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83
The fair values of the assets held by the U.S. pension plans by asset class are as follows:
Fair Value Measurements Using Inputs Considered as
Fair Value at
(Millions)
Level 1
Level 2
Level 3
Dec. 31,
Asset Class
2014
2013
2014
2013
2014
2013
2014
2013
Equities
U.S. equities
$
1,766
$ 1,595
$
3
$ 3
$
―
$ 3
$
1,769
$
1,601
Non-U.S. equities
1,214
1,324
1
1
―
―
1,215
1,325
Index funds
―
―
148
151
2
1
150
152
Long/short equity
―
―
71
67
382
393
453
460
Total Equities
$
2,980
$ 2,919
$
223
$ 222
$
384
$
397
$
3,587
$
3,538
Fixed Income
U.S. government securities
$
1,032
$ 908
$
590
$ 601
$
―
$ ―
$
1,622
$
1,509
Non-U.S. government
securities
7
20
381
316
―
―
388
336
Preferred and convertible
securities
3
―
―
4
―
―
3
4
U.S. corporate bonds
8
14
2,550
2,046
―
―
2,558
2,060
Non-U.S. corporate bonds
―
―
478
412
―
―
478
412
Asset-backed securities
―
―
20
26
―
―
20
26
Collateralized mortgage
obligations
―
―
29
28
―
―
29
28
Private placements
3
―
388
251
―
2
391
253
Derivative instruments
6
(1)
126
6
―
―
132
5
Other
―
―
31
37
―
―
31
37
Total Fixed Income
$
1,059
$ 941
$
4,593
$ 3,727
$
―
$
2
$
5,652
$
4,670
Private Equity
Buyouts
$
―
$ ―
$
―
$ ―
$
700
$ 737
$
700
$
737
Derivative instruments
―
―
―
―
(74)
(97)
(74)
(97)
Direct investments
―
―
―
―
516
467
516
467
Distressed debt
―
―
―
―
202
211
202
211
Growth equity
15
21
―
―
183
170
198
191
Mezzanine
―
―
―
―
116
83
116
83
Real estate
―
―
―
―
147
156
147
156
Secondary
―
―
―
―
145
152
145
152
Venture capital
―
―
―
―
552
548
552
548
Total Private Equity
$
15
$ 21
$
―
$ ―
$
2,
487
$
2,427
$
2,502
$
2,448
Total Absolute Return
$
26
$ ―
$
1,141
$ 1,175
$
1,006
$
658
$
2,173
$
1,833
Commodities
$
―
$ ―
$
―
$ 88
$
―
$
―
$
―
$
88
Cash and Cash Equivalents
$ 287
$ 301
$ 617
$ 1,017
$ ―
$ ―
$ 904
$
1,318
Total
$ 4,367
$ 4,182
$ 6,574
$ 6,229
$ 3,877
$ 3,484
$ 14,818
$
13,895
Other items to reconcile to fair
value of plan assets
$ (175)
$
(6)
Fair value of plan assets
$ 14,643
$
13,889
Publicly traded equities are valued at the closing price reported in the active market in which the individual securities are
traded. Index funds are valued at the net asset value (NAV) as determined by the custodian of the fund. The NAV is
based on the fair value of the underlying assets owned by the fund, minus its liabilities then divided by the number of units
outstanding. Long/short equity interests are valued using the NAV as determined by the administrator or custodian of the
fund. Long/short equity interests, which have a redemption right in the near term and are past any lock-up redemption
period, are classified as level 2.
Fixed income includes derivative instruments such as credit default swaps, interest rate swaps and futures contracts. U.S.
government and government agency bonds and notes are valued at the closing price reported in the active market in
which the individual security is traded. Corporate bonds and notes, asset backed securities and collateralized mortgage
obligations are valued at either the yields currently available on comparable securities of issuers with similar credit ratings
or valued under a discounted cash flows approach that maximizes observable inputs, such as current yields of similar
instruments, but includes adjustments for certain risks that may not be observable such as credit and liquidity risks.