Note 4 Cash and equivalents, marketable securities and short-term investments

Current assets

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

December 31, 2015 ($ in millions)

Cost basis

Gross unrealized gains

Gross unrealized losses

Fair value

Cash and equivalents

Marketable securities and short-term investments

Cash

1,837

 

 

1,837

1,837

 

Time deposits

2,821

 

 

2,821

2,717

104

Other short-term investments

231

 

 

231

 

231

Debt securities available-for-sale:

 

 

 

 

 

 

U.S. government obligations

120

2

(1)

121

121

Other government obligations

2

2

2

Corporate

519

1

(1)

519

11

508

Equity securities available-for-sale

658

9

667

667

Total

6,188

12

(2)

6,198

4,565

1,633

 

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31, 2014 ($ in millions)

Cost basis

Gross unrealized gains

Gross unrealized losses

Fair value

Cash and equivalents

Marketable securities and short-term investments

Cash

2,218

 

 

2,218

2,218

 

Time deposits

3,340

 

 

3,340

3,140

200

Other short-term investments

225

 

 

225

 

225

Debt securities available-for-sale:

 

 

 

 

 

 

U.S. government obligations

135

2

(1)

136

136

Other government obligations

2

2

2

Corporate

734

4

(1)

737

85

652

Equity securities available-for-sale

98

12

110

110

Total

6,752

18

(2)

6,768

5,443

1,325

Included in Other short-term investments at December 31, 2015 and 2014, are receivables of $224 million and $219 million, respectively, representing reverse repurchase agreements. These collateralized lendings, made to a financial institution, have maturity dates of less than one year.

Non-current assets

Included in “Other non-current assets” are certain held-to-maturity marketable securities. At December 31, 2015, the amortized cost, gross unrecognized gain and fair value (based on quoted market prices) of these securities were $99 million, $11 million and $110 million, respectively. At December 31, 2014, the amortized cost, gross unrecognized gain and fair value (based on quoted market prices) of these securities were $95 million, $14 million and $109 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 $1 million, $2 million and $10 million in 2015, 2014 and 2013, respectively. Gross realized losses (reclassified from accumulated other comprehensive loss to income) on available-for-sale securities totaled $2 million and $23 million in 2015 and 2014, respectively, and were not significant in 2013. Such gains and losses were included in “Interest and other finance expense”.

In 2015, 2014 and 2013, other-than-temporary impairments recognized on available-for-sale equity securities were not significant.

At December 31, 2015, 2014 and 2013, 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 2015, 2014 and 2013.

Contractual maturities of debt securities consisted of the following:

 

Available-for-sale

Held-to-maturity

December 31, 2015 ($ in millions)

Cost basis

Fair value

Cost basis

Fair value

Less than one year

430

430

One to five years

160

161

99

110

Six to ten years

51

51

Total

641

642

99

110

At December 31, 2015 and 2014, the Company pledged $92 million and $95 million, respectively, of available-for-sale marketable securities as collateral for issued letters of credit and other security arrangements.