Apple 2015 Annual Report Download - page 59

The Company is subject to taxation and files income tax returns in the U.S. federal jurisdiction and in many state and foreign jurisdictions.
The U.S. Internal Revenue Service (the “IRS”) is currently examining the years 2010 through 2012, and all years prior to 2010 are closed. In
addition, the Company is subject to audits by state, local and foreign tax authorities. In major states and major foreign jurisdictions, the
years subsequent to 2003 generally remain open and could be subject to examination by the taxing authorities.
Management believes that an adequate provision has been made for any adjustments that may result from tax examinations. However,
the outcome of tax audits cannot be predicted with certainty. If any issues addressed in the Company’s tax audits are resolved in a
manner not consistent with management’s expectations, the Company could be required to adjust its provision for income taxes in the
period such resolution occurs. Although timing of the resolution and/or closure of audits is not certain, the Company does not believe it is
reasonably possible that its unrecognized tax benefits would materially change in the next 12 months.
On June 11, 2014, the European Commission issued an opening decision initiating a formal investigation against Ireland for alleged state
aid to the Company. The opening decision concerns the allocation of profits for taxation purposes of the Irish branches of two subsidiaries
of the Company. The Company believes the European Commission’s assertions are without merit. If the European Commission were to
conclude against Ireland, the European Commission could require Ireland to recover from the Company past taxes covering a period of up
to 10 years reflective of the disallowed state aid. While such amount could be material, as of September 26, 2015 the Company is unable
to estimate the impact.
Note 6 – Debt
Commercial Paper
In 2014, the Board of Directors authorized the Company to issue unsecured short-term promissory notes (“Commercial Paper”) pursuant
to a commercial paper program. The Company intends to use net proceeds from the commercial paper program for general corporate
purposes, including dividends and share repurchases. As of September 26, 2015 and September 27, 2014, the Company had $8.5 billion
and $6.3 billion of Commercial Paper outstanding, respectively, with a weighted-average interest rate of 0.14% and 0.12%, respectively,
and maturities generally less than nine months.
The following table provides a summary of cash flows associated with the issuance and maturities of Commercial Paper for 2015 and
2014 (in millions):
2015 2014
Maturities less than 90 days:
Proceeds from (repayments of) commercial paper, net $ 5,293 $ 1,865
Maturities greater than 90 days:
Proceeds from commercial paper 3,851 4,771
Repayments of commercial paper (6,953) (330)
Maturities greater than 90 days, net (3,102) 4,441
Total change in commercial paper, net $ 2,191 $ 6,306
Long-Term Debt
As of September 26, 2015, the Company had outstanding floating- and fixed-rate notes with varying maturities for an aggregate principal
amount of $55.7 billion (collectively the “Notes”). The Notes are senior unsecured obligations, and interest is payable in arrears, quarterly
for the U.S. dollar-denominated and Australian dollar-denominated floating-rate notes, semi-annually for the U.S. dollar-denominated,
Australian dollar-denominated, British pound-denominated and Japanese yen-denominated fixed-rate notes and annually for the euro-
denominated and Swiss franc-denominated fixed-rate notes.
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