Starbucks 2008 Annual Report Download - page 61

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Note 4: Short-term and Long-term Investments
The Company’s short-term and long-term investments consisted of the following (in millions):
Amortized
Cost
Gross
Unrealized
Holding
Losses
Fair
Value
September 28, 2008
Short-term investments — available-for-sale securities:
Corporate debt securities.............................. $ 3.0 $ — $ 3.0
Total........................................... 3.0 $ — 3.0
Short-term investments — trading securities ................. 58.2 49.5
Total short-term investments . . . .......................... $ 61.2 $ 52.5
Long-term investments — available-for-sale securities:
State and local government obligations ................... $ 65.8 $(6.0) $ 59.8
Corporate debt securities.............................. 12.1 (0.5) 11.6
Total long-term investments . . . .......................... $ 77.9 $(6.5) $ 71.4
September 30, 2007
Short-term investments — available-for-sale securities:
State and local government obligations ................... $ 81.4 $(0.1) $ 81.3
US government agency obligations ...................... 2.5 — 2.5
Total........................................... 83.9 $(0.1) 83.8
Short-term investments — trading securities ................. 67.8 73.6
Total short-term investments . . . .......................... $151.7 $157.4
Long-term investments — available-for-sale securities:
US government agency obligations ...................... $ 21.0 $ — $ 21.0
For available-for-sale securities, proceeds from sales were $75.9 million, $47.5 million and $431.2 million, in fiscal
years 2008, 2007 and 2006, respectively. Gross realized gains from sales were $3.8 million in fiscal year 2006.
Gross realized losses from sales were $0.1 million in fiscal year 2006. For fiscal years 2008 and 2007, there were no
realized losses and immaterial amounts of realized gains from sales.
As of September 28, 2008, the Company’s long-term available-for-sale securities of $71.4 million included
$59.8 million invested in auction rate securities (“ARS”). As of September 30, 2007, the Company held
$75.6 million of ARS, which were all classified as short-term available-for-sale securities. ARS have long-dated
maturities but provide liquidity through a Dutch auction process that resets the applicable interest rate at pre-
determined calendar intervals. Due to the auction failures that began in mid-February 2008, these securities became
illiquid and were classified as long-term investments. The investment principal associated with the failed auctions
will not be accessible until:
• successful auctions resume;
• an active secondary market for these securities develops;
• the issuers replace these securities with another form of financing; or
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