Canon 2010 Annual Report Download - page 103
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Please find page 103 of the 2010 Canon annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.CANON ANNUAL REPORT 2010 101
Thousands of U.S. dollars Level 1 Level 2 Level 3 Total
2010: Assets:
Cash and cash equivalents $ — $3,085,272 $ — $3,085,272
Available-for-sale (current):
Government bonds 12 — — 12
Corporate bonds — — 12,346 12,346
Available-for-sale (noncurrent):
Government bonds 1,987 — — 1,987
Corporate bonds — 544 11,728 12,272
Fund trusts 123 22,074 — 22,197
Equity securities 288,914 — — 288,914
Derivatives — 147,531 — 147,531
Total assets $291,036 $3,255,421 $24,074 $3,570,531
Liabilities:
Derivatives $ — $ 11,272 $ — $ 11,272
Total liabilities $ — $ 11,272 $ — $ 11,272
Level 1 investments are comprised principally of Japanese
equity securities, which are valued using an unadjusted quoted
market price in active markets with suffi cient volume and fre-
quency of transactions. Level 2 cash and cash equivalents are
valued based on market approach, using quoted prices for
identical assets in markets that are not active. Level 3 invest-
ments are mainly comprised of corporate bonds, which are val-
ued based on cost approach, using unobservable inputs as the
market for the assets was not active at the measurement date.
Derivative fi nancial instruments are comprised of foreign
exchange contracts. Level 2 derivatives are valued using quotes
obtained from counterparties or third parties, which are period-
ically validated by pricing models using observable market
inputs, such as foreign currency exchange rates and interest
rates, based on market approach.
The following table presents the changes in Level 3 assets
measured on a recurring basis, consisting primarily of corpo-
rate bonds, for the years ended December 31, 2010 and 2009.
Gains and losses included in earnings are mainly related to cor-
porate bonds still held at December 31, 2010 and 2009, and are
reported in “Other, net” in the consolidated statements of income.
Assets and liabilities measured at fair value
on a nonrecurring basis
During the year ended December 31, 2010, non-marketable
equity securities with a carrying amount of ¥5,000 million
($61,728 thousand) were written down to their fair value of
¥2,422 million ($29,901 thousand) and equity securities
accounted for by the equity method with a carrying amount of
¥33,984 million ($419,556 thousand) were written down to their
fair value of ¥15,164 million ($187,210 thousand), resulting in an
other-than-temporary impairment charge totaling ¥21,398 mil-
lion ($264,173 thousand), which was included in earnings. The
non-marketable equity securities were classifi ed as Level 2
instruments and valued based on a market approach using
observable inputs such as unadjusted quoted prices for similar
instruments in active markets at the measurement date. Equity
securities accounted for by the equity method were classifi ed
as Level 3 instruments and valued based on a combination of
income approach and market approach using both unobserv-
able and observable inputs including the use of inputs such as
fi nancial metrics, ratios and projected income of the investees
and appropriate comparable public companies.
Years ended December 31
Millions of yen
Thousands of
U.S. dollars
2010 2009 2010
Balance at beginning of year ¥1,340 ¥1,516 $16,543
Total gains or losses (realized or unrealized):
Included in earnings (79) (221) (975)
Included in other comprehensive income (loss) (7) (1) (86)
Purchases, issuances, and settlements 696 46 8,592
Balance at end of year ¥1,950 ¥1,340 $24,074