Seagate 2012 Annual Report Download - page 62

Table of Contents
amount. Based on the qualitative assessment, if it is not more likely than not that the fair value of a reporting unit is less than its carrying
amount, then the Company is not required to perform the two-step goodwill impairment test.
In accordance with ASC 360-05-4, Impairment or Disposal of Long-lived Assets, we test other long-lived assets, including property,
equipment and leasehold improvements and other intangible assets subject to amortization, for recoverability whenever events or changes in
circumstances indicate that the carrying values of those assets may not be recoverable. We assess the recoverability of an asset group by
determining if the carrying value of the asset group exceeds the sum of the projected undiscounted cash flows expected to result from the use and
eventual disposition of the assets over the remaining economic life of the primary asset in the asset group. If the recoverability test indicates that
the carrying value of the asset group is not recoverable, we will estimate the fair value of the asset group using the same approaches indicated
above for ASC 360 step two and compare it to its carrying value. The excess of the carrying value over the fair value is allocated pro rata to
derive the adjusted carrying value of each asset in the asset group. The adjusted carrying value of each asset in the asset group is not reduced
below its fair value.
Recent Accounting Pronouncements
See "Item 8. Financial Statements and Supplementary Data, Note 1. Basis of Presentation and Summary of Significant Accounting Policies"
for information regarding the effect of new accounting pronouncements on our financial statements.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
We have exposure to market risks due to the volatility of interest rates, foreign currency exchange rates, equity and bond markets. A portion
of these risks are hedged, but fluctuations could impact our results of operations, financial position and cash flows. Additionally, we have
exposure to downgrades in the credit ratings of our counterparties as well as exposure related to our credit rating changes.
Interest Rate Risk. Our exposure to market risk for changes in interest rates relates primarily to our investment portfolio. As of June 28,
2013, the Company had no material available-for-sale securities that had been in a continuous unrealized loss position for a period greater than
12 months. The Company determined no material available-for-sale securities were other-than-temporarily impaired as of June 28, 2013. We
currently do not use derivative financial instruments in our investment portfolio.
We have fixed rate debt obligations. We enter into debt obligations for general corporate purposes including capital expenditures and
working capital needs. We currently do not use interest rate derivatives to hedge interest rate exposure on our outstanding debt.
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