Note 4 Cash and equivalents and marketable securities

Current Assets

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

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December 31, 2013 ($ in millions)

Cost basis

Gross unrealized gains

Gross unrealized losses

Fair value

Cash and equivalents

Marketable securities and short-term investments

Cash

2,414

 

 

2,414

2,414

 

Time deposits

3,556

 

 

3,556

3,538

18

Other short-term investments

9

 

 

9

 

9

Debt securities available-for-sale:

 

 

 

 

 

 

U.S. government obligations

103

2

(1)

104

104

European government obligations

24

1

25

25

Other government obligations

3

3

3

Corporate

212

4

(1)

215

69

146

Equity securities available-for-sale

154

9

(4)

159

159

Total

6,475

16

(6)

6,485

6,021

464

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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

Non-current assets

Included in “Other non-current assets” are certain held-to-maturity marketable securities. At December 31, 2013, the amortized cost, gross unrecognized gain and fair value (based on quoted market prices) of these securities were $104 million, $17 million and $121 million, respectively. 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. These securities are pledged as security for certain outstanding deposit liabilities and the funds received at the respective maturity dates of the securities will only be available to the Company for repayment of these obligations.

Gains, losses and contractual maturities

Gross realized gains (reclassified from accumulated other comprehensive loss to income) on available-for-sale securities totaled $10 million, $3 million and $8 million in 2013, 2012 and 2011, respectively. Gross realized losses (reclassified from accumulated other comprehensive loss to income) on available-for-sale securities were not significant in 2013, 2012 and 2011. Such gains and losses were included in “Interest and other finance expense”.

In 2013, 2012 and 2011, other-than-temporary impairments recognized on available-for-sale equity securities were not significant.

At December 31, 2013, 2012 and 2011, 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 2013, 2012 and 2011.

Contractual maturities of debt securities consisted of the following:

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Available-for-sale

Held-to-maturity

December 31, 2013 ($ in millions)

Cost basis

Fair value

Cost basis

Fair value

Less than one year

162

163

7

7

One to five years

138

143

40

44

Six to ten years

42

41

57

70

Total

342

347

104

121

At December 31, 2013 and 2012, the Company pledged $97 million and $96 million, respectively, of available-for-sale marketable securities as collateral for issued letters of credit and other security arrangements.