Fair Value

Financial assets and liabilities measured at fair value on a recurring basis at March 31, 2013 and December 31, 2012 were (in millions):



March 31, 2013	Level 1		Level 2		Level 3		Total


Assets:
Cash and cash equivalents	$	2,071.8					$	2,071.8
Short-term investments	18.5						18.5
Available-for-sale securities	4.3						4.3
Forward foreign exchange contracts			$	0.5			0.5

Liabilities:
Forward foreign exchange contracts			$	0.7			$	0.7
Contingent purchase price obligations					$	239.6	239.6



December 31, 2012	Level 1		Level 2		Level 3		Total


Assets:
Cash and cash equivalents	$	2,678.3					$	2,678.3
Short-term investments	20.6						20.6
Available-for-sale securities	3.9						3.9
Forward foreign exchange contracts			$	0.5			0.5

Liabilities:
Contingent purchase price obligations					$	266.2	266.2

The reduction in Level 3 contingent purchase price obligations from $266.2 million at December 31, 2012 to $239.6 million at March 31, 2013 resulted primarily from payments of $13.5 million and foreign currency translation changes of $9.3 million.

The carrying amount and fair value of our financial instruments at March 31, 2013 and December 31, 2012 were (in millions):



	2013				2012


	Carrying Amount		Fair Value		Carrying Amount		Fair Value


Assets:
Cash and cash equivalents	$	2,071.8	$	2,071.8	$	2,678.3	$	2,678.3
Short-term investments	18.5		18.5		20.6		20.6
Available-for-sale securities	4.3		4.3		3.9		3.9
Forward foreign exchange contracts	0.5		0.5		0.5		0.5
Cost method investments	22.6		22.6		23.1		23.1

Liabilities:
Short-term borrowings	$	11.6	$	11.6	$	6.4	$	6.4
Forward foreign exchange contracts	0.7		0.7		—		—
Contingent purchase price obligations	239.6		239.6		266.2		266.2
Debt	4,446.7		4,869.6		4,448.9		4,857.3

The estimated fair value of derivative positions in forward foreign exchange contracts is determined using model-derived valuations, taking into consideration market rates and counterparty credit risk. The estimated fair value of the contingent purchase price obligation is calculated in accordance with the terms of each acquisition agreement and are appropriately discounted. The fair value of debt is based on quoted market prices.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References

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+ Details