ADT 2000 Annual Report Download - page 55

FIFTY THREE
[1 1 ] Comprehensive Income
The purpose of reporting comprehensive income (loss) is to report
a measure of all changes in equity, other than transactions with
shareholders. Total comprehensive income (loss) is included in the
Consolidated Statements of Shareholders’ Equity. The components
of accumulated other comprehensive income (loss) are as follows:
ACCUMULATED
CURRENCY UN REALIZED MINIMUM OTHER
TRANSLATI ON GAIN (LOSS) PENSION COMPREHENSI VE
(I N MILLI ONS) ITEMS ON SECURITI ES LI ABI LI TY I NCOME (LOSS)
Balance at September 30, 1997 $(137.1) $ 10.8 $(10.6) $(136.9)
Current period change, gross (45.0) (21.5) (24.6) (91.1)
Income tax benefit 8.3 5.9 9.9 24.1
Balance at September 30, 1998 (173.8) (4.8) (25.3) (203.9)
Current period change, gross (277.8) 18.6 5.2 (254.0)
Income tax benefit (expense) 19.5 (6.0) (5.7) 7.8
Balance at September 30, 1999 (432.1) 7.8 (25.8) (450.1)
Current period change, gross (384.0) 1,094.8 11.5 722.3
Income tax expense — (19.1) (4.0) (23.1)
Balance at September 30, 2000 $(816.1) $1,083.5 $(18.3) $ 249.1
improvement plan and the combination of facilities as a result of its
merger with the Company, approximately $143.6 million of which
was taken as part of the AMP profit improvement plan prior to its
acquisition by Tyco. It also includes an impairment in the value of
goodwill and other intangibles of $81.4 million. The Company
evaluated the profitability and anticipated customer demand for its
various products and found that certain product lines were under-
performing compared to expectations. As a result of this analysis,
which was performed in connection with AMP’s profit improvement
plan, the book value of goodwill and other intangibles was deemed
impaired and written down to fair value.
The Healthcare and Specialty Products segment recorded a
charge of $76.0 million in Fiscal 1999 primarily relating to the write-
down of property, plant and equipment, principally administrative
facilities, associated with the consolidation of facilities in USSC’s
operations in the United States and Europe as a result of its merger
with the Company.
[1 3 ] Extraordinary Items
The extraordinary item in Fiscal 2000 of $0.2 million, net of tax
benefit of $0.1 million, relates to the write-off of unamortized
deferred financing costs related to the LYONs (See Note 4).
The extraordinary item in Fiscal 1999 of $45.7 million, net of tax
benefit of $18.0 million, relates primarily to the write-off of net
unamortized deferred financing costs related to the Company’s debt
tender offers (See Note 4). The extraordinary item in Fiscal 1998 of
$2.4 million, net of tax benefit of $1.2 million, was the write-off
of unamortized deferred financing costs related to the LYONs
(See Note 4).
[1 2 ] Charge for the I mpairment of Long-Lived Assets
The Company reviews the recoverability of the carrying value of long-
lived assets, primarily property, plant and equipment and related
goodwill and other intangible assets, for impairment whenever
events or changes in circumstances indicate that the carrying
amount of an asset may not be fully recoverable. Impairment losses
are recognized when expected future undiscounted cash flows are
less than the assets’ carrying value. When indicators of impairment
are present, the carrying values of the assets are evaluated in rela-
tion to the operating performance and future undiscounted cash
flows of the underlying business. The net book value of the underly-
ing assets is adjusted to fair value if the sum of expected future
undiscounted cash flows is less than book value. Fair values are
based on quoted market prices and assumptions concerning the
amount and timing of estimated future cash flows and assumed dis-
count rates, reflecting varying degrees of perceived risk.
2000 CHARGES
The Healthcare and Specialty Products segment recorded a charge
of $99.0 million primarily related to an impairment in goodwill and
other intangible assets associated with the Company exiting the
interventional cardiology business of USSC.
1999 CHARGES
The Electronics segment recorded a charge of $431.5 million in Fis-
cal 1999, which includes $350.1 million related to the write-down
of property, plant and equipment, primarily manufacturing and
administrative facilities, associated with facility closures through-
out AMP’s worldwide operations in connection with its profit