Voya 2013 Annual Report Download - page 333

ING U.S., Inc.
Notes to the Consolidated Financial Statements
(Dollar amounts in millions, unless otherwise stated)
in any country other than the United States. Silchester clients may contribute to and redeem moneys from
the funds on a monthly basis as of the first business day of each month. Clients must notify Silchester at
least six business days before the month-end to make a redemption request. Baillie Gifford and Silchester,
as a normal course of business, enter into contracts (commitments) that contain indemnifications or
warranties. The funds’ maximum exposure under these arrangements is unknown, as this would involve
future claims that have not yet occurred. Baillie Gifford and Silchester have no unfunded commitments.
(4) Limited partnerships are comprised of two assets which use NAV to calculate fair value. Pantheon Europe
has a balance of $15.5 and Pantheon USA has a balance of $45.3. Their strategy is to create a portfolio of
high quality private equity funds, operating across Europe and diversified by stage, sector, geography,
manager and vintage year. For the year ended December 31, 2012, Pantheon Europe and Pantheon USA
have unfunded commitments of $4.0 and $17.1, respectively, and there were no significant redemption
restrictions.
(5) UBS Trumbull Property Fund (“UBS”) uses the NAV to calculate fair value. UBS has a balance of $67.4
and is an actively managed core portfolio of equity real estate. The Fund has both relative and real return
objectives. Its relative performance objective is to outperform the NFI_ODCE index over any given three-
to-five-year period. The Fund’s real return performance objective is to achieve at least a 5.0% real rate of
return (i.e., inflation-adjusted return), before advisory fees, over any given three-to-five-year period.
(6) MIL has a balance of $62.2 and is designed to realize appreciation in value primarily through the allocation
of capital directly and indirectly among investment funds and accounts.
As described in Note 4. Fair Value Measurements (excluding Consolidated Investment Entities) to these
Consolidated Financial Statements, pension plan assets are categorized into a three-level fair value hierarchy
based upon the inputs available in valuating each of the assets. The fair value hierarchy gives the highest priority
to quoted prices in active markets for identical assets (Level 1) and the lowest priority to unobservable inputs
(Level 3). The leveling hierarchy is applied to the pension plans assets as follows:
Cash and cash equivalents: The carrying amounts for cash and cash equivalents reflect the assets’ fair value. The
fair values for cash and cash equivalents are determined based on quoted market prices. These assets are
classified as Level 1.
Short-term Investment Funds : Short term investment funds are valued by investment managers and are reported
as a NAV per share in which is classified as Level 2. See subscript (5) in Fair Value Plan Assets footnote table
for a description of the fund’s redemption policies.
U.S. Government securities, corporate bonds and notes, and foreign securities: Fair values for actively traded
marketable bonds are determined based upon quoted market prices or dealer quotes and are classified as Level 1
assets. Corporate bonds, ABS, and U.S. agency bonds use observable pricing method such as matrix pricing,
market corroborated pricing or inputs such as yield curves and indices. These investments are classified as
Level 2.
International Commingled Funds: Commingled funds are classified as Level 2 investments. These investments
categorize alternative assets as Level 2 when there is an ability to redeem its investments with the investee at the
Net Asset Value (“NAV”) per share at the measurement date. If it is redeemable at a future date, the entity must
consider the length of time in which the investment is redeemable in making the determination of the fair value
hierarchy level. See subscript (3) in Fair Value Hierarchy table footnotes for description of the fund’s redemption
policies.
Equity securities: Fair values are based upon a quoted market price determined in an active market and are
included in Level 1. The valuations obtained from broker-dealers are non-binding.
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