Alcoa 2010 Annual Report Download - page 149
Download and view the complete annual report
Please find page 149 of the 2010 Alcoa annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.-
1 -
2
-
3
-
4
-
5
-
6
-
7
-
8
-
9
-
10
-
11
-
12
-
13
-
14
-
15
-
16
-
17
-
18
-
19
-
20
-
21
-
22
-
23
-
24
-
25
-
26
-
27
-
28
-
29
-
30
-
31
-
32
-
33
-
34
-
35
-
36
-
37
-
38
-
39
-
40
-
41
-
42
-
43
-
44
-
45
-
46
-
47
-
48
-
49
-
50
-
51
-
52
-
53
-
54
-
55
-
56
-
57
-
58
-
59
-
60
-
61
-
62
-
63
-
64
-
65
-
66
-
67
-
68
-
69
-
70
-
71
-
72
-
73
-
74
-
75
-
76
-
77
-
78
-
79
-
80
-
81
-
82
-
83
-
84
-
85
-
86
-
87
-
88
-
89
-
90
-
91
-
92
-
93
-
94
-
95
-
96
-
97
-
98
-
99
-
100
-
101
-
102
-
103
-
104
-
105
-
106
-
107
-
108
-
109
-
110
-
111
-
112
-
113
-
114
-
115
-
116
-
117
-
118
-
119
-
120
-
121
-
122
-
123
-
124
-
125
-
126
-
127
-
128
-
129
-
130
-
131
-
132
-
133
-
134
-
135
-
136
-
137
-
138
-
139 -
140 -
141 -
142 -
143 -
144 -
145 -
146 -
147 -
148 -
149 -
150 -
151 -
152 -
153 -
154 -
155 -
156 -
157 -
158 -
159 -
160
-
161
-
162
-
163
-
164
-
165
-
166
-
167
-
168
-
169
-
170
-
171
-
172
-
173
-
174
-
175
-
176
-
177
-
178
-
179
-
180
-
181
-
182
-
183
-
184
-
185
-
186
 |
 |
The fair values of outstanding derivative contracts recorded as liabilities in the accompanying Consolidated Balance
Sheet were as follows:
Liability Derivatives
December 31,
2010
December 31,
2009
Derivatives designated as hedging instruments:
Other current liabilities:
Aluminum contracts $ 89 $ 67
Foreign exchange contracts - 4
Other noncurrent liabilities and deferred credits:
Aluminum contracts 647 734
Total derivatives designated as hedging instruments $736 $805
Derivatives not designated as hedging instruments*:
Other current liabilities:
Aluminum contracts $ 52 $ 42
Energy contracts 62 37
Other noncurrent liabilities and deferred credits:
Aluminum contracts 33 36
Embedded credit derivative 23 22
Energy contracts - 24
Foreign exchange contracts - 1
Total derivatives not designated as hedging instruments $170 $162
Less margin posted:
Other current liabilities:
Aluminum contracts $ 4 $ 4
Energy contracts 37 18
Other noncurrent liabilities and deferred credits:
Aluminum contracts - 3
Energy contracts - 12
Sub-total $ 41 $ 37
Total Liability Derivatives $865 $930
* See the “Other” section within Note X for additional information on Alcoa’s purpose for entering into derivatives
not designated as hedging instruments and its overall risk management strategies.
The following table shows the net fair values of outstanding derivative contracts at December 31, 2010 and the effect
on these amounts of a hypothetical change (increase or decrease of 10%) in the market prices or rates that existed at
December 31, 2010:
Fair value
asset/(liability)
Index change
of + / - 10%
Aluminum contracts $(748) $204
Energy contracts (16) 226
Foreign exchange contracts 3 5
Interest rate contracts 43 7
Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly
transaction between market participants at the measurement date. The fair value hierarchy distinguishes between
(1) market participant assumptions developed based on market data obtained from independent sources (observable
inputs) and (2) an entity’s own assumptions about market participant assumptions developed based on the best
information available in the circumstances (unobservable inputs). The fair value hierarchy consists of three broad
141