90 UNITED TECHNOLOGIES CORPORATION During 2012, we recorded net gains on nonrecurring fair value measurements of approximately $157 million within Other income, net from UTC Climate, Controls & Security’s ongoing port- folio transformation efforts including the integration of the legacy UTC Fire & Security businesses with the legacy Carrier businesses. These net gains include approximately $357 million from the sales of controlling interests in manufacturing and distribution joint ven- tures in Asia and Canada, of which approximately $272 million was non-cash. These gains were partially offset by $168 million of other- than-temporary impairment charges related to business dis- positions and a $32 million loss on the disposition of the U.S. UTC Fire & Security branch operations. In addition, we recorded a $34 million gain on the fair market measurement of the Company’s pre- viously held interest in Goodrich. impact to our derivative assets based on our evaluation of our counterparties’ credit risks. The following table provides carrying amounts and fair values of financial instruments that are not carried at fair value at December 31, 2012 and 2011: The following table provides the valuation hierarchy classi- fication of assets and liabilities that are not carried at fair value in our Consolidated Balance Sheet as of December 31, 2012: During 2011, we recorded a non-cash other-than- temporary impairment charge of $66 million within Other income, net on an equity investment. The impairment charge recorded on our investment was determined by comparing the carrying value of our investment to the closing market value of the shares on the date the investment was deemed to be impaired. Valuation Techniques. Our available-for-sale securities include equity investments that are traded in active markets, either domestically or internationally. They are measured at fair value using closing stock prices from active markets and are classified within Level 1 of the valuation hierarchy. Our derivative assets and liabilities include foreign exchange contracts and commodity derivatives that are measured at fair value using internal models based on observable market inputs such as forward rates, interest rates, our own credit risk and our counterparties’ credit risks. Based on these inputs, the derivative assets and liabilities are classified within Level 2 of the valuation hierarchy. Based on our continued ability to trade securities and enter into forward con- tracts, we consider the markets for our fair value instruments to be active. As of December 31, 2012, there were no significant trans- fers in and out of Level 1 and Level 2. As of December 31, 2012, there has not been any sig- nificant impact to the fair value of our derivative liabilities due to our own credit risk. Similarly, there has not been any significant adverse Valuation Techniques. Our long-term receivables and customer financing notes receivable include our commercial and aerospace long-term trade, government and other receivables, leases, and notes receivable. Our long-term liabilities include our aerospace long-term customer payments. Our long-term receiv- ables, customer financing notes receivable and long-term liabilities are measured at fair value using an income approach based on the present value of the contractual, promised or most likely cash flows discounted at observed or estimated market rates for comparable assets or liabilities that are traded in the market. Based on these inputs, long-term receivables, customer financing notes receivable and long-term liabilities are classified within Level 2 of the valuation hierarchy. Our short-term borrowings include commercial paper and other international credit facility agreements. Our long-term debt includes domestic and international notes. Commercial paper and domestic long-term notes are measured at fair values based on comparable transactions and current market interest rates quoted in active markets for similar assets, and are classified within Level 2 of the valuation hierarchy. Foreign short-term borrowings and for- December 31, 2012 December 31, 2011 (DOLLARS IN MILLIONS) Carrying Amount Fair Value Carrying Amount Fair Value Long-term receivables $ 499 $ 464 $ 283 $ 276 Customer financing notes receivable 375 371 309 297 Short-term borrowings (503) (503) (630) (630) Long-term debt (excluding capitalized leases) (22,665) (25,606) (9,575) (11,639) Long-term liabilities (182) (167) – – (DOLLARS IN MILLIONS) Total Fair Value at December 31, 2012 Quoted price in active markets (Level 1) Significant other observable inputs (Level 2) Unobservable inputs (Level 3) Long-term receivables $ 464 $ – $ 464 $ – Customer financing notes receivable 371 – 371 – Short-term borrowings (503) – (320) (183) Long-term debt (excluding capitalized leases) (25,606) – (25,548) (58) Long-term liabilities (167) – (167) – (DOLLARS IN MILLIONS) Total Carrying Value at December 31, 2011 Quoted price in active markets (Level 1) Significant other observable inputs (Level 2) Unobservable inputs (Level 3) Recurring fair value measurements: Available-for-sale securities $ 926 $ 926 $ – $ – Derivative assets 114 – 114 – Derivative liabilities (165) – (165) – Nonrecurring fair value measurements: Equity method investment 13 13 – –