Amgen 2012 Annual Report Download - page 134

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F-35
Accumulated other comprehensive income
The components of Accumulated other comprehensive income (AOCI) are as follows for the years ended December 31,
2012, 2011 and 2010 (in millions):
Foreign
currency
translation Cash flow
hedges
Available-for-
sale
securities Other AOCI
Balance as of December 31, 2009 $ 40 $ (82) $ 95 $ (8) $ 45
Foreign currency translation adjustments (29) — — — (29)
Unrealized gains — 186 155 1 342
Reclassification adjustments to income —(46)(90) — (136)
Income taxes 11 (55)(25) — (69)
Balance as of December 31, 2010 22 3 135 (7) 153
Foreign currency translation adjustments (6) — — — (6)
Unrealized (losses) gains —(51) 125 2 76
Reclassification adjustments to income — 112 (154) — (42)
Other — — — (8)(8)
Income taxes 5(21) 14 — (2)
Balance as of December 31, 2011 21 43 120 (13) 171
Foreign currency translation adjustments (13) — — — (13)
Unrealized (losses) gains — 15 233 (1) 247
Reclassification adjustments to income —(134)(132) — (266)
Income taxes 4 41 (38) — 7
Balance as of December 31, 2012 $ 12 $ (35) $ 183 $ (14) $ 146
Income tax expenses/benefits for unrealized gains and losses and the related reclassification adjustments to income for cash
flow hedges were an $8 million expense and $49 million benefit in 2012, a $20 million benefit and $41 million expense in 2011
and a $71 million expense and $16 million benefit in 2010, respectively. Income tax expenses/benefits for unrealized gains and
losses and the related reclassification adjustments to income for available-for-sale securities were an $87 million expense and $49
million benefit for 2012, a $45 million expense and $59 million benefit in 2011 and a $60 million expense and $35 million benefit
in 2010, respectively.
Other
In addition to common stock, our authorized capital includes 5 million shares of preferred stock, $0.0001 par value. As of
December 31, 2012 and 2011, no shares of preferred stock were issued or outstanding.
16. Fair value measurement
To estimate the fair value of our financial assets and liabilities we use valuation approaches within a hierarchy that maximizes
the use of observable inputs and minimizes the use of unobservable inputs by requiring that observable inputs be used when
available. Observable inputs are inputs that market participants would use in pricing the asset or liability based on market data
obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about
the inputs that market participants would use in pricing the asset or liability and are developed based on the best information
available in the circumstances. The fair value hierarchy is divided into three levels based on the source of inputs as follows:
Level 1 — Valuations based on unadjusted quoted prices in active markets for identical assets or liabilities that the Company
has the ability to access
Level 2 — Valuations for which all significant inputs are observable, either directly or indirectly, other than level 1 inputs
Level 3 — Valuations based on inputs that are unobservable and significant to the overall fair value measurement