Netgear 2010 Annual Report Download - page 101

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Table of Contents
The Company’s investments in cash equivalents and available for sale securities are classified within Level 1 of the fair value hierarchy
because they are valued based on quoted market prices in active markets. The Company enters into foreign currency forward contracts with only
those counterparties that have long-term credit ratings of A+/A1 or higher. The Company’s foreign currency forward contracts are classified
within Level 2 of the fair value hierarchy as they are valued using pricing models that take into account the contract terms as well as currency
rates and counterparty credit rates. The Company verifies the reasonableness of these pricing models using observable market data for related
inputs into such models. Additionally, the Company includes an adjustment for non-performance risk in the recognized measure of fair value of
derivative instruments. At December 31, 2010 and December 31, 2009, the adjustment for non-performance risk did not have a material impact
on the fair value of the Company’s foreign currency forward contracts. The carrying value of non-financial assets and liabilities measured at fair
value in the financial statements on a recurring basis, including accounts receivable and accounts payable, approximate fair value due to their
short maturities.
Note 14—Comprehensive Income and Cumulative Other Comprehensive Income, Net:
The following table sets forth the activity for each component of other comprehensive income, net of related taxes, for the years ended
December 31, 2010, December 31, 2009, and December 31, 2008, (in thousands):
The following table sets forth the components of cumulative other comprehensive income, net of related taxes, as of December 31, 2010
and December 31, 2009 (in thousands):
99
As of December 31, 2009
Total
Quoted market
prices in active
markets
(Level 1)
Significant other
observable inputs
(Level 2)
Significant
unobservable inputs
(Level 3)
Foreign currency forward contracts(3)
(348
)
$
—
$
(
348
)
$
—
Total
(348
)
$
—
$
(
348
)
$
—
(3)
Included in other accrued liabilities on the Company
’
s consolidated balance sheet.
Year ended December 31,
2010
2009
2008
Net income
50,909
9,333
18,050
Unrealized gains on derivative instruments
253
20
—
Unrealized gains (losses) on available
-
for
-
sale securities
(63
)
(34
)
Total comprehensive income
51,166
9,290
18,016
As of
December 31,
2010
2009
Net unrealized gains on derivative instruments
$
273
$
20
Net unrealized gains on available
-
for
-
sale securities
8
Total cumulative other comprehensive income, net of taxes
$
281
$
24