Computer Associates 2007 Annual Report Download - page 111

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Note 4 — Marketable Securities
The following is a summary of marketable securities classified as available-for-sale:
(IN MILLIONS) 2007 2006
YEAR ENDED MARCH 31,
Debt/Equity Securities:
Cost $2 $30
Gross unrealized gains 34
Estimated fair value $5 $34
There were no marketable securities that were considered restricted as of March 31, 2007 and March 31, 2006.
The Company realized net gains on sales of marketable securities of approximately $13 million, $2 million and $8 million for
the fiscal years ended March 31, 2007, 2006 and 2005, respectively.
The estimated fair value of debt and equity securities is based upon published closing prices of those securities as of March 31,
2007 and March 31, 2006. For debt securities, amortized cost is classified by contractual maturity. Expected maturities may
differ from contractual maturities because the issuers of the securities may have the right to prepay obligations without
prepayment penalties.
In September 2006, the Company sold an investment in marketable securities and received net cash proceeds of
approximately $32 million. The transaction resulted in a gain of approximately $14 million, which has been recorded in
the “Other gains, net” line item of the Consolidated Statement of Operations for the fiscal year ended March 31, 2007.
The Company reviewed its investment portfolio for impairment and determined that, as of March 31, 2007 and 2006, the total
unrealized loss for investments impaired for both greater and less than 12 months was immaterial. See also Note 1,
“Significant Accounting Policies”.
The following table summarizes the cost and fair market value of the Company’s marketable securities at March 31, 2007 and
2006:
(IN MILLIONS) COST
ESTIMATED
FAIR VALUE COST
ESTIMATED
FAIR VALUE
MARCH 31, 2007 MARCH 31, 2006
Debt securities, which are recorded at market, maturing:
Within one year or less $— $— $1 $1
Between one and three years ——55
Between three and five years ——11
Beyond five years ——55
Debt securities, which are recorded at market ——12 12
Equity securities, which are recorded at market 2518 22
Total marketable securities $2 $5 $30 $34
Total interest income, which primarily related to the Company’s cash and cash equivalent balances, for the fiscal years ended
March 31, 2007, 2006, and 2005 was approximately $66 million, $57 million, and $50 million, respectively, and is included in
the “Interest expense, net” line item in the Consolidated Statements of Operations.
Note 5 — Segment and Geographic Information
The Company’s chief operating decision makers review financial information presented on a consolidated basis, accompanied
by disaggregated information about revenue, by geographic region, for purposes of assessing financial performance and
making operating decisions. Accordingly, the Company considers itself to be operating in a single industry segment. The
Company does not manage its business by solution or focus area and therefore does not maintain financial statements on
such a basis.
99