Medtronic 2016 Annual Report Download - page 91

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Table of Contents
Medtronic plc
Notes to Consolidated Financial Statements (Continued)
88
Marketable Debt and Equity Securities:
The following tables show the gross unrealized losses and fair values of the Company’s available-for-sale securities that have
been in a continuous unrealized loss position deemed to be temporary, aggregated by investment category as of April 29, 2016
and April 24, 2015:
April 29, 2016
Less than 12 months More than 12 months
(in millions) Fair Value Unrealized
Losses Fair Value Unrealized
Losses
Corporate debt securities $ 756 $ (18) $ 136 $ (6)
Auction rate securities — — 44 (3)
Mortgage-backed securities 196 (5) 92 (5)
U.S. government and agency securities 308 (4) 67 (5)
Debt funds 670 (26) 1,601 (256)
Marketable equity securities 45 (11) — —
Total $ 1,975 $ (64) $ 1,940 $ (275)
April 24, 2015
Less than 12 months More than 12 months
(in millions) Fair Value Unrealized
Losses Fair Value Unrealized
Losses
Corporate debt securities $ 944 $ (9) $ 34 $ (1)
Auction rate securities — — 105 (4)
Mortgage-backed securities 346 (3) 206 (3)
U.S. government and agency securities 356 (1) 267 (3)
Debt funds 1,291 (109) 559 (41)
Marketable equity securities 4 (19) — —
Total $ 2,941 $ (141) $ 1,171 $ (52)
The following table represents the range of the unobservable inputs utilized in the fair value measurement of the auction rate
securities classified as Level 3 as of April 29, 2016:
Valuation Technique Unobservable Input Range (Weighted Average)
Auction rate securities Discounted cash flow Years to principal recovery 2 yrs. - 12 yrs. (3 yrs.)
Illiquidity premium 6%
The Company reviews the fair value hierarchy classification on a quarterly basis. Changes in the ability to observe valuation inputs
may result in a reclassification of levels for certain securities within the fair value hierarchy. The Company’s policy is to recognize
transfers into and out of levels within the fair value hierarchy at the end of the fiscal quarter in which the actual event or change
in circumstances that caused the transfer occurs. There were no transfers between Level 1, Level 2, or Level 3 during the twelve
months ended April 29, 2016. When a determination is made to classify an asset or liability within Level 3, the determination is
based upon the significance of the unobservable inputs to the overall fair value measurement.