Huntsman Corporation Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

FAIR VALUE (Tables)

FAIR VALUE (Tables)

3 Months Ended

Mar. 31, 2012

	March 31, 2012						December 31, 2011

	Carrying Value			Estimated Fair Value			Carrying Value			Estimated Fair Value
Non-qualified employee benefit plan investments	$	14		$	14		$	12		$	12
Cross-currency interest rate contracts		17			17			27			27
Interest rate contracts		(17	)		(17	)		(17	)		(17	)
Long-term debt (including current portion)		(3,821	)		(4,041	)		(3,942	)		(4,061	)

Assets and liabilities are measured at fair value on a recurring basis

				Fair Value Amounts Using

Description	March 31, 2012			Quoted prices in active markets for identical assets (Level 1)(3)		Significant other observable inputs (Level 2)(3)			Significant unobservable inputs (Level 3)
Assets:
Available-for-sale equity securities:
Equity mutual funds	$	14		$	14	$	—		$	—
Derivatives:
Cross-currency interest rate contracts(1)		17			—		17			—

Total assets	$	31		$	14	$	17		$	—

Liabilities:
Derivatives:
Interest rate contracts(2)	$	(17	)	$	—	$	(17	)	$	—

				Fair Value Amounts Using

Description	December 31, 2011			Quoted prices in active markets for identical assets (Level 1)(3)		Significant other observable inputs (Level 2)(3)			Significant unobservable inputs (Level 3)
Assets:
Available-for-sale equity securities:
Equity mutual funds	$	12		$	12	$	—		$	—
Derivatives:
Cross-currency interest rate contracts(1)		27			—		—			27

Total assets	$	39		$	12	$	—		$	27

Liabilities:
Derivatives:
Interest rate contracts(2)	$	(17	)	$	—	$	(17	)	$	—

(1): The income approach is used to calculate the fair value of these instruments. Fair value represents the present value of estimated future cash flows, calculated using relevant interest rates, exchange rates, and yield curves at stated intervals. There were no material changes to the valuation methods or assumptions used to determine the fair value during the current period.
(2): The income approach is used to calculate the fair value of these instruments. Fair value represents the present value of estimated future cash flows, calculated using relevant interest rates and yield curves at stated intervals. There were no material changes to the valuation methods or assumptions used to determine the fair value during the current period.
(3): There were no transfers between Levels 1 and 2 within the fair value hierarchy for the three months ended March 31, 2012 and December 31, 2011.

Reconciliation of beginning and ending balances for assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3)

Fair Value Measurements Using Significant Unobservable Inputs (Level 3)	Cross-Currency Interest Rate Contracts			Total

Beginning balance, January 1, 2012	$	27		$	27
Transfers into Level 3		—			—
Transfer out of Level 3(1)		(27	)		(27	)
Total gains (losses):
Included in earnings		—			—
Included in other comprehensive income		—			—
Purchases, sales, issuances and settlements		—			—

Ending balance, March 31, 2012	$	—		$	—

The amount of total gains (losses) for the period included in earnings attributable to the change in unrealized gains (losses) relating to assets still held at March 31, 2012	$	—		$	—

Fair Value Measurements Using Significant Unobservable Inputs (Level 3)	Cross-Currency Interest Rate Contracts			Total

Beginning balance, January 1, 2011	$	19		$	19
Transfers into or out of Level 3		—			—
Total (losses) gains:
Included in earnings		—			—
Included in other comprehensive income		(15	)		(15	)
Purchases, sales, issuances and settlements		—			—

Ending balance, March 31, 2011	$	4		$	4

The amount of total gains (losses) for the period included in earnings attributable to the change in unrealized gains (losses) relating to assets still held at March 31, 2011	$	—		$	—

(1): We are party to cross-currency interest rate contracts that are measured at fair value in the financial statements. These instruments have historically been categorized by us as Level 3 within the fair value hierarchy due to an unobservable input associated with the credit valuation adjustment, which we deemed to be a significant input to the overall measurement of fair value at inception. During the three months ended March 31, 2012, this credit valuation adjustment has ceased to be a significant input to the entire fair value measurement of these instruments. The remaining inputs which are significant to the fair value measurement of these instruments represent observable market inputs that are inputs other than quoted prices (Level 2 inputs).

Our policy is to recognize transfers between levels within the fair value hierarchy as of the beginning of the reporting period. Due to the change in significance of the credit valuation adjustment to the entire fair value measurement of these instruments, effective January 1, 2012 we have categorized our cross-currency interest rate contracts as Level 2 within the fair value hierarchy.

Schedule of gains and losses (realized and unrealized) included in earnings reported in interest expense and other comprehensive loss

	Interest expense		Other comprehensive income

Total net gains included in earnings	$	—	$	—
Changes in unrealized gains relating to assets still held at March 31, 2012		—		—

	Interest expense		Other comprehensive income

Total net gains included in earnings	$	—	$	—
Changes in unrealized losses relating to assets still held at March 31, 2011		—		(15	)

- Definition

Tabular disclosure of the total amount of gains or losses for the period which are included in earnings or resulted in a change to net assets which gains or losses have arisen from the use of significant unobservable inputs (Level 3) to measure the fair value of assets and liabilities. Such gains or losses are attributable to the change in unrealized gains or losses relating to those assets and liabilities so valued which are still held at the reporting date and which change are also considered for disclosure; it may be expected that a description of where those unrealized gains or losses are reported in the statement of income or the statement of financial position would also be disclosed.

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- Definition

Tabular disclosure of the fair value measurement of assets using significant unobservable inputs (Level 3), a reconciliation of the beginning and ending balances, separately presenting changes during the period attributable to the following: (1) total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings (or changes in net assets) and gains or losses recognized in other comprehensive income, and a description of where those gains or losses included in earnings (or changes in net assets) are reported in the statement of income (or activities); (2) purchases, sales, issuances, and settlements (each type disclosed separately); and (3) transfers in and transfers out of Level 3 (for example, transfers due to changes in the observability of significant inputs), by class of asset.

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- Definition

Tabular disclosure of the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments, assets, and liabilities. Such certain disclosures about the financial instruments, assets, and liabilities include: (1) the fair value of the required items together with their carrying amounts (as appropriate) and (2) the methodology and assumptions used in developing such estimates of fair value.

+ References

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