Time Magazine 2015 Annual Report Download - page 97

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TIME WARNER INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)
Investment Writedowns
For the years ended December 31, 2015, 2014 and 2013, the Company incurred writedowns to reduce the carrying
value of certain investments that experienced other-than-temporary impairments, as set forth below (millions):
December 31,
2015 2014 2013
Equity-method investments ........................................... $ 2 $ 21 $ 5
Cost-method investments ............................................. 6 8 5
Available-for-sale securities ........................................... 19 6 7
Total ............................................................. $ 27 $ 35 $ 17
These amounts have been reflected in Other loss, net in the Consolidated Statement of Operations.
While Time Warner has recognized all declines that are believed to be other-than-temporary as of December 31, 2015,
it is reasonably possible that individual investments in the Company’s portfolio may experience other-than-temporary
declines in value in the future if the underlying investees experience poor operating results or the U.S. or certain foreign
equity markets experience declines in value.
5. FAIR VALUE MEASUREMENTS
A fair value measurement is determined based on the assumptions that a market participant would use in pricing an
asset or liability. A three-tiered hierarchy draws distinctions between market participant assumptions based on (i) observable
inputs such as quoted prices in active markets (Level 1), (ii) inputs other than quoted prices in active markets that are
observable either directly or indirectly (Level 2) and (iii) unobservable inputs that require the Company to use present value
and other valuation techniques in the determination of fair value (Level 3). The following table presents information about
assets and liabilities required to be carried at fair value on a recurring basis as of December 31, 2015 and December 31, 2014,
respectively (millions):
December 31, 2015 December 31, 2014
Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total
Assets:
Trading securities:
Diversified equity
securities (a) ...... $ 179 $ — $ — $ 179 $ 232 $ 5 $ — $ 237
Available-for-sale
securities:
Equity securities ..... 15——1519——19
Debt securities ...... — 70 — 70 — 60 — 60
Derivatives:
Foreign exchange
contracts ......... —79—79—61—61
Other .............. — — 180 180 — — 247 247
Liabilities:
Derivatives:
Foreign exchange
contracts ......... — (2) — (2) — (3) — (3)
Other .............. — — (7) (7) — — (6) (6)
Total .............. $ 194 $ 147 $ 173 $ 514 $ 251 $ 123 $ 241 $ 615
(a) Consists of investments related to deferred compensation.
83