Fair Value of Financial Instruments

The Company’s financial instruments consist primarily of cash and cash equivalents, marketable securities, finance receivables, net, debt, foreign currency exchange and commodity contracts (derivative instruments are discussed further in Note 8).

The following table summarizes the fair value and carrying value of the Company’s financial instruments at December 31 (in thousands):



	2016				2015
	Fair Value		Carrying Value		Fair Value		Carrying Value
Assets:
Cash and cash equivalents	$	759,984	$	759,984	$	722,209	$	722,209
Marketable securities	$	43,638	$	43,638	$	81,448	$	81,448
Derivatives	$	29,034	$	29,034	$	16,235	$	16,235
Finance receivables, net	$	6,921,037	$	6,835,458	$	6,937,053	$	6,868,153
Restricted cash	$	67,147	$	67,147	$	110,642	$	110,642
Liabilities:
Derivatives	$	142	$	142	$	1,300	$	1,300
Unsecured commercial paper	$	1,055,708	$	1,055,708	$	1,201,380	$	1,201,380
Asset-backed Canadian commercial paper conduit facility	$	149,338	$	149,338	$	153,839	$	153,839
Medium-term notes	$	4,139,462	$	4,064,940	$	3,410,966	$	3,316,949
Senior unsecured notes	$	744,552	$	741,306	$	737,435	$	740,653
Term asset-backed securitization debt	$	797,688	$	796,275	$	1,455,776	$	1,459,377

Cash and Cash Equivalents and Restricted Cash – With the exception of certain cash equivalents, the carrying value of these items in the financial statements is based on historical cost. The historical cost basis for these amounts is estimated to approximate their respective fair values due to the short maturity of these instruments. Fair value is based on Level 1 or Level 2 inputs.

Marketable Securities – The carrying value of marketable securities in the financial statements is based on fair value. The fair value of marketable securities is determined primarily based on quoted prices for identical instruments or on quoted market prices of similar financial assets. Fair value is based on Level 1 or Level 2 inputs.

Finance Receivables, Net – The carrying value of retail and wholesale finance receivables in the financial statements is amortized cost less an allowance for credit losses. The fair value of retail finance receivables is generally calculated by discounting future cash flows using an estimated discount rate that reflects current credit, interest rate and prepayment risks associated with similar types of instruments. Fair value is determined based on Level 3 inputs. The amortized cost basis of wholesale finance receivables approximates fair value because they either are short-term or have interest rates that adjust with changes in market interest rates.

Derivatives – Forward contracts for foreign currency exchange and commodities are derivative financial instruments and are carried at fair value on the balance sheet. The fair value of these contracts is determined using quoted forward rates and prices. Fair value is calculated using Level 2 inputs.

Debt – The carrying value of debt in the financial statements is generally amortized cost. The carrying value of unsecured commercial paper approximates fair value due to its short maturity. Fair value is calculated using Level 2 inputs.

The carrying value of debt provided under the Canadian Conduit approximates fair value since the interest rates charged under the facility are tied directly to market rates and fluctuate as market rates change. Fair value is calculated using Level 2 inputs.

The fair values of the medium-term notes and senior unsecured notes are estimated based upon rates currently available for debt with similar terms and remaining maturities. Fair value is calculated using Level 2 inputs.

The fair value of the debt related to term asset-backed securitization transactions is estimated based on pricing currently available for transactions with similar terms and maturities. Fair value is calculated using Level 2 inputs.