SanDisk 2011 Annual Report Download - page 146

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Accumulated Other Comprehensive Income. Accumulated other comprehensive income presented in the
accompanying Consolidated Balance Sheets consists of unrealized gains and losses on available-for-sale
investments, foreign currency translation and hedging activities, net of tax, for all periods presented (in
thousands):
January 1,
2012
January 2,
2011
Accumulated net unrealized gain on:
Available-for-sale investments ................................................ $ 10,849 $ 17,505
Foreign currency translation .................................................. 300,788 231,255
Hedging activities .......................................................... 21,064 11,468
Total accumulated other comprehensive income ...................................... $ 332,701 $ 260,228
The amount of income tax (benefit) expense allocated to unrealized gain on available-for-sale investments,
hedging activities and foreign currency translation was as follows (in thousands):
Fiscal years ended
January 1,
2012
January 2,
2011
January 3,
2010
Available-for-sale investments ........................................ $ 3,342 $ (6,301) $ 13,745
Foreign currency translation .......................................... 10,315 20,979 (5,643)
Hedging activities .................................................. 2,504 (2,776) (11,588)
$ 16,161 $ 11,902 $ (3,486)
Note 6: Goodwill and Intangible Assets
Goodwill. Goodwill balances as of January 1, 2012 and January 2, 2011 are presented below (in thousands):
Carrying
Amount
Balance as of January 2, 2011 ................................................................. $ —
Acquisition of Pliant Technology, Inc. ...................................................... 154,899
Balance as of January 1, 2012 ................................................................. $ 154,899
Goodwill increased by approximately $154.9 million due to the Company’s acquisition of Pliant
Technology, Inc. (“Pliant”) during the second quarter of fiscal year 2011. See Note 15, “Business Acquisition.”
Goodwill is not amortized, but is reviewed and tested for impairment at least annually, on the first day of the
Company’s fourth quarter and whenever events or circumstances occur that indicate that goodwill might be
impaired. Impairment of goodwill is tested at the Company’s reporting unit level. The Company early adopted
the new authoritative guidance issued by the FASB in September 2011 for its fiscal year 2011 annual goodwill
impairment test. This new authoritative guidance modifies the two-step goodwill impairment test by allowing
companies to assess qualitatively whether it is “more likely than not” that a reporting unit’s carrying amount is
greater than its fair value. If it is not “more likely than not” that the fair value of a reporting unit is greater than
its fair value, companies are not required to proceed to a two-step impairment test. In performing the analysis, the
Company first assessed qualitative factors, including macroeconomic conditions, industry and market conditions,
cost factors, overall financial performance, other relevant entity-specific events and events affecting the reporting
unit, to determine whether the existence of events or circumstances led to a determination that it was “more
likely than not” that the fair value of its reporting unit was less than its carrying amount. In addition, the
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