Apple 2011 Annual Report Download - page 22

Download and view the complete annual report

Please find page 22 of the 2011 Apple 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 107

  • 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

Company also has unsecured vendor non-
trade receivables resulting from purchases of components by outsourcing partners and other vendors
that manufacture sub-assemblies or assemble final products for the Company. Two vendors accounted for a significant portion of the Company’
s
non-trade receivables as of September 24, 2011. In addition, the Company has made prepayments associated with long-
term supply agreements
to secure supply of inventory components. While the Company has procedures to monitor and limit exposure to credit risk on its trade and
vendor non-trade receivables as well as long-
term prepayments, there can be no assurance such procedures will effectively limit its credit risk
and avoid losses, which could materially adversely affect the Company’s financial condition and operating results.
Unfavorable results of legal proceedings could materially adversely affect the Company.
The Company is subject to various legal proceedings and claims that have not yet been fully resolved and that have arisen in the ordinary
conduct of business, and additional claims may arise in the future. Results of legal proceedings are subject to significant uncertainty and,
regardless of the merit of the claims, litigation may be expensive, time-consuming, disruptive to the Company’
s operations, and distracting to
management. In recognition of these considerations, the Company may enter into arrangements to settle litigation.
Although management considers the likelihood of such an outcome to be remote, if one or more of these legal matters were resolved against the
Company in the same reporting period for amounts in excess of management’s expectations, the Company’
s consolidated financial statements of
a particular reporting period could be materially adversely affected. Further, such an outcome could result in significant compensatory, punitive
or trebled monetary damages, disgorgement of revenue or profits, remedial corporate measures or injunctive relief against the Company that
could materially adversely affect its financial condition and operating results.
Changes in the Company’
s tax rates, the adoption of new U.S. or international tax legislation or exposure to additional tax liabilities could
affect its future results.
The Company is subject to taxes in the U.S. and numerous foreign jurisdictions. The Company’
s future effective tax rates could be affected by
changes in the mix of earnings in countries with differing statutory tax rates, changes in the valuation of deferred tax assets and liabilities, or
changes in tax laws or their interpretation. Any of these changes could have a material adverse effect on the Company’
s profitability. The
Company is also subject to the continual examination of its income tax returns by the Internal Revenue Service and other tax authorities. The
Company regularly assesses the likelihood of adverse outcomes resulting from these examinations to determine the adequacy of its provision for
taxes. There can be no assurance that the outcomes from these examinations will not materially adversely affect the Company’
s financial
condition and operating results.
None.
The Company’
s headquarters are located in Cupertino, California. As of September 24, 2011, the Company owned or leased approximately
13.2 million square feet of building space, primarily in the U.S., and to a lesser extent, in Europe, Japan, Canada, and the Asia-
Pacific regions.
Of that amount approximately 7.0 million square feet was leased building space, which includes approximately 3.0 million square feet related to
retail store space. Of the Company’
s owned building space, approximately 2.6 million square feet that is located in Cupertino, California will be
demolished to build a second corporate campus. Additionally, the Company owns a total of 584 acres of land in various locations.
As of September 24, 2011, the Company owned a manufacturing facility in Cork, Ireland that also housed a customer support call center and
facilities in Elk Grove, California that included warehousing and distribution operations and a customer support call center. In addition, the
Company owned facilities for research and
20
Item 1B.
Unresolved Staff Comments
Item 2.
Properties