THQ 2009 Annual Report Download - page 76

Download and view the complete annual report

Please find page 76 of the 2009 THQ annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 117

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117

2. Investment Securities
The following table summarizes our investment securities and their related inception-to-date gross
unrealized gains and (losses), as of March 31, 2009 (in thousands).
Gross Gross
Amortized Unrealized Unrealized Fair
Cost Gains Losses Value
Short-term investments:
Municipal securities ................ $ 6,397 $ 5 $ (3) $ 6,399
Corporate securities ................ 2,405 — — 2,405
Total short-term investments ....... 8,802 5 (3) 8,804
Long-term investments:
Municipal securities(1) .............. 5,475 — (450) 5,025
Total long-term investments ........ 5,475 — (450) 5,025
Total available-for-sale investments ...... $14,277 $ 5 $(453) $13,829
Put option ...................... 4,541
Trading securities(1) ............... 26,077
Total long-term investments pledged .. 30,618
Total investment securities ............ $44,447
(1) The municipal securities included in the table above and classified as long-term are all
auction rate securities with most collateralized by student loans guaranteed by the U.S.
government under the Federal Family Education Loan Program and the majority of the
remaining securities backed by monoline bond insurance companies.
Available-for-sale investments
The gross unrealized losses on our short-term available-for-sale investments in the above table were
primarily caused by a decrease in the fair value of the investments as a result of the limited liquidity of
these investments. None of the available-for-sale securities included in the above table have been in an
unrealized loss position for more than 12 months.
During fiscal 2009, our available-for-sale investments included in the table above had a decline in fair value
of $0.5 million that was deemed temporary, as we believe the decline in fair value is primarily attributable
to the limited liquidity of these investments. As such, an unrealized loss in this amount was recorded to
other comprehensive income.
In addition, we had a pre-tax unrealized holding loss on our investment in Yuke’s Co., Ltd. (‘‘Yuke’s’’) that
is classified as available-for-sale and is included in other long-term assets, net (see ‘‘Note 8—Other
Long-Term Assets’’).
During fiscal 2009, we recorded impairment charges of $6.3 million to interest and other income, net,
related to declines in fair value that we concluded were other than temporary. Of this impairment,
$2.0 million related to a downgrade in one security’s rating from A to CCCand $4.3 million related to
securities received as collateral for former auction rate securities (‘‘ARS’’) that were required to be
unwound as a result of Lehman Brothers filing for bankruptcy protection.
During the year ended March 31, 2009 there were $0.1 million of realized gains and $0.4 million of realized
losses from sales of available-for-sale securities.
69