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## NOTES TO THE FINANCIAL STATEMENTS 

## NOTE 5. MARKETABLE, LOANED AND OTHER SECURITIES 

Trading securities are recorded at fair value with unrealized gains and losses included in income. Available-for-sale securities are recorded at fair value with net unrealized holding gains and losses reported, net of tax, in Accumulated other comprehensive income . Held-to-maturity securities are recorded at amortized cost. Realized gains and losses are accounted for using the specific identification method. 

The fair value of substantially all securities is determined by quoted market prices. The estimated fair value of securities for which there are no quoted market prices is based on similar types of securities that are traded in the market. Equity securities that do not have readily determinable fair values are recorded at cost. Book value approximates fair value for all securities. 

Expected maturities of debt securities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without penalty. 

We loan certain securities from our portfolio to other institutions. Such securities are classified as Loaned securities  on the balance sheet. Collateral for the loaned securities, consisting of cash or other securities, is required to be maintained at a rate of 102% of the market value of a loaned security. Ford received securities as collateral in the amount of $399 million and $5.4 billion for 2004 and 2003, respectively. This collateral has not been pledged or sold. Cash collateral received is recorded as an asset in Other current assets , offset by an obligation to return the collateral in Other payables . Income received from loaning securities is recorded as Interest income and other non-operating income/(expense), net. 

Investments in marketable and loaned securities at December 31 were as follows (in millions): 

<img src='content_image/40502.jpg'>

The proceeds and gains/(losses) from sales of available-for-sale securities were as follows (in millions): 

<img src='content_image/40503.jpg'>

