Balance Sheet Information

12 Months Ended

Dec. 29, 2013

Balance Sheet Information [Abstract]

Balance Sheet Information

Balance Sheet Information

Accounts Receivable, net. Accounts receivable, net was as follows (in thousands):

	December 29, 2013			December 30, 2012
Accounts receivable	$	904,551		$	804,221
Allowance for doubtful accounts	(8,274		)	(6,627		)
Price protection, promotions and other activities	(213,468		)	(171,569		)
Total accounts receivable, net	$	682,809		$	626,025

Allowance for Doubtful Accounts. The activity in the allowance for doubtful accounts was as follows (in thousands):

	Fiscal years ended
	December 29, 2013			December 30, 2012			January 1, 2012
Balance, beginning of period	$	6,627		$	5,717		$	8,416
Additions (reductions) charged to costs and expenses	2,167			1,452			(1,476		)
Deductions/write-offs	(520		)	(542		)	(1,223		)
Balance, end of period	$	8,274		$	6,627		$	5,717

Inventory. Inventory was as follows (in thousands):

	December 29, 2013		December 30, 2012
Raw material	$	440,570	$	404,634
Work-in-process	102,543		102,249
Finished goods	213,862		243,192
Total inventory	$	756,975	$	750,075

Other Current Assets. Other current assets were as follows (in thousands):

	December 29, 2013		December 30, 2012
Tax-related receivables	$	70,760	$	186,223
Other non-trade receivables	37,368		—
Prepayment to Flash Forward Ltd.	5,144		20,577
Derivative contract receivables	777		19,064
Prepaid expenses	12,630		13,221
Other current assets	40,206		21,794
Total other current assets	$	166,885	$	260,879

Property and Equipment. Property and equipment were as follows (in thousands):

	December 29, 2013			December 30, 2012
Machinery and equipment	$	1,148,150		$	1,124,701
Software	171,733			148,014
Buildings and building improvements	261,471			227,651
Capital land lease	6,644			6,603
Land	24,427			24,427
Furniture and fixtures	20,481			10,106
Leasehold improvements	6,559			11,979
Property and equipment, at cost	1,639,465			1,553,481
Accumulated depreciation and amortization	(983,671		)	(887,939		)
Property and equipment, net	$	655,794		$	665,542

Depreciation expense of property and equipment totaled $226.3 million, $161.9 million and $115.0 million in fiscal years 2013, 2012 and 2011, respectively.

Notes Receivable and Investments in Flash Ventures. Notes receivable and investments in Flash Partners Ltd., Flash Alliance Ltd. and Flash Forward Ltd. (collectively referred to as “Flash Ventures”) were as follows (in thousands):

	December 29, 2013		December 30, 2012
Notes receivable, Flash Partners Ltd.	$	100,057	$	180,254
Notes receivable, Flash Alliance Ltd.	323,995		476,800
Notes receivable, Flash Forward Ltd.	169,144		162,810
Investment in Flash Partners Ltd.	190,694		232,547
Investment in Flash Alliance Ltd.	283,999		342,048
Investment in Flash Forward Ltd.	66,731		65,653
Total notes receivable and investments in Flash Ventures	$	1,134,620	$	1,460,112

Equity-method investments and the Company’s maximum loss exposure related to Flash Ventures are discussed further in Note 12, “Commitments, Contingencies and Guarantees – Flash Ventures” and Note 13, “Related Parties and Strategic Investments.”

The Company assesses financing receivable credit quality through financial and operational reviews of the borrower and creditworthiness, including credit rating agency ratings, of significant investors of the borrower, where material or known. Impairments, when required for credit worthiness, are recorded in other income (expense). The Company makes or will make long-term loans to Flash Ventures to fund new process technologies and additional wafer capacities. The Company aggregates its Flash Ventures notes receivable into one class of financing receivables due to the similar ownership interest and common structure in each Flash Venture entity. For all reporting periods presented, no loans were past due and no loan impairments were recorded.

Other Non-current Assets. Other non-current assets were as follows (in thousands):

	December 29, 2013		December 30, 2012
Prepaid tax onintercompany transactions	$	37,747	$	42,118
Prepayment to Flash Forward Ltd.	—		5,144
Convertible note issuance costs	20,612		8,708
Long-term prepaid income tax	66,176		63,008
Other non-current assets	42,895		34,832
Total other non-current assets	$	167,430	$	153,810

Other Current Accrued Liabilities. Other current accrued liabilities were as follows (in thousands):

	December 29, 2013		December 30, 2012
Accrued payroll and related expenses	$	227,779	$	102,269
Derivative contract payables	45,741		13,584
Taxes payable	59,618		25,476
Other accrued liabilities	176,594		116,210
Total other current accrued liabilities	$	509,732	$	257,539

Non-current Liabilities. Non-current liabilities were as follows (in thousands):

	December 29, 2013		December 30, 2012
Deferred tax liabilities	$	3,482	$	28,672
Income tax liabilities	205,266		208,629
Deferred credits on intercompany transactions	15,065		58,548
Other non-current liabilities	83,270		112,098
Total non-current liabilities	$	307,083	$	407,947

Warranties. The liability for warranty expense is included in Other current accrued liabilities and Non-current liabilities in the accompanying Consolidated Balance Sheets, and the activity was as follows (in thousands):

	Fiscal years ended
	December 29, 2013			December 30, 2012			January 1, 2012
Balance, beginning of period	$	38,787		$	26,957		$	24,702
Additions and adjustments to cost of revenue	35,763			33,247			29,444
Usage	(30,926		)	(21,417		)	(27,189		)
Balance, end of period	$	43,624		$	38,787		$	26,957

The majority of the Company’s products have a warranty of less than three years, with a small number of products having a warranty ranging up to ten years or more. For warranties ten years or greater, including lifetime warranties, the Company uses the estimated useful life of the product to calculate the warranty exposure. A provision for the estimated future cost related to warranty expense is recorded at the time of customer invoice. The Company’s warranty liability is affected by customer and consumer returns, product failures, number of units sold and repair or replacement costs incurred. Should actual product failure rates, or repair or replacement costs, differ from the Company’s estimates, increases or decreases to its warranty liability would be required.

Comprehensive Income (Loss) Note

Accumulated Other Comprehensive Income (Loss). AOCI presented in the accompanying Consolidated Balance Sheets consists of unrealized gains and losses on available-for-sale investments, foreign currency translation and hedging activities, net of tax, for all periods presented (in thousands):

	December 29, 2013			December 30, 2012
Accumulated net unrealized gain (loss) on:
Available-for-sale investments	$	10,479		$	15,919
Foreign currency translation	(47,440		)	155,389
Hedging activities	(39,498		)	(6,187		)
Total accumulated other comprehensive income (loss)	$	(76,459	)	$	165,121

The amount of income tax (benefit) expense allocated to the unrealized gain (loss) on available-for-sale investments, foreign currency translation and hedging activities was as follows (in thousands):

	Fiscal years ended
	December 29, 2013			December 30, 2012			January 1, 2012
Available-for-sale investments	$	(3,383	)	$	3,121		$	3,342
Foreign currency translation	(38,006		)	(23,791		)	10,315
Hedging activities	—			—			2,504
	$	(41,389	)	$	(20,670	)	$	16,161

The significant amounts reclassified out of each component of AOCI were as follows (in thousands):

	Fiscal years ended
AOCI Component	December 29, 2013			December 30, 2012			January 1, 2012			Statement of Operations  Line Item
Unrealized gain on available-for-sale investments	$	2,375		$	2,969		$	34,549		Interest (expense) and other income (expense), net
Tax impact	(1,122		)	(1,051		)	(2,119		)	Provision for income taxes
Unrealized gain on available-for-sale investments, net of tax	1,253			1,918			32,430
Unrealized holding gains (losses) on derivatives:
Foreign exchange contracts	(41,523		)	(10,946		)	27,985			Cost of revenue
Equity market risk contract	—			—			(9,885		)	Interest (expense) and other income (expense), net
Tax impact	—			—			2,504			Provision for income taxes
Gain (loss) on cash flow hedging activities, net of tax	(41,523		)	(10,946		)	20,604
Total reclassifications for the period, net of tax	$	(40,270	)	$	(9,028	)	$	53,034