Fair Value Measurements

9 Months Ended

Sep. 30, 2013

Disclosure Text Block

Fair Value Measurements

2. Fair Value Measurements

As of September 30,2013 and December 31, 2012, U.S. Cellular did not have any financial assets or liabilities that were requiredto be recorded at fair value in its Consolidated Balance Sheet in accordance with GAAP. However, U.S. Cellular has applied the provisions of fair value accounting for purposes of computing the fair value of financial instruments for disclosure purposes as displayed below.

		Level within the Fair Value Hierarchy	September 30, 2013				December 31, 2012
			Book Value			Fair Value	Book Value		Fair Value
(Dollars in thousands)
Cash and cash equivalents		1	$	183,101	$	183,101	$	378,358	$	378,358
Short-term investments
	U.S. Treasury Notes	1		45,162		45,162		100,676		100,676
Long-term investments
	U.S. Treasury Notes	1		40,099		40,154		50,305		50,339
Long-term debt
	6.95% Senior Notes	1		342,000		330,509		342,000		376,610
	6.7% Senior Notes	2		532,383		512,221		532,194		582,744

Short-term investments and Long-term investments are both designated as held-to-maturity investments and recorded at amortized cost in the Consolidated Balance Sheet. Long-term investment maturities range between 14and 15months at September 30, 2013. Long-term debt excludes capital lease obligations and the current portion of Long-term debt.

The fair values of Cash and cash equivalents and Short-term investments approximate their book values due to the short-term nature of these financial instruments. The fair values of Long-term investments were estimated using quoted market prices for the individual issuances. The fair value of Long-term debt was estimated using market prices for the 6.95% Senior Notes, and discounted cash flow analysis using an estimated yield to maturity of 7.25%for the 6.7% Senior Notes at September 30, 2013.

As of September 30, 2013 and December 31, 2012,U.S. Cellular did not have nonfinancial assets or liabilities that required the application of fair value accounting for purposes of reporting such amounts in the Consolidated Balance Sheet.