Marketable Securities

12 Months Ended

Dec. 31, 2013

Marketable Securities [Abstract]

Marketable Securities

7.           MARKETABLE SECURITIES

The Company evaluates its marketable securities in accordance with authoritative guidance on accounting for investments in debt and equity securities, and has determined that all of its investments in marketable securities should be classified as available-for-sale and reported at fair value, with unrealized gains and losses recorded in Accumulated other comprehensive loss on the Consolidated Statements of Financial Position. The fair values of the Company's available-for-sale marketable securities are based on quoted market prices or other observable market data, discount cash flow analyses, or in some cases, the Company's amortized cost which approximates fair value.

Money market funds included in Cash and cash equivalents on the Consolidated Statements of Financial Position are excluded from the information contained in this Note. Refer to Note 3 of the Notes to Consolidated Financial Statements for information regarding these investments.

As of December 31, 2013, the Company's available-for-sale Marketable securities had gross unrealized gains and (losses) of $2.3 million and $1.5 million, respectively, and consisted of the following:

			Gross		Gross
	Amortized		Unrealized		Unrealized		Estimated Fair
	Cost		Gains		Losses		Value
Auction rate securities - municipal debt	$	3.8	$	-	$	(0.4	)$	3.4
Corporate debt securities		360.7		1.6		(0.2	)	362.1
Government and agency debt securities		358.2		0.2		(0.1	)	358.3
Asset-backed and mortgage-backed securities		73.2		0.5		(0.1	)	73.6
Total debt securities		795.9		2.3		(0.8	)	797.4
Auction rate securities - preferred		4.0		-		(0.7	)	3.3
Total security investments		799.9		2.3		(1.5	)	800.7
Cash equivalents		(12.5	)	-		-		(12.5	)
Total marketable securities	$	787.4	$	2.3	$	(1.5	)$	788.2

As of December 31, 2012, the Company's available-for-sale Marketable securities had gross unrealized gains and (losses) of $3.6 million and $1.6 million, respectively, and consisted of the following:

			Gross		Gross
	Amortized		Unrealized		Unrealized		Estimated Fair
	Cost		Gains		Losses		Value
Auction rate securities - municipal debt	$	3.8	$	-	$	(0.5	)$	3.3
Corporate debt securities		301.3		2.4		(0.1	)	303.6
Government and agency debt securities		340.2		0.6		-		340.8
Asset-backed and mortgage-backed securities		55.9		0.6		-		56.5
Total debt securities		701.2		3.6		(0.6	)	704.2
Auction rate securities - preferred		4.0		-		(1.0	)	3.0
Total security investments		705.2		3.6		(1.6	)	707.2
Cash equivalents		(7.5	)	-		-		(7.5	)
Total marketable securities	$	697.7	$	3.6	$	(1.6	)$	699.7

Although contractual maturities of the Company's investment in debt securities may be greater than one year, the majority of investments are classified as Current assets in the Consolidated Statements of Financial Position due to the Company's ability to use these investments for current liquidity needs if required. As of December 31, 2013 and 2012, auction rate securities of $6.7 million and $6.3 million, respectively, are classified in noncurrent assets due to the fact that the securities have experienced unsuccessful auctions and that poor debt market conditions have reduced the likelihood that the securities will successfully auction within the next 12 months. The contractual maturities of the Company's available-for-sale marketable securities noted above are shown below. Expected maturities may differ from final contractual maturities for certain securities that allow for call or prepayment provisions. Proceeds from calls and prepayments are included in Proceeds from maturities of marketable securities on the Consolidated Statements of Cash Flows. Refer to Note 21 of the Notes to Consolidated Financial Statements for additional information regarding the Company's auction rate preferred stock activity occurring subsequent to the date of the financial statements.

	2013				2012
	Amortized		Estimated Fair		Amortized		Estimated Fair
	Cost		Value		Cost		Value
Due in less than one year	$	160.4	$	160.6	$	185.4	$	185.8
Due in one to five years		621.1		622.2		498.3		500.9
Due after five years		18.4		17.9		21.5		20.5
Total available-for-sale marketable securities	$	799.9	$	800.7	$	705.2	$	707.2

For the years ended December 31, 2013, 2012, and 2011, the Company recognized $1.3 million, $4.2 million, and $3.2 million, respectively, in net gains on its marketable securities; all of which is realized gains due to sales and maturities and is included in Other expense (income), net on the Consolidated Statements of Earnings. The Company uses the specific identification method when accounting for the costs of its available-for-sale marketable securities sold.

Impairment

The FASB guidance on the recognition and presentation of OTTI requires that credit related OTTI on debt securities be recognized in earnings while noncredit related OTTI of debt securities not expected to be sold be recognized in other comprehensive income. For the years ended December 31, 2013, 2012, and 2011, the Company incurred no OTTI on its debt securities.

The table below presents a cumulative rollforward of the amount related to credit losses recognized in earnings for other-than-temporary impairments:

Beginning balance of amounts related to credit losses, January 1, 2011	$	2.7
Credit losses on debt securities for which OTTI was not previously recognized		-
Additional credit losses on debt securities for which OTTI was previously recognized		-
Reductions for securities sold in the period for which OTTI was previously recognized		(0.5	)
Ending balance of amounts related to credit losses, December 31, 2011	$	2.2
Credit losses on debt securities for which OTTI was not previously recognized		-
Additional credit losses on debt securities for which OTTI was previously recognized		-
Reductions for securities sold in the period for which OTTI was previously recognized		(1.9	)
Ending balance of amounts related to credit losses, December 31, 2012	$	0.3
Credit losses on debt securities for which OTTI was not previously recognized		-
Additional credit losses on debt securities for which OTTI was previously recognized		-
Reductions for securities sold in the period for which OTTI was previously recognized		(0.1	)
Ending balance of amounts related to credit losses, December 31, 2013	$	0.2

The following table provides information at December 31, 2013, about the Company's marketable securities with gross unrealized losses for which no other-than-temporary impairment has been incurred, and the length of time that individual securities have been in a continuous unrealized loss position. The gross unrealized loss of $1.5 million, pre-tax, is recognized in accumulated other comprehensive income:

	Less than 12 Months				12 Months or More				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
	Value		Loss		Value		Loss		Value		Loss
Auction rate securities	$	-	$	-	$	6.7	$	(1.1	)$	6.7	$	(1.1	)
Corporate debt securities		85.7		(0.2	)	1.2		-		86.9		(0.2	)
Asset-backed and mortgage-backed securities		43.4		(0.1	)	0.1		-		43.5		(0.1	)
Government and agency		158.5		(0.1	)	-		-		158.5		(0.1	)
Total	$	287.6	$	(0.4	)$	8.0	$	(1.1	)$	295.6	$	(1.5	)

As of December 31, 2013, none of the Company's marketable securities for which OTTI has been incurred are in an unrealized loss position.

The following table provides information, at December 31, 2012, about the Company's marketable securities with gross unrealized losses for which no other-than-temporary impairment has been incurred, and the length of time that individual securities have been in a continuous unrealized loss position. The gross unrealized loss of $1.6 million, pre-tax, is recognized in accumulated other comprehensive income:

	Less than 12 Months				12 Months or More				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
	Value		Loss		Value		Loss		Value		Loss
Auction rate securities	$	-	$	-	$	6.3	$	(1.5	)$	6.3	$	(1.5	)
Corporate debt securities		54.9		(0.1	)	1.4		-		56.3		(0.1	)
Asset-backed and mortgage-backed securities		6.7		-		0.2		-		6.9		-
Government and agency		30.9		-		-		-		30.9		-
Total	$	92.5	$	(0.1	)$	7.9	$	(1.5	)$	100.4	$	(1.6	)

The following table provides information, at December 31, 2012, about the Company's marketable securities with gross unrealized losses for which other-than-temporary impairment has been incurred, and the length of time that individual securities have been in a continuous unrealized loss position:

	Less than 12 Months				12 Months or More				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
	Value		Loss		Value		Loss		Value		Loss
Asset-backed and mortgage-backed securities	$	0.1	$	-	$	-	$	-	$	0.1	$	-
Total	$	0.1	$	-	$	-	$	-	$	0.1	$	-

Auction rate securities

The Company's valuation process for its auction rate security portfolio begins with a credit analysis of each instrument. Under this method, the security is analyzed for factors impacting its future cash flows, such as the underlying collateral, credit ratings, credit insurance or other guarantees, and the level of seniority of the specific tranche of the security. Future cash flows are projected incorporating certain security specific assumptions such as the ratings outlook, the assumption that the auction market will remain illiquid and that the security's interest rate will continue to be set at the maximum applicable rate, and that the security will not be redeemed prior to any scheduled redemption date. The methodology for determining the appropriate discount rate uses market-based yield indicators and the underlying collateral as a baseline for determining the appropriate yield curve, and then adjusting the resultant rate on the basis of the credit and structural analysis of the security. The unrealized losses on the Company's auction rate portfolio are a result of the illiquidity in this market sector and are not due to credit quality. The Company has the intent to hold these securities until liquidity in the market or optional issuer redemption occurs, and it is not more likely than not that the Company will be required to sell these securities before anticipated recovery. Additionally, if the Company requires capital, the Company has available liquidity through its trade receivables facility and revolving credit facility.

Corporate debt securities

Unrealized losses on the Company's corporate debt securities are attributable to current economic conditions and are not due to credit quality. Because the Company does not intend to sell and will not be required to sell the securities before recovery of their net book values, which may be at maturity, the Company does not consider securities in its corporate debt portfolio to be other-than-temporarily impaired at December 31, 2013.

Asset-backed and mortgage-backed securities

Credit losses for the asset-backed and mortgage-backed securities are derived by examining the significant drivers that affect loan performance such as pre-payment speeds, default rates, and current loan status. These drivers are used to apply specific assumptions to each security and are further divided in order to separate the underlying collateral into distinct groups based on loan performance characteristics. For instance, more weight is placed on higher risk categories such as collateral that exhibits higher than normal default rates, those loans originated in high risk states where home appreciation has suffered the most severe correction, and those loans which exhibit longer delinquency rates. Based on these characteristics, collateral-specific assumptions are applied to build a model to project future cash flows expected to be collected. These cash flows are then discounted at the current yield used to accrete the beneficial interest, which approximates the effective interest rate implicit in the bond at the date of acquisition for those securities purchased at par. The unrealized losses on the Company's remaining asset-backed and mortgage-backed securities are due to constraints in market liquidity for certain portions of these sectors in which the Company has investments, and are not due to credit quality. Because the Company does not intend to sell and will not be required to sell the securities before recovery of their net book values, the Company does not consider the remainder of its asset-backed and mortgage-backed debt portfolio to be other-than-temporarily impaired at December 31, 2013.

Government and Agency securities

The unrealized losses on the Company's investments in government and agency securities are the result of interest rate effects. Because the Company does not intend to sell the securities and it is not more likely than not that the Company will be required to sell the securities before recovery of their net book values, the Company does not consider these investments to be other-than-temporarily impaired at December 31, 2013.