AMD 2013 Annual Report Download - page 80

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Foreign Currency Translation/Transactions. The functional currency of all of the Company’s foreign
subsidiaries is the U.S. dollar. Assets and liabilities denominated in non-U.S. dollars have been remeasured into
U.S. dollars at current exchange rates for monetary assets and liabilities and historical exchange rates for non-
monetary assets and liabilities. Non-U.S. dollar denominated transactions have been remeasured at average
exchange rates in effect during each period, except for those cost of sales and expense transactions related to
non-monetary balance sheet amounts, which have been remeasured at historical exchange rates. The gains or
losses from foreign currency remeasurement are included in earnings.
Foreign Subsidies. The Company received investment grants in connection with the construction and
operation of certain facilities in Asia. Generally, such grants are subject to forfeiture in declining amounts over
the life of the agreement if the Company does not maintain certain levels of employment or meet other conditions
specified in the relevant grant documents. Accordingly, amounts granted are initially recorded as a receivable
until cash proceeds are received. In the period the grant receivable is recorded, a current and long-term liability is
also recorded which is subsequently amortized as a reduction to cost of sales.
The Company also received an investment grant relating to certain research and development projects.
These research and development funds are recorded as a reduction of research and development expenses when
all conditions and requirements set forth in the underlying grant agreement are met.
Marketing, Communications and Advertising Expenses. Marketing, communications and advertising
expenses for 2013, 2012 and 2011 were approximately $210 million, $287 million and $397 million,
respectively. Cooperative advertising funding obligations under customer incentive programs are accrued and the
costs are recorded upon agreement with customers and vendor partners. Cooperative advertising expenses are
recorded as marketing, general and administrative expense to the extent the cash paid does not exceed the
estimated fair value of the advertising benefit received. Any excess of cash paid over the estimated fair value of
the advertising benefit received is recorded as a reduction of revenue.
Net Income (Loss) Per Share. Basic net income (loss) per share is computed based on the weighted-
average number of shares outstanding and 35 million shares issuable upon exercise of the warrants issued by the
Company to West Coast Hitech L.P. (WCH), in connection with the initial GLOBALFOUNDRIES, Inc. (GF)
transaction in 2009. The warrants became exercisable on July 24, 2009 at per share price of $0.01.
Diluted net income per share is computed based on the weighted-average number of shares outstanding plus
any potentially dilutive shares outstanding. Potentially dilutive shares include stock options, restricted stock,
restricted stock units and shares issuable upon the conversion of convertible debt.
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