Blackberry 2013 Annual Report Download - page 215

Research In Motion Limited
Management’s Discussion and Analysis of Financial Condition and Results of Operations
The table below summarizes the current assets, current liabilities, and working capital of the Company:
The increase in current assets of $30 million at the end of fiscal 2013 from the end of fiscal 2012 was primarily due to an increase in
short-term investments of $858 million and income taxes receivable of $462 million. This is partially offset by decreases in accounts
receivable, inventories, and other receivables of $709 million, $424 million and $224 million, respectively.
At March 2, 2013, accounts receivable was $2.4 billion, a decrease of $709 million from March 3, 2012. The decrease was primarily
due to a decrease in revenue during fiscal 2013, which was partially offset by an increase in days sales outstanding to 79.9 days in the
fourth quarter of fiscal 2013 from 68.1 days at the end of fiscal 2012.
Inventories decreased by $424 million at the end of fiscal 2013 compared to the same period in the prior fiscal year, reflecting a
decrease in the amount of BlackBerry smartphone and BlackBerry PlayBook tablets held in inventory as a result of improved supply
chain efficiency compared to fiscal 2012.
The decrease in other receivables of $224 million is due to a decrease in receivables from the Company’s contract manufacturers.
As of March 2, 2013, the Company has accounts receivables outstanding related to service access fees provided to wireless service
providers in Venezuela. The Company does not sell smartphones or tablets directly into the Venezuelan market, does not have foreign
operations in Venezuela and only invoices its services denominated in United States dollars (“USD”). On February 8, 2013, the
Venezuela government announced that, effective February 13, 2013, its currency, the Venezuelan Bolivar, would be devalued by 32%
of the USD equivalent. As of March 2, 2013, the Company has been successful in collecting its service revenues from wireless
service providers in Venezuela and will continue to closely monitor its efforts in future periods. As a result of the currency
devaluation and given the uncertainty around future changes to the Venezuela leadership, the Company could face additional
challenges in obtaining payment on its receivables if the Venezuela carriers cannot secure governmental approvals to buy and remit
USD for services provided.
The Company also sells products and provides services in additional foreign jurisdictions including Asia-Pacific, the Middle East and
Latin America, which expose the Company to political, legal and economic uncertainties and may limit the Company’s ability to
collect on its sales generating activities, which may have a negative impact on the Company’s cash balance. These uncertainties
include, but are not limited to, the following:
50
As at
(in millions)
March 2, 2013 March 3, 2012 Change
Current assets
$7,101 $7,071 3
0
Current liabilities
3,448 3,389 59
Workin
g
ca
p
ital
$3,653 $3,682 (29)
• Challen
g
es with enforcin
g
contracts in local courts;
• Currency devaluations in hyper-inflationary markets resulting in a loss of revenues due to their inability to procure the
Com
p
an
y
’s our
p
roducts and services in the future; and