Note 4 Cash and equivalents and marketable securities

Current Assets

Cash and equivalents and marketable securities and short-term investments consisted of the following:

Download XLS (18 kB)

December 31, 2012 ($ in millions)

Cost basis

Gross
unrealized
gains

Gross
unrealized
losses

Fair value

Cash and
equivalents

Marketable securities
and short-term
investments

Cash

2,784

 

 

2,784

2,784

Time deposits

3,993

 

 

3,993

3,963

30

Other short-term investments

15

 

 

15

15

Debt securities available-for-sale:

 

 

 

 

 

 

U.S. government obligations

152

8

(1)

159

159

Other government obligations

3

3

3

Corporate

236

9

245

128

117

Equity securities available-for-sale

1,271

12

(1)

1,282

1,282

Total

8,454

29

(2)

8,481

6,875

1,606

 

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31, 2011 ($ in millions)

Cost basis

Gross
unrealized
gains

Gross
unrealized
losses

Fair value

Cash and
equivalents

Marketable securities
and short-term
investments

Cash

1,655

 

 

1,655

1,655

Time deposits

2,986

 

 

2,986

2,984

2

Debt securities available-for-sale:

 

 

 

 

 

 

U.S. government obligations

753

8

761

761

Other government obligations

3

3

3

Corporate

298

8

(1)

305

180

125

Equity securities available-for-sale

50

10

(3)

57

57

Total

5,745

26

(4)

5,767

4,819

948

Non-current assets

The Company also holds shares in a publicly-traded company which are classified as available-for-sale equity securities and recorded in “Other non-current assets”. At December 31, 2012 and 2011, other-than-temporary impairments were recognized on these securities but were not significant.

In addition, certain held-to-maturity marketable securities (pledged in respect of a certain non-current deposit liability) are recorded in “Other non-current assets”. At December 31, 2012, the amortized cost, gross unrecognized gain and fair value (based on quoted market prices) of these securities were $97 million, $27 million and $124 million, respectively. At December 31, 2011, the amortized cost, gross unrecognized gain and fair value (based on quoted market prices) of these securities were $92 million, $28 million and $120 million, respectively.

Gains, losses and contractual maturities

Gross realized gains (reclassified from accumulated other comprehensive loss to income) on available-for-sale securities were $3 million, $8 million and $16 million in 2012, 2011 and 2010, respectively. Gross realized losses (reclassified from accumulated other comprehensive loss to income) on available-for-sale securities were not significant in 2012, 2011 and 2010. Such gains and losses were included in “Interest and other finance expense”.

In 2012 and 2011, other-than-temporary impairments recognized on available-for-sale equity securities were not significant. There was no other-than-temporary impairment in 2010.

At December 31, 2012, 2011 and 2010, gross unrealized losses on available-for-sale securities that have been in a continuous unrealized loss position were not significant and the Company does not intend and does not expect to be required to sell these securities before the recovery of their amortized cost.

There were no sales of held-to-maturity securities in 2012, 2011 and 2010.

Contractual maturities of debt securities consisted of the following:

Download XLS (16 kB)

 

Available-for-sale

Held-to-maturity

December 31, 2012 ($ in millions)

Cost basis

Fair value

Cost basis

Fair value

Less than one year

128

128

One to five years

200

210

41

48

Six to ten years

63

69

56

76

Total

391

407

97

124

At December 31, 2012 and 2011, the Company pledged $96 million and $90 million, respectively, of available-for-sale marketable securities as collateral for issued letters of credit and other security arrangements.