Intel 2014 Annual Report Download - page 70

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INTEL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Financial Instruments Not Recorded at Fair Value on a Recurring Basis
On a quarterly basis, we measure the fair value of our grants receivable, cost method loans receivable, non-marketable cost
method investments, reverse repurchase agreements with original maturities greater than approximately three months, and
indebtedness carried at amortized cost; however, the assets are recorded at fair value only when an impairment is recognized.
The carrying amounts and fair values of financial instruments not recorded at fair value on a recurring basis at the end of each
period were as follows:
December 27, 2014
Carrying
Amount
Fair Value Measured Using
Fair Value(In Millions) Level 1 Level 2 Level 3
Grants receivable ...................................... $ 676 $ — $ 679 $ — $ 679
Loans receivable ...................................... $ 250 $ — $ 250 $ — $ 250
Non-marketable cost method investments ................... $ 1,769 $ — $ — $ 2,599 $ 2,599
Reverse repurchase agreements .......................... $ 450 $ — $ 450 $ — $ 450
Short-term debt ....................................... $ 1,588 $ — $ 2,145 $ — $ 2,145
Long-term debt ........................................ $ 12,107 $ 11,467 $ 1,309 $ — $ 12,776
NVIDIA Corporation cross-license agreement liability .......... $ 395 $ — $ 399 $ — $ 399
December 28, 2013
Carrying
Amount
Fair Value Measured Using
Fair Value(In Millions) Level 1 Level 2 Level 3
Grants receivable ...................................... $ 416 $ — $ 481 $ — $ 481
Loans receivable ...................................... $ 267 $ — $ 250 $ 17 $ 267
Non-marketable cost method investments ................... $ 1,270 $ — $ — $ 2,105 $ 2,105
Reverse repurchase agreements .......................... $ 400 $ — $ 400 $ — $ 400
Short-term debt ....................................... $ 24 $ — $ 24 $ — $ 24
Long-term debt ........................................ $ 13,165 $ 10,937 $ 2,601 $ — $ 13,538
NVIDIA Corporation cross-license agreement liability .......... $ 587 $ — $ 597 $ — $ 597
The fair value of our grants receivable is determined using a discounted cash flow model, which discounts future cash flows using
an appropriate yield curve. As of December 27, 2014 and December 28, 2013, the carrying amount of our grants receivable was
classified within other current assets and other long-term assets, as applicable.
The carrying amount and fair value of loans receivable exclude loans measured and recorded at a fair value of $721 million as of
December 27, 2014 ($805 million as of December 28, 2013). The fair value of our loans receivable and reverse repurchase
agreements, including those held at fair value, is determined using a discounted cash flow model. All significant inputs in the
models are derived from or corroborated with observable market data, such as LIBOR-based yield curves, currency spot and
forward rates, and credit ratings. The credit quality of these assets remains high, with credit ratings of A+/A1 or better for the
substantial majority of our loans receivable and the majority of our reverse repurchase agreements as of December 27, 2014.
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