Southwest Airlines 2012 Annual Report Download - page 113

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the U.S. Government. The range of maturities for the Company’s auction rate securities are from 6 years to
35 years. Considering the relative insignificance of these securities in comparison to the Company’s liquid assets
and other sources of liquidity, the Company has no current intention of selling these securities nor does it expect
to be required to sell these securities before a recovery in their cost basis. At the time of the first failed auctions
during first quarter 2008, the Company held a total of $463 million in auction rate securities and, since that time,
has been able to sell $413 million of these instruments at par value.
The Company remains in discussions with its remaining counterparties to determine whether mutually
agreeable decisions can be reached regarding the effective repurchase of its remaining auction rate securities. The
Company continues to earn interest on its outstanding auction rate security instruments. Any future fluctuation in
fair value related to these instruments that the Company deems to be temporary, including any recoveries of
previous temporary write-downs, would be recorded to AOCI. If the Company determines that any future
valuation adjustment is other than temporary, it will record a charge to earnings as appropriate.
105