Oracle 2010 Annual Report Download - page 120

Table of Contents
ORACLE CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
May 31, 2011
to mitigate the risks and volatility associated with our foreign currency transactions. We may suspend this program from time to time and did so during the fourth
quarter of fiscal 2010 until resuming the program in the second quarter of fiscal 2011. Our foreign currency exposures typically arise from intercompany
sublicense fees, intercompany loans and other intercompany transactions that are expected to be cash settled in the near term. Our foreign currency forward
contracts are generally short-term in duration. Our ultimate realized gain or loss with respect to currency fluctuations will generally depend on the size and type
of cross-currency exposures that we enter into, the currency exchange rates associated with these exposures and changes in those rates, the net realized and
unrealized gains or losses on foreign currency forward contracts to offset these exposures and other factors.
We neither use these foreign currency forward contracts for trading purposes nor do we designate these forward contracts as hedging instruments pursuant to
ASC 815. Accordingly, we record the fair values of these contracts as of the end of our reporting period to our consolidated balance sheet with changes in fair
values recorded to our consolidated statement of operations. The balance sheet classification for the fair values of these forward contracts is prepaid expenses and
other current assets for unrealized gains and other current liabilities for unrealized losses. The statement of operations classification for changes in fair values of
these forward contracts is non-operating income (expense), net, for both realized and unrealized gains and losses.
As of May 31, 2011, the notional amounts of the forward contracts we held to purchase U.S. Dollars in exchange for other major international currencies were
$2.5 billion and the notional amounts of forward contracts we held to sell U.S. Dollars in exchange for other major international currencies were $1.6 billion. The
net unrealized losses of our outstanding foreign currency forward contracts were nominal at May 31, 2011. As of May 31, 2010, we had a nominal amount of
foreign currency forward contracts outstanding.
Included in our non-operating income (expense), net were $(39) million, $(35) million and $3 million of net (losses) gains related to these forward contracts for
the years ended May 31, 2011, 2010 and 2009, respectively.
12. COMMITMENTS AND CONTINGENCIES
Lease Commitments
We lease certain facilities, furniture and equipment under operating leases. As of May 31, 2011, future minimum annual operating lease payments and future
minimum payments to be received from non-cancelable subleases were as follows:
(in millions)
Fiscal 2012 $ 458
Fiscal 2013 341
Fiscal 2014 226
Fiscal 2015 159
Fiscal 2016 121
Thereafter 265
Future minimum operating lease payments 1,570
Less: minimum payments to be received from non-cancelable subleases (238)
Total future minimum operating lease payments, net $1,332
Lease commitments include future minimum rent payments for facilities that we have vacated pursuant to our restructuring and merger integration activities, as
discussed in Note 9. We have approximately $320 million in facility obligations, net of estimated sublease income and other costs, in accrued restructuring for
these locations in our consolidated balance sheet at May 31, 2011.
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Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document Research℠