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2016 Financial Report of the United States Government


Notes to the Financial Statements

Note 7. Debt and Equity Securities

Debt and Equity Securities as of September 30, 2016
 
By Category
 
Held-to-Maturity
Available-for-Sale
Trading Securities
(In billions of dollars)
Cost
Basis
Unamor-
tized
Premium/
Discount
Net
Investment
Cost
Basis
Unreal-
ized
Gain
(Loss)
Fair
Value
Cost
Basis
Unreal-
ized
Gain
(Loss)
Fair
Value
Total
Debt Securities:
Non-U.S. Government 0.1 - 0.1 9.5 0.4 9.9 0.1 - 0.1 10.1
Corporate and other bonds - - - - - - 0.2 - 0.2 0.2
Mortgage/asset backed 0.3 - 0.3 - - - - - - 0.3
All other debt securities - - - - - - 0.2 - 0.2 0.2
Equity Securities:
Unit trust - - - - - - 1.0 0.3 1.3 1.3
Common stocks - - - - - - 0.2 - 0.2 0.2
All other equity securities 0.1 - 0.1 - - - 0.2 - 0.2 0.3
Other 10.9 - 10.9 - - - 0.4 - 0.4 11.3
Total debt and equity securities categorized as held-to-maturity, available-for-sale or trading 11.4 - 11.4 9.5 0.4 9.9 2.3 0.3 2.6 23.9
Total RRB debt and equity securities 24.3

Total debt and equity securities
48.2

Debt and Equity Securities as of September 30, 2015
 
By Category
 
Held-to-Maturity
Available-for-Sale
Trading Securities
(In billions of dollars)
Cost
Basis
Unamor-
tized
Premium/
Discount
Net
Investment
Cost
Basis
Unreal-
ized
Gain
(Loss)
Fair
Value
Cost
Basis
Unreal-
ized
Gain
(Loss)
Fair
Value
Total
Debt Securities:
Non-U.S. Government 0.1 - 0.1 12.4 (0.7) 11.7 10.9 (0.8) 10.1 21.9
Corporate and other bonds - - - - - - 11.3 - 11.3 11.3
Mortgage/asset backed 0.2 - 0.2 - - - 3.6 - 3.6 3.8
Commercial - - - - - - 0.2 - 0.2 0.2
All other debt securities - - - - - - 3.5 - 3.5 3.5
Equity Securities:
Unit trust - - - - - - 17.4 3.8 21.2 21.2
Common stocks - - - - - - 1.3 0.3 1.6 1.6
All other equity securities 0.1 - 0.1 - - - 2.5 (0.4) 2.1 2.2
Other 3.7 - 3.7 - - - 11.1 0.4 11.5 15.2
Total debt and equity securities categorized as held-to-maturity, available-for-sale or trading 4.1 - 4.1 12.4 (0.7) 11.7 61.8 3.3 65.1 80.9
Total RRB debt and equity securities 23.5

Total debt and equity securities
104.4

Debt and Equity Securities as of September 30, 2016, and 2015
 
By Agency
(In billions of dollars)
2016
2015
Railroad Retirement Board 24.3 23.5
Department of the Treasury 9.9 11.7
Tennessee Valley Authority 9.8 9.2
Pension Benefit Guaranty Corporation - 55.7
All Other 4.2 4.3

  Total securities and investments
48.2 104.4

These debt and equity securities do not include nonmarketable Treasury securities, which have been eliminated in consolidation. Held-to-maturity debt and equity securities are reported at amortized cost, net of unamortized discounts and premiums. Available-for-sale debt and equity securities are reported at fair value. Trading debt and equity securities are reported at fair value. TVA invests primarily in fixed maturity and equity securities, classified as trading. TVA reported gains related to trading securities still held as of September 30, 2016 and 2015 of $0.3 billion and $0.2 billion, respectively. Treasury invests primarily in fixed maturity and equity securities, classified as available-for-sale securities. Treasury's Exchange Stabilization Fund invests primarily in foreign fixed maturity debt, with a fair value of $9.8 billion and $11.7 billion as of September 30, 2016, and 2015, respectively. The National Railroad Retirement Investment Trust (NRRIT), on behalf of the RRB, manages and invests railroad retirement assets that are to be used to pay retirement benefits to the Nation’s railroad workers under the Railroad Retirement Program. As an investment company, NRRIT is subject to different accounting standards that do not require the classifications presented above. Please refer to NRRIT's financial statements for more detailed information concerning this specific investment. The TVA balance includes $7.3 billion and $6.9 billion as of September 30, 2016, and 2015, respectively, for the Tennessee Valley Authority Retirement System (TVARS). TVARS includes unrealized gains of $0.5 billion and $0.1 billion as of September 30, 2016 and 2015, respectively. The Department of the Defense reflects majority of all other total securities and investments. NRRIT, Treasury and TVA base market values on the last sale of a listed security, on the mean of the "bid-and-ask" for nonlisted securities, or on a valuation model in the case of fixed income securities that are not actively traded. These valuations are determined as of the end of each fiscal year. Purchases and sales of securities are recorded on the trade date. Please refer to the individual financial statements of DOD, NRRIT, Treasury, and TVA for more detailed information related to debt and equity securities. These agencies comprise 98.0 percent of the total reported debt and equity securities of $48.2 billion as of September 30, 2016. In fiscal year 2016, PBGC reported the amounts for its Trust Fund, that represents the present value of future benefits, in Note 21—Fiduciary Activities. Per Title IV of ERISA, PBGC is directed in its role as guarantor to provide guaranteed benefits to the extent allowed within statutory limits. As a result of reflecting the Trust Fund as fiduciary activity for fiscal year 2016, amounts in the table above display a decrease of $55.7 billion since the Trust Fund balances were reported with debt and equity securities in fiscal year 2015. PBGC's reporting changed as a result of clarifying Treasury guidance for fiscal year 2016 regarding fiduciary activities.

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