Cisco System Inc the leading Internet protocol-based networking equipment company, has significant holdings of investment securities. Use the financial information provided to analyze Ciscos holdings and address the following question:

Determine the effect of changes in fair value on net income and other comprehensive income in fiscal 2013, 2012, and 2011. If unrealized gains and losses on available-for-sale securities were reported in net income rather than other comprehensive income, what would be the effect on net income in fiscal 2013, 2012, and 2011?

At or for the year ended July 27, 2013 July 28, 2012 July 30, 2011

Total Assets $101,191 $91,759 $87,095

Net Income before Taxes $11,227 $10,159 $7,825

Summary of Comprehensive Income

Year Ended July 27, 2013 July 28, 2012 July 30, 2011

Net Income $9,983 $8,041 $6,490

Change in:

Unrealized gains and losses on

Investments, net (37) (78) 154

Derivative instruments 61 (59) (21)

Cumulative translation

Adjustment and other (77) (496) 538

Comprehensive income

(Loss) $9,930 $7,408 $7,161