16.Fair Values of Assets and Liabilities

For a description of the fair value hierarchy and the Company’s fair value methodologies, including the use of independent third-party pricing services, see note “2 – Summary of Significant Accounting Policies.” The Company did not transfer any assets or liabilities between Level 1, Level 2, or Level 3 during 2014 or 2013. In addition, the Company did not adjust prices received from the primary independent third-party pricing service at December 31, 2014 or 2013.

Financial Instruments Recorded at Fair Value

The following tables present the fair value hierarchy for assets measured at fair value. Liabilities recorded at fair value were not material, and therefore are not included in the following tables:


	Quoted Prices
	in Active Markets			Significant			Significant
	for Identical			Other Observable			Unobservable
	Assets			Inputs			Inputs		Balance at
December 31, 2014	(Level 1)			(Level 2)			(Level 3)		Fair Value
Cash equivalents:
Money market funds		$	2,142		$	-	$	-	$	2,142
Commercial paper			-			32		-		32
Total cash equivalents			2,142			32		-		2,174
Investments segregated and on deposit for
regulatory purposes:
Certificates of deposit			-			4,125		-		4,125
U.S. Government securities			-			2,186		-		2,186
Total investments segregated and on deposit for
regulatory purposes			-			6,311		-		6,311
Other securities owned:
Schwab Funds® money market funds			224			-		-		224
Equity and bond mutual funds			215			-		-		215
State and municipal debt obligations			-			51		-		51
Equity, U.S. Government and corporate debt, and
other securities			2			24		-		26
Total other securities owned			441			75		-		516
Securities available for sale:
Asset-backed securities			-			19,366		-		19,366
U.S. agency mortgage-backed securities			-			18,717		-		18,717
Corporate debt securities			-			8,045		-		8,045
U.S. agency notes			-			3,795		-		3,795
Treasury securities			-			2,994		-		2,994
Certificates of deposit			-			1,534		-		1,534
Non-agency commercial mortgage-backed securities			-			317		-		317
Other securities			-			15		-		15
Total securities available for sale			-			54,783		-		54,783
Total		$	2,583		$	61,201	$	-	$	63,784


	Quoted Prices
	in Active Markets			Significant				Significant
	for Identical			Other Observable				Unobservable
	Assets			Inputs				Inputs	Balance at
December 31, 2013	(Level 1)			(Level 2)				(Level 3)	Fair Value
Cash equivalents:
Money market funds		$	1,141		$	-	$	-	$	1,141
Commercial paper			-			22		-		22
Total cash equivalents			1,141			22		-		1,163
Investments segregated and on deposit for
regulatory purposes:
Certificates of deposit			-			2,737		-		2,737
U.S. Government securities			-			2,539		-		2,539
Total investments segregated and on deposit for
regulatory purposes			-			5,276		-		5,276
Other securities owned:
Schwab Funds® money market funds			261			-		-		261
Equity and bond mutual funds			208			-		-		208
State and municipal debt obligations			-			32		-		32
Equity, U.S. Government and corporate debt, and
other securities			1			15		-		16
Total other securities owned			470			47		-		517
Securities available for sale:
U.S. agency mortgage-backed securities			-			18,645		-		18,645
Asset-backed securities			-			15,206		-		15,206
Corporate debt securities			-			9,007		-		9,007
U.S. agency notes			-			4,136		-		4,136
Certificates of deposit			-			3,652		-		3,652
Non-agency residential mortgage-backed securities			-			593		-		593
Non-agency commercial mortgage-backed securities			-			279		-		279
Other securities			-			100		-		100
Total securities available for sale			-			51,618		-		51,618
Total		$	1,611		$	56,963	$	-	$	58,574

Financial Instruments Not Recorded at Fair Value

Descriptions of the valuation methodologies and assumptions used to estimate the fair value of financial instruments not recorded at fair value are also described in note “2 – Summary of Significant Accounting Policies.” There were no significant changes in these methodologies or assumptions during 2014. The following tables present the fair value hierarchy for financial instruments not recorded at fair value:


			Quoted Prices
			in Active Markets			Significant			Significant
			for Identical			Other Observable			Unobservable
	Carrying		Assets			Inputs			Inputs			Balance at
December 31, 2014	Amount		(Level 1)			(Level 2)			(Level 3)			Fair Value
Assets:
Cash and cash equivalents	$	9,189		$	-		$	9,189		$	-	$	9,189
Cash and investments segregated and
on deposit for regulatory purposes		14,466			-			14,466			-		14,466
Receivables from brokers, dealers, and
clearing organizations		469			-			469			-		469
Receivables from brokerage clients – net		15,666			-			15,666			-		15,666
Securities held to maturity:
U.S. agency mortgage-backed securities		33,388			-			33,745			-		33,745
Non-agency commercial mortgage-backed
securities		1,001			-			998			-		998
Total securities held to maturity		34,389			-			34,743			-		34,743
Loans to banking clients: (1)
Residential real estate mortgages		8,127			-			8,158			-		8,158
Home equity loans and lines of credit		2,955			-			3,026			-		3,026
Personal loans secured by securities		2,320			-			2,320			-		2,320
Other		39			-			38			-		38
Total loans to banking clients		13,441			-			13,542			-		13,542
Other assets		76			-			76			-		76
Total	$	87,696		$	-		$	88,151		$	-	$	88,151
Liabilities:
Deposits from banking clients	$	102,815		$	-		$	102,815		$	-	$	102,815
Payables to brokers, dealers, and clearing
organizations		2,004			-			2,004			-		2,004
Payables to brokerage clients		34,305			-			34,305			-		34,305
Accrued expenses and other liabilities		687			-			687			-		687
Long-term debt		1,899			-			2,010			-		2,010
Total	$	141,710		$	-		$	141,821		$	-	$	141,821

(1)	The carrying value of loans to banking clients excludes the allowance for loan losses of $42 million at December 31, 2014.


			Quoted Prices
			in Active Markets			Significant			Significant
			for Identical			Other Observable			Unobservable
	Carrying		Assets			Inputs			Inputs			Balance at
December 31, 2013	Amount		(Level 1)			(Level 2)			(Level 3)			Fair Value
Assets:
Cash and cash equivalents	$	6,565		$	-		$	6,565		$	-	$	6,565
Cash and investments segregated and
on deposit for regulatory purposes		18,273			-			18,273			-		18,273
Receivables from brokers, dealers, and
clearing organizations		509			-			509			-		509
Receivables from brokerage clients – net		13,949			-			13,949			-		13,949
Securities held to maturity:
U.S. agency mortgage-backed securities		29,260			-			28,500			-		28,500
Non-agency commercial mortgage-backed
securities		958			-			890			-		890
Other securities		100			-			100			-		100
Total securities held to maturity		30,318			-			29,490			-		29,490
Loans to banking clients: (1)
Residential real estate mortgages		8,006			-			7,930			-		7,930
Home equity loans and lines of credit		3,041			-			3,043			-		3,043
Personal loans secured by securities		1,384			-			1,384			-		1,384
Other		36			-			35			-		35
Total loans to banking clients		12,467			-			12,392			-		12,392
Other assets		64			-			64			-		64
Total	$	82,145		$	-		$	81,242		$	-	$	81,242
Liabilities:
Deposits from banking clients	$	92,972		$	-		$	92,972		$	-	$	92,972
Payables to brokers, dealers, and clearing
organizations		1,467			-			1,467			-		1,467
Payables to brokerage clients		35,333			-			35,333			-		35,333
Accrued expenses and other liabilities		680			-			680			-		680
Long-term debt		1,903			-			1,989			-		1,989
Total	$	132,355		$	-		$	132,441		$	-	$	132,441

(1)	The carrying value of loans to banking clients excludes the allowance for loan losses of $48 million at December 31, 2013.