Adobe 2001 Annual Report Download - page 48

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We have a policy in place to review privately-held investments on a regular basis to evaluate the
carrying amount and economic viability of these companies. This policy includes, but is not limited to,
reviewing each of the companies’ cash position, financing needs, earnings/revenue outlook, operational
performance, management/ownership changes, and competition. The evaluation process is based on
information that we request from these privately-held companies. This information is not subject to the
same disclosure regulations as U.S. public companies, and as such, the basis for these evaluations is subject
to the timing and the accuracy of the data received from these companies. If we believe that the carrying
value of an investment is carried at an amount in excess of fair value, it is our policy to record a reserve in
addition to our equity method of accounting and the related writedown is recorded as an investment loss
on our consolidated statements of income.
Facility Leases
We are exposed to interest rate risk associated with leases of our facilities whose payments are tied to
the LIBOR and have evaluated the hypothetical changes in lease obligations arising from selected
hypothetical changes in LIBOR. Market changes reflected immediate hypothetical parallel increases in the
LIBOR curve of plus or minus 50, 100, and 150 basis points for a twelve-month period. Based on this
analysis, such charges would not be material to our results of operations or financial position.
Item 8. Financial Statements and Supplementary Data
FINANCIAL STATEMENTS
Our financial statements required by this item are submitted as a separate section of this Form 10-K.
See Item 14 (a)(1) for a listing of financial statements provided in the section titled ‘‘FINANCIAL
STATEMENTS’’.
48