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Table of Contents
ORACLE CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
May 31, 2014
Effects of Derivative and Non-Derivative Instruments Designated as Hedges on Income and Other Comprehensive Loss (OCL)
Lease Commitments
We lease certain facilities, furniture and equipment under operating leases. As of May 31, 2014, future minimum annual operating lease
payments and future minimum payments to be received from non-cancelable subleases were as follows:
Lease commitments included 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 $112 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, 2014.
Rent expense was $278 million, $313 million and $329 million for fiscal 2014, 2013 and 2012, respectively, net of sublease income of
approximately $55 million, $69 million and $89 million, respectively. Certain lease agreements contain renewal options providing for extensions
of the lease terms.
Unconditional Obligations
In the ordinary course of business, we enter into certain unconditional purchase obligations with our suppliers, which are agreements that are
enforceable, legally binding and specify terms, including: fixed or minimum quantities to be purchased; fixed, minimum or variable price
provisions; and the approximate timing of the
117
Amount of Gain (Loss)
Recognized in Accumulated
OCL (Effective Portion)
Location and Amount of Gain
Reclassified from Accumulated OCL
into Income (Effective Portion)
(in millions)
Year Ended
May 31, 2014
Year Ended
May 31, 2014
Cross
-
currency swap agreements designated as cash flow hedges
$
74
Non
-
operating (expense)
income, net
$
69
Foreign currency borrowings designated as net investment hedge
$
(34
)
Not applicable
$
—
Location and Amount of Loss
Recognized in Income on Derivative
Location and Amount of Gain on
Hedged Item Recognized in Income
Attributable to Risk Being Hedged
Year Ended May 31,
Year Ended May 31,
(in millions)
2014
2013
2014
2013
Interest rate swap agreements designated as fair value hedges
Interest expense
$
(18
)
$
(28
)
Interest expense
$
18
$
28
12. COMMITMENTS AND CONTINGENCIES
(in millions)
Fiscal 2015
$
373
Fiscal 2016
304
Fiscal 2017
230
Fiscal 2018
168
Fiscal 2019
120
Thereafter
203
Future minimum operating lease payments
1,398
Less: minimum payments to be received from non
-
cancelable subleases
(63
)
Total future minimum operating lease payments, net
$
1,335