MoneyGram 2015 Annual Report Download - page 93
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Table of Contents
The Company records its pension assets at fair value as described in Note 4 — FairValueMeasurement.The following is a description of the Pension Plan’s
investments at fair value and valuation methodologies:
•Common/collectivetrusts— The fair values of the underlying funds in the common/collective trusts are valued based on the unit value established
for each fund at each valuation date. The unit value of a collective investment fund is calculated by dividing the fund's net asset value on the
calculation date by the number of units of the fund that are outstanding on the calculation date, which is derived from observable purchase and
redemption activity in the collective investment fund.
• Real estate — The Pension Plan trust holds an investment in a real estate development project. The fair value of this investment represents the
estimated fair value of the plan’s related ownership percentage in the project based upon an appraisal of the underlying real property as of each
balance sheet date. The fund investment strategy for this asset is long-term capital appreciation.
The following tables are a summary of the Pension Plan’s financial assets recorded at fair value, by hierarchy level, as of December 31 :
2015
(Amounts in millions) Level 1
Level 2
Level 3
Total
Common/collective trusts
Short-term investment fund $ —
$ 1.2
$ —
$ 1.2
Equity securities:
Large cap —
26.8
—
26.8
Small cap —
6.3
—
6.3
International —
14.8
—
14.8
Fixed income securities —
53.3
—
53.3
Total common/collective trusts $ —
$ 102.4
$ —
$ 102.4
Real estate —
—
5.5
5.5
Total financial assets $ —
$ 102.4
$ 5.5
$ 107.9
2014
(Amounts in millions) Level 1
Level 2
Level 3
Total
Common/collective trusts
Short-term investment fund $ —
$ 1.0
$ —
$ 1.0
Equity securities:
Large cap —
34.2
—
34.2
Small cap —
8.8
—
8.8
International —
16.4
—
16.4
Emerging —
3.5
—
3.5
Fixed income —
72.7
—
72.7
Total common/collective trusts $ —
$ 136.6
$ —
$ 136.6
Real estate —
—
5.0
5.0
Total financial assets $ —
$ 136.6
$ 5.0
$ 141.6
The Company’s Pension Plan assets include one security that the Company considers to be a Level 3 asset for valuation purposes. This security is an investment in
a real estate joint venture and requires the use of unobservable inputs in its fair value measurement. The fair value of this asset as of December 31, 2015 and 2014
was $5.5 million and $5.0 million , respectively. The change in reported fair value was the result of $0.5 million change in unrealized gain for 2015 .
The following table represents the Pension Plan's Level 3 financial instrument and the valuation technique used to measure the fair value of the financial
instrument.
(Amounts in millions)
2015
2014
Instrument
Principal Valuation Technique
Fair Value
Fair Value
Real estate
Appraisal of underlying asset
$ 5.5
$ 5.0
F-29