Symantec 2012 Annual Report Download - page 156

SYMANTEC CORPORATION
Notes to Consolidated Financial Statements — (Continued)
Concentrations of credit risk
A significant portion of our revenue and net income is derived from international sales and independent
agents and distributors. Fluctuations of the U.S. dollar against foreign currencies, changes in local regulatory or
economic conditions, piracy, or nonperformance by independent agents or distributors could adversely affect
operating results.
Financial instruments that potentially subject us to concentrations of credit risk consist principally of cash
and cash equivalents, short-term investments, and trade accounts receivable. Our investment policy limits the
amount of credit risk exposure to any one issuer and to any one country. We are exposed to credit risks in the
event of default by the issuers to the extent of the amount recorded in the Consolidated Balance Sheets. The
credit risk in our trade accounts receivable is substantially mitigated by our credit evaluation process, reasonably
short collection terms, and the geographical dispersion of sales transactions. We maintain reserves for potential
credit losses and such losses have been within management’s expectations. See Note 10 for details of significant
customers.
Advertising costs
Advertising costs are charged to operations as incurred and include electronic and print advertising, trade
shows, collateral production, placement fees with hardware manufacturers, and all forms of direct marketing.
Advertising costs included in Sales and marketing expense for fiscal 2012, 2011, and 2010 were $667 million,
$668 million, and $615 million, respectively.
Recently issued and adopted authoritative guidance
In May 2011, the Financial Accounting Standards Board (“FASB”) issued an accounting standards update
that provided guidance on achieving a consistent definition of and common requirements for measurement and
disclosure of fair values in U.S. generally accepted accounting principles (“GAAP”) and International Financial
Reporting Standards (“IFRS”). The guidance expanded disclosures relating to fair value measurements that are
estimated using significant unobservable (Level 3) inputs. The guidance also required categorization by level of
the fair value hierarchy for items that are not measured at fair value but for which fair value is required to be
disclosed. We adopted this guidance in the fourth quarter of fiscal 2012. The adoption of this guidance did not
have a material impact on our Consolidated Financial Statements.
In June 2011, the FASB issued an accounting standards update that eliminates the option to report other
comprehensive income and its components in the statement of stockholders’ equity and requires that all
non-owner changes in stockholders’ equity be presented in either a single continuous statement of comprehensive
income or in two separate but consecutive statements. In December 2011, the FASB issued another accounting
standards update that defers the requirement to present reclassification adjustments for each component of
Accumulated other comprehensive income (“AOCI”) in both Other comprehensive income and Net income on
the face of the financial statements The amended guidance will be adopted by us in the first quarter of fiscal
2013, on a retrospective basis, and will result only in changes in our financial statement presentation.
In September 2011, the FASB issued an accounting standards update that permits entities to first assess
qualitative factors to determine whether it is more likely than not (a likelihood of more than 50%) that the fair
value of a reporting unit is less than its carrying amount as a basis for determining whether it is necessary to
perform the two-step goodwill impairment test. This new guidance will be adopted by us in fiscal 2013 on a
prospective basis, and will be applied in our fourth quarter of fiscal 2013 at the time we perform our annual
goodwill test. We do not expect that this guidance will materially impact our Consolidated Financial Statements.
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