temporary impairment. The Company did not have any credit-
related losses during 2013, 2012 or 2011.