Ameriprise 2013 Annual Report Download - page 163

pricing assumptions and updated as experience develops. Significant unobservable inputs that reflect policyholder behavior
are reviewed quarterly along with other valuation assumptions.
Customer Deposits
The Company uses various Black-Scholes calculations to determine the fair value of the embedded derivative liability
associated with the provisions of its stock market certificates. The inputs to these calculations are primarily market
observable and include interest rates, volatilities and equity index levels. As a result, these measurements are classified as
Level 2.
Other Liabilities
Derivatives that are measured using quoted prices in active markets, such as foreign currency forwards, or derivatives that
are exchange-traded, are classified as Level 1 measurements. The fair value of derivatives that are traded in less active
OTC markets are generally measured using pricing models with market observable inputs such as interest rates and equity
index levels. These measurements are classified as Level 2 within the fair value hierarchy and include swaps and the
majority of options. The Company’s nonperformance risk associated with uncollateralized derivative liabilities was
immaterial at December 31, 2013 and 2012. See Note 15 and Note 16 for further information on the credit risk of
derivative instruments and related collateral.
Securities sold but not yet purchased include highly liquid investments which are short-term in nature. Securities sold but
not yet purchased are measured using amortized cost, which is a reasonable estimate of fair value because of the short
time between the purchase of the instrument and its expected realization and are classified as Level 2.
During the reporting periods, there were no material assets or liabilities measured at fair value on a nonrecurring basis.
The following tables provide the carrying value and the estimated fair value of financial instruments that are not reported at
fair value. All other financial instruments that are reported at fair value have been included above in the table with
balances of assets and liabilities Ameriprise Financial measured at fair value on a recurring basis.
December 31, 2013
Fair Value
Carrying
Value Level 1 Level 2 Level 3 Total
(in millions)
Financial Assets
Mortgage loans, net $ 3,510 $ — $ — $ 3,490 $ 3,490
Policy and certificate loans 774 — 1 765 766
Receivables 1,141 107 1,026 8 1,141
Restricted and segregated cash 2,360 2,360 — — 2,360
Other investments and assets 440 — 368 73 441
Financial Liabilities
Policyholder account balances, future policy benefits and
claims $ 14,106 $ — $ — $ 14,724 $ 14,724
Investment certificate reserves 3,977 — — 3,982 3,982
Brokerage customer deposits 3,088 3,088 — — 3,088
Separate account liabilities 4,007 — 4,007 — 4,007
Debt and other liabilities 3,416 137 3,372 134 3,643
December 31, 2012
Fair Value
Carrying
Value Level 1 Level 2 Level 3 Total
(in millions)
Financial Assets
Mortgage loans, net $ 3,609 $ — $ — $ 3,694 $ 3,694
Policy and certificate loans 754 — 2 725 727
Receivables 1,067 135 926 12 1,073
Restricted and segregated cash 2,538 2,538 — — 2,538
Other investments and assets 390 — 333 60 393
Financial Liabilities
Policyholder account balances, future policy benefits and
claims $ 14,701 $ — $ — $ 15,982 $ 15,982
Investment certificate reserves 3,504 — — 3,494 3,494
Brokerage customer deposits 3,024 3,024 — — 3,024
Separate account liabilities 3,362 — 3,362 — 3,362
Debt and other liabilities 3,033 145 3,109 142 3,396
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