Goldman Sachs 2012 Annual Report Download - page 151

Notes to Consolidated Financial Statements
Transfers out of level 3 of other financial assets during the
year ended December 2012 reflected transfers to level 2 of
certain insurance receivables primarily due to increased
transparency of the mortality inputs used to value
these receivables.
Transfers into level 3 of other financial liabilities during the
year ended December 2012 primarily reflected transfers
from level 2 of certain hybrid financial instruments,
principally due to decreased transparency of certain
correlation and volatility inputs used to value
these instruments.
Transfers out of level 3 of other financial liabilities during
the year ended December 2012 primarily reflected transfers
to level 2 of certain hybrid financial instruments, principally
due to increased transparency of certain correlation and
volatility inputs used to value these instruments, and
unobservable inputs no longer being significant to the
valuation of other instruments.
Level 3 Other Financial Assets at Fair Value for the Year Ended December 2011
in millions
Balance,
beginning
of year
Net
realized
gains/
(losses)
Net unrealized
gains/(losses)
relating to
instruments
still held at
year-end Purchases Sales Issuances Settlements
Net
transfers
in and/or
(out) of
level 3
Balance,
end of
year
Securities purchased under agreements
to resell $ 100 $ 2 $ — $ 620 $— $ — $ (165) $ — $ 557
Receivables from customers
and counterparties 298 — 54 468 — — (25) — 795
Total $ 398 $ 2 1$54
1$1,088 $— $ — $ (190) $ — $ 1,352
1. The aggregate amounts include gains of approximately $54 million and $2 million reported in “Market making” and “Other principal transactions,” respectively.
Level 3 Other Financial Liabilities at Fair Value for the Year Ended December 2011
in millions
Balance,
beginning
of year
Net
realized
(gains)/
losses
Net unrealized
(gains)/losses
relating to
instruments
still held at
year-end Purchases Sales Issuances Settlements
Net
transfers
in and/or
(out) of
level 3
Balance,
end of
year
Deposits $ — $— $ — $ — $— $ 13 $ — $ — $ 13
Securities sold under agreements to
repurchase, at fair value 2,060 — — — — 299 (178) — 2,181
Other secured financings 8,349 8 3 — — 483 (4,062) (3,029) 1,752
Unsecured short-term borrowings 3,476 (15) (340) (5) — 815 (1,080) 443 3,294
Unsecured long-term borrowings 2,104 25 5 — — 441 (193) (191) 2,191
Other liabilities and accrued expenses 2,409 — 1,095 5,840 — — (348) — 8,996
Total $18,398 $18 1$ 763 1$5,835 $— $2,051 $(5,861) $(2,777) $18,427
1. The aggregate amounts include losses of approximately $766 million, $7 million and $8 million reported in “Market making,” “Other principal transactions” and
“Interest expense,” respectively.
The net unrealized loss on other financial assets and
liabilities at fair value of $709 million for the year ended
December 2011 primarily consisted of losses on other
liabilities and accrued expenses, primarily attributable to
the impact of a change in interest rates on certain insurance
liabilities. These losses were primarily offset by gains on
unsecured short-term borrowings, primarily reflecting gains
on certain equity-linked notes, principally due to a decline
in global equity markets.
Significant transfers in or out of level 3 during the year
ended December 2011 included:
‰Other secured financings: net transfer out of level 3 of
$3.03 billion, principally due to transfers to level 2 of
certain borrowings as unobservable inputs were no longer
significant to the valuation of these borrowings as they
neared maturity.
‰Unsecured short-term borrowings: net transfer into
level 3 of $443 million, principally due to transfers to
level 3 of certain borrowings due to less transparency of
market prices as a result of less activity in these
financial instruments.
Goldman Sachs 2012 Annual Report 149