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For purposes of comparison, the following tables present additional information about Level 3 assets
measured at fair value on a recurring basis for the year ended December 31, 2010:
Available-for-sale marketable securities
Twelve Months Ended,
December 31, 2010
Total Level 3
securities
Corporate debt
securities
AB and MB
securities
ARS - muni
debt
securities
ARS - preferred
securities
Balance, beginning of period ...... $25.4 $ 1.0 $ 2.4 $18.6 $3.4
Realized and unrealized gains/
(losses) included in earnings* . . . (0.2) — (0.2) — —
Unrealized gains/(losses) included
in OCI — OTTI securities ....... 1.2 — 0.6 0.6 —
Unrealized gains/(losses) included
in OCI — All other ............. 0.1 — 0.2 (0.2) 0.1
Purchases ..................... 8.4 8.4 — — —
Sales and redemptions .......... (10.1) (3.7) (1.9) (4.5) —
Transfers in .................... 11.1 5.1 6.0 — —
Transfers out ................... (8.4) (8.0) (0.4) — —
Balance, end of period ........... $27.5 $ 2.8 $ 6.7 $14.5 $3.5
OCI = Other comprehensive income
OTTI = Other-than-temporary impairment
AB = Asset-backed
MB = Mortgage-backed
ARS = Auction rate security
* Included in Other (income) expense, net on the Consolidated Statements of Earnings
Realized and unrealized losses included in earnings during 2010 included $0.2 million of OTTI of Level
3 mortgage-backed securities that were held by the Company at December 31, 2010. OTTI is recorded
in Net impairment losses on securities on the Consolidated Statements of Earnings.
Transfers
2011
The Company transferred, on a gross basis, $80.3 million of U.S. agency debt securities and $20.2
million of corporate debt securities from Level 1 to Level 2 due to lower levels of market activity noted
during 2011. The Company also transferred from Level 2 to Level 1, on a gross basis, $21.6 million of
U.S. agency debt securities and $36.8 million of corporate debt securities due to trading volumes
sufficient to indicate an active market for the securities.
Additionally, as indicated in the table above, the Company transferred, on a gross basis, $2.5 million of
asset-backed securities, $20.7 million of corporate debt securities and $1.5 million of U.S. agency debt
securities from Level 2 to Level 3 during 2011. The Company was unable to corroborate the consensus
price of these securities with a sufficient level of observable market data to maintain Level 2
classification. The Company also transferred, on a gross basis, $3.3 million of corporate debt and
mortgage-backed securities from Level 3 to Level 2 as the Company was able to obtain information
demonstrating that the prices were observable in the market as of December 31, 2011.
2010
The Company transferred, on a gross basis, $51.6 million from Level 1 to Level 2 due to lower levels of
market activity for certain U.S. agency debt securities noted during 2010. The fair values of the
Company’s U.S. agency debt securities are generally categorized as Level 1 but may be downgraded
based on the Company’s assessment of market activity for individual securities. The Company also
transferred from Level 2 to Level 1, on a gross basis, $14.8 million of corporate debt securities due to
trading volumes sufficient to indicate an active market for the securities as well as $1.7 million of U.S.
agency debt securities due to the securities resuming higher levels of market activity during 2010.
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