Mattel 2012 Annual Report Download - page 33

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The level of returns on pension plan assets and the actuarial assumptions used for valuation purposes
could affect Mattel’s earnings in future periods. Changes in standards and government regulations could
also affect its pension plan expense and funding requirements.
Assumptions used in determining projected benefit obligations and the fair value of plan assets for Mattel’s
pension plan are evaluated by Mattel in consultation with outside actuaries. In the event that Mattel determines
that changes are warranted in the assumptions used, such as the discount rate, expected long term rate of return,
or health care costs, its future pension benefit expenses could increase or decrease. Due to changing market
conditions or changes in the participant population, the actuarial assumptions that Mattel uses may differ from
actual results, which could have a significant impact on its pension and postretirement liability and related costs.
Funding obligations are determined based on the value of assets and liabilities on a specific date as required
under relevant government regulations for each plan. Future pension funding requirements, and the timing of
funding payments, could be affected by legislation enacted by the relevant governmental authorities.
If Mattel’s nonamortizable intangible assets or goodwill becomes impaired, Mattel’s results of operations
could be adversely affected.
Mattel tests its nonamortizable intangible assets, including trademarks and trade names, and goodwill for
impairment annually or more often if an event or circumstance indicates that an impairment may have occurred.
The impairment test for nonamortizable intangible assets is performed by comparing the estimated fair values of
the assets with their carrying values. Future changes in estimates used to determine the fair values may impact
the fair value of Mattel’s intangible assets, which could results in a write-down, negatively impacting its results
of operations. For purposes of evaluating whether goodwill is impaired, goodwill is allocated to various reporting
units, which are at the operating segment level. Declines in profitability of Mattel’s reporting units may impact
the fair value of its reporting units, which could result in a write-down of its goodwill, negatively impacting its
results of operations.
*****************
If any of the risks and uncertainties described in the cautionary factors listed above actually occurs, Mattel’s
business, financial condition and results of operations could be significantly and adversely affected. The factors
listed above are not exhaustive. Other sections of this Annual Report on Form 10-K include additional factors
that could materially and adversely impact Mattel’s business, financial condition and results of operations.
Moreover, Mattel operates in a very competitive and rapidly changing environment. New factors emerge from
time to time, and it is not possible for management to predict the impact of all of these factors on Mattel’s
business, financial condition or results of operations, or the extent to which any factor, or combination of factors,
may cause actual results to differ materially from those contained in any forward-looking statements. Given these
risks and uncertainties, investors should not rely on forward-looking statements as a prediction of actual results.
Any or all of the forward-looking statements contained in this Annual Report on Form 10-K and any other public
statement made by Mattel or its representatives may turn out to be wrong. Mattel expressly disclaims any
obligation to update or revise any forward-looking statements, whether as a result of new developments or
otherwise.
Item 1B. Unresolved Staff Comments.
None.
Item 2. Properties.
Mattel owns its corporate headquarters in El Segundo, California, consisting of approximately
335,000 square feet, and an adjacent office building consisting of approximately 55,000 square feet. Mattel also
leases buildings in El Segundo consisting of approximately 327,000 square feet. All segments use these facilities.
Mattel also owns facilities in East Aurora, New York, consisting of approximately 535,000 square feet, which is
used by the North America segment and for corporate support functions. American Girl owns its headquarters
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