Ao calcular os ganhos diluídos por ação, as opções de ações são

Notícia do mercado de ações de hoje & amp; Análise.

Roku mostra a volatilidade é seu amigo em ações individuais, também.

A Roku tem uma visão para o futuro.

Vídeos de notícias mais recentes.

Últimas notícias.

Procurar notícias por categoria.

Tecnologia.

Commodities.

Idéias de investimento.

Inteligência de mercado.

Fique à frente dos mercados com estes artigos de leitura obrigatória.

Mercado de ações hoje.

Ações para assistir.

Rally dos estoques conforme os investidores reavaliam o relatório do Fed.

História em destaque de.

Últimos artigos por Martin Tillier.

A nova coluna de leitura obrigatória de Martin Tiller nos mercados.

Esclarecedor. Divertido. Todo dia. Apenas na NASDAQ.

Editar favoritos.

Insira até 25 símbolos separados por vírgulas ou espaços na caixa de texto abaixo. Esses símbolos estarão disponíveis durante sua sessão para uso nas páginas aplicáveis.

Personalize sua experiência NASDAQ.

Selecione a cor de fundo de sua escolha:

Selecione uma página de destino padrão para sua pesquisa de cotação:

Por favor, confirme sua seleção:

Você selecionou para alterar sua configuração padrão para a Pesquisa de cotação. Esta será agora sua página de destino padrão; a menos que você altere sua configuração novamente ou exclua seus cookies. Tem certeza de que deseja alterar suas configurações?

Desative seu bloqueador de anúncios (ou atualize suas configurações para garantir que o JavaScript e os cookies estejam ativados), para que possamos continuar a fornecer a você as notícias e os dados de mercado de primeira linha que você espera de nós.

Comparando o rendimento P / E, EPS e ganhos.

O índice preço / lucro (P / L), também conhecido como “múltiplo de lucros”, é uma das medidas de avaliação mais populares usadas por investidores e analistas. A definição básica de um índice P / L é o preço das ações dividido pelo lucro por ação (EPS). O fato de a medida P / E ser uma relação torna-a particularmente adequada para fins de avaliação, mas é um pouco difícil de usar intuitivamente ao avaliar o retorno potencial, especialmente entre diferentes tipos de investimento. É aqui que entra o rendimento.

O rendimento do lucro é definido como EPS dividido pelo preço da ação (E / P). Em outras palavras, é o recíproco do índice P / E.

Assim, rendimento de ganhos = EPS / preço = 1 / (relação P / E), expresso como uma porcentagem.

Se a ação A está sendo negociada a US $ 10 e seu EPS no ano passado (ou 12 meses, abreviado como “ttm”) foi de 50 centavos, tem um P / L de 20 (US $ 10/50 centavos) e um rendimento de 5% (50 centavos / US $ 10).

Se o estoque B estiver sendo negociado a US $ 20 e seu EPS (ttm) for de US $ 2, ele terá um P / L de 10 e um rendimento de 10% (US $ 2 / US $ 20).

Assumindo que A e B são empresas muito similares operando no mesmo setor, com estruturas de capital quase idênticas, qual você acha que representa o melhor valor? A resposta óbvia é B. De uma perspectiva de avaliação, ela tem um P / E muito mais baixo. Do ponto de vista do rendimento dos lucros, B tem um rendimento de 10%, o que significa que cada dólar investido no estoque geraria EPS de 10 centavos. O estoque A, por outro lado, só tem um rendimento de 5%, o que significa que cada dólar investido nele geraria EPS de 5 centavos.

O rendimento dos lucros facilita a comparação de retornos potenciais entre, digamos, um estoque e um título de alto rendimento. Digamos que um investidor com algum apetite por risco esteja tentando decidir entre o Estoque B e um título de junk bonds com um rendimento de 6%. Comparar o P / E de 10 da B e o rendimento de 6% da sucata é semelhante a maçãs e laranjas. Mas o uso do rendimento de 10% dos lucros de B torna mais fácil para o investidor comparar os retornos e decidir se o diferencial de rendimento de 4 pontos percentuais justifica o risco de investir no estoque em vez do título. Observe que, mesmo que o Estoque B tenha apenas um rendimento de dividendos de 4% (mais sobre isso posteriormente), o investidor está mais preocupado com o retorno potencial total do que com o retorno real.

EPS é a medida final da lucratividade de uma empresa, e é basicamente definida como lucro líquido dividido pelo número de ações em circulação. O EPS básico possui o número básico de ações em circulação no denominador, enquanto o EPS totalmente diluído (FDEPS) usa o número de ações totalmente diluídas no denominador.

Da mesma forma, P / E vem em duas formas principais:

P / E à direita refere-se à relação preço / lucro baseada em EPS para os quatro trimestres seguintes ou 12 meses, conforme observado anteriormente. Forward P / E significa o índice preço / lucro baseado no EPS estimado futuro, como o ano fiscal ou civil atual, ou o ano seguinte.

O índice P / E para um estoque específico, embora suficientemente útil por si só, é de utilidade ainda maior quando comparado a outros parâmetros, como:

P / E Setorial: A comparação entre o P / L da ação e o de outras empresas de porte semelhante em seu setor, bem como o P / L médio do setor, permitirá determinar se o estoque está sendo negociado com uma cotação de prêmio ou desconto. em relação aos seus pares. P / E relativo: Comparar o P / E da ação com a sua faixa P / E durante um período de tempo fornece uma indicação da percepção do investidor. Uma ação pode estar sendo negociada a P / E muito mais baixa agora do que no passado, porque os investidores percebem que seu crescimento mais rápido está por trás dela. P / E para o crescimento do lucro (PEG Ratio): O índice PEG compara o P / E com o crescimento dos lucros futuros ou passados. Uma ação com P / E de 10 e crescimento de 10% nos lucros tem uma relação PEG de 1, enquanto que uma com P / E de 10 e crescimento de ganhos de 20% tem uma taxa de PEG de 0,5. Segundo o índice PEG, a segunda empresa está subvalorizada em relação à primeira.

Usando o rendimento de ganhos para computar a taxa de pagamento de dividendos.

Uma questão que muitas vezes surge com uma ação que paga um dividendo é a de seu índice de pagamento, que em sua forma mais básica é a proporção de dividendos pagos como porcentagem do lucro por ação. O payout ratio é um importante indicador de sustentabilidade dos dividendos. Se uma empresa paga consistentemente mais em dividendos do que ganha em lucro líquido, o dividendo pode estar em perigo em algum momento. Embora uma definição menos rigorosa do índice de pagamento use os dividendos pagos como uma porcentagem do fluxo de caixa por ação, por uma questão de simplicidade, definimos o índice de pagamento de dividendos nesta seção como: Dividendos por Ação (DPS) / EPS.

O rendimento de dividendos é outra medida comumente usada para avaliar o retorno potencial de uma ação. Uma ação com um rendimento de dividendos de 4% e uma possível apreciação de 6% tem um potencial de retorno total de 10%. Dividend Yield = Dividendos por ação (DPS) / Preço.

Como o Índice de Pagamento de Dividendos = DPS / EPS, a divisão do numerador e do denominador pelo preço nos dá:

Rácio de Pagamento de Dividendos = (DPS / P) / (EPS / P) = Rendimento de Dividendos / Rendimento dos Ganhos.

Vamos usar o Procter & amp; Gamble (NYSE: PG) para ilustrar esse conceito. P & amp; G fechou em $ 84,28 em 27 de novembro de 2013. O estoque teve um P / E de 20,86, com base no EPS de 12 meses à direita, e um rendimento de dividendos (ttm) de 2,75%.

O índice de pagamento de dividendos da P & G foi, portanto, = 2,75 / (1 / 20,86) * = 2,75 / 4,79 = 57,5%

* Lembre-se que o rendimento do salário = 1 / (relação P / E)

O payout ratio também pode ser calculado simplesmente dividindo o DPS (US $ 2,32) pelo EPS (US $ 4,04) no ano anterior. No entanto, na realidade, esse cálculo exige que se conheça os valores reais dos dividendos e lucros por ação, que geralmente são menos conhecidos pelos investidores do que o rendimento de dividendos e o P / L de uma ação específica.

Assim, se uma ação com um rendimento de dividendos de 5% for negociada a um P / L de 15 (o que significa que seu rendimento de ganhos é de 6,67%), sua taxa de pagamento é de aproximadamente 75%.

Como o Procter & amp; A sustentabilidade dos dividendos da Gamble se compara à da provedora de serviços de telecomunicações Windstream Holdings (Nasdaq: WIN), que teve o maior rendimento de dividendos indicado de todos os constituintes da S & P 500 (em 27 de novembro de 2013) acima de 12%? Ao preço de fechamento de US $ 8,09, a WIN teve um dividend yield de 12,36% e foi negociada a um P / L de 27,9 (para um rendimento de rendimento de 3,58%). Com o rendimento de dividendos de 12,36%, muito maior do que o rendimento dos lucros da ação, o índice de pagamento de dividendos para a WIN foi de 345%. Em outras palavras, o pagamento de dividendos da WIN foi quase 3,5 vezes seu EPS no ano passado. Isto é confirmado pelo seu DPS (ttm) de US $ 1 e EPS de 29 centavos. Um investidor à procura de uma ação com alto grau de sustentabilidade de dividendos seria melhor escolher Procter & amp; Gamble do que Windstream.

A proeminência do P / E como uma medida de avaliação é improvável que seja descarrilada tão cedo pelo rendimento dos lucros, que não é tão amplamente usado. Embora a principal vantagem do rendimento dos lucros seja permitir uma comparação intuitiva dos possíveis retornos a serem feitos, ele apresenta as seguintes desvantagens:

Maior Grau de Incerteza: O retorno indicado pelo rendimento do lucro tem um grau muito maior de incerteza do que o retorno de um instrumento de renda fixa. Mais Volatilidade: Como o lucro líquido e o EPS podem flutuar significativamente de um ano para o outro, o rendimento do lucro geralmente será mais volátil do que os rendimentos de renda fixa. Apenas Retorno Indicativo: O rendimento de ganhos indica apenas o retorno aproximado com base no EPS; o retorno real pode divergir substancialmente do rendimento do lucro, especialmente para ações que não pagam dividendos ou pequenos dividendos.

Como um exemplo do último ponto, suponha que um fictício Widget Co. está sendo negociado a US $ 10 e ganhará US $ 1 em EPS ao longo do ano. Se pagar o valor total como dividendos, a empresa teria um rendimento de dividendos indicado de 10%. E se a empresa não pagar dividendos? Neste caso, uma via de retorno potencial para os investidores da Widget Co. é o aumento do valor contábil da empresa, graças aos lucros retidos (ou seja, ele fez lucros, mas não os pagou como dividendos).

Para manter as coisas simples, suponha que a Widget Co. esteja negociando exatamente no valor contábil. Se o valor contábil por ação aumentar de US $ 10 para US $ 11 (devido ao aumento de US $ 1 nos lucros acumulados), as ações seriam negociadas a US $ 11 para um retorno de 10% ao investidor. Mas e se houver um excesso de widgets no mercado e a Widget Co. começar a negociar com um grande desconto sobre o valor contábil? Nesse caso, em vez de um retorno de 10%, o investidor pode incorrer em uma perda das holdings da Widget Co.

O P / L pode ser o padrão estabelecido para fins de avaliação, mas sua reciprocidade - o rendimento do lucro - é especialmente útil para comparar retornos potenciais em diferentes instrumentos. O rendimento do lucro também permite que cálculos back-of-the-envelope sejam feitos para calcular o índice de pagamento de dividendos de um estoque usando medidas amplamente seguidas, como o rendimento de dividendos e o índice P / L.

Notas às Demonstrações Financeiras Consolidadas - Relatório Anual 2008.

Navegação Hierárquica.

1. Base de Apresentação.

O ano fiscal da Cisco Systems, Inc. (a "Empresa" ou "Cisco") é de 52 ou 53 semanas, que termina no último sábado de julho. O exercício fiscal de 2008, 2007 e 2006 foram exercícios fiscais de 52 semanas. As Demonstrações Financeiras Consolidadas incluem as contas da Cisco e suas subsidiárias. Todas as contas e transações entre companhias foram eliminados. A empresa conduz negócios globalmente e é gerenciada principalmente em uma base geográfica nos seguintes cinemas: Estados Unidos e Canadá; Mercados Europeus; Mercados emergentes; Ásia-Pacífico; e no Japão. O teatro dos Mercados Emergentes consiste da Europa Oriental, América Latina, Oriente Médio e África, e da Rússia e da Comunidade de Estados Independentes (CEI).

2. Sumário das Políticas Contábeis Significativas.

(a) Caixa e Equivalentes de Caixa.

A Companhia considera todos os investimentos de alta liquidez comprados com prazo original ou remanescente de menos de três meses na data da compra como equivalentes de caixa. Caixa e equivalentes de caixa são mantidos em diversas instituições financeiras.

(b) Investimentos.

Os investimentos da Companhia incluem títulos de agências governamentais e governamentais, títulos de dívida de empresas, títulos lastreados em ativos, títulos e notas municipais e títulos de capital com ações negociadas em bolsa. Esses investimentos são mantidos sob custódia de várias instituições financeiras importantes. O método de identificação específico é utilizado para determinar a base de custo dos títulos de renda fixa alienados. O método da média ponderada é utilizado para determinar a base de custo dos títulos patrimoniais negociados publicamente alienados. Em 26 de julho de 2008 e 28 de julho de 2007, os investimentos da Companhia foram classificados como disponíveis para venda e esses investimentos são registrados no Balanço Patrimonial Consolidado pelo valor justo. Ganhos e perdas não realizados sobre esses investimentos, na medida em que os investimentos não são protegidos, são incluídos como um componente separado do resultado abrangente acumulado, líquido de impostos.

A Companhia reconhece uma redução no valor recuperável quando um declínio no valor justo de seus investimentos abaixo da base de custo é considerado não temporário. A Companhia considera vários fatores ao determinar se deve reconhecer uma redução no valor recuperável, incluindo o período e a extensão em que o valor justo foi menor que a base de custo da Companhia, a condição financeira e as perspectivas de curto prazo da investida, e a intenção da empresa e a capacidade de manter o investimento por um período de tempo suficiente para permitir qualquer recuperação antecipada do valor de mercado.

A Companhia também possui investimentos em empresas de capital fechado. Estes investimentos estão incluídos em outros ativos no Balanço Patrimonial Consolidado e são principalmente contabilizados pelo custo. A Companhia monitora esses investimentos quanto a perdas por redução ao valor recuperável e faz reduções apropriadas nos valores contábeis, caso a Companhia determine que uma redução no valor recuperável é necessária, principalmente com base na situação financeira e nas perspectivas de curto prazo dessas empresas.

Os estoques são demonstrados pelo menor valor entre custo ou mercado. O custo é calculado usando o custo padrão, que se aproxima do custo real, em uma base de primeiro a entrar, primeiro a sair. A Companhia fornece reduções de estoque com base em estoques em excesso e obsoletos, determinados principalmente por previsões futuras de demanda. A redução é medida como a diferença entre o custo do estoque e o mercado com base em suposições sobre a demanda futura e cobrada da provisão de estoque, que é um componente do custo de vendas. No momento do reconhecimento da perda, uma base nova e de custo mais baixo para esse inventário é estabelecida, e as mudanças subseqüentes nos fatos e circunstâncias não resultam na restauração ou aumento naquela base de custo recém-estabelecida. Além disso, a Companhia registra um passivo para compromissos de compra firmes, não canceláveis e incondicionais com fabricantes e fornecedores contratados por quantidades que excedam as previsões futuras de demanda da Companhia, consistentes com sua avaliação de estoques excessivos e obsoletos.

(d) Provisão para devedores duvidosos.

A provisão para créditos de liquidação duvidosa é baseada na avaliação da empresa sobre a cobrança das contas dos clientes. A Companhia revisa regularmente a provisão considerando fatores como experiência histórica, qualidade de crédito, a idade dos saldos de contas a receber e condições econômicas atuais que podem afetar a capacidade de pagamento de um cliente.

(e) Financiamento de Recebíveis e Garantias.

A Companhia fornece acordos financeiros, incluindo arrendamentos, contratos de serviços financiados e empréstimos, para que determinados clientes qualificados construam, mantenham e atualizem suas redes. Os recebíveis de arrendamentos representam basicamente arrendamentos de tipo de venda e de financiamento direto. Arrendamentos e empréstimos normalmente têm prazos de dois a três anos e geralmente são garantidos por uma garantia mobiliária nos ativos subjacentes. A Companhia mantém uma provisão para recebíveis de financiamento incobráveis com base em vários fatores, incluindo a classificação de risco da carteira, condições macroeconômicas, experiência histórica e outros fatores de mercado. A Companhia também fornece garantias de financiamento, que geralmente são para vários acordos de financiamento de terceiros para canalizar parceiros e outros clientes. A Companhia poderia ser chamada para efetuar o pagamento sob essas garantias em caso de não pagamento a terceiros. Veja a Nota 6.

(f) Depreciação e Amortização.

O imobilizado é registrado ao custo, menos depreciação e amortização acumuladas. A depreciação e a amortização são calculadas pelo método linear durante os seguintes períodos:

(g) Ágio e ativos intangíveis adquiridos.

O ágio é testado para perda de valor anualmente e durante o período entre os testes anuais em determinadas circunstâncias, e baixado quando prejudicado. Com base nos testes de deterioração realizados, não houve redução no valor do ágio no exercício fiscal de 2008, 2007 ou 2006. Os ativos intangíveis adquiridos, exceto o ágio, são amortizados ao longo de suas vidas úteis, a menos que essas vidas sejam consideradas indefinidas. Os ativos intangíveis adquiridos são registrados ao custo, deduzido da amortização acumulada. A amortização é calculada ao longo da vida útil estimada dos respectivos ativos, geralmente de dois a sete anos.

(h) Imparidade de Activos de Vida Longa.

Ativos de vida longa e certos ativos intangíveis identificáveis a serem mantidos e utilizados são revisados para a verificação de impairment sempre que eventos ou mudanças nas circunstâncias indicarem que o valor contábil de tais ativos pode não ser recuperável. A determinação da recuperabilidade de ativos de longa duração é baseada em uma estimativa de fluxos de caixa futuros não descontados, resultante do uso do ativo e sua eventual alienação. A mensuração de uma perda por redução ao valor recuperável para ativos de longa duração e certos ativos intangíveis identificáveis que a administração espera deter e usar se baseia no valor justo do ativo. Ativos de vida longa e certos ativos intangíveis identificáveis a serem alienados são registrados pelo menor valor entre o valor contábil e o valor justo menos custos de venda.

(i) Instrumentos Derivativos.

A Companhia reconhece instrumentos derivativos como ativos ou passivos e mensura esses instrumentos ao valor justo. A contabilização de mudanças no valor justo de um derivativo depende do uso pretendido do derivativo e da designação resultante. Para um instrumento derivativo designado como hedge de valor justo, o ganho ou a perda é reconhecido no resultado no período da mudança juntamente com a perda ou ganho compensatório sobre o item coberto atribuído ao risco que está sendo protegido. Para um instrumento derivativo designado como hedge de fluxo de caixa, a parcela efetiva do ganho ou perda do derivativo é inicialmente reportada como um componente de outros resultados abrangentes acumulados e subseqüentemente reclassificada no resultado quando a exposição protegida afeta os resultados. A parte ineficaz do ganho ou perda é reportada nos lucros imediatamente. Para instrumentos derivativos que não são designados como hedge contábil, mudanças no valor justo são reconhecidas no resultado no período da mudança.

(j) Valor Justo de Instrumentos Financeiros.

O valor justo de determinados instrumentos financeiros da Companhia, incluindo caixa e equivalentes de caixa, remuneração acumulada e outros passivos circulantes, aproxima-se do valor contábil por causa de seus vencimentos curtos. Além disso, o valor justo dos recebíveis de empréstimos da Companhia e contratos de serviços financiados também se aproximam do valor contábil. Os valores justos dos investimentos de renda fixa, dos títulos patrimoniais de capital aberto e da dívida de longo prazo da Companhia são determinados utilizando preços cotados no mercado para esses títulos ou instrumentos financeiros similares.

(k) Participação Minoritária.

A Companhia consolida seu investimento em um fundo de capital de risco administrado pela SOFTBANK Corp. e suas afiliadas (& SO SOFTBANK & rdquo;). Em 26 de julho de 2008, a participação minoritária de US $ 49 milhões representa a participação do SOFTBANK no fundo de capital de risco.

(l) Conversão de moeda estrangeira.

Ativos e passivos de subsidiárias estrangeiras que operam em moeda nacional, onde a moeda nacional é a moeda funcional, são convertidos para dólares norte-americanos pelas taxas de câmbio em vigor na data do balanço, com os ajustes de conversão resultantes registrados diretamente em uma moeda. componente separado do outro rendimento integral acumulado. As contas de receita e despesa são convertidas pelas taxas de câmbio médias durante o ano. Os ajustes de remensuração são registrados em outros resultados, líquidos.

(m) Concentrações de Risco.

Caixa e equivalentes de caixa são mantidos em diversas instituições financeiras. Depósitos mantidos com bancos podem exceder o valor do seguro fornecido sobre tais depósitos. Geralmente, esses depósitos podem ser resgatados sob demanda e são mantidos com instituições financeiras com crédito de boa reputação e, portanto, possuem risco de crédito mínimo. A Companhia busca mitigar esses riscos, distribuindo seu risco por várias contrapartes e monitorando os perfis de risco dessas contrapartes.

A Companhia realiza avaliações de crédito contínuas de seus clientes e, com exceção de certas transações de financiamento, não exige garantia de seus clientes. Os clientes da empresa estão principalmente nos mercados corporativo, de prestação de serviços e comercial. A Companhia recebe alguns de seus componentes de fornecedores exclusivos. Além disso, a empresa conta com um número limitado de fabricantes e fornecedores contratados para fornecer serviços de fabricação para seus produtos. A incapacidade de um fabricante ou fornecedor contratado para atender aos requisitos de suprimento da Companhia poderia afetar materialmente os resultados operacionais futuros.

(n) Reconhecimento de receita.

Os produtos da empresa geralmente são integrados com software essencial para a funcionalidade do equipamento. Além disso, a Companhia fornece atualizações e aprimoramentos de software não especificados relacionados ao equipamento por meio de seus contratos de manutenção para a maioria de seus produtos. Assim, a Empresa contabiliza a receita de acordo com a Declaração de Posição No. 97-2, "Reconhecimento de Receita de Software", & rdquo; e todas as interpretações relacionadas. Para as vendas de produtos onde o software é incidental ao equipamento, ou em acordos de hospedagem, a Empresa aplica as disposições do Boletim de Contabilidade do Pessoal No. 104, "Reconhecimento de Receitas", & nbsp; e todas as interpretações relacionadas.

A Companhia reconhece a receita quando há evidência persuasiva de um acordo, a entrega ocorreu, a taxa é fixa ou determinável e a cobrança é razoavelmente assegurada. Nos casos em que a aceitação final do produto, sistema ou solução é especificada pelo cliente, a receita é diferida até que todos os critérios de aceitação tenham sido atendidos. A receita de serviços de suporte técnico é diferida e reconhecida proporcionalmente ao longo do período durante o qual os serviços serão executados, o que normalmente é de um a três anos. A receita de serviços avançados é reconhecida no momento da entrega ou da conclusão do desempenho.

Quando uma venda envolve vários elementos, como vendas de produtos que incluem serviços, toda a taxa do contrato é alocada para cada elemento respectivo com base no valor justo relativo e reconhecida quando os critérios de reconhecimento de receita para cada elemento são atendidos. O valor justo de cada elemento é estabelecido com base no preço de venda cobrado quando o mesmo elemento é vendido separadamente.

A empresa usa distribuidores que armazenam estoques e geralmente vendem para integradores de sistemas, provedores de serviços e outros revendedores. Além disso, certos produtos são vendidos através de parceiros varejistas. A Companhia refere-se a essas vendas através de distribuidores e parceiros de varejo como seu sistema de vendas de dois níveis para o cliente final. A receita de distribuidores e parceiros de varejo é reconhecida com base em um método de venda por meio de informações fornecidas por eles. Distribuidores e parceiros varejistas participam de vários programas de marketing cooperativo e outros, e a Companhia mantém provisões e provisões estimadas para esses programas. A Empresa acumula custos de garantia, devoluções de vendas e outras licenças com base em sua experiência histórica.

(o) Custos de Publicidade.

A Companhia contabiliza todos os custos de publicidade quando incorridos. Os custos de publicidade não foram significativos para todos os anos apresentados.

(p) Despesa de Remuneração Baseada em Ações.

O SFAS 123 requer a mensuração e reconhecimento de despesas de remuneração para todas as concessões de pagamento baseado em ações feitas a funcionários e diretores, incluindo opções de ações de funcionários e compras de ações de funcionários relacionadas ao Plano de Compra de Ações do Funcionário (baseado em direitos de compra de funcionários). sobre os valores justos estimados. O SFAS 123 (R) exige que as empresas estipulem o valor justo dos prêmios de pagamento baseado em ações na data da concessão, usando um modelo de precificação de opções. O valor dos prêmios que, em última instância, devem ser investidos é reconhecido como despesa durante os períodos de serviço exigidos nas Declarações de Operações Consolidadas da Companhia.

Despesas com remuneração com base em ações reconhecidas nas Demonstrações de Operações Consolidadas da Companhia para todos os exercícios apresentados incluíram despesas de remuneração de benefícios baseados em ações concedidas antes, mas ainda não concedidas em 30 de julho de 2005 com base na data da concessão. estimados de acordo com as provisões pro forma do SFAS 123, e despesas de remuneração para os prêmios de pagamento baseado em ações concedidos após 30 de julho de 2005 com base na data de concessão estimados de acordo com as disposições do SFAS 123 (R). Em conjunto com a adoção do SFAS 123 (R) no início do exercício fiscal de 2006, a Companhia alterou seu método de atribuir o valor da remuneração baseada em ações às despesas da abordagem de opção múltipla acelerada ao método de opção única linear . Despesas de remuneração para todos os prêmios de pagamento baseados em ações concedidos até 30 de julho de 2005 continuarão a ser reconhecidos usando a abordagem de opção múltipla acelerada, enquanto as despesas de remuneração para todos os prêmios de pagamento baseado em ações concedidas após 30 de julho de 2005 são reconhecidas usando o método de opção única de linha reta. Como a despesa de compensação baseada em ações reconhecida nas Demonstrações Consolidadas de Operações é baseada em prêmios que devem ser adquiridos, ela foi reduzida por confiscos.

Após a adoção do SFAS 123 (R), a Companhia também alterou seu método de avaliação para prêmios baseados em ações concedidos a partir do ano fiscal de 2006 para um modelo binômio de precificação de opções (modelo lattice-binomial) do Black-Scholes. modelo de precificação de opções ("modelo Black-Scholes") anteriormente usado para as informações pro forma da Companhia exigidas pelo SFAS 123. A determinação do valor justo dos prêmios de pagamento baseado em ações na data de concessão usando um modelo de precificação de opções é afetado pelo preço da ação da empresa, bem como pelas suposições relativas a um número de variáveis altamente complexas e subjetivas. Essas variáveis incluem, mas não se limitam a, a volatilidade esperada do preço da ação da Companhia durante o prazo dos prêmios e os comportamentos dos exercícios de opções de ações de funcionários reais e projetados. Os modelos de precificação de opções foram desenvolvidos para uso na estimativa do valor das opções negociadas que não possuem restrições de vesting ou hedge e são totalmente transferíveis. Como as opções de ações de empregados da Companhia têm certas características que são significativamente diferentes das opções negociadas e como as mudanças nas premissas subjetivas podem afetar materialmente o valor estimado, na opinião da administração, os modelos de avaliação existentes podem não fornecer uma medida precisa do valor das opções negociadas. valor justo das opções de ações para empregados da Companhia. Embora o valor justo das opções de ações para empregados seja determinado de acordo com o SFAS 123 (R) e SAB 107 usando um modelo de precificação de opções, esse valor pode não ser indicativo do valor justo observado em uma transação de compra / venda voluntária.

A Companhia optou por aplicar o método de transição alternativo fornecido na Posição do Quadro de Funcionários do FASB No. FAS 123 (R) -3 'Eleição de Transição Relacionada à Contabilização dos Efeitos Fiscais dos Prêmios de Pagamento Baseado em Ações'. para cálculo dos efeitos fiscais da remuneração baseada em ações de acordo com o SFAS 123 (R). O método de transição alternativa inclui métodos simplificados para estabelecer o saldo inicial do pool de capital integralizado adicional (& quot; pool APIC & quot;) relacionado aos efeitos fiscais da remuneração baseada em ações de funcionários, e para determinar o impacto subsequente no pool APIC e Demonstrações Consolidadas de Fluxos de Caixa dos efeitos fiscais dos prêmios de compensação baseados em ações de funcionários que estão em circulação após a adoção do SFAS 123 (R).

(q) Custos de desenvolvimento de software.

Os custos de desenvolvimento de software precisam ser capitalizados de acordo com a Declaração de Padrões Contábeis Financeiros No. 86, "Contabilização dos Custos do Software de Computador a Serem Vendidos, Alugados ou de Qualquer Outra Forma Comercializados", & rdquo; não foram materiais até o momento. Custos de desenvolvimento de software para uso interno que devem ser capitalizados de acordo com a Declaração de Posição No. 98-1, "Contabilização dos Custos de Software de Computador Desenvolvido ou Obtido para Uso Interno", & rdquo; também não foram materiais até o momento.

(r) Imposto de Renda.

A despesa de imposto de renda é baseada na receita contábil financeira antes dos impostos. Impostos diferidos ativos e passivos são reconhecidos para os efeitos fiscais esperados de diferenças temporárias entre as bases fiscais de ativos e passivos e seus valores reportados. As provisões de avaliação são registradas para reduzir os ativos fiscais diferidos até o montante que será mais provável do que não ser realizado.

Em 29 de julho de 2007, a Companhia adotou o FIN 48, que é uma mudança na contabilização do imposto de renda. O FIN 48 contém uma abordagem em duas etapas para reconhecer e mensurar as posições fiscais incertas contabilizadas de acordo com o SFAS 109. O primeiro passo é avaliar a posição tributária para reconhecimento determinando se o peso da evidência disponível indica que é mais provável que não. que a posição será mantida na auditoria, incluindo a resolução de recursos relacionados ou processos de litígio, se houver. O segundo passo é mensurar o benefício fiscal como o maior valor que tem mais de 50% de probabilidade de ser realizado no momento da liquidação. A Companhia classificará o passivo por benefícios fiscais não reconhecidos como circulante na medida em que a Companhia antecipar o pagamento (ou recebimento) de caixa no prazo de um ano. Os juros e multas relacionados a posições fiscais incertas são reconhecidos na provisão para imposto de renda. Veja a Nota 13.

(s) Cálculo do Lucro Líquido por Ação.

O lucro líquido básico por ação é calculado utilizando o número médio ponderado de ações ordinárias em circulação durante o período. O lucro líquido diluído por ação é calculado utilizando a média ponderada de ações ordinárias e ações ordinárias potenciais diluidoras em circulação durante o período. As ações ordinárias potenciais diluidoras consistem principalmente em opções de ações para funcionários, ações restritas e unidades de estoque restritas.

Declaração de Padrões Contábeis Financeiros (SFAS) No. 128, & ldquo; Lucro por ação, & rdquo; exige que as opções de ações de capital de funcionários, ações não investidas e instrumentos de patrimônio semelhantes concedidos pela Companhia sejam tratados como ações ordinárias em circulação no cálculo do lucro diluído por ação. As ações diluídas incluem o efeito dilutivo das opções dentro do dinheiro, que é calculado com base no preço médio da ação para cada período fiscal, usando o método de ações em tesouraria. Segundo o método de ações em tesouraria, o valor que o empregado deve pagar pelo exercício das opções, o valor do custo da remuneração para serviços futuros que a Companhia ainda não reconheceu e o valor dos benefícios fiscais que seriam registrados no capital adicional quando o prêmio se torna dedutível é assumido para ser usado para recomprar ações.

(t) Consolidação de Entidades de Interesse Variável.

O Financial Accounting Standards Board (FASB) emitiu a Interpretação No. 46 do FASB, “Consolidação de entidades de interesse variável”. (“FIN 46”), em janeiro de 2003. A FIN 46 exige que se uma entidade for a beneficiária primária de uma entidade de participação variável, os ativos, passivos e resultados das operações da entidade de participação variável devem ser incluídos nas demonstrações contábeis consolidadas. declarações da entidade. Interpretação do FASB No. 46 (R), “Consolidação de Entidades de Interesse Variável” (“FIN 46 (R)”), foi emitida em dezembro de 2003. A Companhia adotou o FIN 46 (R) em 24 de janeiro de 2004. Para informações adicionais sobre entidades de participação variável, veja a Nota 10.

(u) Uso de Estimativas.

A preparação de demonstrações financeiras e divulgações relacionadas em conformidade com os princípios contábeis geralmente aceitos nos Estados Unidos exige que a administração faça estimativas e julgamentos que afetam os valores reportados nas Demonstrações Contábeis Consolidadas e notas explicativas. As estimativas são usadas para o seguinte, entre outras:

Revenue recognition Allowance for doubtful accounts and sales returns Inventory valuation and liability for purchase commitments with contract manufacturers and suppliers Warranty costs Share-based compensation expense Investment impairments Goodwill impairments Income taxes Loss contingencies.

The actual results experienced by the Company may differ materially from management’s estimates.

(v) Recent Accounting Pronouncements.

In September 2006, the FASB issued SFAS No. 157, “Fair Value Measurements” (“SFAS 157”). SFAS 157 defines fair value, establishes a framework for measuring fair value, and enhances fair value measurement disclosure. In February 2008, the FASB issued FASB Staff Position (“FSP”) 157-1, “Application of FASB Statement No. 157 to FASB Statement No. 13 and Other Accounting Pronouncements That Address Fair Value Measurements for Purposes of Lease Classification or Measurement under Statement 13” (“FSP 157-1”) and FSP 157-2, “Effective Date of FASB Statement No. 157” (“FSP 157-2”). FSP 157-1 amends SFAS 157 to remove certain leasing transactions from its scope. FSP 157-2 delays the effective date of SFAS 157 for all nonfinancial assets and nonfinancial liabilities, except for items that are recognized or disclosed at fair value in the financial statements on a recurring basis (at least annually), until the beginning of the first quarter of fiscal 2010. The measurement and disclosure requirements related to financial assets and financial liabilities are effective for the Company in the first quarter of fiscal 2009. The adoption of SFAS 157 for financial assets and financial liabilities is not expected to have a material impact on the Company’s results of operations or financial position. The Company is currently assessing the impact that SFAS 157 will have on its results of operations and financial position when it is applied to nonfinancial assets and nonfinancial liabilities beginning in the first quarter of fiscal 2010.

In February 2007, the FASB issued SFAS No. 159, “The Fair Value Option for Financial Assets and Financial Liabilities—Including an amendment of FASB Statement No. 115” (“SFAS 159”). SFAS 159 is expected to expand the use of fair value accounting but does not affect existing standards that require certain assets or liabilities to be carried at fair value. The objective of SFAS 159 is to improve financial reporting by providing companies with the opportunity to mitigate volatility in reported earnings caused by measuring related assets and liabilities differently without having to apply complex hedge accounting provisions. Under SFAS 159, a company may choose, at specified election dates, to measure eligible items at fair value and report unrealized gains and losses on items for which the fair value option has been elected in earnings at each subsequent reporting date. SFAS 159 is effective for the Company in the first quarter of fiscal 2009, and it is not expected to have a material impact on the Company’s results of operations or financial position.

SFAS 141(R) and SFAS 160.

In December 2007, the FASB issued SFAS No. 141 (revised 2007), “Business Combinations” (“SFAS 141(R)”) and SFAS No. 160, “Noncontrolling Interests in Consolidated Financial Statements—an amendment of ARB No. 51” (“SFAS 160”). SFAS 141(R) will significantly change current practices regarding business combinations. Among the more significant changes, SFAS 141(R) expands the definition of a business and a business combination; requires the acquirer to recognize the assets acquired, liabilities assumed and noncontrolling interests (including goodwill), measured at fair value at the acquisition date; requires acquisition-related expenses and restructuring costs to be recognized separately from the business combination; requires assets acquired and liabilities assumed from contractual and noncontractual contingencies to be recognized at their acquisition-date fair values with subsequent changes recognized in earnings; and requires in-process research and development to be capitalized at fair value as an indefinite-lived intangible asset. SFAS 160 will change the accounting and reporting for minority interests, reporting them as equity separate from the parent entity’s equity, as well as requiring expanded disclosures. SFAS 141(R) and SFAS 160 are effective for financial statements issued for fiscal years beginning after December 15, 2008. The Company is currently assessing the impact that SFAS 141(R) and SFAS 160 will have on its results of operations and financial position.

In March 2008, the FASB issued SFAS No. 161, “Disclosures about Derivative Instruments and Hedging Activities, an amendment of FASB Statement No. 133” (“SFAS 161”), which requires additional disclosures about the objectives of using derivative instruments; the method by which the derivative instruments and related hedged items are accounted for under FASB Statement No.133 and its related interpretations; and the effect of derivative instruments and related hedged items on financial position, financial performance, and cash flows. SFAS 161 also requires disclosure of the fair values of derivative instruments and their gains and losses in a tabular format. SFAS 161 is effective for financial statements issued for fiscal years and interim periods beginning after November 15, 2008, with early adoption encouraged. The Company is currently assessing the impact that the adoption of SFAS 161 will have on its financial statement disclosures.

(w) Reclassifications.

Certain reclassifications have been made to prior year balances in order to conform to the current year’s presentation.

3. Business Combinations.

(a) Purchase Acquisitions.

Under the terms of the definitive agreements related to the Company’s purchase acquisitions and asset purchases completed during fiscal 2008, 2007, and 2006, the purchase consideration consisted of one or more of cash, shares of Cisco common stock, and fully vested stock options assumed.

A summary of the purchase acquisitions and asset purchases completed in fiscal 2008, 2007, and 2006 is as follows (in millions):

The purchase consideration for the Company’s purchase acquisitions and asset purchases is also allocated to tangible assets acquired and liabilities assumed.

Fiscal 2008.

The Company acquired Navini Networks, Inc. to extend the Company’s WiMAX solutions for service providers. The Company acquired Securent, Inc. to allow the Company to offer its enterprise customers policy management software solutions, which are designed to allow enterprises to administer, enforce, and audit access to data, communications, and applications across different types of information technology (IT) environments.

Fiscal 2007.

The Company acquired Arroyo Video Solutions, Inc. to enable carriers to accelerate the creation and distribution of network-delivered entertainment, interactive media, and advertising services across the growing portfolio of televisions, personal computers, and mobile handsets. The Company acquired IronPort Systems, Inc. to extend the Company’s security portfolio in email and messaging security solutions. The Company acquired Reactivity, Inc. to complement and extend the Company’s application networking services portfolio within advanced technologies. The Company acquired WebEx Communications, Inc., a provider of on-demand collaboration applications. WebEx’s network-based solution for delivering business-to-business collaboration extends the Company’s unified communications portfolio, particularly within the small and medium-sized business (SMB) market.

Fiscal 2006.

The Company acquired KiSS Technology A/S to develop networked entertainment products for the consumer. The Company acquired Scientific-Atlanta, Inc. to create an end-to-end solution for carrier networks and the digital home and deliver large-scale video systems to extend Cisco’s commitment to and leadership in the service provider market. The Company acquired Sheer Networks, Inc. to provide technology that is designed to adapt to network changes, scale to large networks, and help extend new technologies and services that simplify the task of monitoring and maintaining complex networks.

The Consolidated Financial Statements include the operating results of each business from the date of acquisition. Pro forma results of operations for the acquisitions other than Scientific-Atlanta completed during fiscal 2008, 2007, and 2006 have not been presented because the effects of the acquisitions, individually or in the aggregate, were not material to the Company’s financial results. The pro forma results of Scientific-Atlanta are presented below.

(b) Acquisition of Scientific-Atlanta, Inc.

On February 24, 2006, Cisco completed the acquisition of Scientific-Atlanta, Inc., a provider of set-top boxes, end-to-end video distribution networks, and video integration systems. The financial information in the table below summarizes the combined results of operations of Cisco and Scientific-Atlanta, on a pro forma basis, as though the companies had been combined as of the beginning of fiscal 2006. The unaudited pro forma financial information combines the historical results of operations of Cisco for fiscal 2006, which include the results of operations of Scientific-Atlanta subsequent to February 24, 2006, and the historical results of operations of Scientific-Atlanta for the six months ended December 30, 2005 and the month ended February 24, 2006.

This information is presented for informational purposes only and is not indicative of the results of operations that would have been achieved if the acquisition of Scientific-Atlanta and issuance of $6.5 billion of debt (see Note 8) had taken place at the beginning of fiscal 2006. The debt was issued to finance the acquisition of Scientific-Atlanta as well as for general corporate purposes. For the purposes of this pro forma financial information, the interest expense on the entire debt, including the effects of hedging, were included in the pro forma financial adjustments. The pro forma financial information also included incremental share-based compensation expense due to the acceleration of Scientific-Atlanta employee stock options prior to the acquisition date, investment banking fees, and other acquisition-related costs, recorded in Scientific-Atlanta’s historical results of operations during February 2006. In addition, the pro forma financial information also included the purchase accounting adjustments on historical Scientific-Atlanta inventory, adjustments to depreciation on acquired property and equipment, a charge for in-process research and development, amortization charges from acquired intangible assets, adjustments to interest income, and related tax effects.

The following table summarizes the pro forma financial information (in millions, except per-share amounts):

The following table presents the compensation expense related to acquisitions and investments (in millions):

Share-Based Compensation Expense.

Beginning in fiscal 2006, share-based compensation related to acquisitions and investments is measured under SFAS 123(R) and includes deferred share-based compensation relating to acquisitions completed prior to fiscal 2006. As of July 26, 2008, the remaining balance of share-based compensation related to acquisitions and investments to be recognized over the vesting periods was $245 million.

Cash Compensation Expense.

In connection with the Company’s purchase acquisitions, asset purchases, and acquisitions of variable interest entities, the Company has agreed to pay certain additional amounts contingent upon the achievement of certain agreed-upon technology, development, product, or other milestones, or the continued employment with the Company of certain employees of the acquired entities. In each case, any additional amounts paid will be recorded as compensation expense. As of July 26, 2008, the Company may be required to recognize future compensation expense pursuant to these agreements of up to $558 million, including the remaining potential amount of additional compensation expense related to Nuova Systems, Inc., as discussed below.

Nuova Systems, Inc.

During fiscal 2008, the Company purchased the remaining interests in Nuova Systems, Inc. not previously held by the Company, representing approximately 20% of Nuova Systems. Under the terms of the merger agreement, the former minority interest holders of Nuova Systems are eligible to receive up to three milestone payments based on agreed-upon formulas. As a result, during 2008 the Company recorded compensation expense of $277 million related to the fair value of amounts that are expected to be earned by the minority interest holders pursuant to a vesting schedule. Actual amounts payable to the former minority interest holders of Nuova Systems will depend upon achievement under the agreed-upon formulas.

Subsequent changes to the fair value of the amounts probable of being earned and the continued vesting will result in adjustments to the recorded compensation expense. The potential amount that could be recorded as compensation expense may be up to a maximum of $678 million, including the amount that has been expensed as of the end of fiscal 2008. The compensation is expected to be paid during fiscal 2010 through fiscal 2012.

4. Goodwill and Purchased Intangible Assets.

(a) Goodwill.

The following tables present the changes in goodwill allocated to the Company’s reportable segments during fiscal 2008 and 2007 (in millions):

In the table above, “Other” primarily includes foreign currency translation and purchase accounting adjustments.

(b) Purchased Intangible Assets.

The following tables present details of the purchased intangible assets acquired through acquisitions during fiscal 2008 and 2007 (in millions, except years):

The following tables present details of the Company’s purchased intangible assets (in millions):

(1) The technology category for the year ended July 26, 2008 includes technology intangible assets acquired through business combinations as well as technology licenses.

The following table presents the amortization of purchased intangible assets (in millions):

During the years ended July 26, 2008 and July 29, 2006, the Company recorded impairment charges of $33 million and $69 million, respectively, from write-downs of purchased intangible assets primarily related to certain technology and customer relationships due to reductions in expected future cash flows, and the amounts were recorded as amortization of purchased intangible assets.

The estimated future amortization expense of purchased intangible assets as of July 26, 2008, is as follows (in millions):

5. Balance Sheet Details.

The following tables provide details of selected balance sheet items (in millions):

6. Financing Receivables and Guarantees.

(a) Lease Receivables.

Lease receivables represent sales-type and direct-financing leases resulting from the sale of the Company’s and complementary third-party products. These lease arrangements typically have terms from two to three years and are generally collateralized by a security interest in the underlying assets. The net lease receivables are summarized as follows (in millions):

Contractual maturities of the gross lease receivables at July 26, 2008 were $655 million in fiscal 2009, $514 million in fiscal 2010, $328 million in fiscal 2011, $160 million in fiscal 2012, and $73 million in fiscal 2013 and thereafter. Actual cash collections may differ from the contractual maturities due to early customer buyouts, refinancings, or defaults.

(b) Financed Service Contracts.

Financed service contracts are summarized as follows (in millions):

The revenue related to financed service contracts, which primarily relates to technical support services, is deferred and included in deferred service revenue. The revenue is recognized ratably over the period during which the related services are to be performed, which is typically from one to three years.

Loan receivables are summarized as follows (in millions):

A portion of the revenue related to loan receivables is deferred and included in deferred product revenue based on revenue recognition criteria.

(d) Financing Guarantees.

The Company provides financing guarantees, which are generally for various third-party financing arrangements extended to channel partners and other customers. The Company could be called upon to make payment under these guarantees in the event of nonpayment to the third party. As of July 26, 2008, the total maximum potential future payments related to these guarantees was approximately $830 million, of which approximately $610 million was recorded as deferred revenue on the consolidated balance sheet in accordance with revenue recognition policies and FIN 45.

7. Investments.

(a) Summary of Investments.

The following tables summarize the Company’s investments (in millions):

(b) Gains and Losses on Investments.

The following table presents gross realized gains and losses related to the Company’s investments (in millions):

The following tables present the breakdown of the investments with unrealized losses at July 26, 2008 and July 28, 2007 (in millions):

The gross unrealized losses related to fixed income securities as of July 26, 2008 were primarily due to changes in interest rates and credit market conditions. The gross unrealized losses related to publicly traded equity securities as of July 26, 2008 were due to changes in market prices. The Company’s management has determined that the gross unrealized losses on its investment securities at July 26, 2008 are temporary in nature. The Company reviews its investments to identify and evaluate investments that have indications of possible impairment. Factors considered in determining whether a loss is temporary include the length of time and extent to which fair value has been less than the cost basis, the financial condition and near-term prospects of the investee, and the Company’s intent and ability to hold the investment for a period of time sufficient to allow for any anticipated recovery in market value. Substantially all of the Company’s fixed income securities are rated investment grade.

The following table summarizes the maturities of the Company’s fixed income securities at July 26, 2008 (in millions):

Actual maturities may differ from the contractual maturities because borrowers may have the right to call or prepay certain obligations.

8. Borrowings.

(a) Long-Term Debt.

In February 2006, the Company issued $500 million of senior floating interest rate notes based on LIBOR due 2009 (the “2009 Notes”), $3.0 billion of 5.25% senior notes due 2011 (the “2011 Notes”), and $3.0 billion of 5.50% senior notes due 2016 (the “2016 Notes”), for an aggregate principal amount of $6.5 billion. The following table summarizes the Company’s long-term debt (in millions, except percentages):

Upon termination during fiscal 2008 of the interest rate swaps entered into in connection with the 2011 Notes and the 2016 Notes, the Company received proceeds of $432 million, net of accrued interest, which was recorded as a hedge accounting adjustment of the carrying amount of the fixed-rate debt and which is being amortized as a reduction to interest expense over the remaining terms of the fixed-rate notes. The effective rates for the 2011 Notes and the 2016 Notes as of July 26, 2008 include the fixed rate interest on the notes, the amortization of the hedge accounting adjustment and the accretion of the discount. The effective rates for the 2011 Notes and the 2016 Notes as of July 28, 2007 included the variable rate in effect as of the period end on the interest rate swaps and the accretion of the discount.

The 2011 Notes and the 2016 Notes are redeemable by the Company at any time, subject to a make-whole premium. During fiscal 2008, the Company reclassified the 2009 Notes to the current portion of long-term debt. Based on market prices, the fair value of the Company’s long-term debt, including the current portion of long-term debt, was $6.6 billion as of July 26, 2008. The Company was in compliance with all debt covenants as of July 26, 2008.

Interest is payable quarterly on the 2009 Notes and semi-annually on the 2011 Notes and 2016 Notes. Interest expense and cash paid for interest are summarized as follows (in millions):

(b) Credit Facility.

In August 2007 the Company entered into a credit agreement with certain institutional lenders that provides for a $3.0 billion unsecured revolving credit facility that is scheduled to expire on August 17, 2012. Any advances under the credit agreement will accrue interest at rates that are equal to, based on certain conditions, either (i) the higher of the Federal Funds rate plus 0.50% or Bank of America’s “prime rate” as announced from time to time, or (ii) LIBOR plus a margin that is based on the Company’s senior debt credit ratings as published by Standard & Poor’s Ratings Services and Moody’s Investors Service, Inc. The credit agreement requires that the Company maintain an interest coverage ratio as defined in the agreement. As of July 26, 2008, the Company was in compliance with the required interest coverage ratio and the Company had not borrowed any funds under the credit facility. The Company may also, upon the agreement of either the then existing lenders or of additional lenders not currently parties to the agreement, increase the commitments under the credit facility up to a total of $5.0 billion and/or extend the expiration date of the credit facility up to August 15, 2014.

9. Derivative Instruments.

The Company uses derivative instruments primarily to manage exposures to foreign currency, interest rate, and equity security price risks. The Company’s primary objective in holding derivatives is to reduce the volatility of earnings and cash flows associated with changes in foreign currency, interest rates, and equity security prices. The Company’s derivatives expose it to credit risk to the extent that the counterparties may be unable to meet the terms of the agreement. The Company seeks to mitigate such risks by limiting its counterparties to major financial institutions. In addition, the potential risk of loss with any one counterparty resulting from this type of credit risk is monitored. Management does not expect material losses as a result of defaults by counterparties.

(a) Foreign Currency Derivatives.

The Company’s foreign exchange forward and option contracts are summarized as follows (in millions):

The Company conducts business globally in numerous currencies. As such, it is exposed to adverse movements in foreign currency exchange rates. To limit the exposure related to foreign currency changes, the Company enters into foreign currency contracts. The Company does not enter into foreign exchange forward or option contracts for trading purposes.

The Company enters into foreign exchange forward contracts to reduce the short-term effects of foreign currency fluctuations on assets and liabilities such as foreign currency receivables, including long-term customer financings, investments, and payables. Gains and losses on the contracts are included in other income (loss), net, and offset foreign exchange gains and losses from the revaluation of intercompany balances or other current assets, investments, or liabilities denominated in currencies other than the functional currency of the reporting entity. The Company’s foreign exchange forward contracts related to current assets and liabilities generally range from one to three months in original maturity. Additionally, the Company has entered into foreign exchange forward contracts with maturities of up to two years related to long-term customer financings. The foreign exchange forward contracts related to investments generally have maturities of less than two years. The Company also hedges certain net investments in its foreign subsidiaries with forward contracts which generally have maturities of less than six months.

The Company hedges certain foreign currency forecasted transactions related to certain operating expenses with currency options and forward contracts. These currency option and forward contracts generally have maturities of less than 18 months and these transactions are designated as cash flow hedges. The effective portion of the derivative’s gain or loss is initially reported as a component of accumulated other comprehensive income and subsequently reclassified into earnings when the hedged exposure affects earnings. The ineffective portion, if any, of the gain or loss is reported in earnings immediately. During fiscal 2008, 2007, and 2006, there were no significant gains or losses recognized in earnings for hedge ineffectiveness. The Company did not discontinue any hedges during any of the years presented because it was probable that the original forecasted transactions would not occur.

(b) Interest Rate Derivatives.

The Company’s interest rate derivatives are summarized as follows (in millions):

The Company’s primary objective for holding fixed income securities is to achieve an appropriate investment return consistent with preserving principal and managing risk. To realize these objectives, the Company may utilize interest rate swaps or other derivatives designated as fair value or cash flow hedges.

Interest Rate Swaps, Investments.

The Company is currently a party to $1.0 billion of interest rate swaps designated as fair value hedges of its investment portfolio. Under these interest rate swap contracts, the Company makes fixed-rate interest payments and receives interest payments based on LIBOR. The effect of these swaps is to convert fixed-rate returns to floating-rate returns based on LIBOR for a portion of the Company’s fixed income portfolio. The gains and losses related to changes in the value of the interest rate swaps are included in other income (loss), net, and offset the changes in fair value of the underlying hedged investment. The fair values of the interest rate swaps designated as hedges of the Company’s investments are reflected in prepaid expenses and other current assets or other current liabilities.

Interest Rate Swaps, Long-Term Debt.

In conjunction with its issuance of fixed-rate senior notes in February 2006, the Company entered into $6.0 billion of interest rate swaps designated as fair value hedges of the fixed-rate debt. The effect of these swaps was to convert fixed-rate interest expense to floating-rate interest expense based on LIBOR. During fiscal 2008, the Company terminated the $6.0 billion of interest rate swaps and received proceeds of $432 million, net of accrued interest, which was recorded as a hedge accounting adjustment of the carrying amount of the fixed-rate debt and is amortized as a reduction to interest expense over the remaining terms of the fixed-rate notes. While such interest rate swaps were in effect, their fair values were reflected in other assets or other long-term liabilities and the gains and losses related to changes in the value of such interest rate swaps were included in other income (loss), net, and offset the changes in fair value of the underlying debt.

The Company’s equity derivatives are summarized as follows (in millions):

The Company maintains a portfolio of publicly traded equity securities which are subject to price risk. The Company may hold equity securities for strategic purposes or to diversify the Company’s overall investment portfolio. To manage its exposure to changes in the fair value of certain equity securities, the Company may enter into equity derivatives, including forward sale and option agreements. As of July 26, 2008, the Company had entered into forward sale agreements on certain publicly traded equity securities designated as fair value hedges. The gains and losses due to changes in the value of the hedging instruments are included in other income (loss), net, and offset the change in the fair value of the underlying hedged investment. The fair values of the equity derivatives are reflected in prepaid expenses and other current assets and other current liabilities.

10. Commitments and Contingencies.

(a) Operating Leases.

The Company leases office space in several U. S. locations. Outside the United States, larger leased sites include sites in Australia, Belgium, Canada, China, France, Germany, India, Israel, Italy, Japan, and the United Kingdom. Rent expense totaled $291 million, $219 million, and $181 million in fiscal 2008, 2007, and 2006, respectively. Future annual minimum lease payments under all noncancelable operating leases with an initial term in excess of one year as of July 26, 2008 are as follows (in millions):

(b) Purchase Commitments with Contract Manufacturers and Suppliers.

The Company purchases components from a variety of suppliers and uses several contract manufacturers to provide manufacturing services for its products. During the normal course of business, in order to manage manufacturing lead times and help ensure adequate component supply, the Company enters into agreements with contract manufacturers and suppliers that either allow them to procure inventory based upon criteria as defined by the Company or that establish the parameters defining the Company’s requirements. In certain instances, these agreements allow the Company the option to cancel, reschedule, and adjust the Company’s requirements based on its business needs prior to firm orders being placed. Consequently, only a portion of the Company’s reported purchase commitments arising from these agreements are firm, noncancelable, and unconditional commitments. As of July 26, 2008 and July 28, 2007, the Company had total purchase commitments for inventory of $2.7 billion and $2.6 billion, respectively.

In addition to the above, the Company records a liability for firm, noncancelable, and unconditional purchase commitments for quantities in excess of its future demand forecasts consistent with the valuation of the Company’s excess and obsolete inventory. As of July 26, 2008 and July 28, 2007, the liability for these purchase commitments was $184 million and $168 million, respectively, and was included in other current liabilities.

(d) Other Commitments.

The Company also has certain funding commitments primarily related to its investments in privately held companies and venture funds, some of which are based on the achievement of certain agreed-upon milestones, and some of which are required to be funded on demand. The funding commitments were approximately $359 million and $140 million as of July 26, 2008 and July 28, 2007, respectively.

(e) Variable Interest Entities.

In the ordinary course of business, the Company has investments in privately held companies and provides financing to certain customers through its wholly owned subsidiaries, which may be considered to be variable interest entities. The Company has evaluated its investments in these privately held companies and customer financings and determined that there were no significant unconsolidated variable interest entities as of July 26, 2008.

(f) Guarantees and Product Warranties.

The following table summarizes the activity related to the product warranty liability during fiscal 2008 and 2007 (in millions):

The Company accrues for warranty costs as part of its cost of sales based on associated material product costs, labor costs for technical support staff, and associated overhead. The products sold are generally covered by a warranty for periods ranging from 90 days to five years, and for some products the Company provides a limited lifetime warranty.

In the normal course of business, the Company indemnifies other parties, including customers, lessors, and parties to other transactions with the Company, with respect to certain matters. The Company has agreed to hold the other parties harmless against losses arising from a breach of representations or covenants, or out of intellectual property infringement or other claims made against certain parties. These agreements may limit the time within which an indemnification claim can be made and the amount of the claim. In addition, the Company has entered into indemnification agreements with its officers and directors, and the Company’s bylaws contain similar indemnification obligations to the Company’s agents. It is not possible to determine the maximum potential amount under these indemnification agreements due to the Company’s limited history with prior indemnification claims and the unique facts and circumstances involved in each particular agreement. Historically, payments made by the Company under these agreements have not had a material effect on the Company’s operating results, financial position, or cash flows.

The Company also provides financing guarantees, which are generally for various third-party financing arrangements to channel partners and other customers. See Note 6. The Company’s other arrangements as of July 26, 2008 that were subject to recognition and disclosure requirements under FIN 45 were not material.

(g) Legal Proceedings.

The Company and other defendants were subject to claims asserted by Telcordia Technologies, Inc. on July 16, 2004 in the Federal District Court for the District of Delaware alleging that various Cisco routers, switches and optical products infringed United States Patent Nos. 4,893,306, 4,835,763, and Re 36,633. Telcordia sought damages and injunctive relief. The Court ruled that, as a matter of law, the Company does not infringe Patent No. 4,893,306. After conclusion of a trial, on May 10, 2007, a jury found that infringement had occurred on the other patents and awarded damages in an amount that is not material to the Company. The Company has asked the Court to reverse the verdict as a matter of law, and if necessary, the Company intends to appeal the decision. Telcordia has asked the Court to enhance damages and award it attorneys’ fees and also has the right to appeal. The Company believes that the ultimate outcome of this matter and aggregate potential damages will not be material.

Brazilian authorities are investigating certain employees of the Company’s Brazilian subsidiary and certain employees of a Brazilian importer of the Company’s products relating to the allegation of evading import taxes and other alleged improper transactions involving the subsidiary and the importer. The Company is conducting a thorough review of the matter. To date, Brazilian authorities have not asserted a claim against the Company. The Company is unable to determine the likelihood of an unfavorable outcome on any potential claims against it or to reasonably estimate a range of loss, if any. In addition, the Company is investigating the allegations regarding improper transactions, the Company has proactively communicated with United States authorities to provide information and report on its findings, and the United States authorities are currently investigating such allegations.

In addition, the Company is subject to legal proceedings, claims, and litigation arising in the ordinary course of business, including intellectual property litigation. While the outcome of these matters is currently not determinable, the Company does not expect that the ultimate costs to resolve these matters will have a material adverse effect on its consolidated financial position, results of operations, or cash flows.

11. Shareholders’ Capital próprio.

(a) Stock Repurchase Program.

In September 2001, the Company’s Board of Directors authorized a stock repurchase program. As of July 26, 2008, the Company’s Board of Directors had authorized an aggregate repurchase of up to $62 billion of common stock under this program and the remaining authorized repurchase amount was $8.4 billion with no termination date. The stock repurchase activity under the stock repurchase program in fiscal 2007 and 2008 is summarized as follows (in millions, except per-share amounts):

(1) Includes stock repurchases that were pending settlement as of period end.

The purchase price for the shares of the Company’s stock repurchased is reflected as a reduction to shareholders’ capital próprio. In accordance with Accounting Principles Board Opinion No. 6, “Status of Accounting Research Bulletins,” the Company is required to allocate the purchase price of the repurchased shares as (i) a reduction to retained earnings until retained earnings are zero and then as an increase to accumulated deficit and (ii) a reduction of common stock and additional paid-in capital. Issuance of common stock and the tax benefit related to employee stock incentive plans are recorded as an increase to common stock and additional paid-in capital.

(b) Other Repurchases of Common Stock.

The Company also repurchases shares in settlement of employee tax withholding obligations due upon the vesting of restricted stock or stock units.

Under the terms of the Company’s Articles of Incorporation, the Board of Directors may determine the rights, preferences, and terms of the Company’s authorized but unissued shares of preferred stock.

(d) Comprehensive Income.

The components of comprehensive income are as follows (in millions):

The Company consolidates its investment in a venture fund managed by SOFTBANK as the Company is the primary beneficiary as defined under FIN 46(R). As a result, SOFTBANK’s interest in the change in the unrealized gains and losses on the investments in the venture fund is recorded as a component of accumulated other comprehensive income and is reflected as a change in minority interest.

12. Employee Benefit Plans.

(a) Employee Stock Purchase Plan.

The Company has an Employee Stock Purchase Plan, which includes its subplan, the International Employee Stock Purchase Plan (together, the “Purchase Plan”), under which 321.4 million shares of the Company’s stock have been reserved for issuance. Eligible employees may purchase a limited number of shares of the Company’s stock at a discount of up to 15% of the lesser of the market value on the subscription date or the purchase date, which is approximately six months after the subscription date. The Purchase Plan terminates on January 3, 2010. The Company issued 19 million, 17 million, and 21 million shares under the Purchase Plan in fiscal 2008, 2007, and 2006, respectively. As of July 26, 2008, 63 million shares were available for issuance under the Purchase Plan.

(b) Employee Stock Incentive Plans.

Stock Incentive Plan Program Description.

As of July 26, 2008, the Company had five stock incentive plans: the 2005 Stock Incentive Plan (the “2005 Plan”); the 1996 Stock Incentive Plan (the “1996 Plan”); the 1997 Supplemental Stock Incentive Plan (the “Supplemental Plan”); the Cisco Systems, Inc. SA Acquisition Long-Term Incentive Plan (the “SA Acquisition Plan”); and the Cisco Systems, Inc. WebEx Acquisition Long-Term Incentive Plan (the “WebEx Acquisition Plan”). In addition, the Company has, in connection with the acquisitions of various companies, assumed the share-based awards granted under stock incentive plans of the acquired companies or issued share-based awards in replacement thereof. Share-based awards are designed to reward employees for their long-term contributions to the Company and provide incentives for them to remain with the Company. The number and frequency of share-based awards are based on competitive practices, operating results of the Company, government regulations, and other factors. Since the inception of the stock incentive plans, the Company has granted stock options to virtually all employees, and the majority has been granted to employees below the vice president level. The Company’s primary stock incentive plans are summarized as follows:

As amended on November 15, 2007, the maximum number of shares issuable under the 2005 Plan over its term is 559 million shares plus the amount of any shares underlying awards outstanding on November 15, 2007 under the 1996 Plan, the SA Acquisition Plan and the WebEx Acquisition Plan that are forfeited or are terminated for any other reason before being exercised or settled. However, any shares underlying awards outstanding on November 15, 2007 under the 1996 Plan, the SA Acquisition Plan, and the WebEx Acquisition Plan that expire unexercised at the end of their maximum terms will not be considered to become available for reissuance under the 2005 Plan. If any awards granted under the 2005 Plan are forfeited or are terminated for any other reason before being exercised or settled, then the shares underlying the awards will again be available under the 2005 Plan. The number of shares available for issuance under the 2005 Plan will be reduced by 2.5 shares for each share awarded as stock grants or stock units.

The 2005 Plan permits the granting of stock options, stock, stock units, and stock appreciation rights to employees (including employee directors and officers) and consultants of the Company and its subsidiaries and affiliates, and non-employee directors of the Company. Stock options granted under the 2005 Plan have an exercise price of at least 100% of the fair market value of the underlying stock on the grant date and expire no later than nine years from the grant date. The stock options will generally become exercisable for 20% or 25% of the option shares one year from the date of grant and then ratably over the following 48 or 36 months, respectively. Stock grants and stock units will generally vest with respect to 20% or 25% of the shares covered by the grant on each of the first through fifth or fourth anniversaries of the date of the grant, respectively. The Compensation and Management Development Committee of the Board of Directors has the discretion to use different vesting schedules. Stock appreciation rights may be awarded in combination with stock options or stock grants and such awards shall provide that the stock appreciation rights will not be exercisable unless the related stock options or stock grants are forfeited. Stock grants may be awarded in combination with non-statutory stock options, and such awards may provide that the stock grants will be forfeited in the event that the related non-statutory stock options are exercised.

The 1996 Plan expired on December 31, 2006, and the Company can no longer make equity awards under the 1996 Plan. The maximum number of shares issuable over the term of the 1996 Plan was 2.5 billion shares. Stock options granted under the 1996 Plan have an exercise price of at least 100% of the fair market value of the underlying stock on the grant date and expire no later than nine years from the grant date. The stock options generally become exercisable for 20% or 25% of the option shares one year from the date of grant and then ratably over the following 48 or 36 months, respectively. Certain other grants have utilized a 60-month ratable vesting schedule. In addition, the Board of Directors, or other committees administering the plan, have the discretion to use a different vesting schedule and have done so from time to time.

Supplemental Plan.

The Supplemental Plan expired on December 31, 2007, and the Company can no longer make equity awards under the Supplemental Plan. Officers and members of the Company’s Board of Directors were not eligible to participate in the Supplemental Plan. Nine million shares were reserved for issuance under the Supplemental Plan.

Acquisition Plans.

In connection with the Company’s acquisitions of Scientific-Atlanta and WebEx, the Company adopted the SA Acquisition Plan and the WebEx Acquisition Plan, respectively, each effective upon completion of the applicable acquisition. These plans constitute assumptions, amendments, restatements, and renamings of the 2003 Long-Term Incentive Plan of Scientific-Atlanta and the WebEx Communications, Inc. Amended and Restated 2000 Stock Incentive Plan, respectively. The plans permit the grant of stock options, stock, stock units, and stock appreciation rights to certain employees of the Company and its subsidiaries and affiliates who had been employed by Scientific-Atlanta or its subsidiaries or WebEx or its subsidiaries, as applicable. As a result of the shareholder approval of the amendment and extension of the 2005 Plan, as of November 15, 2007, the Company will no longer make stock option grants or direct share issuances under either the SA Acquisition Plan or the WebEx Acquisition Plan.

Dilutive Effect of Stock Options.

Weighted-average basic and diluted shares outstanding for fiscal 2008 were 6.0 billion shares and 6.2 billion shares, respectively. For the year ended July 26, 2008, the dilutive effect of potential common shares was approximately 177 million shares or 3.0% of the basic shares outstanding based on the Company’s average share price of $27.15.

The following table illustrates grant dilution computed based on net stock options granted as a percentage of shares of common stock outstanding at the fiscal year end (in millions, except percentages):

General Share-Based Award Information.

A summary of share-based award activity is as follows (in millions, except per-share amounts):

(1) The total pretax intrinsic value of stock options exercised during fiscal 2008, 2007, and 2006 was $1.6 billion, $3.1 billion and $1.3 billion, respectively.

(2) Amounts represent restricted stock and other share-based awards (excluding stock options) granted and assumed. The Company had total shares of restricted stock and restricted stock units outstanding of 10 million, 11 million, and 6 million as of July 26, 2008, July 28, 2007, and July 29, 2006, respectively. Share-based awards available for grant are reduced by 2.5 shares for each share awarded as stock grants or pursuant to stock units from the 2005 Plan subsequent to November 15, 2007.

The following table summarizes significant ranges of outstanding and exercisable stock options as of July 26, 2008 (in millions, except years and share prices):

The aggregate intrinsic value in the preceding table represents the total pretax intrinsic value, based on the Company’s closing stock price of $22.43 as of July 25, 2008, which would have been received by the option holders had those option holders exercised their stock options as of that date. The total number of in-the-money stock options exercisable as of July 26, 2008 was 463 million. As of July 28, 2007, 829 million outstanding stock options were exercisable and the weighted-average exercise price was $30.13.

Valuation and Expense Information Under SFAS 123(R)

Share-based compensation expense recognized under SFAS 123(R) consists primarily of expenses for stock options, stock purchase rights, restricted stock, and restricted stock units granted to employees. The following table summarizes employee share-based compensation expense (in millions):

(1) Share-based compensation expense of $87 million, $34 million, and $87 million related to acquisitions and investments for fiscal 2008, 2007, and 2006, respectively, is disclosed in Note 3 and is not included in the above table.

As of July 26, 2008, total compensation cost related to unvested share-based awards, including share-based compensation relating to acquisitions and investments, not yet recognized was $3.4 billion, which is expected to be recognized over approximately 3.5 years on a weighted-average basis. The income tax benefit for employee share-based compensation expense was $330 million, $342 million, and $294 million for fiscal 2008, 2007, and 2006, respectively.

Lattice-Binomial Model.

Upon adoption of SFAS 123(R) at the beginning of fiscal 2006, the Company began estimating the value of employee stock options and employee stock purchase rights on the date of grant using a lattice-binomial model. Prior to the adoption of SFAS 123(R), the value of each employee stock option and employee stock purchase right was estimated on the date of grant using the Black-Scholes model.

The Company’s employee stock options have vesting provisions and various restrictions including restrictions on transfer and hedging, among others, and are often exercised prior to their contractual maturity. Lattice-binomial models are more capable of incorporating the features of the Company’s employee stock options than closed-form models such as the Black-Scholes model. The use of a lattice-binomial model requires extensive actual employee exercise behavior data and a number of complex assumptions including expected volatility, risk-free interest rate, expected dividends, kurtosis, and skewness. The weighted-average assumptions, using the lattice-binomial model, and the weighted-average expected life and estimated grant date fair values of employee stock options granted during the respective years and employee stock purchase rights with subscription dates in the respective years are summarized as follows:

The determination of the fair value of share-based payment awards on the date of grant using an option-pricing model is impacted by the Company’s stock price as well as assumptions regarding a number of highly complex and subjective variables. The weighted-average assumptions were determined as follows:

For employee stock options, the Company used the implied volatility for two-year traded options on the Company’s stock as the expected volatility assumption required in the lattice-binomial model, consistent with SFAS 123(R) and SAB 107. For employee stock purchase rights, the Company used the implied volatility for six-month traded options on the Company’s stock. The selection of the implied volatility approach was based upon the availability of actively traded options on the Company’s stock and the Company’s assessment that implied volatility is more representative of future stock price trends than historical volatility. The risk-free interest rate assumption is based upon observed interest rates appropriate for the term of the Company’s employee stock options and employee stock purchase rights. The dividend yield assumption is based on the history and expectation of dividend payouts. The estimated kurtosis and skewness are technical measures of the distribution of stock price returns, which affect expected employee exercise behaviors, and are based on the Company’s stock price return history as well as consideration of various academic analyses.

The expected life of employee stock options represents the weighted-average period the stock options are expected to remain outstanding and is a derived output of the lattice-binomial model. The expected life of employee stock options is impacted by all of the underlying assumptions and calibration of the Company’s model. The lattice-binomial model assumes that employees’ exercise behavior is a function of the option’s remaining vested life and the extent to which the option is in-the-money. The lattice-binomial model estimates the probability of exercise as a function of these two variables based on the entire history of exercises and cancellations on all past option grants made by the Company.

Accuracy of Fair Value Estimates.

The Company uses third-party analyses to assist in developing the assumptions used in, as well as calibrating, its lattice-binomial model. The Company is responsible for determining the assumptions used in estimating the fair value of its share-based payment awards. The Company’s determination of the fair value of share-based payment awards is affected by assumptions regarding a number of highly complex and subjective variables. These variables include, but are not limited to, the Company’s expected stock price volatility over the term of the awards and actual and projected employee stock option exercise behaviors. Option-pricing models were developed for use in estimating the value of traded options that have no vesting or hedging restrictions and are fully transferable. Because the Company’s employee stock options have certain characteristics that are significantly different from traded options, and because changes in the subjective assumptions can materially affect the estimated value, in management’s opinion, the existing valuation models may not provide an accurate measure of the fair value of the Company’s employee stock options. Although the fair value of employee stock options is determined in accordance with SFAS 123(R) and SAB 107 using an option-pricing model, that value may not be indicative of the fair value observed in a willing buyer/willing seller market transaction.

The Company sponsors the Cisco Systems, Inc. 401(k) Plan (the “Plan”) to provide retirement benefits for its employees. As allowed under Section 401(k) of the Internal Revenue Code, the Plan provides for tax-deferred salary contributions for eligible employees. The Plan allows employees to contribute from 1% to 25% of their annual compensation to the Plan on a pretax and after-tax basis. Employee contributions are limited to a maximum annual amount as set periodically by the Internal Revenue Code. The Company matches pretax employee contributions up to 100% of the first 4% of eligible earnings that are contributed by employees. Therefore, the maximum matching contribution that the Company may allocate to each participant’s account will not exceed $9,200 for the 2008 calendar year due to the $230,000 annual limit on eligible earnings imposed by the Internal Revenue Code. All matching contributions vest immediately. The Company’s matching contributions to the Plan totaled $171 million, $131 million, and $96 million in fiscal 2008, 2007, and 2006, respectively.

The Plan allows employees who meet the age requirements and reach the Plan contribution limits to make a catch-up contribution not to exceed the lesser of 50% of their eligible compensation or the limit set forth in the Internal Revenue Code. The catch-up contributions are not eligible for matching contributions. In addition, the Plan provides for discretionary profit-sharing contributions as determined by the Board of Directors. Such contributions to the Plan are allocated among eligible participants in the proportion of their salaries to the total salaries of all participants. There were no discretionary profit-sharing contributions made in fiscal 2008, 2007, or 2006.

The Company also sponsors other 401(k) plans that arose from acquisitions of other companies. The Company’s contributions to these plans were not material to the Company on either an individual or aggregate basis for any of the fiscal years presented.

(d) Deferred Compensation Plans.

The Company maintains a deferred compensation plan for certain employees and directors of Scientific-Atlanta (the “SA Plan”). The deferred compensation liability under the SA Plan was approximately $126 million and $109 million, as of July 26, 2008 and July 28, 2007, respectively, and was recorded in current and long-term liabilities.

The Cisco Systems, Inc. Deferred Compensation Plan (the “Deferred Compensation Plan”), a nonqualified deferred compensation plan, became effective June 25, 2007. As required by applicable law, participation in the Deferred Compensation Plan is limited to a group of the Company’s management employees, which group includes each of the Company’s named executive officers. Under the Deferred Compensation Plan, which is an unfunded and unsecured deferred compensation arrangement, a participant may elect to defer base salary, bonus, and/or commissions, pursuant to such rules as may be established by the Company, up to the maximum percentages for each deferral election as described in the plan. This operates in a manner similar to the way in which the Company’s 401(k) plan operates, but without regard to the maximum deferral limitations imposed on 401(k) plans by the Internal Revenue Code. The Company may also, at its discretion, make a matching contribution to the employee under the Deferred Compensation Plan. A matching contribution equal to 4% of eligible compensation over the Internal Revenue Code limit for calendar year 2008 that is deferred by participants under the Deferred Compensation Plan will be made to eligible participants’ accounts at the end of calendar year 2008. The deferred compensation liability under this plan was approximately $45 million as of July 26, 2008 and was recorded in long-term liabilities.

(e) Defined Benefit Plans Assumed from Scientific-Atlanta.

Upon completion of the acquisition of Scientific-Atlanta, the Company assumed certain defined benefit plans related to employee pensions. Scientific-Atlanta had a defined benefit pension plan covering substantially all of its domestic employees, defined benefit pension plans covering certain international employees, a restoration retirement plan for certain domestic employees, and supplemental executive retirement plans for certain key officers (collectively, the “Pension Plans”).

The fair value of the liabilities of these plans was determined as of the July 26, 2008 and July 28, 2007 measurement dates. The fair value determination of the liabilities reflects the Company’s intent to integrate the Scientific-Atlanta employee benefit programs with those of the Company. As a result, no additional benefits have been accrued under the Pension Plans since February 2008.

The following table sets forth projected benefit obligations, plan assets, and amounts recorded in current and long-term liabilities under the Pension Plans (in millions):

The accumulated benefit obligations under the Pension Plans were $197 million and $225 million as of July 26, 2008 and July 28, 2007, respectively.

13. Income Taxes.

(a) Provision for Income Taxes.

The provision for income taxes consists of the following (in millions):

The Company paid income taxes of $2.8 billion, $1.7 billion, and $1.6 billion in fiscal 2008, 2007, and 2006, respectively. Income before provision for income taxes consists of the following (in millions):

The items accounting for the difference between income taxes computed at the federal statutory rate and the provision for income taxes consists of the following:

The tax provision for fiscal 2008 included tax expense of $229 million related to the intercompany realignment of certain of the Company’s foreign operations during the third and fourth quarters of fiscal 2008. The tax provision for fiscal 2008 also included a net tax benefit of $162 million related to a settlement of certain tax matters with the IRS during the first quarter of fiscal 2008. In December 2006, the Tax Relief and Health Care Act of 2006 reinstated the U. S. federal R&D tax credit, retroactive to January 1, 2006. As a result, the tax provision for fiscal 2007 included a tax benefit of approximately $60 million related to the U. S. federal R&D tax credit attributable to fiscal 2006 R&D. The tax provision for fiscal 2006 included a benefit of approximately $124 million from the favorable settlement of a tax audit in a foreign jurisdiction.

U. S. income taxes and foreign withholding taxes associated with the repatriation of earnings of foreign subsidiaries were not provided for on a cumulative total of $21.9 billion of undistributed earnings for certain foreign subsidiaries. The Company intends to reinvest these earnings indefinitely in its foreign subsidiaries. If these earnings were distributed to the United States in the form of dividends or otherwise, or if the shares of the relevant foreign subsidiaries were sold or otherwise transferred, the Company would be subject to additional U. S. income taxes (subject to an adjustment for foreign tax credits) and foreign withholding taxes. Determination of the amount of unrecognized deferred income tax liability related to these earnings is not practicable.

On October 22, 2004, the American Jobs Creation Act of 2004 (the “Jobs Creation Act”) was signed into law. The Jobs Creation Act created a temporary incentive for U. S. corporations to repatriate accumulated income earned abroad by providing an 85 percent dividends received deduction for certain dividends from controlled foreign corporations. In fiscal 2006, the Company distributed cash from its foreign subsidiaries and reported an extraordinary dividend (as defined in the Jobs Creation Act) of $1.2 billion and a related tax liability of approximately $63 million in its fiscal 2006 federal income tax return. This amount was previously provided for in the provision for income taxes and is included in income taxes payable. This distribution does not change the Company’s intention to indefinitely reinvest undistributed earnings of certain of its foreign subsidiaries in operations outside the United States.

As a result of certain employment and capital investment actions and commitments, the Company’s income in certain countries is subject to reduced tax rates and in some cases is wholly exempt from tax. These tax incentives expire in whole or in part at various times through fiscal 2025.

(b) Unrecognized Tax Benefits.

On July 29, 2007, the Company adopted FIN 48 which prescribes a comprehensive model for the financial statement recognition, measurement, classification, and disclosure of uncertain tax positions. As a result of the adoption of FIN 48, the Company reduced the liability for net unrecognized tax benefits by $451 million and accounted for this as a cumulative effect of a change in accounting principle that was recorded as an increase to retained earnings of $202 million and an increase to additional paid-in capital of $249 million. The total amount of gross unrecognized tax benefits as of the date of adoption was $3.3 billion, of which $2.9 billion would affect the effective tax rate if realized. The Company historically classified liabilities for unrecognized tax benefits in current income taxes payable. In implementing FIN 48, the Company has reclassified liabilities for unrecognized tax benefits for which the Company does not anticipate payment or receipt of cash within one year to noncurrent income taxes payable. In addition, the Company reclassified the income tax receivable to income taxes payable.

The aggregate changes in the balance of gross unrecognized tax benefits during fiscal 2008 were as follows (in millions):

In connection with the regular examination of the Company’s federal income tax returns for fiscal years ended July 27, 2002 through July 31, 2004, the IRS proposed certain adjustments related to the Company’s international operations. In the first quarter of fiscal 2008, the Company and the IRS agreed to a settlement with respect to certain tax issues related to U. S. income inclusions arising from the Company’s international operations for fiscal years ended July 27, 2002 through July 29, 2006. As a result of the settlement, the Company reduced the amount of gross unrecognized tax benefits by approximately $1.0 billion. The Company also reduced the amount of accrued interest by $39 million. In addition, the IRS has proposed other adjustments that are not covered under the settlement agreement related to fiscal years ended July 27, 2002 through July 31, 2004. The Company has timely filed a protest with IRS Appeals on these proposed adjustments. The Company believes that adequate amounts have been reserved for any adjustments that may ultimately result from these examinations.

As of July 26, 2008, $2.1 billion of the unrecognized tax benefits would affect the effective tax rate if realized. The Company’s policy to include interest and penalties related to income taxes, including unrecognized tax benefits, within the provision for income taxes did not change as a result of implementing FIN 48. As of the date of adoption of FIN 48, the Company had accrued $183 million in income taxes payable for the payment of interest and penalties. As of July 26, 2008, the Company had accrued $166 million in income taxes payable for the payment of interest and penalties, of which $8 million was recorded to the provision for income taxes during fiscal 2008. The Company is no longer subject to U. S. federal income tax audit for returns covering tax years through fiscal year 2001. With limited exceptions, the Company is no longer subject to state and local or foreign income tax audits for returns covering tax years through fiscal year 1997. Although timing of the resolution of audits is highly uncertain, the Company does not believe it is reasonably possible that the total amount of unrecognized tax benefits as of July 26, 2008 will materially change in the next 12 months.

The following table presents the breakdown between current and noncurrent net deferred tax assets (in millions):

The components of the deferred tax assets and liabilities are as follows (in millions):

As of July 26, 2008, the Company’s federal, state, and foreign net operating loss carryforwards for income tax purposes were $344 million, $1.7 billion, and $97 million, respectively. If not utilized, the federal net operating loss carryforwards will begin to expire in fiscal 2016, the state net operating loss carryforwards will begin to expire in fiscal 2009, and the foreign net operating loss carryforwards will begin to expire in fiscal 2011. As of July 26, 2008, the Company’s federal and state tax credit carryforwards for income tax purposes were approximately $10 million and $600 million, respectively. If not utilized, the federal and state tax credit carryforwards will begin to expire in fiscal 2009.

14. Segment Information and Major Customers.

The Company’s operations involve the design, development, manufacturing, marketing, and technical support of networking and other products and services related to the communications and information technology industry. Cisco products include routers, switches, advanced technologies, and other products. These products, primarily integrated by Cisco IOS Software, link geographically dispersed local-area networks (LANs), metropolitan-area networks (MANs) and wide-area networks (WANs).

(a) Net Sales and Gross Margin by Theater.

The Company conducts business globally and is primarily managed on a geographic basis. The Company’s management makes financial decisions and allocates resources based on the information it receives from its internal management system. Sales are attributed to a geographic theater based on the ordering location of the customer. During the first quarter of fiscal 2008, the Company enhanced its methodology for attributing certain revenue transactions, including revenue deferrals, and the associated cost of sales for each to the respective geographic theater and revised the information utilized by the Company’s chief operating decision maker (CODM). As a result, the Company has reclassified prior year net sales and gross margin amounts by theater to conform to the current year’s presentation.

The Company does not allocate research and development, sales and marketing, or general and administrative expenses to its geographic theaters in this internal management system because management does not include the information in its measurement of the performance of the operating segments. In addition, the Company does not allocate amortization of acquisition-related intangible assets, share-based compensation expense, and the effects of purchase accounting adjustments to inventory to the gross margin for each theater because management also does not include this information in its measurement of the performance of the operating segments.

Summarized financial information by theater for fiscal 2008, 2007, and 2006, based on the Company’s internal management system and as utilized by the Company’s CODM, is as follows (in millions):

(1) Net sales in the United States were $20.2 billion, $18.3 billion, and $14.8 billion for fiscal 2008, 2007, and 2006, respectively.

(2) The unallocated corporate items primarily include the effects of amortization of acquisition-related intangible assets and share-based compensation expense.

(b) Net Sales for Groups of Similar Products and Services.

The following table presents net sales for groups of similar products and services (in millions):

The Company refers to some of its products and technologies as advanced technologies. As of July 26, 2008, the Company had identified the following advanced technologies for particular focus: application networking services, home networking, security, storage area networking, unified communications, video systems, and wireless technology. The Company continues to identify additional advanced technologies for focus and investment in the future, and the Company’s investments in some previously identified advanced technologies may be curtailed or eliminated depending on market developments.

The majority of the Company’s assets, excluding cash and cash equivalents and investments, as of July 26, 2008 and July 28, 2007 were attributable to its U. S. operations. The Company’s total cash and cash equivalents and investments held outside of the United States in various foreign subsidiaries was $24.4 billion as of July 26, 2008, and the remaining $1.8 billion was held in the United States. In fiscal 2008, 2007, and 2006, no single customer accounted for 10% or more of the Company’s net sales.

Property and equipment information is based on the physical location of the assets. The following table presents property and equipment information for geographic areas (in millions):

15. Net Income Per Share.

The following table presents the calculation of basic and diluted net income per share (in millions, except per-share amounts):

IAS 33 Earnings per Share Quiz.

Quiz-summary.

0 of 25 questions completed.

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25.

Em formação.

Você já concluiu o teste antes. Portanto, você não pode iniciá-lo novamente.

Questionário está carregando.

Você deve entrar ou se inscrever para iniciar o teste.

Você precisa concluir o teste, para iniciar este teste:

0 of 25 questions answered correctly.

O tempo passou.

You have reached 0 of 0 points, ( 0 )

Categorias.

IAS 33 - Earnings per Share 0%

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25.

Revisão respondida.

1 Questão.

Which of the following securities do not influence diluted EPS?

Equity shares not entitled to dividend, but which may in the future Ordinary preference shares Convertible loan stock Share options.

Ordinary preference shares are not convertible to ordinary shares, and do not influence the diluted EPS figure.

2 Questão.

Platinum Limited had an after tax profit of $400,000 for the year. $80,000 of this was earned from the once off sale of machinery.

During the period it paid dividends to the ordinary shareholders of $100,000 and $50,000 to preference shareholders.

It had 1,000,000 ordinary shares in issue for the entire period.

The basic earnings per share for Platinum Limited in the period is…

32c 33c 35c 17c.

After tax profit ($400,000) minus preference dividend ($50,000) = $350,000.

Ordinary shares in issue = 1,000,000.

After tax profit ($400,000) minus preference dividend ($50,000) = $350,000.

Ordinary shares in issue = 1,000,000.

3 Questão.

Ordinary shares are equity instruments, which rank above all other classes of equity instruments.

Verdadeiro falso.

False – Ordinary shares are equity instruments which rank behind all other classes of equity instruments.

4 Questão.

A potential ordinary share is…

An ordinary share, which has not been paid for A preferential share An authorised, but not issued ordinary share A financial instrument which may entitle the holder to ordinary shares.

A potential ordinary share is a financial instrument or other contract that may entitle its holder to ordinary shares.

5 Questão.

Which of the following is not an example of a potential ordinary share?

Standard preferred share Convertible preferred share Share warrants Convertible debt.

Standard preferred shares are usually not convertible to ordinary shares. \

Examples of potential ordinary shares are:

• convertible preferred shares.

• employee stock purchase plans.

• contractual rights to purchase shares.

• contingent issuance contracts or agreements (such as those arising in a business combination)

Standard preferred shares are usually not convertible to ordinary shares. \

Examples of potential ordinary shares are:

• convertible preferred shares.

• employee stock purchase plans.

• contractual rights to purchase shares.

• contingent issuance contracts or agreements (such as those arising in a business combination)

6 Questão.

A contract which gives rise to a financial asset in one entity and a financial liability in another entity is called:

An equity instrument A financial instrument A sale agreement A derivative.

A financial instrument is any contract that gives rise to both a financial asset of one entity and a financial liability or equity instrument of another entity.

7 Questão.

A contract that evidences a residual interest in the assets of an entity after deducting all of its liabilities is called…

An equity instrument A financial instrument Secured loan Mortgage.

An equity instrument is a contract, which results in the transfer or purchase of shares (equity) in an entity. Equity holders (i. e. shareholders) are entitled to the value of the assets once liabilities are deducted.

8 Questão.

Private companies must present EPS on the face of their financial statements.

Verdadeiro falso.

False – Only listed companies, or companies in the process of being listed, need to present EPS information. Private companies may present EPS information, but only if they chose to do so.

9 Questão.

Basic EPS is calculated using the net profit of loss for the period attributable to…

Ordinary shareholders Preferred shareholders Debenture holders Secured creditors.

Basic EPS is calculated by dividing the net profit or loss for the period attributable to ordinary shareholders.

10 Questão.

A lossmaking entity does not have to present EPS.

Verdadeiro falso.

False – Basic and diluted EPS must be presented even if the amounts are negative (i. e. a loss per share).

11 Questão.

Preference dividends are _____ the net profit figure, prior to calculating Basic EPS.

Added to Deducted from.

Preferential dividends are deducted from the net profit figure when calculating Basic EPS. Preferential dividends must be paid before a dividend may be paid to ordinary shareholders.

12 Questão.

Preference dividends, which remain unpaid at the end of the financial period, are not deducted from net profit when calculating Basic EPS.

Verdadeiro falso.

False – The full amount of the preference dividend should be deducted from the net profit figure before computing Basic EPS.

Preference dividends in respect of previous periods are excluded.

False – The full amount of the preference dividend should be deducted from the net profit figure before computing Basic EPS.

Preference dividends in respect of previous periods are excluded.

13 . Questão.

Ordinary shares outstanding during the period are.

Based on the outstanding shares in the previous period Based on the outstanding shares at the start of the period Based on the outstanding shares at the end of the period The weighted average number of shares outstanding during the period.

The weighted average number of shares outstanding during the period is used for a Basic EPS calculation. Certain adjustments may be required if the entity issued shares during the period.

14 Questão.

Shares are usually included in the weighted average number of shares from the date consideration is…

Received Receivable Discussed Agreed.

When the consideration is receivable for the issue of shares, the shares are included to the weighted average number of shares. This is generally the same date the shares are issued.

15 . Questão.

If ordinary shares are only partly paid, they should not be included as part of a Basic EPS calculation.

Verdadeiro falso.

False – Partly paid ordinary shares should be included in a Basic EPS calculation. If they are only entitled to a partial dividend, they should be treated as a fraction of an ordinary share based on their entitlement to a dividend compared to fully paid ordinary shares.

If they are not entitled to a dividend, they should be left out of the Basic EPS calculation until they are paid up, or are entitled to a dividend.

16 . Questão.

Which of the following events requires no adjustment to the prior period’s EPS calculations?

Bonus issue of shares Exercise of stock warrant Share split Reverse share split.

When a stock warrant is issued, there will be an increase in resources to the entity. Therefore the prior period’s EPS should not be adjusted.

With a bonus issue, share split or reverse share split, the entity will have no extra resources. The prior period EPS should be adjusted to make them comparable to this period.

When a stock warrant is issued, there will be an increase in resources to the entity. Therefore the prior period’s EPS should not be adjusted.

With a bonus issue, share split or reverse share split, the entity will have no extra resources. The prior period EPS should be adjusted to make them comparable to this period.

17 . Questão.

Theoretical ex-rights price (‘TERP’) is calculated when there is a:

Bonus issue Rights issue Stock split Reverse stock split All of these.

Rights issue – When there is a rights issue, the entity receives additional funds for issuing additional shares, this doesn’t happen in a bonus issue or stock split. Furthermore, the shares are sold at below market rates in a rights issue. As there are additional resources in the entity, but not at the market rate, the prior period EPS must be adjusted (using the TERP figure) to aid comparison of the periods.

18 . Questão.

Following a rights issue, the comparative figure for the previous period should be adjusted as follows:

Prior period EPS x (TERP ÷ FV per share prior to rights issue) TERP x (FV per share prior to rights issue ÷ Prior period EPS) TERP x Prior period EPS Prior period EPS x (FV per share prior to rights issue ÷ TERP)

To adjust the comparative information following a rights issue, the prior period EPS is multiplied by TERP and divided by the fair value per share prior to the exercise of the rights issue.

19 . Questão.

Diluted EPS shows.

The expected EPS if all securities with an equity interest, exercise those interests The expected EPS if the share price falls The expected EPS if all loans are discharged The expected EPS if equity options and warrants are redeemed.

Diluted EPS shows the expected EPS if all securities with an equity interest, exercise their interests. It is not restricted to just options and warrants.

20 . Questão.

When calculating diluted EPS, the basic EPS is adjusted by the _____ effect of dividends, interest and other charges.

Pre-tax Post-tax.

Post-tax – Adjust the basic EPS for the post tax amount. These payments to potential ordinary shareholders may have entitled the entity to a tax deduction prior to redemption which will not be available if converted to ordinary shares.

21 . Questão.

Which of the following should be adjusted when calculating dilutive EPS?

Finance charges payable on convertible debt Preference dividends payable on convertible preference shares Interest paid on convertible debt Payments to non-discretionary employee profit sharing plans All of these.

Todos esses. They will be affected should the convertible instruments become ordinary shares. Even the employee profit sharing plan may be affected by the conversion of the instruments to equity.

22 . Questão.

If the conversion of a potential ordinary share resulted in an increase in net profit per share, this should not be treated as dilutive.

Verdadeiro falso.

True – Under IAS 33, potential ordinary shares shall be treated as dilutive when, and only when, their conversion to ordinary shares would decrease earnings per share or increase loss per share from continuing operations.

23 . Questão.

Where should basic EPS be presented in the financial statements?

Statement of Comprehensive Income Statement of Financial Position Statement of Changes in Equity Notes to the financial statements.

An entity required to disclose EPS must do so on the face of the Statement of Comprehensive Income.

24 . Questão.

A reconciliation of the amounts of shares used to calculate basic EPS and diluted EPS should be provided.

Verdadeiro falso.

True – The two amounts used in the denominators (weighted average number of shares) should be disclosed and a reconciliation of the two denominator figures (for basic and diluted EPS) should be provided.

25 . Questão.

Alternative methods of calculating EPS must never be presented.

Verdadeiro falso.

False – An entity may chose to present an alternative EPS figure, but must do so in addition to the EPS calculated in accordance to IAS 33. Some entities chose to do this after adjusting earnings for one off items.

If an entity presents an alternative EPS, it must be presented in the notes to the financial statements and use the same weighted average number of shares used in the IAS 33 calculation.

CAP2 SFMA Notes € 9.00 ACCA P4 Advanced Financial Management Mind Maps € 9.00 € 7.00 ACCA P5 Advanced Performance Management mind maps € 9.00 € 7.00 Guide to Consolidation Journal Entries € 9.00 IFRS Mind Maps € 9.00.

Este site usa cookies. To find out more, see our Cookies Policy.

Chartered Education - We train accountants.

Phone: +353 (0)1 4433 400.

JUNTE-SE À NOSSA NEWSLETTER.

Be the first to learn about our latest updates and receive exclusive offers on new products.

Lucro por ação | Cálculo | EPS básico vs EPS diluído.

Quando você analisa a saúde financeira de uma empresa, a primeira medida que você pode querer verificar é a lucratividade. A parte do lucro de uma empresa alocada a cada ação em circulação de ações ordinárias é conhecida como Lucro por Ação ou EPS. Embora a interpretação do Earnings Per Share seja relativamente fácil, o cálculo do EPS não é tão simples. Por exemplo, vamos dar uma olhada na Tabela de ganhos por ação da Colgate Palmolive.

fonte & # 8211; Colchões da Colgate 10K.

Observamos que existem duas variações de EPS & # 8211; EPS básico e EPS diluído na Colgate. Observe também que as opções de ações e unidades de estoque restritas estão afetando o número total de ações em circulação. Se isto é um pouco confuso neste estágio, então não se preocupe, o primer em EPS cobre o básico e então o leva ao nível avançado de Earnings Per Share. Os tópicos abordados são conforme abaixo & # 8211;

O que é lucro por ação ou EPS?

Medida de lucratividade corporativa mais comumente usada para empresas de capital aberto. O lucro por ação (EPS) informa aos acionistas ordinários quanto da receita disponível está associada às ações que possuem (sua participação no bolo).

Pontos importantes a serem observados sobre o EPS.

O EPS é relatado apenas para ações ordinárias As empresas não negociadas publicamente não são obrigadas a divulgar os números de EPS. O EPS fornece informações para os acionistas ordinários sobre: Pagamento de dividendos futuros O valor de suas participações.

Estrutura de capital simples versus complexa.

A estrutura de capital de uma empresa é simples se consistir apenas em ações ordinárias ou não incluir ações ordinárias potenciais que, após a conversão ou exercício, possam diluir os ganhos por ação ordinária. Empresas com estruturas de capital simples precisam apenas relatar a fórmula básica de EPS.

Uma estrutura de capital complexa possui títulos que poderiam ter um efeito diluidor sobre o lucro por ação ordinária. A partir de agora, pense no efeito dilutivo como aqueles títulos que reduzem o Lucro por Ação.

Uma estrutura de capital complexa possui títulos potencialmente diluidores, como opções, garantias ou títulos conversíveis. Empresas com estruturas de capital complexas devem reportar EPS básico e EPS diluído. O cálculo do EPS diluído sob uma estrutura de capital complexa permite que os investidores vejam o impacto adverso no EPS se todos os títulos diluídos se converterem em ações ordinárias.

Vamos olhar o exemplo da Colgate novamente neste contexto. A Colgate tem uma estrutura de capital complexa & # 8211; Por quê? A razão é que sua estrutura de capital contém opções de ações e unidades de estoque restritivas que podem aumentar o número de ações em circulação (denominador). Se o número de ações em circulação aumentar, o EPS diminuirá. Por favor, observe que no caso da Colgate, o número de ações que aumentam devido a opções de ações e unidades de estoque restritas é de 9,1 milhões para o ano de 2014.

fonte & # 8211; Colchões da Colgate 10K.

Lucro básico por ação (EPS) Definição.

O EPS básico não considera o efeito de quaisquer títulos diluídos. Aqui usamos os ganhos reais e o número real de ações ordinárias emitidas.

Fórmula EPS básica em uma estrutura de capital simples:

Os dividendos preferenciais do ano corrente são subtraídos do lucro líquido porque o lucro por ação refere-se aos ganhos disponíveis para o acionista ordinário. Dividendos de ações ordinárias não são subtraídos do lucro líquido.

Tomemos o exemplo da Colgate do exemplo acima, o lucro líquido (2013) atribuível aos acionistas ordinários é de US $ 2.241 milhões e as ações ordinárias em circulação é de 930,8 milhões. O EPS da Colgate para 2014 é de US $ 2.241 / 930,8 = US $ 2,41.

fonte & # 8211; Colchões da Colgate 10K.

Quantidade Média Ponderada de Ações Ordinárias.

Como o número de ações ordinárias em circulação pode mudar ao longo do ano, a média ponderada é usada para calcular o lucro por ação. A média ponderada do número de ações ordinárias é o número de ações em circulação durante o ano ponderado pela porção do ano em que estavam em circulação. Os analistas precisam encontrar o número equivalente de ações inteiras em circulação para o ano.

Três etapas para calcular o número médio ponderado de ações ordinárias em circulação:

Identifique o saldo inicial de ações ordinárias e as mudanças nas ações ordinárias durante o ano. Para cada alteração nas ações ordinárias: Etapa 1 e # 8211; Calcule o número de ações em circulação após cada alteração nas ações ordinárias. Emissão de novas ações aumenta o número de ações em circulação. A recompra de ações reduz o número de ações em circulação. Etapa 2 e # 8211; Ponderar as ações em circulação pela parte do ano entre essa alteração e a próxima alteração: peso = dias pendentes / 365 = meses pendentes / 12 Etapa 3 & # 8211; Soma até para calcular o número médio ponderado de ações ordinárias em circulação.

Calcule o EPS Básico.

Albatross Inc 2007 Lucro Líquido & # 8211; US $ 1.000.000. Dados adicionais fornecidos abaixo.

100.000 ações preferenciais classe A ações cumulativas, valor do dividendo $ 2,00 / ação 50.000 ações Classe B ações não cumulativas preferenciais, valor do dividendo $ 1,50 / ação Nenhum Dividendo declarado ou pago no ano atual Qual será o numerador do EPS básico da Albatross Inc?

Numerador de EPS = Lucro Líquido - Dividendos Preferenciais.

Média ponderada do número de ações.

O número médio ponderado de ações é calculado conforme abaixo de & # 8211;

Dividendos em ações & amp; Divisões de ações.

No cálculo do número médio ponderado de ações, os dividendos em ações e os desdobramentos são apenas mudanças nas unidades de medida, e não mudanças na propriedade dos lucros. Uma ação dividendo ou acionistas divididos). Quando ocorre uma bonificação ou divisão de ações, o cálculo do número médio ponderado de ações requer a atualização das ações em circulação antes do dividendo ou divisão de ações. Não é ponderada pela parcela do ano após a ocorrência do dividendo ou divisão de ações. Especificamente, antes de iniciar as três etapas de cálculo da média ponderada, os números a seguir são corrigidos para refletir os efeitos do dividendo / desdobramento: o saldo inicial das ações em circulação; Todas as ações emitidas ou compradas antes do dividendo ou dividendo; Nenhuma reformulação é feita para ações emitidas ou compradas após a data do dividendo ou dividendo. Se uma bonificação em ações ou um desdobramento ocorrer após o final do ano, mas antes que as demonstrações contábeis sejam emitidas, a média ponderada do número de ações em circulação durante o ano (e quaisquer outros anos apresentados na forma comparativa) deve ser reapresentada.

Calcular o efeito do desdobramento de ações & amp; Dividendos em Ações.

Calcular o número médio ponderado de ações para o seguinte -

O número médio ponderado de ações é calculado conforme abaixo de & # 8211;

Dividendos em ações da Colgate & # 8211;

Como resultado do desdobramento de ações de 2013, todos os dados históricos por ação e os números de ações em circulação foram ajustados retroativamente. Em 2012, as ações em circulação foram de 476,1 milhões e quase duplicaram, para 930,8 milhões, devido ao desdobramento de ações duas por uma.

fonte & # 8211; Colchões da Colgate 10K.

EPS diluído.

Se uma empresa tiver uma estrutura de capital complexa, ela deve reportar dois números de EPS: EPS básico e EPS diluído.

Os títulos podem ser diluidores ou anti-dilutivos. Títulos antidilutivos são aqueles que, mediante conversão ou exercício, aumentam o lucro por ação ou reduzem o prejuízo por ação. A probabilidade de conversão ou exercício de títulos anti-dilutivos é considerada remota.

O EPS diluído mostra o efeito adverso potencial máximo sobre o EPS se os títulos diluidores se converterem em ações ordinárias. O objetivo é mostrar o pior caso & # 8221; cenário. Portanto, o cálculo do EPS diluído não considera títulos anti-diluidores, o que aumenta o EPS. No cálculo do EPS diluído, os analistas precisam verificar cada título potencialmente dilutivo individualmente para ver se ele é dilutivo ou anti-dilutivo. Todos os títulos anti-diluição estão excluídos e não podem ser utilizados para compensar títulos diluidores.

Para calcular o lucro por ação diluído, comece do lucro por ação básico e, em seguida, remova o efeito adverso de todos os títulos diluídos em circulação durante o período.

No cálculo do EPS diluído, os efeitos adversos dos títulos diluidores são removidos ajustando-se o numerador e o denominador da fórmula básica de EPS.

Identifique todos os títulos potencialmente diluíveis: títulos conversíveis, opções, ações preferenciais conversíveis, bônus de subscrição, etc. Calcule o EPS básico. O efeito de títulos potencialmente diluidores não é incluído no cálculo. Determine o efeito de cada título potencialmente dilutivo sobre o EPS para ver se ele é dilutivo ou anti-dilutivo. Como? Calcule o EPS ajustado, supondo que a conversão ocorra. Se EPS básico (& gt;), a garantia é dilutiva (anti-dilutiva). Excluir todos os títulos anti-diluidores do cálculo do EPS diluído. Use títulos básicos e diluidores para calcular o EPS diluído.

Efeito da dívida conversível em EPS.

Efeito no numerador.

Na conversão, o numerador (lucro líquido) da fórmula básica de EPS aumenta de acordo com a despesa de juros líquida de imposto associada àquela aumentada pelo valor da despesa de juros, líquida de impostos associados a essas ações ordinárias potenciais. Por quê? Se convertido, não haveria juros para o título, de modo que a renda disponível para as ações ordinárias aumentaria de acordo. Os juros pós-impostos são usados porque os juros dos títulos são dedutíveis, enquanto o lucro líquido é calculado após a dedução do imposto.

Efeito no denominador.

Na conversão, o denominador (número médio ponderado de ações em circulação) da fórmula básica de EPS aumenta pelo número de ações criadas a partir da conversão, ponderado pelo tempo que essas ações estariam em circulação: número de ações devido a conversão = valor nominal de o preço de conversão / conversão convertível.

Antes de calcular o EPS diluído, é preciso verificar se essa garantia é anti-dilutiva. Para verificar se a dívida conversível é anti-dilutiva, calcule.

Se este número for menor que o EPS básico, a dívida conversível é dilutiva e deve ser incluída no cálculo do EPS diluído.

Exemplo EPS & # 8211; Efeito da dívida conversível.

Calcular o número médio ponderado de ações para o seguinte -

Durante 2006, a KK Enterprise reportou lucro líquido de US $ 250.000 e teve 100.000 ações ordinárias. Durante 2006, a KK Enterprise emitiu 1.000 ações de 10%, com ações preferenciais de $ 100 em circulação. Em 2006, a KK Enterprise emitiu, ao par de 600, US $ 1.000, bônus de 8%, cada um conversível em 100 ações ordinárias. Calcule o EPS diluído. Suponha taxa de imposto & # 8211; 40%

Cálculo do EPS diluído.

Efeito do estoque preferencial conversível.

Efeito no numerador.

Na conversão, o numerador da fórmula básica de EPS aumentaria pelo valor dos dividendos preferenciais. Se convertido, não haverá dividendos para as ações preferenciais conversíveis, de forma que a renda disponível para as ações ordinárias aumentará de acordo. Diferentemente dos juros dos títulos, os dividendos preferenciais não são dedutíveis nos impostos.

Efeito no denominador.

Na conversão, o denominador da fórmula básica de EPS aumentaria pelo número de ações criadas a partir da conversão, ponderada pelo tempo que essas ações estariam em circulação: número de ações devido à conversão = número de ações preferenciais conversíveis em circulação x taxa de conversão. O tempo em aberto seria o ano inteiro se as ações preferenciais fossem emitidas em um ano anterior, ou uma fração do ano, se as ações preferenciais forem emitidas no ano atual.

Antes de calcular o EPS diluído, é preciso verificar se essa garantia é anti-dilutiva.

Para verificar se o estoque preferencial conversível é anti-dilutivo, calcule.

Se esse número for inferior ao EPS básico, o estoque preferencial conversível será dilutivo e deverá ser incluído no cálculo do lucro por ação diluído.

Exemplo & # 8211; Efeito do estoque preferencial conversível no EPS.

Durante 2006, a KK Enterprise reportou lucro líquido de US $ 250.000 e teve 100.000 ações ordinárias. Durante 2006, a KK Enterprise emitiu 1.000 ações de 10%, com ações preferenciais de $ 100 em circulação, cada uma conversível em 40 ações. Calculou o EPS diluído. Suponha taxa de imposto & # 8211; 40%

Cálculo do EPS diluído.

Método de Ações do Tesouro & # 8211; Opções e warrants.

O método de Ações em Tesouraria é usado para calcular o impacto de títulos diluidores, como Opções e Warrants. Por favor, olhe para o método de ações do Tesouro para uma cobertura detalhada.

Lucro por Ação da Colgate.

Observamos o seguinte no cronograma de ganhos por ação da Colgate.

fonte & # 8211; Colchões da Colgate 10K.

Metodologia Básica de Cálculo de EPS & # 8211; O lucro básico por ação ordinária é calculado dividindo-se o lucro líquido disponível para os acionistas ordinários pela quantidade média ponderada de ações ordinárias em circulação durante o período. Metodologia de cálculo de EPS diluído & # 8211; O lucro diluído por ação ordinária é calculado usando o método de ações em tesouraria com base na média ponderada do número de ações ordinárias, mais o efeito dilutivo das ações ordinárias em circulação durante o período. Ações ordinárias potenciais diluidoras incluem opções de ações em circulação e unidades de estoque restritas. Títulos anti-dilutivos & # 8211; Em 31 de dezembro de 2013, 2012 e 2011, o número médio de opções de ações que eram anti-dilutivas e não incluídas nos cálculos de lucro por ação diluído foi 1.785.032, 3.504.608 e 3.063.536, respectivamente, Stock Split Adjustment & # 8211; Como resultado do desdobramento de ações de 2013, todos os dados históricos por ação e os números de ações em circulação foram ajustados retroativamente.

Como o Lucro por Ação está relacionado aos Mercados de Ações.

Ganhar representa rentabilidade da empresa e é considerado o mais importante indicador de saúde financeira da empresa. Os ganhos são reportados quatro vezes por ano pelas empresas de capital aberto e notamos que os analistas de pesquisa e investidores seguem de perto esta temporada de resultados. Ganhos crescentes ou EPS são uma medida do ótimo desempenho da empresa e, de certa forma, uma medida de retorno para o investidor. Infact, EPS é diretamente para os mercados de ações por wallstreet PE wide mega faixa larga ou relação preço / EPS. Diminuir o múltiplo de PE em comparação com o PE médio da indústria, melhor é do ponto de vista de investimentos e avaliações. Os preços das ações reagem fortemente aos resultados trimestrais devido à mesma conexão. Por exemplo, abaixo está o movimento do preço da ação da Blackberry Ltd. após o relatório trimestral de lucros. Observe os movimentos bruscos nos preços das ações. Saiba mais sobre o Enterprise Value e Equity Value aqui.

Outros recursos que você pode gostar.

Se você aprendeu algo novo ou gostou da postagem, por favor, deixe um comentário abaixo. Diz-me o que pensas. Muito obrigado e tome cuidado. Aprendizagem Feliz!

Dheeraj Vaidya.

trabalhou como Analista de Equity do JPMorgan, ex-CLSA India Analyst; edu qualification - cleared all 3 CFA exams, FRM Charterholder, IIT Delhi, IIML; Este é o meu blog pessoal que visa ajudar estudantes e profissionais a se tornarem impressionantes na Análise Financeira. Aqui, eu compartilho segredos sobre as melhores maneiras de analisar ações, zumbindo IPOs, M & A, Private Equity, Startups, Avaliações e Empreendedorismo.

Firstly, I appreciate the blog you have created. This is one of the tremendous work you have done. I have a little bit query with regards to ‘Calculate the effect of Stock Splits & Stock Dividends’where your answer is 185000 as weighted average common share outstanding, and my answer is 162500. Can you please recalculate the Stock Splits & Stock Dividends on weighted average comm. share outstanding….?

Dheeraj Vaidya diz.

thanks for the question. I guess you missed the restatement that needs to be done due to 50% stock dividend. The calculation becomes (100,000 x 1.5 x 3/12) + (120,000 x 1.5 x 2/12) + ……

Thanks so much for a clear picture for the EPS evolution.

Dheeraj Vaidya diz.

thank you so much, it is so helpful to me.

Dheeraj Vaidya diz.

dalam menghitung %perubahan eps, eps mana yang digunakan??

eps dilusian atau eps dasar??

I am preparing for a certification exam and your article provided much know leg area beyond what I needed. Obrigado.

Thanks Joan. I am glad you linked the article.

mahendra edunoori says.

its very interesting and helpful to me. i learned something extra what i knew earlier.

thanking you to share such files.

i hope i can learn many more new things by following you…

Thanks for sch a good and informative post. You mentioned EPS is helpful for investors, analyst. But wont ROE give a better picture of companys performance ?

Binodgopal Mukherjee says.

Útil. Simples. Fácil de entender. Obrigado por compartilhar o seu conhecimento.

Thank you for this elaborate article on EPS. Your style of writing is simple, yet comprehensive.

Wall Street Mojo says.

Thank you Dennis.

You articles relating to valuations are very helpful and easy to go thru. And very excellent stuff to learn and horn our valuation skills.

Wall Street Mojo says.

Muito Obrigado. I am glad you like these resources 🙂

Deixe uma resposta Cancelar resposta.

Cursos Recomendados.

Mensagens Úteis.

O CFA Institute não endossa, promove ou garante a precisão ou a qualidade do WallStreetMojo. CFA® e Chartered Financial Analyst® são marcas registradas de propriedade do CFA Institute.

Notes to Consolidated Financial Statements - Annual Report 2008.

Navegação Hierárquica.

1. Basis of Presentation.

The fiscal year for Cisco Systems, Inc. (the “Company” or “Cisco”) is the 52 or 53 weeks ending on the last Saturday in July. Fiscal 2008, 2007, and 2006 were 52-week fiscal years. The Consolidated Financial Statements include the accounts of Cisco and its subsidiaries. All significant intercompany accounts and transactions have been eliminated. The Company conducts business globally and is primarily managed on a geographic basis in the following theaters: United States and Canada; European Markets; Emerging Markets; Asia Pacific; and Japan. The Emerging Markets theater consists of Eastern Europe, Latin America, the Middle East and Africa, and Russia and the Commonwealth of Independent States (CIS).

2. Summary of Significant Accounting Policies.

(a) Cash and Cash Equivalents.

The Company considers all highly liquid investments purchased with an original or remaining maturity of less than three months at the date of purchase to be cash equivalents. Cash and cash equivalents are maintained with various financial institutions.

(b) Investments.

The Company’s investments include government and government agency securities, corporate debt securities, asset-backed securities, municipal notes and bonds, and publicly traded equity securities. These investments are held in the custody of several major financial institutions. The specific identification method is used to determine the cost basis of fixed income securities disposed of. The weighted-average method is used to determine the cost basis of publicly traded equity securities disposed of. At July 26, 2008 and July 28, 2007, the Company’s investments were classified as available-for-sale and these investments are recorded in the Consolidated Balance Sheets at fair value. Unrealized gains and losses on these investments, to the extent the investments are unhedged, are included as a separate component of accumulated other comprehensive income, net of tax.

The Company recognizes an impairment charge when a decline in the fair value of its investments below the cost basis is judged to be other-than-temporary. The Company considers various factors in determining whether to recognize an impairment charge, including the length of time and extent to which the fair value has been less than the Company’s cost basis, the financial condition and near-term prospects of the investee, and the Company’s intent and ability to hold the investment for a period of time sufficient to allow for any anticipated recovery in market value.

The Company also has investments in privately held companies. These investments are included in other assets in the Consolidated Balance Sheets and are primarily carried at cost. The Company monitors these investments for impairment and makes appropriate reductions in carrying values if the Company determines that an impairment charge is required based primarily on the financial condition and near-term prospects of these companies.

Inventories are stated at the lower of cost or market. Cost is computed using standard cost, which approximates actual cost, on a first-in, first-out basis. The Company provides inventory write-downs based on excess and obsolete inventories determined primarily by future demand forecasts. The write down is measured as the difference between the cost of the inventory and market based upon assumptions about future demand and charged to the provision for inventory, which is a component of cost of sales. At the point of the loss recognition, a new, lower-cost basis for that inventory is established, and subsequent changes in facts and circumstances do not result in the restoration or increase in that newly established cost basis. In addition, the Company records a liability for firm, noncancelable, and unconditional purchase commitments with contract manufacturers and suppliers for quantities in excess of the Company’s future demand forecasts consistent with its valuation of excess and obsolete inventory.

(d) Allowance for Doubtful Accounts.

The allowance for doubtful accounts is based on the Company’s assessment of the collectibility of customer accounts. The Company regularly reviews the allowance by considering factors such as historical experience, credit quality, the age of the accounts receivable balances, and current economic conditions that may affect a customer’s ability to pay.

(e) Financing Receivables and Guarantees.

The Company provides financing arrangements, including leases, financed service contracts, and loans, for certain qualified customers to build, maintain, and upgrade their networks. Lease receivables primarily represent sales-type and direct-financing leases. Leases and loans typically have two - to three-year terms and are usually collateralized by a security interest in the underlying assets. The Company maintains an allowance for uncollectible financing receivables based on a variety of factors, including the risk rating of the portfolio, macroeconomic conditions, historical experience, and other market factors. The Company also provides financing guarantees, which are generally for various third-party financing arrangements to channel partners and other customers. The Company could be called upon to make payment under these guarantees in the event of nonpayment to the third party. See Note 6.

(f) Depreciation and Amortization.

Property and equipment are stated at cost, less accumulated depreciation and amortization. Depreciation and amortization are computed using the straight-line method over the following periods:

(g) Goodwill and Purchased Intangible Assets.

Goodwill is tested for impairment on an annual basis and during the period between annual tests in certain circumstances, and written down when impaired. Based on the impairment tests performed, there was no impairment of goodwill in fiscal 2008, 2007, or 2006. Purchased intangible assets other than goodwill are amortized over their useful lives unless these lives are determined to be indefinite. Purchased intangible assets are carried at cost, less accumulated amortization. Amortization is computed over the estimated useful lives of the respective assets, generally two to seven years.

(h) Impairment of Long-Lived Assets.

Long-lived assets and certain identifiable intangible assets to be held and used are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. Determination of recoverability of long-lived assets is based on an estimate of undiscounted future cash flows resulting from the use of the asset and its eventual disposition. Measurement of an impairment loss for long-lived assets and certain identifiable intangible assets that management expects to hold and use is based on the fair value of the asset. Long-lived assets and certain identifiable intangible assets to be disposed of are reported at the lower of carrying amount or fair value less costs to sell.

(i) Derivative Instruments.

The Company recognizes derivative instruments as either assets or liabilities and measures those instruments at fair value. The accounting for changes in the fair value of a derivative depends on the intended use of the derivative and the resulting designation. For a derivative instrument designated as a fair value hedge, the gain or loss is recognized in earnings in the period of change together with the offsetting loss or gain on the hedged item attributed to the risk being hedged. For a derivative instrument designated as a cash flow hedge, the effective portion of the derivative’s gain or loss is initially reported as a component of accumulated other comprehensive income and subsequently reclassified into earnings when the hedged exposure affects earnings. The ineffective portion of the gain or loss is reported in earnings immediately. For derivative instruments that are not designated as accounting hedges, changes in fair value are recognized in earnings in the period of change.

(j) Fair Value of Financial Instruments.

The fair value of certain of the Company’s financial instruments, including cash and cash equivalents, accrued compensation, and other current liabilities, approximates the carrying amount because of their short maturities. In addition, the fair value of the Company’s loan receivables and financed service contracts also approximate the carrying amount. The fair values of fixed income investments, publicly traded equity securities, and the Company’s long-term debt are determined using quoted market prices for those securities or similar financial instruments.

(k) Minority Interest.

The Company consolidates its investment in a venture fund managed by SOFTBANK Corp. and its affiliates (“SOFTBANK”). As of July 26, 2008, minority interest of $49 million represents SOFTBANK’s share of the venture fund.

(l) Foreign Currency Translation.

Assets and liabilities of non-U. S. subsidiaries that operate in a local currency environment, where that local currency is the functional currency, are translated to U. S. dollars at exchange rates in effect at the balance sheet date, with the resulting translation adjustments directly recorded to a separate component of accumulated other comprehensive income. Income and expense accounts are translated at average exchange rates during the year. Remeasurement adjustments are recorded in other income (loss), net.

(m) Concentrations of Risk.

Cash and cash equivalents are maintained with several financial institutions. Deposits held with banks may exceed the amount of insurance provided on such deposits. Generally, these deposits may be redeemed upon demand and are maintained with financial institutions with reputable credit and therefore bear minimal credit risk. The Company seeks to mitigate such risks by spreading its risk across multiple counterparties and monitoring the risk profiles of these counterparties.

The Company performs ongoing credit evaluations of its customers and, with the exception of certain financing transactions, does not require collateral from its customers. The Company’s customers are primarily in the enterprise, service provider, and commercial markets. The Company receives certain of its components from sole suppliers. Additionally, the Company relies on a limited number of contract manufacturers and suppliers to provide manufacturing services for its products. The inability of a contract manufacturer or supplier to fulfill supply requirements of the Company could materially impact future operating results.

(n) Revenue Recognition.

The Company’s products are generally integrated with software that is essential to the functionality of the equipment. Additionally, the Company provides unspecified software upgrades and enhancements related to the equipment through its maintenance contracts for most of its products. Accordingly, the Company accounts for revenue in accordance with Statement of Position No. 97-2, “Software Revenue Recognition,” and all related interpretations. For sales of products where software is incidental to the equipment, or in hosting arrangements, the Company applies the provisions of Staff Accounting Bulletin No. 104, “Revenue Recognition,” and all related interpretations.

The Company recognizes revenue when persuasive evidence of an arrangement exists, delivery has occurred, the fee is fixed or determinable, and collectibility is reasonably assured. In instances where final acceptance of the product, system, or solution is specified by the customer, revenue is deferred until all acceptance criteria have been met. Technical support services revenue is deferred and recognized ratably over the period during which the services are to be performed, which is typically from one to three years. Advanced services revenue is recognized upon delivery or completion of performance.

When a sale involves multiple elements, such as sales of products that include services, the entire fee from the arrangement is allocated to each respective element based on its relative fair value and recognized when revenue recognition criteria for each element are met. Fair value for each element is established based on the sales price charged when the same element is sold separately.

The Company uses distributors that stock inventory and typically sell to systems integrators, service providers, and other resellers. In addition, certain products are sold through retail partners. The Company refers to these sales through distributors and retail partners as its two-tier system of sales to the end customer. Revenue from distributors and retail partners is recognized based on a sell-through method using information provided by them. Distributors and retail partners participate in various cooperative marketing and other programs, and the Company maintains estimated accruals and allowances for these programs. The Company accrues for warranty costs, sales returns, and other allowances based on its historical experience.

(o) Advertising Costs.

The Company expenses all advertising costs as incurred. Advertising costs were not material for all years presented.

(p) Share-Based Compensation Expense.

SFAS 123(R) requires the measurement and recognition of compensation expense for all share-based payment awards made to employees and directors including employee stock options and employee stock purchases related to the Employee Stock Purchase Plan (“employee stock purchase rights”) based on estimated fair values. SFAS 123(R) requires companies to estimate the fair value of share-based payment awards on the date of grant using an option-pricing model. The value of awards that are ultimately expected to vest is recognized as expense over the requisite service periods in the Company’s Consolidated Statements of Operations.

Share-based compensation expense recognized in the Company’s Consolidated Statements of Operations for all years presented included compensation expense for share-based payment awards granted prior to, but not yet vested as of, July 30, 2005 based on the grant date fair value estimated in accordance with the pro forma provisions of SFAS 123, and compensation expense for the share-based payment awards granted subsequent to July 30, 2005 based on the grant date fair value estimated in accordance with the provisions of SFAS 123(R). In conjunction with the adoption of SFAS 123(R) at the beginning of fiscal 2006, the Company changed its method of attributing the value of share-based compensation to expense from the accelerated multiple-option approach to the straight-line single-option method. Compensation expense for all share-based payment awards granted on or prior to July 30, 2005 will continue to be recognized using the accelerated multiple-option approach while compensation expense for all share-based payment awards granted subsequent to July 30, 2005 is recognized using the straight-line single-option method. Because share-based compensation expense recognized in the Consolidated Statements of Operations is based on awards ultimately expected to vest, it has been reduced for forfeitures.

Upon adoption of SFAS 123(R), the Company also changed its method of valuation for share-based awards granted beginning in fiscal 2006 to a lattice-binomial option-pricing model (“lattice-binomial model”) from the Black-Scholes option-pricing model (“Black-Scholes model”) which was previously used for the Company’s pro forma information required under SFAS 123. The Company’s determination of fair value of share-based payment awards on the date of grant using an option-pricing model is affected by the Company’s stock price as well as assumptions regarding a number of highly complex and subjective variables. These variables include, but are not limited to, the Company’s expected stock price volatility over the term of the awards and actual and projected employee stock option exercise behaviors. Option-pricing models were developed for use in estimating the value of traded options that have no vesting or hedging restrictions and are fully transferable. Because the Company’s employee stock options have certain characteristics that are significantly different from traded options and because changes in the subjective assumptions can materially affect the estimated value, in management’s opinion, the existing valuation models may not provide an accurate measure of the fair value of the Company’s employee stock options. Although the fair value of employee stock options is determined in accordance with SFAS 123(R) and SAB 107 using an option-pricing model, that value may not be indicative of the fair value observed in a willing buyer/willing seller market transaction.

The Company has elected to apply the alternative transition method provided in FASB Staff Position No. FAS 123(R)-3 “Transition Election Related to Accounting for Tax Effects of Share-Based Payment Awards” for calculating the tax effects of share-based compensation pursuant to SFAS 123(R). The alternative transition method includes simplified methods to establish the beginning balance of the additional paid-in capital pool (“APIC pool”) related to the tax effects of employee share-based compensation, and to determine the subsequent impact on the APIC pool and Consolidated Statements of Cash Flows of the tax effects of employee share-based compensation awards that are outstanding upon adoption of SFAS 123(R).

(q) Software Development Costs.

Software development costs required to be capitalized pursuant to Statement of Financial Accounting Standards No. 86, “Accounting for the Costs of Computer Software to Be Sold, Leased, or Otherwise Marketed,” have not been material to date. Software development costs for internal use required to be capitalized pursuant to Statement of Position No. 98-1, “Accounting for the Costs of Computer Software Developed or Obtained for Internal Use,” have also not been material to date.

(r) Income Taxes.

Income tax expense is based on pretax financial accounting income. Deferred tax assets and liabilities are recognized for the expected tax consequences of temporary differences between the tax bases of assets and liabilities and their reported amounts. Valuation allowances are recorded to reduce deferred tax assets to the amount that will more likely than not be realized.

On July 29, 2007, the Company adopted FIN 48, which is a change in accounting for income taxes. FIN 48 contains a two-step approach to recognizing and measuring uncertain tax positions accounted for in accordance with SFAS 109. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be sustained on audit, including resolution of related appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest amount that is more than 50% likely of being realized upon settlement. The Company will classify the liability for unrecognized tax benefits as current to the extent that the Company anticipates payment (or receipt) of cash within one year. Interest and penalties related to uncertain tax positions are recognized in the provision for income taxes. See Note 13.

(s) Computation of Net Income per Share.

Basic net income per share is computed using the weighted-average number of common shares outstanding during the period. Diluted net income per share is computed using the weighted-average number of common shares and dilutive potential common shares outstanding during the period. Dilutive potential common shares primarily consist of employee stock options, restricted stock and restricted stock units.

Statement of Financial Accounting Standards (SFAS) No. 128, “Earnings per Share,” requires that employee equity share options, unvested shares, and similar equity instruments granted by the Company be treated as potential common shares outstanding in computing diluted earnings per share. Diluted shares outstanding include the dilutive effect of in-the-money options which is calculated based on the average share price for each fiscal period using the treasury stock method. Under the treasury stock method, the amount the employee must pay for exercising stock options, the amount of compensation cost for future service that the Company has not yet recognized, and the amount of tax benefits that would be recorded in additional paid-in capital when the award becomes deductible are assumed to be used to repurchase shares.

(t) Consolidation of Variable Interest Entities.

The Financial Accounting Standards Board (FASB) issued FASB Interpretation No. 46, “Consolidation of Variable Interest Entities” (“FIN 46”), in January 2003. FIN 46 requires that if an entity is the primary beneficiary of a variable interest entity, the assets, liabilities, and results of operations of the variable interest entity should be included in the consolidated financial statements of the entity. FASB Interpretation No. 46(R), “Consolidation of Variable Interest Entities” (“FIN 46(R)”), was issued in December 2003. The Company adopted FIN 46(R) effective January 24, 2004. For additional information regarding variable interest entities, see Note 10.

(u) Use of Estimates.

The preparation of financial statements and related disclosures in conformity with accounting principles generally accepted in the United States requires management to make estimates and judgments that affect the amounts reported in the Consolidated Financial Statements and accompanying notes. Estimates are used for the following, among others:

The actual results experienced by the Company may differ materially from management’s estimates.

(v) Recent Accounting Pronouncements.

SFAS 141(R) and SFAS 160.

(w) Reclassifications.

Certain reclassifications have been made to prior year balances in order to conform to the current year’s presentation.

3. Business Combinations.

(a) Purchase Acquisitions.

A summary of the purchase acquisitions and asset purchases completed in fiscal 2008, 2007, and 2006 is as follows (in millions):

The purchase consideration for the Company’s purchase acquisitions and asset purchases is also allocated to tangible assets acquired and liabilities assumed.

Fiscal 2008.

Fiscal 2007.

Fiscal 2006.

(b) Acquisition of Scientific-Atlanta, Inc.

The following table summarizes the pro forma financial information (in millions, except per-share amounts):

The following table presents the compensation expense related to acquisitions and investments (in millions):

Share-Based Compensation Expense.

Cash Compensation Expense.

Nuova Systems, Inc.

4. Goodwill and Purchased Intangible Assets.

(a) Goodwill.

The following tables present the changes in goodwill allocated to the Company’s reportable segments during fiscal 2008 and 2007 (in millions):

In the table above, “Other” primarily includes foreign currency translation and purchase accounting adjustments.

(b) Purchased Intangible Assets.

The following tables present details of the purchased intangible assets acquired through acquisitions during fiscal 2008 and 2007 (in millions, except years):

The following tables present details of the Company’s purchased intangible assets (in millions):

(1) The technology category for the year ended July 26, 2008 includes technology intangible assets acquired through business combinations as well as technology licenses.

The following table presents the amortization of purchased intangible assets (in millions):

The estimated future amortization expense of purchased intangible assets as of July 26, 2008, is as follows (in millions):

5. Balance Sheet Details.

The following tables provide details of selected balance sheet items (in millions):

6. Financing Receivables and Guarantees.

(a) Lease Receivables.

(b) Financed Service Contracts.

Financed service contracts are summarized as follows (in millions):

Loan receivables are summarized as follows (in millions):

A portion of the revenue related to loan receivables is deferred and included in deferred product revenue based on revenue recognition criteria.

(d) Financing Guarantees.

7. Investments.

(a) Summary of Investments.

The following tables summarize the Company’s investments (in millions):

(b) Gains and Losses on Investments.

The following table presents gross realized gains and losses related to the Company’s investments (in millions):

The following tables present the breakdown of the investments with unrealized losses at July 26, 2008 and July 28, 2007 (in millions):

The following table summarizes the maturities of the Company’s fixed income securities at July 26, 2008 (in millions):

Actual maturities may differ from the contractual maturities because borrowers may have the right to call or prepay certain obligations.

8. Borrowings.

(a) Long-Term Debt.

Interest is payable quarterly on the 2009 Notes and semi-annually on the 2011 Notes and 2016 Notes. Interest expense and cash paid for interest are summarized as follows (in millions):

(b) Credit Facility.

9. Derivative Instruments.

(a) Foreign Currency Derivatives.

The Company’s foreign exchange forward and option contracts are summarized as follows (in millions):

(b) Interest Rate Derivatives.

The Company’s interest rate derivatives are summarized as follows (in millions):

Interest Rate Swaps, Investments.

Interest Rate Swaps, Long-Term Debt.

The Company’s equity derivatives are summarized as follows (in millions):

10. Commitments and Contingencies.

(a) Operating Leases.

(b) Purchase Commitments with Contract Manufacturers and Suppliers.

(d) Other Commitments.

(e) Variable Interest Entities.

(f) Guarantees and Product Warranties.

The following table summarizes the activity related to the product warranty liability during fiscal 2008 and 2007 (in millions):

(g) Legal Proceedings.

11. Shareholders’ Capital próprio.

(a) Stock Repurchase Program.

(1) Includes stock repurchases that were pending settlement as of period end.

(b) Other Repurchases of Common Stock.

The Company also repurchases shares in settlement of employee tax withholding obligations due upon the vesting of restricted stock or stock units.

(d) Comprehensive Income.

The components of comprehensive income are as follows (in millions):

12. Employee Benefit Plans.

(a) Employee Stock Purchase Plan.

(b) Employee Stock Incentive Plans.

Stock Incentive Plan Program Description.

Supplemental Plan.

Acquisition Plans.

Dilutive Effect of Stock Options.

General Share-Based Award Information.

A summary of share-based award activity is as follows (in millions, except per-share amounts):

(1) The total pretax intrinsic value of stock options exercised during fiscal 2008, 2007, and 2006 was $1.6 billion, $3.1 billion and $1.3 billion, respectively.

The following table summarizes significant ranges of outstanding and exercisable stock options as of July 26, 2008 (in millions, except years and share prices):

Valuation and Expense Information Under SFAS 123(R)

Lattice-Binomial Model.

Accuracy of Fair Value Estimates.

(d) Deferred Compensation Plans.

(e) Defined Benefit Plans Assumed from Scientific-Atlanta.

The following table sets forth projected benefit obligations, plan assets, and amounts recorded in current and long-term liabilities under the Pension Plans (in millions):

The accumulated benefit obligations under the Pension Plans were $197 million and $225 million as of July 26, 2008 and July 28, 2007, respectively.

13. Income Taxes.

(a) Provision for Income Taxes.

The provision for income taxes consists of the following (in millions):

The items accounting for the difference between income taxes computed at the federal statutory rate and the provision for income taxes consists of the following:

(b) Unrecognized Tax Benefits.

The aggregate changes in the balance of gross unrecognized tax benefits during fiscal 2008 were as follows (in millions):

The following table presents the breakdown between current and noncurrent net deferred tax assets (in millions):

The components of the deferred tax assets and liabilities are as follows (in millions):

14. Segment Information and Major Customers.

(a) Net Sales and Gross Margin by Theater.

Summarized financial information by theater for fiscal 2008, 2007, and 2006, based on the Company’s internal management system and as utilized by the Company’s CODM, is as follows (in millions):

(1) Net sales in the United States were $20.2 billion, $18.3 billion, and $14.8 billion for fiscal 2008, 2007, and 2006, respectively.

(2) The unallocated corporate items primarily include the effects of amortization of acquisition-related intangible assets and share-based compensation expense.

(b) Net Sales for Groups of Similar Products and Services.

The following table presents net sales for groups of similar products and services (in millions):

Property and equipment information is based on the physical location of the assets. The following table presents property and equipment information for geographic areas (in millions):

15. Net Income Per Share.

The following table presents the calculation of basic and diluted net income per share (in millions, except per-share amounts):

Search This Blog

Forex on-line Maceió

Ao calcular os ganhos diluídos por ação, as opções de ações são

Comments

Post a Comment