Qualcomm 2011 Annual Report Download - page 71

QUALCOMM Incorporated
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
2010 and 2009 , respectively, were outstanding but not included in the computation of diluted earnings per common share because the effect
would be anti-dilutive. Put options outstanding during fiscal 2011 to purchase 11,800,000 shares of common stock were not included in the
earnings per common share computation because the put options’ exercise prices were less than the average market price of the common stock
while they were outstanding, and therefore, the effect on diluted earnings per common share would be anti-dilutive (Note 7). In addition,
1,963,000 and 235,000 shares of other common stock equivalents outstanding in fiscal 2011 and 2010, respectively, were not included in the
computation of diluted earnings per common share because the effect would be anti-dilutive. There were no common stock equivalents
outstanding in fiscal 2009 whose effect would be anti-dilutive.
Comprehensive Income. Comprehensive income is defined as the change in equity of a business enterprise during a period from transactions
and other events and circumstances from non-owner sources, including foreign currency translation adjustments and unrealized gains and losses
on marketable securities. The Company presents comprehensive income in its consolidated statements of stockholders’ equity. The
reclassification adjustment for net realized gains results from the recognition of the net realized gains in the statements of operations when
marketable securities are sold or derivative instruments are settled. The reclassification adjustment for other-than-temporary losses on
marketable securities included in net income results from the recognition of the unrealized losses in the statements of operations when they are
no longer viewed as temporary. The portion of other-than-temporary impairment losses related to noncredit factors and subsequent changes in
fair value included in comprehensive income is shown separately from other unrealized gains or losses on marketable securities.
Components of accumulated other comprehensive income in Qualcomm stockholders’ equity consisted of the following (in millions):
At September 25, 2011 , accumulated other comprehensive income included $13 million of other-than-temporary losses on marketable debt
securities related to factors other than credit, net of income taxes.
Total comprehensive income attributable to Qualcomm consisted of the following (in millions):
Note 2. Fair Value Measurements
Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or
most advantageous market for the asset or liability in an orderly transaction between market participants as of the measurement date. Applicable
accounting guidance provides an established hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and
minimizes the use of unobservable inputs by requiring that the most
F- 12
September 25,
2011
September 26,
2010
Noncredit other-than-temporary impairment losses and subsequent changes in fair value related to certain marketable
debt securities, net of income taxes
$
27
$
62
Net unrealized gains on marketable securities, net of income taxes
427
723
Net unrealized losses on derivative instruments, net of income taxes
(15
)
(8
)
Foreign currency translation
(86
)
(80
)
$
353
$
697
2011
2010 2009
Net income
$
4,242
$
3,247
$
1,592
Other comprehensive income:
Foreign currency translation
(9
)
(40
)
(25
)
Noncredit other-than-temporary impairment losses and subsequent changes in fair value related to certain
marketable debt securities, net of income taxes of $10, ($5) and $12, respectively
(19
)
21
135
Net unrealized (losses) gains on other marketable securities and derivative instruments, net of income taxes of
$80, $74 and ($5), respectively
(145
)
392
261
Reclassification of net realized gains on marketable securities and derivative instruments included in net
income, net of income taxes of $112, ($12) and $75, respectively
(199
)
(380
)
(93
)
Reclassification of other-than-temporary losses on marketable securities included in net income, net of income
taxes of $14, ($5) and $130, respectively
25
116
613
Total other comprehensive (loss) income
(347
)
109
891
Total comprehensive income
3,895
3,356
2,483
Comprehensive loss attributable to noncontrolling interests
21
—
—
Comprehensive income attributable to Qualcomm
$
3,916
$
3,356
$
2,483