Google 2015 Annual Report Download - page 77

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Table of Contents Alphabet Inc. and Google Inc.
73
Non-Marketable Debt Securities
Our non-marketable debt securities are primarily preferred stock that are redeemable at our option and convertible
notes issued by private companies. These debt securities do not have readily determinable market values and are
categorized accordingly as Level 3 in the fair value hierarchy. To estimate the fair value of these securities, we use a
combination of valuation methodologies, including market and income approaches based on prior transaction prices;
estimated timing, probability, and amount of cash flows; and illiquidity considerations. Financial information of private
companies may not be available and consequently we will estimate the value based on the best available information
at the measurement date. We estimate a range of fair values based on valuation approaches noted above and as of
December 31, 2014 and 2015, the fair value recorded on the Consolidated Balance Sheets for individual investments
is within the range. No material impairments were recognized for the years ended December 31, 2013, 2014, and
2015.
The following table presents a reconciliation for our assets measured and recorded at fair value on a recurring
basis, using significant unobservable inputs (Level 3) (in millions):
Level 3
Balance as of December 31, 2014 $ 90
Purchases, issuances, and settlements(1) 934
Balance as of December 31, 2015 $ 1,024
(1) Purchases of securities included our $900 million investment in SpaceX, a space exploration and space transport company,
made during January 2015.
Note 4. Debt
Short-Term Debt
We have a debt financing program of up to $3.0 billion through the issuance of commercial paper. Net proceeds
from this program are used for general corporate purposes. As of December 31, 2014 and 2015, we had $2.0 billion
of outstanding commercial paper recorded as short-term debt with a weighted-average interest rate of 0.1% and 0.2%,
respectively. In conjunction with this program, we have a $3.0 billion revolving credit facility expiring in July 2016. The
interest rate for the credit facility is determined based on a formula using certain market rates. As of December 31,
2014 and 2015, we were in compliance with the financial covenant in the credit facility, and no amounts were outstanding
under the credit facility as of December 31, 2014 and 2015. The estimated fair value of the short-term debt approximated
its carrying value as of December 31, 2014 and 2015.