Symantec 2014 Annual Report Download - page 145

Equity investments. We make equity investments in privately-held companies whose businesses are
complementary to our business. These investments are accounted for under the cost method of accounting, as we
hold less than 20% of the voting stock outstanding and do not exert significant influence over these companies.
The investments are included in other long-term assets. We assess the recoverability of these investments by
reviewing various indicators of impairment. If indicators are present, a fair value measurement is made by
performing a discounted cash flow analysis of the investment. If a decline in value is determined to be other-
than-temporary, impairment would be recognized and included in other income (expense), net. As of March 28,
2014 and March 29, 2013, we held equity investments in privately-held companies of $13 million and $14
million, respectively.
Debt. Our debt has included senior unsecured notes, convertible senior notes, and a revolving credit
facility.Our senior unsecured notes are recorded at cost based upon par value at issuance less discounts. The
discount associated with our senior unsecured notes represents the amount by which the face value exceeds the
issuance price. The discount and issuance costs (recognized initially in the other long-term assets) are amortized
using the effective interest rate method over the term of the debt as a non-cash charge to interest expense.
Borrowings under our $1.0 billion senior unsecured revolving credit facility (“credit facility”) would be
recognized at cost plus accrued interest based upon stated interest rates.
Trade accounts receivable
Trade accounts receivable are recorded at the invoiced amount and are not interest bearing. We maintain an
allowance for doubtful accounts to reserve for potentially uncollectible trade receivables. Additions to the
allowance for doubtful accounts are recorded as general and administrative expenses. We review our trade
receivables by aging category to identify specific customers with known disputes or collectability issues. In
addition, we maintain an allowance for all other receivables not included in the specific reserve by applying
specific percentages of projected uncollectible receivables to the various aging categories. In determining these
percentages, we analyze our historical collection experience and current economic trends. We exercise judgment
when determining the adequacy of these reserves as we evaluate historical bad debt trends, general economic
conditions in the U.S. and internationally, and changes in customer financial conditions. We also offset deferred
revenue against accounts receivable when channel inventories are in excess of specified levels and for
transactions where collection of a receivable is not considered probable.
The following table summarizes trade accounts receivable, net of allowances and reserves, for the periods
presented:
March 28,
2014
March 29,
2013
(Dollars in millions)
Trade accounts receivable $ 1,034 $ 1,054
Allowance for doubtful accounts (7) (5)
Reserve for product returns (20) (18)
Trade accounts receivable, net $ 1,007 $ 1,031
Inventories
Inventories are carried at the lower of cost or market. Cost is principally determined using the first-in, first-
out method. Adjustments to reduce the cost of inventory to its net realizable value are made, if required, for
estimated excess, obsolescence or impaired balances. Inventory predominantly consists of deferred costs of
revenue and finished goods. Deferred costs of revenue were $9 million as of March 28, 2014 and $15 million as
of March 29, 2013. Finished goods were $10 million as of March 28, 2014 and $11 million as of March 29, 2013.
66