Macy's 2009 Annual Report Download - page 83

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
The fair values of the Pension Plan assets as of January 30, 2010, excluding interest and dividend
receivables and pending investment purchases and sales, by asset category are as follows:
Fair Value Measurements
Total
Quoted Prices in
Active Markets for
Identical Assets
(Level 1)
Significant
Observable
Inputs
(Level 2)
Significant
Unobservable
Inputs
(Level 3)
(millions)
Cash and cash equivalents .......................... $ 184 $ – $ 184 $ –
Equity securities:
U.S ........................................ 613 163 450 –
International ................................. 262 – 262 –
Fixed income securities:
U. S. Treasury bonds .......................... 41 – 41 –
Other Government bonds ....................... 11 – 11 –
Agency backed bonds ......................... 15 – 15 –
Corporate bonds .............................. 91 – 91 –
Mortgage-backed securities ..................... 91 – 91 –
Asset-backed securities ........................ 20 – 20 –
Pooled funds ................................. 164 – 164 –
Other types of investments:
Real estate .................................. 156 – – 156
Hedge funds ................................. 133 – – 133
Private equity ................................ 124 – – 124
Total ........................................... $1,905 $163 $1,329 $413
Corporate bonds consist primarily of investment grade bonds of U.S. issuers from diverse industries.
The fair value of the real estate, hedge funds and private equity investments represents the reported net asset
value of shares or underlying assets of the investment. Private equity and real estate investments are valued using
fair values per the most recent financial reports provided by the investment sponsor, adjusted as appropriate for
any lag between the date of the financial reports and January 30, 2010. The real estate investments are diversified
across property types and geographical areas primarily in the United States of America. Private equity
investments generally invest in limited partnerships in the United States of America and Europe. The hedge fund
investments are through a fund of funds approach.
Due to the nature of the underlying assets of the real estate, hedge funds and private equity investments,
changes in market conditions and the economic environment may significantly impact the net asset value of these
investments and, consequently, the fair value of the Pension Plan’s investments. These investments are
redeemable at net asset value to the extent provided in the documentation governing the investments. However,
these redemption rights may be restricted in accordance with the governing documents. Redemption of these
investments is subject to restrictions including lock-up periods where no redemptions are allowed, restrictions on
redemption frequency and advance notice periods for redemptions. As of January 30, 2010, certain of these
investments are generally subject to lock-up periods, ranging from four to ten years, certain of these investments
are subject to restrictions on redemption frequency, ranging from daily to twice per year, and certain of these
investments are subject to advance notice requirements, ranging from sixty-day notification to ninety-day
notification. As of January 30, 2010, the Pension Plan had unfunded commitments related to certain of these
investments totaling approximately $78 million.
F-35