Fair Value Measurements (Tables)

9 Months Ended

Sep. 30, 2012

Fair Value Measurements

Mattel’s financial assets and liabilities measured and reported at fair value on a recurring basis include the following:

	September 30, 2012
	Level 1		Level 2		Level 3		Total
	(In thousands)
Assets:
Foreign currency forward exchange contracts (a)	$	—	$	19,868	$	—	$	19,868
Auction rate securities (b)		—		—		13,656		13,656
Total assets	$	—	$	19,868	$	13,656	$	33,524
Liabilities:
Foreign currency forward exchange contracts (a)	$	—	$	11,743	$	—	$	11,743

	September 30, 2011
	Level 1		Level 2		Level 3		Total
	(In thousands)
Assets:
Foreign currency forward exchange contracts (a)	$	—	$	25,301	$	—	$	25,301
Auction rate securities (b)		—		—		21,000		21,000
Total assets	$	—	$	25,301	$	21,000	$	46,301
Liabilities:
Foreign currency forward exchange contracts (a)	$	—	$	10,954	$	—	$	10,954

	December 31, 2011
	Level 1		Level 2		Level 3		Total
	(In thousands)
Assets:
Foreign currency forward exchange contracts (a)	$	—	$	31,896	$	—	$	31,896
Auction rate securities (b)		—		—		15,630		15,630
Total assets	$	—	$	31,896	$	15,630	$	47,526
Liabilities:
Foreign currency forward exchange contracts (a)	$	—	$	4,312	$	—	$	4,312

(a) The fair value of the foreign currency forward exchange contracts is based on dealer quotes of market forward rates and reflects the amount that Mattel would receive or pay at their maturity dates for contracts involving the same notional amounts, currencies, and maturity dates.

(b) The fair value of the auction rate securities is estimated using a discounted cash flow model based on (i) estimated interest rates, timing, and amount of cash flows, (ii) credit spreads, recovery rates, and credit quality of the underlying securities, (iii) illiquidity considerations, and (iv) market correlation.

Fair Value Measurements - Level 3

The following table presents information about Mattel’s assets measured and reported at fair value on a recurring basis using significant Level 3 inputs:

	Level 3
	(In thousands)
Balance at December 31, 2011	$	15,630
Net unrealized loss		(1,974	)
Balance at September 30, 2012	$	13,656