Cisco System Inc the leading Internet protocol-based networking equipment compan
ID: 2330332 • Letter: C
Question
Cisco System Inc the leading Internet protocol-based networking equipment company, has significant holdings of investment securities. Use the financial information provided to analyze Cisco’s holdings and address the following question:
For its investment securities, determine the types and amount of investments in each level in the hierarchy in fiscal 2013.
At or for the year ended July 27, 2013 July 28, 2012 July 30, 2011
Total Assets $101,191 $91,759 $87,095
Net Income before Taxes $11,227 $10,159 $7,825
Summary of Comprehensive Income
Year Ended July 27, 2013 July 28, 2012 July 30, 2011
Net Income $9,983 $8,041 $6,490
Change in:
Unrealized gains and losses on
Investments, net (37) (78) 154
Derivative instruments 61 (59) (21)
Cumulative translation
Adjustment and other (77) (496) 538
Comprehensive income
(Loss) $9,930 $7,408 $7,161
Explanation / Answer
Cisco System Inc has 4 categories of Investment:-
1) It has investments securities classified as available for sale which is evident from the fact that cisco is recogniznig the fair value changes through Profit and Loss Account
2) Cisco also has derivative securities
3) it also has securities that are purchased in foreign currency since the CTA account ie cumulative translation adjustment, is appearing in the Profit and Loss Account.
4) It also has debt securities that are mearured at Fair value through other comprehensive income.