NOTE 4 INVESTMENTS
INVESTMENT COMPONENTS, INCLUDING ASSOCIATED DERIVATIVES
| (In millions) | Cost Basis | Unrealized Gains | Unrealized Losses | Recorded Basis | Cash and Cash Equivalents | Short-term Investments | Equity and Other Investments |
|---|---|---|---|---|---|---|---|
| June 30, 2009 | |||||||
| Cash | $$2,064 | $)))))– | $)))))– | $,,2,064 | $2,064 | $((((,,(– | $(((((– |
| Mutual funds | 1,007 | – | (25) | 982 | 900 | 82 | – |
| Commercial paper | 2,601 | – | – | 2,601 | 400 | 2,201 | – |
| Certificates of deposit | 555 | – | – | 555 | 275 | 280 | – |
| U.S. Government and Agency securities | 13,450 | 21 | (5) | 13,466 | 2,369 | 11,097 | – |
| Foreign government bonds | 3,450 | 71 | (4) | 3,517 | – | 3,517 | – |
| Mortgage-backed securities | 3,353 | 81 | (16) | 3,418 | – | 3,418 | – |
| Corporate notes and bonds | 4,361 | 287 | (52) | 4,596 | – | 4,596 | – |
| Municipal securities | 255 | 2 | (1) | 256 | 68 | 188 | – |
| Common and preferred stock | 4,015 | 627 | (182) | 4,460 | – | – | 4,460 |
| Other investments | 465 | – | – | 465 | – | (8) | 473 |
| Total | $35,576 | $1,089 | $(285) | $36,380 | $6,076 | $25,371 | $4,933 |
| (In millions) | Cost Basis | Unrealized Gains | Unrealized Losses | Recorded Basis | Cash and Cash Equivalents | Short-term Investments | Equity and Other Investments |
|---|---|---|---|---|---|---|---|
| June 30, 2008 | |||||||
| Cash | $,,3,274 | $ ,,,,,– | $ ),,,– | $,,3,274 | $,,3,274 | $ ,((,,,,– | $ ,,(,,– |
| Mutual funds | 1,044 | 15 | (8) | 1,051 | 835 | 136 | 80 |
| Commercial paper | 787 | – | – | 787 | 787 | – | – |
| Certificates of deposit | 1,580 | – | – | 1,580 | 1,373 | 207 | – |
| U.S. Government and Agency securities | 4,200 | 37 | (4) | 4,233 | 1,839 | 2,318 | 76 |
| Foreign government bonds | 3,466 | 15 | (62) | 3,419 | – | 3,419 | – |
| Mortgage-backed securities | 3,628 | 31 | (25) | 3,634 | – | 3,634 | – |
| Corporate notes and bonds | 5,013 | 91 | (39) | 5,065 | 2,122 | 2,943 | – |
| Municipal securities | 761 | 4 | (4) | 761 | 109 | 652 | – |
| Common and preferred stock | 4,815 | 1,224 | (113) | 5,926 | – | – | 5,926 |
| Other investments | 520 | – | – | 520 | – | 14 | 506 |
| Total | $29,088 | $1,417 | $(255) | $30,250 | $10,339 | $13,323 | $6,588 |
UNREALIZED LOSSES ON INVESTMENTS
Investments with continuous unrealized losses for less than 12 months and 12 months or greater and their related fair values were as follows:
| Less than 12 months | 12 months or greater | Total | ||||
|---|---|---|---|---|---|---|
| (In millions) | Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | Total Fair Value | Unrealized Losses |
| June 30, 2009 | ||||||
| Mutual funds | $ )))) 3 | $ ,, (1) | $ ,,, 77 | $ ,(24) | $ ,,,,80 | $,,(25) |
| U.S. Government and Agency securities | 4,033 | (5) | – | – | 4,033 | (5) |
| Foreign government bonds | 1,444 | (3) | 669 | (1) | 2,113 | (4) |
| Mortgage-backed securities | 503 | (16) | – | – | 503 | (16) |
| Corporate notes and bonds | 713 | (10) | 504 | (42) | 1,217 | (52) |
| Municipal securities | 16 | (1) | – | – | 16 | (1) |
| Common and preferred stock | 1,154 | (135) | 120 | (47) | 1,274 | (182) |
| Total | $7,866 | $(171) | $ 1,370 | $(114) | $9,236 | $(285) |
| Less than 12 months | 12 months or greater | Total | ||||
|---|---|---|---|---|---|---|
| (In millions) | Fair Value | Unrealized Losses | Fair Value | Unrealized Losses | Total Fair Value | Unrealized Losses |
| June 30, 2008 | ||||||
| Mutual funds | $ ) 123 | $ , (7) | $ ((,12 | $((1) | $ ,,135 | $,,,(8) |
| U.S. Government and Agency securities | 342 | (4) | – | – | 342 | (4) |
| Foreign government bonds | 2,241 | (62) | – | – | 2,241 | (62) |
| Mortgage-backed securities | 1,078 | (25) | – | – | 1,078 | (25) |
| Corporate notes and bonds | 807 | (26) | 925 | (13) | 1,732 | (39) |
| Municipal securities | 176 | (3) | 193 | (1) | 369 | (4) |
| Common and preferred stock | 598 | (106) | 28 | (7) | 626 | (113) |
| Total | $5,365 | $(233) | $1,158 | $(22) | $6,523 | $(255) |
At June 30, 2009, unrealized losses of $285 million consisted of: $79 million related to investment grade fixed-income securities, $24 million related to investments in high yield and emerging market fixed-income securities, $110 million related to domestic equity securities, and $72 million related to international equity securities. At June 30, 2008, unrealized losses of $255 million consisted of: $121 million related to investment grade fixedincome securities, $21 million related to investments in high yield and emerging market fixed-income securities, $99 million related to domestic equity securities, and $14 million related to international equity securities. Unrealized losses from fixed-income securities are primarily attributable to changes in interest rates. Unrealized losses from domestic and international equities are due to market price movements. Management does not believe any unrealized losses represent other-than-temporary impairments based on our evaluation of available evidence as of June 30, 2009.
At June 30, 2009, the recorded basis and estimated fair value of common and preferred stock and other investments that are restricted for more than one year or are not publicly traded was $204 million. At June 30, 2008, the recorded basis and estimated fair value of these investments was $289 million. The estimate of fair value is based on publicly available market information or other estimates determined by management.
DEBT INVESTMENT MATURITIES
| (In millions) | Cost Basis | Estimated Fair Value |
|---|---|---|
| Due in one year or less | $ 8,487 | $ 6,750 |
| Due after one year through five years | 9,796 | 10,071 |
| Due after five years through ten years | 1,212 | 1,248 |
| Due after ten years | 2,759 | 2,819 |
| Total | $22,254 | $20,888 |