Hasbro 2013 Annual Report Download - page 84

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HASBRO, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements — (Continued)
(Thousands of Dollars and Shares Except Per Share Data)
totaling approximately $187,130 (at year-end 2013 exchange rates) have been provided to the Mexican
government related to the 2000 through 2004 assessments, allowing the Company to defend its positions. The
Company is not currently required to guarantee the amount of the 2005 through 2007 assessments. The Company
expects to be successful in sustaining its position with respect to these assessments as well as similar positions
that may be taken by the Mexican tax authorities for periods subsequent to 2007.
The Company believes it is reasonably possible that certain tax examinations and statutes of limitations may
be concluded and will expire within the next 12 months, and that unrecognized tax benefits, excluding potential
interest and penalties, may decrease by up to approximately $5,500, substantially all of which would be recorded
as a tax benefit in the consolidated statements of operations. In addition, approximately $800 of potential interest
and penalties related to these amounts would also be recorded as a tax benefit in the consolidated statements of
operations.
The cumulative amount of undistributed earnings of Hasbro’s international subsidiaries held for indefinite
reinvestment is approximately $1,861,000 at December 29, 2013. In the event that all international undistributed
earnings were remitted to the United States, the amount of incremental taxes would be approximately $492,000.
(11) Capital Stock
In each of May 2011 and August 2013 the Company’s Board of Directors authorized the repurchases of up
to $500,000 in common stock after five previous authorizations dated May 2005, July 2006, August
2007, February 2008 and April 2010 with a cumulative authorized repurchase amount of $2,325,000 were fully
utilized. Purchases of the Company’s common stock may be made from time to time, subject to market
conditions, and may be made in the open market or through privately negotiated transactions. The Company has
no obligation to repurchase shares under the authorization and the time, actual number, and the value of the
shares which are repurchased will depend on a number of factors, including the price of the Company’s common
stock. In 2013, the Company repurchased 2,268 shares at an average price of $45.17. The total cost of these
repurchases, including transaction costs, was $102,505. At December 29, 2013, $524,822 remained under the
current authorizations.
(12) Fair Value of Financial Instruments
The Company measures certain assets at fair value in accordance with current accounting standards. The fair
value hierarchy consists of three levels: Level 1 fair values are valuations based on quoted market prices in active
markets for identical assets or liabilities that the entity has the ability to access; Level 2 fair values are those
valuations based on quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or
other inputs that are observable or can be corroborated by observable data for substantially the full term of the
assets or liabilities; and Level 3 fair values are valuations based on inputs that are supported by little or no market
activity and that are significant to the fair value of the assets or liabilities. There have been no transfers between
levels within the fair value hierarchy.
Current accounting standards permit entities to choose to measure many financial instruments and certain
other items at fair value and establish presentation and disclosure requirements designed to facilitate comparisons
between entities that choose different measurement attributes for similar assets and liabilities. The Company has
elected the fair value option for certain investments. At December 29, 2013 and December 30, 2012, these
investments totaled $28,048 and $24,091, respectively, and are included in prepaid expenses and other current
assets in the consolidated balance sheets. The Company recorded net gains of $152, $2,504 and $61 on these
investments in other (income) expense, net for the years ended December 29, 2013, December 30, 2012 and
December 25, 2011, respectively, relating to the change in fair value of such investments.
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