Activision 2011 Annual Report Download - page 79

20. Accumulated Other Comprehensive Income (Loss)
The components of accumulated other comprehensive income (loss) at December 31, 2011 and 2010 were as follows
(amounts in millions):
At
December 31,
2011
At
December 31,
2010
Foreign currency translation adjustment .............................................. $(72) $(11)
Unrealized depreciation on investments, net of deferred
income taxes of $0 and $(1) for December 31, 2011 and
2010, respectively ............................................................................ —(2)
Accumulated other comprehensive loss ............................................... $(72) $(13)
Income taxes were not provided for foreign currency translation items as these are considered indefinite investments
in non-U.S. subsidiaries.
21. Supplemental Cash Flow Information
Supplemental cash flow information is as follows (amounts in millions):
For the Years Ended
December 31,
2011 2010 2009
Supplemental cash flow information:
Cash paid for income taxes...................................................................... $317 $255 $257
Cash paid for interest ............................................................................... 4 2 5
22. Related Party Transactions
Treasury
Our foreign currency risk management program seeks to reduce risks arising from foreign currency fluctuations. We
use derivative financial instruments, primarily currency forward contracts and swaps, with Vivendi as our principal counterparty.
The gross notional amount of outstanding foreign exchange swaps was $85 million and $138 million at December 31, 2011 and
2010, respectively. A pretax net unrealized loss of $1 million and unrealized gain of less than a million for the years ended
December 31, 2011 and 2010, respectively, resulted from the foreign exchange contracts and swaps with Vivendi and were
recognized in the consolidated statements of operations.
Others
Activision Blizzard has entered into various transactions and agreements, including cash management services,
investor agreement, tax sharing agreement, and music royalty agreements with Vivendi and its subsidiaries and affiliates.
Effective July 23, 2010, we terminated our unsecured credit agreement with Vivendi, the lender, which provided for a revolving
credit facility of up to $475 million. None of these services, transactions and agreements with Vivendi and its subsidiaries and
affiliates is material either individually or in the aggregate to the consolidated financial statements as a whole.
In addition, we are party to a number of agreements with Universal Music Group, a wholly owned subsidiary of
Vivendi, and its affiliates. These agreements pertain to the licensing of master recordings and compositions for our games and
for marketing and promotional purposes. We expensed and paid an aggregate of $5 million, $12 million and $14 million in
royalties and other fees (including fees relating to the marketing of artists whose music was licensed for our games) to Universal
Music Group and its affiliates for those uses during the years ended December 31, 2011, 2010 and 2009, respectively. Royalty
amounts due to Universal Music Group and its affiliates are not material at December 31, 2011, 2010 and 2009.
23. Recently Issued Accounting Pronouncements
In May 2011, the FASB issued an update to the accounting rules for fair value measurement to provide a consistent
definition of fair value and ensure that the fair value measurement and disclosure requirements are similar between U.S. GAAP
and International Financial Reporting Standards (“IFRS”). This update changes certain fair value measurement principles and
enhances the disclosure requirements for fair value measurements. This update does not extend the use of fair value accounting,
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