Dell 2007 Annual Report Download - page 91

Table of Contents
DELL INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
accordance with its investment policy. Dell's investments in debt securities have effective maturities of less than five years. Management
believes that no significant concentration of credit risk for investments exists for Dell.
Dell markets and sells its products and services to large corporate clients, governments, healthcare and education accounts, as well as
small-to-medium businesses and individuals.
Dell purchases a number of components from single or limited sources. In some cases, alternative sources of supply are not available. In
other cases, Dell may establish a working relationship with a single source or a limited number of sources if Dell believes it is
advantageous due to performance, quality, support, delivery, capacity, or price considerations. If the supply of a critical single- or
limited-source product or component is delayed or curtailed, Dell may not be able to ship the related product in desired quantities and in a
timely manner. Even where multiple sources of supply are available, qualification of the alternative suppliers and establishment of
reliable supplies could result in delays and a possible loss of sales, which could harm operating results.
NOTE 11 — SEGMENT INFORMATION
Dell conducts operations worldwide and is managed in three geographic regions: the Americas; Europe, Middle East and Africa
("EMEA"); and Asia Pacific-Japan ("APJ"). The Americas region, which is based in Round Rock, Texas, covers the U.S., Canada, and
Latin America. Within the Americas, Dell is further segmented into Business and U.S. Consumer. The Americas Business ("Business")
segment includes sales to corporate, government, healthcare, and education customers, while the U.S. Consumer segment includes sales
primarily to individual consumers and selected retailers within the U.S. Dell has developed and started implementing a plan to combine
the consumer business of both EMEA and APJ with the U.S. Consumer business and re-align its management and financial reporting
structure. Dell will begin reporting worldwide Consumer once it completes the global consolidation of this business, which is expected to
be the first quarter of Fiscal 2009. The changes have had no impact on Dell's operating segment structure to date. This segment will
include worldwide sales to individual consumers and select retailers. The EMEA segment, based in Bracknell, England, covers Europe,
the Middle East, and Africa. The APJ region, based in Singapore, covers the Asian countries of the Pacific Rim as well as Australia, New
Zealand, and India.
Corporate expenses are included in Dell's measure of segment operating income for management reporting purposes; however, with the
adoption of SFAS 123(R), beginning in Fiscal 2007, stock-based compensation expense is not allocated to Dell's reportable segments.
Beginning in the fourth quarter of Fiscal 2008, acquisition-related charges such as in-process research and development and amortization
of intangibles are not allocated to Dell's reportable segments. The asset totals disclosed by geography are directly managed by those
regions and include accounts receivable, inventory, certain fixed assets, and certain other assets. Assets are not allocated specifically to
the Business and U.S. Consumer segment within the Americas. Corporate assets primarily include cash and cash equivalents,
investments, deferred tax assets, goodwill, intangible assets, and other assets.
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