Southwest Airlines 2013 Annual Report Download - page 119

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12. ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)
Comprehensive income includes changes in the fair value of certain financial derivative instruments that qualify
for hedge accounting, unrealized gains and losses on certain investments, and actuarial gains/losses arising from the
Company’s postretirement benefit obligation. A rollforward of the amounts included in AOCI, net of taxes, is shown
below for 2013 and 2012:
(in millions)
Fuel
derivatives
Interest rate
derivatives
Defined benefit
plan items Other
Deferred
tax impact
Accumulated other
comprehensive
income (loss)
Balance at December 31, 2011 ..... $ (297) $ (107) $ 54 $ (14) $ 140 $ (224)
2012 changes in fair value ...... 31 (27) (28) 6 (73) (91)
Reclassification to earnings ..... 163 26 — — 7 196
Balance at December 31, 2012 ..... $ (103) $ (108) $ 26 $ (8) $ 74 $ (119)
2013 changes in fair value ...... (82) 22 39 16 — (5)
Reclassification to earnings ..... 165 28 — — (72) 121
Balance at December 31, 2013 ..... $ (20) $ (58) $ 65 $ 8 $ 2 $ (3)
The following table illustrates the significant amounts reclassified out of each component of AOCI for the year
ended December 31, 2013:
Year ended December 31, 2013
(in millions)
AOCI components
Amounts reclassified
from AOCI
Affected line item in the
Consolidated Statement of
Comprehensive Income
Unrealized gain on fuel derivative
instruments .......................... $ 165 Fuel and oil expense
62 Less: Tax Expense
$ 103 Net of tax
Unrealized gain on interest rate derivative
instruments .......................... $ 28 Interest expense
10 Less: Tax Expense
$ 18 Net of tax
Total reclassifications for the period ......... $ 121 Netoftax
13. COMMON STOCK
The Company has one class of capital stock, its common stock. Holders of shares of common stock are entitled
to receive dividends when and if declared by the Board of Directors and are entitled to one vote per share on all matters
submitted to a vote of the Shareholders. At December 31, 2013, the Company had 29 million shares of common stock
reserved for issuance pursuant to Employee stock plans (of which 22 million shares had not been granted) through
various share-based compensation arrangements. See Note 14.
14. STOCK PLANS
Share-based compensation
The Company has previously awarded share-based compensation pursuant to plans covering the majority of its
Employee groups, including plans adopted via collective bargaining, plans covering the Company’s Board of Directors,
and options granted pursuant to a prior employment contract with the Chairman Emeritus of the Company. The
Company accounts for share-based compensation utilizing fair value.
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