Electronic Arts 2000 Annual Report Download - page 63

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(17) DISCLOSURES ABOUT FAIR VALUE OF FINANCIAL INSTRUMENTS
The following methods and assumptions were used to estimate the fair value of each class of financial instruments for which it
is practicable to estimate that value:
Cash, cash equivalents, short-term investments, receivables, accounts payable and accrued liabilities -
the carrying amount
approximates fair value because of the short maturity of these instruments.
Long-term investments, investments classified as held-to-maturity and marketable securities -
fair value is based on quoted mar-
ket prices.
(18) SEGMENT INFORMATION
In 1999, the Company adopted SFAS No. 131,
“Disclosures about Segments of an Enterprise and Related Information”,
which
supersedes SFAS No. 14,
“Financial Reporting for Segments of a Business Enterprise”.
SFAS No. 131 establishes standards for
the reporting by public business enterprises of information about product lines, geographic areas and major customers. The
method for determining what information to report is based on the way that management organizes the operating segments
within the Company for making operational decisions and assessments of financial performance. The Company’s chief operat-
ing decision maker is considered to be the Company’s Chief Executive Officer (“CEO”). The CEO reviews financial information
presented on a consolidated basis accompanied by disaggregated information about revenues by geographic region and by
product lines for purposes of making operating decisions and assessing financial performance.
As a result of the approval of the Tracking Stock proposal to authorize issuance of a new series of common stock designated
as Class B common stock, intended to reflect the performance of EA.com, management considers EA.com a separate reportable
segment. Accordingly, prior period information has been restated to disclose separate segments. The Company operates in two
principal business segments globally:
•Electronic Arts core (“EA Core”) business segment: creation, marketing and distribution of entertainment software.
•EA.com business segment: creation, marketing and distribution of entertainment software which can be played or sold online.
Please see the discussion regarding segment reporting in the MD&A.
EA 2000 AR
61
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS