Apple 2002 Annual Report Download - page 52

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$123 million as of September 30, 2000.
Prior to its sale, the Company had categorized its investment in Samsung as available-for-sale requiring that it be carried at fair value with
unrealized gains and losses, net of taxes, reported in equity as a component of accumulated other comprehensive income. The fair value of the
Company's investment in Samsung was approximately $123 million as of September 30, 2000. With the adoption of SFAS No. 133 on
October 1, 2000, the Company was required to account for the conversion option embedded in the
65
Samsung bonds separately from the related debt. The conversion feature was carried at fair value with any changes in fair value recognized in
earnings in the period in which they occur. Included in the $17 million gross SFAS No. 133 transition adjustment recorded in earnings during
the first quarter of fiscal 2001 was a $23 million favorable adjustment for the restatement to fair value as of October 1, 2000, of the derivative
component of the Company's investment in Samsung. To adjust the carrying value of the derivative component of its investment in Samsung to
fair value as of December 30, 2000, the Company recognized an unrealized loss of approximately $13 million during the first quarter of 2001.
During the second quarter of 2001, the Company sold this investment for book value, including accrued interest, and received net proceeds of
approximately $117 million.
Other Strategic Investments
The Company has made additional minority debt and equity investments in several privately held technology companies which were reflected
in the consolidated balance sheets in other assets. These investments are inherently risky because the products and/or markets of these
companies are typically not fully developed. During 2001 the Company determined that the decline in fair value of certain of these investments
was other-than-temporary and, accordingly, recognized a charge to earnings of approximately $8 million. This charge was included in gains
(losses) on non-current investments, net. During 2002, the Company determined that the decline in fair value of certain of these investments
was other-than-temporary and, accordingly, recognized a charge to earnings of $15 million. These charges were included in gains (losses) on
non-current investments, net. As of September 28, 2002, the Company has no private debt or equity investments reflected in its consolidated
balance sheet.
Note 3—Consolidated Financial Statement Details
Inventories
(in millions)
(in millions)
66
2002
2001
Purchased parts $
9
$
1
Work in process
—
—
Finished goods
36
10
Total inventories $
45
$
11
2002
2001
Land and buildings $
342
$
337
Machinery and equipment
183
182
Office furniture and equipment
67
63
Internal-use software
184
192
Leasehold improvements
281
186
1,057
960
Accumulated depreciation and amortization
(436
)
(396
)
Net property, plant, and equipment
$
621
$
564