AMD 2007 Annual Report Download - page 100

Table of Contents
other methods. For assets held for sale, impairment losses are measured at the lower of the carrying amount of the assets or the fair value of the assets less costs
to sell. For assets to be disposed of other than by sale, impairment losses are measured as their carrying amount less salvage value, if any, at the time the assets
cease to be used. As a result of the Company’s impairment analysis in the fourth quarter of 2007, the Company recorded an impairment charge related to certain
acquisition-related intangible assets initially recognized as a result of the acquisition of ATI (see Note 3).
Included in other assets on the consolidated balance sheets are balances related to certain technology licenses. The balances related to these licenses, net of
amortization, were $297 million and $204 million at December 29, 2007 and December 31, 2006. Estimated future amortization expense related to these licenses
is as follows:
In millions
Fiscal Year
2008 $ 122
2009 102
2010 46
2011 8
2012 5
Thereafter 14
Total $ 297
Commitments and Contingencies. From time to time the Company is a defendant or plaintiff in various legal actions that arise in the normal course of
business. The Company is also a party to environmental matters, including local, regional, state and federal government clean-up activities at or near locations
where the Company currently or has in the past conducted business. The Company is also a guarantor of various third-party obligations and commitments. The
Company is required to assess the likelihood of any adverse judgments or outcomes to these matters as well as potential ranges of probable losses. A
determination of the amount of reserves required for these commitments and contingencies, if any, that would be charged to earnings, includes assessing the
probability of adverse outcomes and estimating the amount of potential losses. The required reserves, if any, may change in the future due to new developments
in each matter or changes in circumstances, such as a change in settlement strategy. Changes in required reserves could increase or decrease the Company’s
earnings in the period the changes are made (see Notes 14 and 17).
Cash Equivalents. Cash equivalents consist of financial instruments that are readily convertible into cash and have original maturities of three months or
less at the time of purchase.
Marketable Securities. The Company classifies its marketable debt and equity securities at the date of acquisition as either held to maturity or
available-for-sale. Substantially all of the Company’s investments in marketable debt and equity securities are classified as available-for-sale. These securities are
reported at fair value with the related unrealized gains and losses included in accumulated other comprehensive income (loss), net of tax, a component of
stockholders equity. Fair values for marketable securities are based on market trading quotes. Realized gains and losses and declines in the value of securities
determined to be other-than-temporary are included in other income (expense), net. The cost of securities sold is based on the specific identification method.
The Company classifies investments with remaining time to maturity of more than three months as marketable securities. Marketable securities generally
consist of money market auction rate preferred stocks and debt securities such as commercial paper, corporate notes, separately-held corporate stocks, certificates
of deposit and marketable direct obligations of United States governmental agencies. Available-for-sale debt securities with remaining time to maturity greater
than twelve months are classified as current when they represent investments of cash that are intended to be used in current operations.
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Source: ADVANCED MICRO DEVIC, 10-K, February 26, 2008