3Ware 2002 Annual Report Download - page 67

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APPLIED MICRO CIRCUITS CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
4. Investments
Short-Term Investments
The Company classifies its short-term investments as “available-for-sale” and records such assets at the
estimated fair value with unrealized gains and losses excluded from earnings and reported, net of tax, in
comprehensive income (loss). The basis for computing realized gains or losses is by specific identification.
The following is a summary of available-for-sale securities (in thousands):
Amortized
Cost
Gross Unrealized Estimated
Fair ValueGains Losses
At March 31, 2002:
U.S. treasury securities and obligations of U.S. government
agencies ............................................. $ 119,335 $ 638 $ 206 $ 119,767
State, Municipal and County government notes and bonds ....... 106,333 752 — 107,085
U.S. corporate debt securities .............................. 492,949 4,468 1,152 496,265
$ 718,617 $5,858 $1,358 $ 723,117
At March 31, 2001:
U.S. treasury securities and obligations of U.S. government
agencies ............................................. $ 26,984 $ 109 $ 5 $ 27,088
State, Municipal and County government notes and bonds ....... 388,689 1,510 — 390,199
U.S. corporate debt securities .............................. 654,418 2,304 113 656,609
$1,070,091 $3,923 $ 118 $1,073,896
Available-for-sale securities by contractual maturity are as follows (in thousands):
March 31,
2002
Due in one year or less ....................................................... $297,650
Due after one year through two years ........................................... 212,244
Greater than two years ....................................................... 213,223
$723,117
Strategic Equity Investments
The Company enters into certain equity investments for the promotion of business and strategic objectives,
and typically does not attempt to reduce or eliminate the inherent market risks on these investments. These
strategic investments are classified separately as strategic equity investments, totaling $28.0 million and
$14.5 million at March 31, 2001 and 2002, respectively. The strategic equity and convertible debt instruments are
valued at cost because the Company does not have the ability to exercise significant influence over the investees’
operations and financial policies. In the year ended March 31, 2002, the Company realized a gain on its strategic
equity investments of $1.2 million. This gain was offset by $15.0 million of recognized impairments.
F-14