Costco 2012 Annual Report Download - page 60

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December 15, 2011. The Company plans to adopt this guidance at the beginning of its first quarter of
fiscal year 2013. Adoption of this guidance is not expected to have a material impact on the Company’s
consolidated financial statements and will impact the financial statements’ presentation only. A portion
of the new comprehensive income guidance required entities to present reclassification adjustments
out of accumulated other comprehensive income by component in both the statement in which net
income is presented and the statement in which other comprehensive income is presented. In
December 2011, the FASB issued guidance which indefinitely defers the guidance related to the
presentation of reclassification adjustments on the face of the financial statements.
In September 2011, the FASB issued guidance to amend and simplify the rules related to testing
goodwill for impairment. The revised guidance allows an initial qualitative evaluation, based on the
entity’s events and circumstances, to determine whether it is more likely than not that the fair value of a
reporting unit is less than its carrying amount. The results of this qualitative assessment determine
whether it is necessary to perform the currently required two-step impairment test. The new guidance
is effective for annual and interim goodwill impairment tests performed for fiscal years beginning after
December 15, 2011. Early adoption is permitted. The Company plans to adopt this guidance at the
beginning of its first quarter of fiscal year 2013. Adoption of this guidance is not expected to have a
material impact on the Company’s consolidated financial statements.
Note 2—Investments
The Company’s investments at the end of 2012 and 2011 were as follows:
2012:
Cost
Basis
Unrealized
Gains
Recorded
Basis
Available-for-sale:
U.S. government and agency securities .................... $ 776 $6 $ 782
Corporate notes and bonds .............................. 54 0 54
FDIC-insured corporate bonds ............................ 35 0 35
Asset and mortgage-backed securities ..................... 8 0 8
Total available-for-sale .............................. 873 6 879
Held-to-maturity:
Certificates of deposit ................................... 447 447
Total Short-Term Investments ........................ $1,320 $6 $1,326
2011:
Cost
Basis
Unrealized
Gains
Recorded
Basis
Available-for-sale:
U.S. government and agency securities .................... $1,096 $ 8 $1,104
Corporate notes and bonds .............................. 6 1 7
FDIC-insured corporate bonds ............................ 208 1 209
Asset and mortgage-backed securities ..................... 12 0 12
Total available-for-sale .............................. 1,322 10 1,332
Held-to-maturity:
Certificates of deposit ................................... 272 272
Total Short-Term Investments ........................ $1,594 $10 $1,604
At the end of 2012, 2011 and 2010 the Company’s available-for-sale securities that were in continuous
unrealized-loss position were not material. Gross unrealized gains and losses on cash equivalents
were not material at the end of 2012 and 2011.
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