3M 2011 Annual Report Download - page 78

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72
As a result of certain employment commitments and capital investments made by 3M, income from manufacturing
activities in China, Taiwan, Korea, Brazil, and Singapore is subject to reduced tax rates or, in some cases, is exempt
from tax for years through 2013, 2016, 2018, 2023, and 2023, respectively. The income tax benefits attributable to
the tax status of these subsidiaries are estimated to be $77 million (11 cents per diluted share) in 2011, $69 million
(10 cents per diluted share) in 2010, and $50 million (7 cents per diluted share) in 2009.
The Company has not provided deferred taxes on unremitted earnings attributable to international companies that
have been considered to be reinvested indefinitely. These earnings relate to ongoing operations and were
approximately $7.1 billion as of December 31, 2011. Because of the availability of U.S. foreign tax credits, it is not
practicable to determine the income tax liability that would be payable if such earnings were not indefinitely
reinvested.
NOTE 9. Marketable Securities
The Company invests in agency securities, corporate securities, asset-backed securities, treasury securities and
other securities. The following is a summary of amounts recorded on the Consolidated Balance Sheet for marketable
securities (current and non-current).
Dec. 31, Dec. 31,
(Millions) 2011 2010
U.S. government agency securities .............................. $ 119
$ 246
Foreign government agency securities ......................... 8
52
Corporate debt securities .............................................. 413
280
Commercial paper ......................................................... 30
55
Certificates of deposit/time deposit ............................... 49
29
U.S. treasury securities ................................................. — 55
U.S. municipal securities ............................................... 9
20
A
sset-backed securities:
Automobile loan related ............................................. 530
253
Credit card related ..................................................... 244
79
Equipment lease related ............................................ 54
24
Other .......................................................................... 5
8
A
sset-backed securities total ........................................ 833
364
Current marketable securities ................................... $1,461
$1,101
U.S. government agency securities .............................. $ 361
$63
Foreign government agency securities ......................... 15
3
Corporate debt securities .............................................. 255
192
U.S. treasury securities ................................................. 34
44
U.S. municipal securities ............................................... 5
3
A
uction rate securities ................................................... 4
7
A
sset-backed securities:
Automobile loan related ............................................. 188
144
Credit card related ..................................................... 24
70
Equipment lease related ............................................ 10
14
A
sset-backed securities total ........................................ 222
228
Non-current marketable securities ............................ $ 896
$ 540
Total marketable securities ........................................ $2,357
$1,641
Classification of marketable securities as current or non-current is dependent upon management’s intended holding
period, the security’s maturity date and liquidity considerations based on market conditions. If management intends
to hold the securities for longer than one year as of the balance sheet date, they are classified as non-current. At
December 31, 2011, gross unrealized losses totaled approximately $12 million (pre-tax), while gross unrealized gains
totaled approximately $3 million (pre-tax). At December 31, 2010, gross unrealized losses totaled approximately $9
million (pre-tax), while gross unrealized gains totaled approximately $5 million (pre-tax). Gross realized gains on
sales or maturities of marketable securities were not material in 2011, 2010 and 2009. Gross realized losses on sales
or maturities of marketable securities were not material in 2011 and 2010, and totaled $3 million in 2009. Cost of