Blackberry 2008 Annual Report Download - page 47

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45
The Company is exposed to market and credit risk on
its investment portfolio. The Company reduces this risk by
investing in liquid, investment grade securities and by limiting
exposure to any one entity or group of related entities. As at
March 1, 2008, no single issuer represented more than 9% of
the total cash, cash equivalents and investments (March 3, 2007
- no single issuer represented more than 9% of the total cash,
cash equivalents and investments).
Market values are determined for each individual security
in the investment portfolio. The Company assesses declines
in the value of individual investments for impairment to
determine whether the decline is other-than-temporary. The
Company makes this assessment by considering available
evidence, including changes in general market conditions,
specific industry and individual company data, the length of
time and the extent to which the fair value has been less than
cost, the financial condition, the near-term prospects of the
individual investment and the Company’s ability and intent to
hold the debt securities to maturity. As of March 1, 2008, the
Company has recorded a $5.6 million other-than-temporary
impairment on specific SIV holdings. See “Liquidity and
Capital Resources – Structured Investment Vehicle”.
sells to a variety of customers, three customers comprised
19%, 14% and 10% of trade receivables as at March 1, 2008
(March 3 , 2007 – two customers comprised 23% and 13%).
Additionally, three customers comprised 21%, 15% and 12%
of the Company’s fiscal 2008 annual sales (fiscal 2007 annual
sales – four customers comprised 19%, 14%, 11% and 11%).
The Company is exposed to credit risk on derivative
financial instruments arising from the potential for
counterparties to default on their contractual obligations.
The Company mitigates this risk by limiting counterparties
to highly rated financial institutions and by continuously
monitoring their creditworthiness. The Company’s exposure
to credit loss and market risk will vary over time as a function
of currency exchange rates. The Company measures its
counterparty credit exposure as a percentage of the total
fair value of the applicable derivative instruments. Where the
net fair value of derivative instruments with any counterparty
is negative, the Company deems the credit exposure to that
counterparty to be nil. As at March 1, 2008, the maximum
credit exposure to a single counterparty, measured as a
percentage of the total fair value of derivative instruments
with net unrealized gains was 40% (March 3, 2007 – nil,
March 4, 2006 – 46%).