HP 2007 Annual Report Download - page 124
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HEWLETT-PACKARD COMPANY AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Continued)
Note 9: Financial Instruments (Continued)
and fair market value of derivative financial instruments and the respective SFAS 133 classification on the Consolidated
Balance Sheets were as follows for the following fiscal years ended October 31:
2007
Gross
Notional
Other
Current
Assets
Long-term
Financing
Receivables
and
Other Assets
Other
Accrued
Liabilities
Other
Liabilities Total
In millions
Fair value hedges ............................................ $2,450 $— $21 $— $— $21
Cash flow hedges............................................ 9,657 73 — (183) — (110)
Net investment hedges .................................... 1,002 5 — (78) (27) (100)
Other derivatives............................................. 17,854 86 7(377) (87) (371)
Total................................................................ $30,963 $164 $28 $(638) $(114) $(560)
2006
Gross
Notional
Other
Current
Assets
Long-term
Financing
Receivables
and
Other Assets
Other
Accrued
Liabilities
Other
Liabilities Total
In millions
Fair value hedges ............................................ $2,550 $1 $2 $(1) $(3) $(1)
Cash flow hedges............................................ 8,768 33 — (97) — (64)
Net investment hedges .................................... 844 1 1 (8) (7) (13)
Other derivatives............................................. 10,482 25 13 (135) (28) (125)
Total................................................................ $22,644 $60 $16 $(241) $(38) $(203)
Fair Value of Other Financial Instruments
For certain of HP’ s financial instruments, including cash and cash equivalents, short-term investments, accounts
receivable, financing receivables, notes payable and short-term borrowings, accounts payable and other accrued liabilities,
the carrying amounts approximate fair value due to their short maturities. The estimated fair value of HP’ s short- and long-
term debt was approximately $8.1 billion at October 31, 2007, compared to a carrying value of $8.2 billion at that date. The
estimated fair value of the debt is based primarily on quoted market prices, as well as borrowing rates currently available to
HP for bank loans with similar terms and maturities.
Note 10: Financing Receivables and Operating Leases
Financing receivables represent sales-type and direct-financing leases resulting from the marketing of HP’ s and
third-party products. These receivables typically have terms from two to five years and are usually collateralized by a security
interest in the underlying assets. Financing receivables also include billed receivables from operating leases. The components
of net financing receivables, which are
110