ALLT » Topics » Risk of Interest Rate Fluctuation

This excerpt taken from the ALLT 20-F filed May 7, 2009.

Risk of Interest Rate Fluctuation 

        We do not have any long-term borrowings. We have a significant amount of cash that is currently invested primarily in interest bearing investment such as bank time deposits, money market funds, ARS and as of the beginning of 2009, also U.S. government treasury bills. These investments expose us to the changes in interest rates. If interest rates further decline, our results of operations may be adversely affected due to lower interest income from these investments. See “ITEM 3: Key Information–Risk Factors–We have invested a substantial portion of our cash in auction-rate securities, which subjects us to liquidity and investment risk. Due to uncertainties in the capital markets regarding auction-rate securities, we recorded impairment charges in 2007 and 2008, and, if the fair value of these investments were to decline further, we could be required to record further impairment charges related to these investments” and “–We may receive much lower interest income on our interest bearing investments and suffer from losses due to the macro economic situation that may cause interest rates to remain at their current low level or further decline” and “ITEM 5: Operating and Financial Review and Prospects–Operating Results–Overview–Financial income (expenses), net” for further information regarding our investments in auction rate securities. The primary objective of our investment activities is to preserve principal while maximizing the income that we receive from our investments without significantly increasing risk and loss. Our investments are exposed to market risk due to fluctuation in interest rates, which may affect our interest income and the fair market value of our investments. We manage this exposure by performing ongoing evaluations of our investments. Due to the short and medium-term maturities of our investments to date, their carrying value approximates the fair value. We generally hold investments to maturity in order to limit our exposure to interest rate fluctuations.

This excerpt taken from the ALLT 20-F filed Jun 27, 2008.

Risk of Interest Rate Fluctuation

          We do not have any long-term borrowings. Our investments consist primarily of cash and cash equivalents and interest bearing, investment-grade investments in marketable securities. These marketable securities currently consist of corporate debt securities, money market funds and auction-rate securities. See “ITEM 3: Key Information—Risk Factors—We have invested a portion of our cash in auction-rate securities, which subjects us to liquidity and investment risk. Due to recent uncertainties in the capital markets regarding auction-rate securities, we recorded impairment charges in the fourth quarter of 2007 and the first quarter of 2008, and, if the fair value of these investments were to decline further, we could be required to record further impairment charges related to these investments” and “ITEM 5: Operating and Financial Review and Prospects—Operating Results—Overview—Financial income (expenses), net” for further information regarding our investments in auction rate securities. The primary objective of our investment activities is to preserve principal while maximizing the income that we receive from our investments without significantly increasing risk and loss. Our investments are exposed to market risk due to fluctuation in interest rates, which may affect our interest income and the fair market value of our investments. We manage this exposure by performing ongoing evaluations of our investments. Due to the short and medium-term maturities of our investments to date, their carrying value approximates the fair value. We generally hold investments to maturity in order to limit our exposure to interest rate fluctuations.

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This excerpt taken from the ALLT 20-F filed Jun 28, 2007.

Risk of Interest Rate Fluctuation 

        We do not have any long-term borrowings. Our investments consist primarily of cash and cash equivalents and interest bearing, investment-grade investments in marketable securities with maturities of up to three years. These marketable securities currently consist of corporate debt securities, governmental debt securities and money market funds, and may in the future include commercial paper and non-governmental debt securities. The primary objective of our investment activities is to preserve principal while maximizing the income that we receive from our investments without significantly increasing risk and loss. Our investments are exposed to market risk due to fluctuation in interest rates, which may affect our interest income and the fair market value of our investments. We manage this exposure by performing ongoing evaluations of our investments. Due to the short and medium-term maturities of our investments to date, their carrying value approximates the fair value. We generally hold investments to maturity in order to limit our exposure to interest rate fluctuations.

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