Financial Instruments And Fair Value Measurements

9 Months Ended

Sep. 30, 2011

Financial Instruments And Fair Value Measurements

NOTE 5—FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS

The table below presents disclosures about the financial assets and financial liabilities measured at fair value on a recurring basis in the Company's financial statements as of September 30, 2011 and December 31, 2010 (in millions):

		00000000			00000000		00000000			00000000		00000000			00000000		00000000			00000000
	September 30, 2011										December 31, 2010
	Total			Level 1		Level 2			Level 3		Total			Level 1		Level 2			Level 3
	UAL
Cash and cash equivalents	$	6,984		$	6,984	$	—		$	—	$	8,069		$	8,069	$	—		$	—
Short-term investments:
Auction rate securities		121			—		—			121		119			—		—			119
CDARS		276			276		—			—		45			45		—			—
Asset-backed securities		411			411		—			—		258			258		—			—
Corporate debt		474			474		—			—		135			135		—			—
U.S. government and agency notes		25			25		—			—		39			39		—			—
Other fixed income securities		66			66		—			—		15			15		—			—
EETC		60			—		—			60		66			—		—			66
Fuel derivatives, net		(75	)		—		(75	)		—		375			—		375			—
Foreign currency derivatives		(3	)		—		(3	)		—		(7	)		—		(7	)		—
Restricted cash (a)		135			135		—			—		160			160		—			—

		00000000			00000000		00000000			00000000		00000000		00000000		00000000		00000000
	United (a)
Cash and cash equivalents	$	4,070		$	4,070	$	—		$	—	$	4,665	$	4,665	$	—	$	—
Short-term investments:
Asset-backed securities		31			31		—			—		—		—		—		—
Corporate debt		137			137		—			—		—		—		—		—
U.S. government and agency notes		2			2		—			—		—		—		—		—
Other fixed income securities		16			16		—			—		—		—		—		—
EETC		60			—		—			60		66		—		—		66
Fuel derivatives, net		(48	)		—		(48	)		—		277		—		277		—

		00000000			00000000		00000000			00000000			00000000			00000000		00000000			00000000
	Continental
Cash and cash equivalents	$	2,908		$	2,908	$	—		$	—		$	3,398		$	3,398	$	—		$	—
Short-term investments:
Auction rate securities		121			—		—			121			119			—		—			119
CDARS		276			276		—			—			45			45		—			—
Asset-backed securities		380			380		—			—			258			258		—			—
Corporate debt		337			337		—			—			135			135		—			—
U.S. government and agency notes		23			23		—			—			39			39		—			—
Other fixed income securities		50			50		—			—			15			15		—			—
Fuel derivatives, net		(27	)		—		(27	)		—			98			—		98			—
Foreign currency derivatives		(3	)		—		(3	)		—			(7	)		—		(7	)		—
Restricted cash		135			135		—			—			160			160		—			—
Convertible debt derivative asset		199			—		—			199			286			—		—			286
Convertible debt option liability		(103	)		—		—			(103	)		(164	)		—		—			(164	)

(a) United's restricted cash is recorded at cost.

The tables below present disclosures about the activity for "Level Three" financial assets and financial liabilities for the three and nine months ended September 30 (in millions):

	Three Months Ended September 30,
	2011						2010
UAL (a)	Auction Rate Securities			EETC			EETC
Balance at June 30	$	121		$	65		$	61
Settlements		—			(2	)		(2	)
Reported in earnings—unrealized		1			—			—
Reported in other comprehensive income		(1	)		(3	)		4
Balance at September 30	$	121		$	60		$	63

(a) For 2010, amounts also represent United. For 2011, United's only Level Three recurring measurements are the above EETCs.

	Nine Months Ended September 30,
	2011					2010
UAL (a)	Auction Rate Securities		EETC			EETC
Balance at January 1	$	119	$	66		$	51
Settlements		—		(4	)		(4	)
Reported in earnings—unrealized		2		—			—
Reported in other comprehensive income		—		(2	)		16
Balance at September 30	$	121	$	60		$	63

(a) For 2010, amounts also represent United. For 2011, United's only Level Three recurring measurements are the above EETCs.

	Successor - 2011									Predecessor - 2010
Continental	Auction Rate Securities			Convertible Debt Supplemental Derivative Asset (a)			Convertible Debt Conversion Option Liability (a)			Auction Rate Securities		Auction Rate Securities  Put Right
Balance at June 30	$	121		$	251		$	(143	)	$	117	$	—
Sales		—			—			—			—		—
Gains (losses):
Reported in earnings:
Realized		—			—			—			—		—
Unrealized		1			(52	)		40			—		—
Reported in other comprehensive income		(1	)		—			—			—		—
Balance at September 30	$	121		$	199		$	(103	)	$	117	$	—

(a) These derivatives are not designated as hedges. The Convertible Debt Supplemental Derivative Asset is classified in "Other Asset - Other, net", and the Convertible Debt Conversion Option Liability is classified in "Other liabilities and deferred credits - Other" in Continental's consolidated balance sheets. The earnings impact is classified in "Nonoperating income (expense) - Miscellaneous, net" in Continental's statements of consolidated operations.

	Successor - 2011								Predecessor - 2010
Continental	Auction Rate Securities		Convertible Debt Supplemental Derivative Asset (a)			Convertible Debt Conversion Option Liability (a)			Auction Rate Securities			Auction Rate Securities Put Right
Balance at January 1	$	119	$	286		$	(164	)	$	201		$	20
Sales		—		—			—			(106	)		—
Gains (losses):
Reported in earnings:
Realized		—		—			—			23			(21	)
Unrealized		2		(87	)		61			—			1
Reported in other comprehensive income (loss)		—		—			—			(1	)		—
Balance at September 30	$	121	$	199		$	(103	)	$	117		$	—

(a) These derivatives are not designated as hedges. The Convertible Debt Supplemental Derivative Asset is classified in "Other Asset - Other, net", and the Convertible Debt Conversion Option Liability is classified in "Other liabilities and deferred credits - Other" in Continental's consolidated balance sheets. The earnings impact is classified in "Nonoperating income (expense) - Miscellaneous, net" in Continental's statements of consolidated operations.

As of September 30, 2011, Continental's auction rate securities, which had a par value of $145 million, an amortized cost basis of $119 million and unrealized gains of $2 million, were variable-rate debt instruments with contractual maturities generally greater than ten years and with interest rates that reset every 7, 28 or 35 days, depending on the terms of the particular instrument. These securities are backed by pools of student loans guaranteed by state-designated guaranty agencies and reinsured by the U.S. government. All of the auction rate securities that Continental holds are senior obligations under the applicable indentures authorizing the issuance of the securities.

During the first nine months of 2010, Continental Predecessor sold, at par, auction rate securities having a par value of $106 million. Certain of these auction rate securities were subject to a put right granted to Continental by an institution permitting Continental to sell to the institution certain auction rate securities at their full par value. Continental classified the auction rate securities underlying the put right as trading securities and elected the fair value option under applicable accounting standards for the put right, with changes in the fair value of the put right and the underlying auction rate securities recognized in earnings currently. Continental recognized gains on the sales using the specific identification method. The gains were substantially offset by the cancellation of the related put rights. The net gains are included in miscellaneous nonoperating income (expense) in Continental Predecessor's statements of consolidated operations and were not material.

As of September 30, 2011, United's enhanced equipment trust certificate ("EETC") securities, which were repurchased in open market transactions in 2007, have an amortized cost basis of $66 million and unrealized losses of $6 million. All changes in the fair value of these investments have been classified within accumulated other comprehensive income.

The Continental Successor debt-related derivatives presented in the table above relate to (a) supplemental indenture agreements that provide that Continental's convertible debt, which was previously convertible into shares of Continental common stock, is convertible into shares of UAL common stock upon the terms and conditions specified in the indentures, and (b) the embedded conversion options in Continental's convertible debt that are required to be separated and accounted for as though they are free-standing derivatives as a result of the Continental debt becoming convertible into the common stock of a different reporting entity. These derivatives are reported in Continental's separate financial statements and eliminated in consolidation for UAL. See the Company's 2010 Annual Report for additional information.

The table below presents the carrying values and estimated fair values of financial instruments not presented in the tables above as of September 30, 2011 and December 31, 2010 (in millions):

	September 30, 2011				December 31, 2010
	Carrying Amount		Fair Value		Carrying Amount		Fair Value
UAL debt	$	12,074	$	12,151	$	13,845	$	14,995
United debt		5,826		5,565		7,026		7,350
Continental Successor debt		5,835		5,717		6,401		6,663

Fair value of the financial instruments included in the tables above was determined as follows:

Description	Fair Value Methodology
Cash, Cash Equivalents, Short-term Investments, Investments and Restricted Cash	The carrying amounts approximate fair value because of the short-term maturity of these assets and liabilities. These assets have maturities of less than one year except for the EETCs, auction rate securities and corporate debt.
	Fair value is based on (a) the trading prices of the investment or similar instruments, (b) an income approach, which uses valuation techniques to convert future amounts into a single present amount based on current market expectations about those future amounts when observable trading prices are not available, or (c) internally-developed models of the expected future cash flows related to the securities.
Fuel Derivatives	Derivative contracts are privately negotiated contracts and are not exchange traded. Fair value measurements are estimated with option pricing models that employ observable inputs. Inputs to the valuation models include contractual terms, market prices, yield curves, fuel price curves and measures of volatility, among others.
Foreign Currency Derivatives	Fair value is determined with a formula utilizing observable inputs. Significant inputs to the valuation models include contractual terms, risk-free interest rates and forward exchange rates.
Debt	Fair values were based on either market prices or the discounted amount of future cash flows using our current incremental rate of borrowing for similar liabilities.
Convertible Debt Derivative Asset and Option Liability	The Company used a binomial lattice model to value the conversion options and the supplemental derivative assets. Significant binomial model inputs that are not objectively determinable include volatility and discount rate.

United Airlines Inc [Member]

Financial Instruments And Fair Value Measurements

NOTE 5—FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS

The table below presents disclosures about the financial assets and financial liabilities measured at fair value on a recurring basis in the Company's financial statements as of September 30, 2011 and December 31, 2010 (in millions):

		00000000			00000000		00000000			00000000		00000000			00000000		00000000			00000000
	September 30, 2011										December 31, 2010
	Total			Level 1		Level 2			Level 3		Total			Level 1		Level 2			Level 3
	UAL
Cash and cash equivalents	$	6,984		$	6,984	$	—		$	—	$	8,069		$	8,069	$	—		$	—
Short-term investments:
Auction rate securities		121			—		—			121		119			—		—			119
CDARS		276			276		—			—		45			45		—			—
Asset-backed securities		411			411		—			—		258			258		—			—
Corporate debt		474			474		—			—		135			135		—			—
U.S. government and agency notes		25			25		—			—		39			39		—			—
Other fixed income securities		66			66		—			—		15			15		—			—
EETC		60			—		—			60		66			—		—			66
Fuel derivatives, net		(75	)		—		(75	)		—		375			—		375			—
Foreign currency derivatives		(3	)		—		(3	)		—		(7	)		—		(7	)		—
Restricted cash (a)		135			135		—			—		160			160		—			—

		00000000			00000000		00000000			00000000		00000000		00000000		00000000		00000000
	United (a)
Cash and cash equivalents	$	4,070		$	4,070	$	—		$	—	$	4,665	$	4,665	$	—	$	—
Short-term investments:
Asset-backed securities		31			31		—			—		—		—		—		—
Corporate debt		137			137		—			—		—		—		—		—
U.S. government and agency notes		2			2		—			—		—		—		—		—
Other fixed income securities		16			16		—			—		—		—		—		—
EETC		60			—		—			60		66		—		—		66
Fuel derivatives, net		(48	)		—		(48	)		—		277		—		277		—

		00000000			00000000		00000000			00000000			00000000			00000000		00000000			00000000
	Continental
Cash and cash equivalents	$	2,908		$	2,908	$	—		$	—		$	3,398		$	3,398	$	—		$	—
Short-term investments:
Auction rate securities		121			—		—			121			119			—		—			119
CDARS		276			276		—			—			45			45		—			—
Asset-backed securities		380			380		—			—			258			258		—			—
Corporate debt		337			337		—			—			135			135		—			—
U.S. government and agency notes		23			23		—			—			39			39		—			—
Other fixed income securities		50			50		—			—			15			15		—			—
Fuel derivatives, net		(27	)		—		(27	)		—			98			—		98			—
Foreign currency derivatives		(3	)		—		(3	)		—			(7	)		—		(7	)		—
Restricted cash		135			135		—			—			160			160		—			—
Convertible debt derivative asset		199			—		—			199			286			—		—			286
Convertible debt option liability		(103	)		—		—			(103	)		(164	)		—		—			(164	)

(a) United's restricted cash is recorded at cost.

The tables below present disclosures about the activity for "Level Three" financial assets and financial liabilities for the three and nine months ended September 30 (in millions):

	Three Months Ended September 30,
	2011						2010
UAL (a)	Auction Rate Securities			EETC			EETC
Balance at June 30	$	121		$	65		$	61
Settlements		—			(2	)		(2	)
Reported in earnings—unrealized		1			—			—
Reported in other comprehensive income		(1	)		(3	)		4
Balance at September 30	$	121		$	60		$	63

(a) For 2010, amounts also represent United. For 2011, United's only Level Three recurring measurements are the above EETCs.

	Nine Months Ended September 30,
	2011					2010
UAL (a)	Auction Rate Securities		EETC			EETC
Balance at January 1	$	119	$	66		$	51
Settlements		—		(4	)		(4	)
Reported in earnings—unrealized		2		—			—
Reported in other comprehensive income		—		(2	)		16
Balance at September 30	$	121	$	60		$	63

(a) For 2010, amounts also represent United. For 2011, United's only Level Three recurring measurements are the above EETCs.

	Successor - 2011									Predecessor - 2010
Continental	Auction Rate Securities			Convertible Debt Supplemental Derivative Asset (a)			Convertible Debt Conversion Option Liability (a)			Auction Rate Securities		Auction Rate Securities  Put Right
Balance at June 30	$	121		$	251		$	(143	)	$	117	$	—
Sales		—			—			—			—		—
Gains (losses):
Reported in earnings:
Realized		—			—			—			—		—
Unrealized		1			(52	)		40			—		—
Reported in other comprehensive income		(1	)		—			—			—		—
Balance at September 30	$	121		$	199		$	(103	)	$	117	$	—

(a) These derivatives are not designated as hedges. The Convertible Debt Supplemental Derivative Asset is classified in "Other Asset - Other, net", and the Convertible Debt Conversion Option Liability is classified in "Other liabilities and deferred credits - Other" in Continental's consolidated balance sheets. The earnings impact is classified in "Nonoperating income (expense) - Miscellaneous, net" in Continental's statements of consolidated operations.

	Successor - 2011								Predecessor - 2010
Continental	Auction Rate Securities		Convertible Debt Supplemental Derivative Asset (a)			Convertible Debt Conversion Option Liability (a)			Auction Rate Securities			Auction Rate Securities Put Right
Balance at January 1	$	119	$	286		$	(164	)	$	201		$	20
Sales		—		—			—			(106	)		—
Gains (losses):
Reported in earnings:
Realized		—		—			—			23			(21	)
Unrealized		2		(87	)		61			—			1
Reported in other comprehensive income (loss)		—		—			—			(1	)		—
Balance at September 30	$	121	$	199		$	(103	)	$	117		$	—

(a) These derivatives are not designated as hedges. The Convertible Debt Supplemental Derivative Asset is classified in "Other Asset - Other, net", and the Convertible Debt Conversion Option Liability is classified in "Other liabilities and deferred credits - Other" in Continental's consolidated balance sheets. The earnings impact is classified in "Nonoperating income (expense) - Miscellaneous, net" in Continental's statements of consolidated operations.

As of September 30, 2011, Continental's auction rate securities, which had a par value of $145 million, an amortized cost basis of $119 million and unrealized gains of $2 million, were variable-rate debt instruments with contractual maturities generally greater than ten years and with interest rates that reset every 7, 28 or 35 days, depending on the terms of the particular instrument. These securities are backed by pools of student loans guaranteed by state-designated guaranty agencies and reinsured by the U.S. government. All of the auction rate securities that Continental holds are senior obligations under the applicable indentures authorizing the issuance of the securities.

During the first nine months of 2010, Continental Predecessor sold, at par, auction rate securities having a par value of $106 million. Certain of these auction rate securities were subject to a put right granted to Continental by an institution permitting Continental to sell to the institution certain auction rate securities at their full par value. Continental classified the auction rate securities underlying the put right as trading securities and elected the fair value option under applicable accounting standards for the put right, with changes in the fair value of the put right and the underlying auction rate securities recognized in earnings currently. Continental recognized gains on the sales using the specific identification method. The gains were substantially offset by the cancellation of the related put rights. The net gains are included in miscellaneous nonoperating income (expense) in Continental Predecessor's statements of consolidated operations and were not material.

As of September 30, 2011, United's enhanced equipment trust certificate ("EETC") securities, which were repurchased in open market transactions in 2007, have an amortized cost basis of $66 million and unrealized losses of $6 million. All changes in the fair value of these investments have been classified within accumulated other comprehensive income.

The Continental Successor debt-related derivatives presented in the table above relate to (a) supplemental indenture agreements that provide that Continental's convertible debt, which was previously convertible into shares of Continental common stock, is convertible into shares of UAL common stock upon the terms and conditions specified in the indentures, and (b) the embedded conversion options in Continental's convertible debt that are required to be separated and accounted for as though they are free-standing derivatives as a result of the Continental debt becoming convertible into the common stock of a different reporting entity. These derivatives are reported in Continental's separate financial statements and eliminated in consolidation for UAL. See the Company's 2010 Annual Report for additional information.

The table below presents the carrying values and estimated fair values of financial instruments not presented in the tables above as of September 30, 2011 and December 31, 2010 (in millions):

	September 30, 2011				December 31, 2010
	Carrying Amount		Fair Value		Carrying Amount		Fair Value
UAL debt	$	12,074	$	12,151	$	13,845	$	14,995
United debt		5,826		5,565		7,026		7,350
Continental Successor debt		5,835		5,717		6,401		6,663

Fair value of the financial instruments included in the tables above was determined as follows:

Description	Fair Value Methodology
Cash, Cash Equivalents, Short-term Investments, Investments and Restricted Cash	The carrying amounts approximate fair value because of the short-term maturity of these assets and liabilities. These assets have maturities of less than one year except for the EETCs, auction rate securities and corporate debt.
	Fair value is based on (a) the trading prices of the investment or similar instruments, (b) an income approach, which uses valuation techniques to convert future amounts into a single present amount based on current market expectations about those future amounts when observable trading prices are not available, or (c) internally-developed models of the expected future cash flows related to the securities.
Fuel Derivatives	Derivative contracts are privately negotiated contracts and are not exchange traded. Fair value measurements are estimated with option pricing models that employ observable inputs. Inputs to the valuation models include contractual terms, market prices, yield curves, fuel price curves and measures of volatility, among others.
Foreign Currency Derivatives	Fair value is determined with a formula utilizing observable inputs. Significant inputs to the valuation models include contractual terms, risk-free interest rates and forward exchange rates.
Debt	Fair values were based on either market prices or the discounted amount of future cash flows using our current incremental rate of borrowing for similar liabilities.
Convertible Debt Derivative Asset and Option Liability	The Company used a binomial lattice model to value the conversion options and the supplemental derivative assets. Significant binomial model inputs that are not objectively determinable include volatility and discount rate.

Continental Airlines Inc [Member]

Financial Instruments And Fair Value Measurements

NOTE 5—FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS

The table below presents disclosures about the financial assets and financial liabilities measured at fair value on a recurring basis in the Company's financial statements as of September 30, 2011 and December 31, 2010 (in millions):

		00000000			00000000		00000000			00000000		00000000			00000000		00000000			00000000
	September 30, 2011										December 31, 2010
	Total			Level 1		Level 2			Level 3		Total			Level 1		Level 2			Level 3
	UAL
Cash and cash equivalents	$	6,984		$	6,984	$	—		$	—	$	8,069		$	8,069	$	—		$	—
Short-term investments:
Auction rate securities		121			—		—			121		119			—		—			119
CDARS		276			276		—			—		45			45		—			—
Asset-backed securities		411			411		—			—		258			258		—			—
Corporate debt		474			474		—			—		135			135		—			—
U.S. government and agency notes		25			25		—			—		39			39		—			—
Other fixed income securities		66			66		—			—		15			15		—			—
EETC		60			—		—			60		66			—		—			66
Fuel derivatives, net		(75	)		—		(75	)		—		375			—		375			—
Foreign currency derivatives		(3	)		—		(3	)		—		(7	)		—		(7	)		—
Restricted cash (a)		135			135		—			—		160			160		—			—

		00000000			00000000		00000000			00000000		00000000		00000000		00000000		00000000
	United (a)
Cash and cash equivalents	$	4,070		$	4,070	$	—		$	—	$	4,665	$	4,665	$	—	$	—
Short-term investments:
Asset-backed securities		31			31		—			—		—		—		—		—
Corporate debt		137			137		—			—		—		—		—		—
U.S. government and agency notes		2			2		—			—		—		—		—		—
Other fixed income securities		16			16		—			—		—		—		—		—
EETC		60			—		—			60		66		—		—		66
Fuel derivatives, net		(48	)		—		(48	)		—		277		—		277		—

		00000000			00000000		00000000			00000000			00000000			00000000		00000000			00000000
	Continental
Cash and cash equivalents	$	2,908		$	2,908	$	—		$	—		$	3,398		$	3,398	$	—		$	—
Short-term investments:
Auction rate securities		121			—		—			121			119			—		—			119
CDARS		276			276		—			—			45			45		—			—
Asset-backed securities		380			380		—			—			258			258		—			—
Corporate debt		337			337		—			—			135			135		—			—
U.S. government and agency notes		23			23		—			—			39			39		—			—
Other fixed income securities		50			50		—			—			15			15		—			—
Fuel derivatives, net		(27	)		—		(27	)		—			98			—		98			—
Foreign currency derivatives		(3	)		—		(3	)		—			(7	)		—		(7	)		—
Restricted cash		135			135		—			—			160			160		—			—
Convertible debt derivative asset		199			—		—			199			286			—		—			286
Convertible debt option liability		(103	)		—		—			(103	)		(164	)		—		—			(164	)

(a) United's restricted cash is recorded at cost.

The tables below present disclosures about the activity for "Level Three" financial assets and financial liabilities for the three and nine months ended September 30 (in millions):

	Three Months Ended September 30,
	2011						2010
UAL (a)	Auction Rate Securities			EETC			EETC
Balance at June 30	$	121		$	65		$	61
Settlements		—			(2	)		(2	)
Reported in earnings—unrealized		1			—			—
Reported in other comprehensive income		(1	)		(3	)		4
Balance at September 30	$	121		$	60		$	63

(a) For 2010, amounts also represent United. For 2011, United's only Level Three recurring measurements are the above EETCs.

	Nine Months Ended September 30,
	2011					2010
UAL (a)	Auction Rate Securities		EETC			EETC
Balance at January 1	$	119	$	66		$	51
Settlements		—		(4	)		(4	)
Reported in earnings—unrealized		2		—			—
Reported in other comprehensive income		—		(2	)		16
Balance at September 30	$	121	$	60		$	63

(a) For 2010, amounts also represent United. For 2011, United's only Level Three recurring measurements are the above EETCs.

	Successor - 2011									Predecessor - 2010
Continental	Auction Rate Securities			Convertible Debt Supplemental Derivative Asset (a)			Convertible Debt Conversion Option Liability (a)			Auction Rate Securities		Auction Rate Securities  Put Right
Balance at June 30	$	121		$	251		$	(143	)	$	117	$	—
Sales		—			—			—			—		—
Gains (losses):
Reported in earnings:
Realized		—			—			—			—		—
Unrealized		1			(52	)		40			—		—
Reported in other comprehensive income		(1	)		—			—			—		—
Balance at September 30	$	121		$	199		$	(103	)	$	117	$	—

(a) These derivatives are not designated as hedges. The Convertible Debt Supplemental Derivative Asset is classified in "Other Asset - Other, net", and the Convertible Debt Conversion Option Liability is classified in "Other liabilities and deferred credits - Other" in Continental's consolidated balance sheets. The earnings impact is classified in "Nonoperating income (expense) - Miscellaneous, net" in Continental's statements of consolidated operations.

	Successor - 2011								Predecessor - 2010
Continental	Auction Rate Securities		Convertible Debt Supplemental Derivative Asset (a)			Convertible Debt Conversion Option Liability (a)			Auction Rate Securities			Auction Rate Securities Put Right
Balance at January 1	$	119	$	286		$	(164	)	$	201		$	20
Sales		—		—			—			(106	)		—
Gains (losses):
Reported in earnings:
Realized		—		—			—			23			(21	)
Unrealized		2		(87	)		61			—			1
Reported in other comprehensive income (loss)		—		—			—			(1	)		—
Balance at September 30	$	121	$	199		$	(103	)	$	117		$	—

(a) These derivatives are not designated as hedges. The Convertible Debt Supplemental Derivative Asset is classified in "Other Asset - Other, net", and the Convertible Debt Conversion Option Liability is classified in "Other liabilities and deferred credits - Other" in Continental's consolidated balance sheets. The earnings impact is classified in "Nonoperating income (expense) - Miscellaneous, net" in Continental's statements of consolidated operations.

As of September 30, 2011, Continental's auction rate securities, which had a par value of $145 million, an amortized cost basis of $119 million and unrealized gains of $2 million, were variable-rate debt instruments with contractual maturities generally greater than ten years and with interest rates that reset every 7, 28 or 35 days, depending on the terms of the particular instrument. These securities are backed by pools of student loans guaranteed by state-designated guaranty agencies and reinsured by the U.S. government. All of the auction rate securities that Continental holds are senior obligations under the applicable indentures authorizing the issuance of the securities.

During the first nine months of 2010, Continental Predecessor sold, at par, auction rate securities having a par value of $106 million. Certain of these auction rate securities were subject to a put right granted to Continental by an institution permitting Continental to sell to the institution certain auction rate securities at their full par value. Continental classified the auction rate securities underlying the put right as trading securities and elected the fair value option under applicable accounting standards for the put right, with changes in the fair value of the put right and the underlying auction rate securities recognized in earnings currently. Continental recognized gains on the sales using the specific identification method. The gains were substantially offset by the cancellation of the related put rights. The net gains are included in miscellaneous nonoperating income (expense) in Continental Predecessor's statements of consolidated operations and were not material.

As of September 30, 2011, United's enhanced equipment trust certificate ("EETC") securities, which were repurchased in open market transactions in 2007, have an amortized cost basis of $66 million and unrealized losses of $6 million. All changes in the fair value of these investments have been classified within accumulated other comprehensive income.

The Continental Successor debt-related derivatives presented in the table above relate to (a) supplemental indenture agreements that provide that Continental's convertible debt, which was previously convertible into shares of Continental common stock, is convertible into shares of UAL common stock upon the terms and conditions specified in the indentures, and (b) the embedded conversion options in Continental's convertible debt that are required to be separated and accounted for as though they are free-standing derivatives as a result of the Continental debt becoming convertible into the common stock of a different reporting entity. These derivatives are reported in Continental's separate financial statements and eliminated in consolidation for UAL. See the Company's 2010 Annual Report for additional information.

The table below presents the carrying values and estimated fair values of financial instruments not presented in the tables above as of September 30, 2011 and December 31, 2010 (in millions):

	September 30, 2011				December 31, 2010
	Carrying Amount		Fair Value		Carrying Amount		Fair Value
UAL debt	$	12,074	$	12,151	$	13,845	$	14,995
United debt		5,826		5,565		7,026		7,350
Continental Successor debt		5,835		5,717		6,401		6,663

Fair value of the financial instruments included in the tables above was determined as follows:

Description	Fair Value Methodology
Cash, Cash Equivalents, Short-term Investments, Investments and Restricted Cash	The carrying amounts approximate fair value because of the short-term maturity of these assets and liabilities. These assets have maturities of less than one year except for the EETCs, auction rate securities and corporate debt.
	Fair value is based on (a) the trading prices of the investment or similar instruments, (b) an income approach, which uses valuation techniques to convert future amounts into a single present amount based on current market expectations about those future amounts when observable trading prices are not available, or (c) internally-developed models of the expected future cash flows related to the securities.
Fuel Derivatives	Derivative contracts are privately negotiated contracts and are not exchange traded. Fair value measurements are estimated with option pricing models that employ observable inputs. Inputs to the valuation models include contractual terms, market prices, yield curves, fuel price curves and measures of volatility, among others.
Foreign Currency Derivatives	Fair value is determined with a formula utilizing observable inputs. Significant inputs to the valuation models include contractual terms, risk-free interest rates and forward exchange rates.
Debt	Fair values were based on either market prices or the discounted amount of future cash flows using our current incremental rate of borrowing for similar liabilities.
Convertible Debt Derivative Asset and Option Liability	The Company used a binomial lattice model to value the conversion options and the supplemental derivative assets. Significant binomial model inputs that are not objectively determinable include volatility and discount rate.