Item 9A. Controls and Procedures
Item 9A. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
Based on an evaluation under the supervision and with the participation of the Company’s management, the Company’s principal executive officer and principal financial officer have concluded that the Company’s disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act were effective as of September 26, 2020 to provide reasonable assurance that information required to be disclosed by the Company in reports that it files or submits under the Exchange Act is (i) recorded, processed, summarized and reported within the time periods specified in the SEC rules and forms and (ii) accumulated and communicated to the Company’s management, including its principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.
Inherent Limitations over Internal Controls
The Company’s internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S. generally accepted accounting principles (“GAAP”). The Company’s internal control over financial reporting includes those policies and procedures that:
(i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the Company’s assets;
(ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with GAAP, and that the Company’s receipts and expenditures are being made only in accordance with authorizations of the Company’s management and directors; and
(iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the Company’s assets that could have a material effect on the financial statements.
Management, including the Company’s Chief Executive Officer and Chief Financial Officer, does not expect that the Company’s internal controls will prevent or detect all errors and all fraud. A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of internal controls can provide absolute assurance that all control issues and instances of fraud, if any, have been detected. Also, any evaluation of the effectiveness of controls in future periods are subject to the risk that those internal controls may become inadequate because of changes in business conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Management’s Annual Report on Internal Control over Financial Reporting
The Company’s management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act). Management conducted an assessment of the effectiveness of the Company’s internal control over financial reporting based on the criteria set forth in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework). Based on the Company’s assessment, management has concluded that its internal control over financial reporting was effective as of September 26, 2020 to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements in accordance with GAAP. The Company’s independent registered public accounting firm, Ernst & Young LLP, has issued an audit report on the Company’s internal control over financial reporting, which appears in Part II, Item 8 of this Form 10-K.
Changes in Internal Control over Financial Reporting
There were no changes in the Company’s internal control over financial reporting during the fourth quarter of 2020, which were identified in connection with management’s evaluation required by paragraph (d) of Rules 13a-15 and 15d-15 under the Exchange Act, that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.
Item 9B. Other Information
None.
Apple Inc. | 2020 Form 10-K | 62
PART III
Item 10. Directors, Executive Officers and Corporate Governance
The information required by this Item is set forth under the headings “Corporate Governance,” “Directors,” “Executive Officers” and, if applicable, “Other Information—Security Ownership of Certain Beneficial Owners and Management” in the Company’s 2021 Proxy Statement to be filed with the SEC within 120 days after September 26, 2020 in connection with the solicitation of proxies for the Company’s 2021 annual meeting of shareholders, and is incorporated herein by reference.
Item 11. Executive Compensation
The information required by this Item is set forth under the heading “Executive Compensation,” under the subheadings “Board Oversight of Risk Management” and, if applicable, “Compensation Committee Interlocks and Insider Participation” under the heading “Corporate Governance” and under the subheadings “Compensation of Directors” and “Director Compensation—2020” under the heading “Directors” in the Company’s 2021 Proxy Statement to be filed with the SEC within 120 days after September 26, 2020, and is incorporated herein by reference.
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
The information required by this Item is set forth under the headings “Other Information—Security Ownership of Certain Beneficial Owners and Management” and “Other Information—Equity Compensation Plan Information” in the Company’s 2021 Proxy Statement to be filed with the SEC within 120 days after September 26, 2020, and is incorporated herein by reference.
Item 13. Certain Relationships and Related Transactions, and Director Independence
The information required by this Item is set forth under the subheadings “Role of the Board of Directors,” “Board Committees”, “Review, Approval, or Ratification of Transactions with Related Persons” and “Transactions with Related Persons” under the heading “Corporate Governance” in the Company’s 2021 Proxy Statement to be filed with the SEC within 120 days after September 26, 2020, and is incorporated herein by reference.
Item 14. Principal Accountant Fees and Services
The information required by this Item is set forth under the subheadings “Fees Paid to Auditors” and “Policy on Audit Committee Pre-Approval of Audit and Non-Audit Services Performed by the Independent Registered Public Accounting Firm” under the proposal “Ratification of Appointment of Independent Registered Public Accounting Firm” in the Company’s 2021 Proxy Statement to be filed with the SEC within 120 days after September 26, 2020, and is incorporated herein by reference.
Apple Inc. | 2020 Form 10-K | 63
PART IV
Item 15. Exhibit and Financial Statement Schedules
(a) Documents filed as part of this report
(1) All financial statements
Index to Consolidated Financial Statements Page
Consolidated Statements of Operations for the years ended September 26, 2020, September 28, 2019 and September 29, 2018
31
Consolidated Statements of Comprehensive Income for the years ended September 26, 2020, September 28, 2019 and September 29, 2018
32
Consolidated Balance Sheets as of September 26, 2020 and September 28, 2019
33
Consolidated Statements of Shareholders’ Equity for the years ended September 26, 2020 , September 28, 2019 and September 29, 2018
34
Consolidated Statements of Cash Flows for the years ended September 26, 2020, September 28, 2019 and September 29, 2018
35
Notes to Consolidated Financial Statements
36
Selected Quarterly Financial Information (Unaudited)
57
Reports of Independent Registered Public Accounting Firm
59
(2) Financial Statement Schedules
All financial statement schedules have been omitted, since the required information is not applicable or is not present in amounts sufficient to require submission of the schedule, or because the information required is included in the consolidated financial statements and accompanying notes included in this Form 10-K.
(3) Exhibits required by Item 601 of Regulation S-K (1)
Incorporated by Reference
Exhibit Number Exhibit Description Form Exhibit Filing Date/
Period End Date
3.1 Restated Articles of Incorporation of the Registrant filed on August 3 , 2020 .
8-K 3.1 8/7/20
3.2 Amended and Restated Bylaws of the Registrant effective as of December 13, 2016.
8-K 3.2 12/15/16
4.1** Description of Securities of the Registrant.
4.2 Indenture, dated as of April 29, 2013, between the Registrant and The Bank of New York Mellon Trust Company, N.A., as Trustee.
S-3 4.1 4/29/13
4.3 Officer’s Certificate of the Registrant, dated as of May 3, 2013, including forms of global notes representing the Floating Rate Notes due 2016, Floating Rate Notes due 2018, 0.45% Notes due 2016, 1.00% Notes due 2018, 2.40% Notes due 2023 and 3.85% Notes due 2043.
8-K 4.1 5/3/13
4.4 Officer’s Certificate of the Registrant, dated as of May 6, 2014, including forms of global notes representing the Floating Rate Notes due 2017, Floating Rate Notes due 2019, 1.05% Notes due 2017, 2.10% Notes due 2019, 2.85% Notes due 2021, 3.45% Notes due 2024 and 4.45% Notes due 2044.
8-K 4.1 5/6/14
4.5 Officer’s Certificate of the Registrant, dated as of November 10, 2014, including forms of global notes representing the 1.000% Notes due 2022 and 1.625% Notes due 2026.
8-K 4.1 11/10/14
4.6 Officer’s Certificate of the Registrant, dated as of February 9, 2015, including forms of global notes representing the Floating Rate Notes due 2020, 1.55% Notes due 2020, 2.15% Notes due 2022, 2.50% Notes due 2025 and 3.45% Notes due 2045.
8-K 4.1 2/9/15
4.7 Officer’s Certificate of the Registrant, dated as of May 13, 2015, including forms of global notes representing the Floating Rate Notes due 2017, Floating Rate Notes due 2020, 0.900% Notes due 2017, 2.000% Notes due 2020, 2.700% Notes due 2022, 3.200% Notes due 2025, and 4.375% Notes due 2045.
8-K 4.1 5/13/15
4.8 Officer’s Certificate of the Registrant, dated as of July 31, 2015, including forms of global notes representing the 3.05% Notes due 2029 and 3.60% Notes due 2042.
8-K 4.1 7/31/15
Apple Inc. | 2020 Form 10-K | 64
Incorporated by Reference
Exhibit Number Exhibit Description Form Exhibit Filing Date/
Period End Date
4.9 Officer’s Certificate of the Registrant, dated as of September 17, 2015, including forms of global notes representing the 1.375% Notes due 2024 and 2.000% Notes due 2027.
8-K 4.1 9/17/15
4.10 Officer’s Certificate of the Registrant, dated as of February 23, 2016, including forms of global notes representing the Floating Rate Notes due 2019, Floating Rate Notes due 2021, 1.300% Notes due 2018, 1.700% Notes due 2019, 2.250% Notes due 2021, 2.850% Notes due 2023, 3.250% Notes due 2026, 4.500% Notes due 2036 and 4.650% Notes due 2046.
8-K 4.1 2/23/16
4.11 Supplement No. 1 to the Officer’s Certificate of the Registrant, dated as of March 24, 2016.
8-K 4.1 3/24/16
4.12 Officer’s Certificate of the Registrant, dated as of August 4, 2016, including forms of global notes representing the Floating Rate Notes due 2019, 1.100% Notes due 2019, 1.550% Notes due 2021, 2.450% Notes due 2026 and 3.850% Notes due 2046.
8-K 4.1 8/4/16
4.13 Officer’s Certificate of the Registrant, dated as of February 9, 2017, including forms of global notes representing the Floating Rate Notes due 2019, Floating Rate Notes due 2020, Floating Rate Notes due 2022, 1.550% Notes due 2019, 1.900% Notes due 2020, 2.500% Notes due 2022, 3.000% Notes due 2024, 3.350% Notes due 2027 and 4.250% Notes due 2047.
8-K 4.1 2/9/17
4.14 Officer’s Certificate of the Registrant, dated as of May 11, 2017, including forms of global notes representing the Floating Rate Notes due 2020, Floating Rate Notes due 2022, 1.800% Notes due 2020, 2.300% Notes due 2022, 2.850% Notes due 2024 and 3.200% Notes due 2027.
8-K 4.1 5/11/17
4.15 Officer’s Certificate of the Registrant, dated as of May 24, 2017, including forms of global notes representing the 0.875% Notes due 2025 and 1.375% Notes due 2029.
8-K 4.1 5/24/17
4.16 Officer’s Certificate of the Registrant, dated as of June 20, 2017, including form of global note representing the 3.000% Notes due 2027.
8-K 4.1 6/20/17
4.17 Officer’s Certificate of the Registrant, dated as of August 18, 2017, including form of global note representing the 2.513% Notes due 2024.
8-K 4.1 8/18/17
4.18 Officer’s Certificate of the Registrant, dated as of September 12, 2017, including forms of global notes representing the 1.500% Notes due 2019, 2.100% Notes due 2022, 2.900% Notes due 2027 and 3.750% Notes due 2047.
8-K 4.1 9/12/17
4.19 Officer’s Certificate of the Registrant, dated as of November 13, 2017, including forms of global notes representing the 1.800% Notes due 2019, 2.000% Notes due 2020, 2.400% Notes due 2023, 2.750% Notes due 2025, 3.000% Notes due 2027 and 3.750% Notes due 2047.
8-K 4.1 11/13/17
4.20 Indenture, dated as of November 5, 2018, between the Registrant and The Bank of New York Mellon Trust Company, N.A., as Trustee.
S-3 4.1 11/5/18
4.21 Officer’s Certificate of the Registrant, dated as of September 11, 2019, including forms of global notes representing the 1.700% Notes due 2022, 1.800% Notes due 2024, 2.050% Notes due 2026, 2.200% Notes due 2029 and 2.950% Notes due 2049.
8-K 4.1 9/11/19
4.22 Officer’s Certificate of the Registrant, dated as of No vember 15, 2019 , including forms of global notes representing the 0.000 % Notes due 202 5 and 0.500 % Notes due 20 31 .
8-K 4.1 11/15/19
4.23 Officer’s Certificate of the Registrant, dated as of May 11, 2020, including forms of global notes representing the 0.750% Notes due 2023, 1.125% Notes due 2025, 1.650% Notes due 2030 and 2.650% Notes due 2050.
8-K 4.1 5/11/20
4.24 Officer’s Certificate of the Registrant, dated as of August 20 , 2020, including forms of global notes representing the 0.550 % Notes due 202 5 , 1. 25% Notes due 20 30 , 2.40 0% Notes due 20 5 0 and 2. 5 50% Notes due 20 6 0.
8-K 4.1 8/20/20
4.25* Apple Inc. Deferred Compensation Plan.
S-8 4.1 8/23/18
10.1* Employee Stock Purchase Plan, as amended and restated as of March 10, 2015.
8-K 10.1 3/13/15
10.2* Form of Indemnification Agreement between the Registrant and each director and executive officer of the Registrant.
10-Q 10.2 6/27/09
10.3* Apple Inc. Non-Employee Director Stock Plan, as amended and restated as of February 13, 2018.
8-K 10.1 2/14/18
10.4* 2003 Employee Stock Plan, as amended through February 25, 2010.
8-K 10.1 3/1/10
Apple Inc. | 2020 Form 10-K | 65
Incorporated by Reference
Exhibit Number Exhibit Description Form Exhibit Filing Date/
Period End Date
10.5* Form of Restricted Stock Unit Award Agreement under 2003 Employee Stock Plan effective as of November 16, 2010.
10-Q 10.10 12/25/10
10.6* 2014 Employee Stock Plan, as amended and restated as of October 1, 2017.
10-K 10.8 9/30/17
10.7* Form of Amendment, effective as of August 26, 2014, to Restricted Stock Unit Award Agreements and Performance Award Agreements outstanding as of August 26, 2014.
10-K 10.13 9/27/14
10.8* Form of Restricted Stock Unit Award Agreement under 2014 Employee Stock Plan effective as of October 14, 2016.
10-K 10.18 9/24/16
10.9* Form of Restricted Stock Unit Award Agreement under 2014 Employee Stock Plan effective as of September 26, 2017.
10-K 10.20 9/30/17
10.10* Form of Performance Award Agreement under 2014 Employee Stock Plan effective as of September 26, 2017.
10-K 10.21 9/30/17
10.11* Form of Restricted Stock Unit Award Agreement under Non-Employee Director Stock Plan effective as of February 13, 2018.
10-Q 10.2 3/31/18
10.12* Form of Restricted Stock Unit Award Agreement under 2014 Employee Stock Plan effective as of August 21, 2018.
10-K 10.17 9/29/18
10.13* Form of Performance Award Agreement under 2014 Employee Stock Plan effective as of August 21, 2018.
10-K 10.18 9/29/18
10.14* Form of Restricted Stock Unit Award Agreement under 2014 Employee Stock Plan effective as of September 29, 2019.
10-K 10.15 9/28/19
10.15* Form of Performance Award Agreement under 2014 Employee Stock Plan effective as of September 29, 2019.
10-K 10.16 9/28/19
10.16*, ** Form of Restricted Stock Unit Award Agreement under 2014 Employee Stock Plan effective as of August 18 , 20 20 .
10.17*, ** Form of Performance Award Agreement under 2014 Employee Stock Plan effective as of August 18 , 20 20 .
21.1** Subsidiaries of the Registrant.
23.1** Consent of Independent Registered Public Accounting Firm.
24.1** Power of Attorney (included on the Signatures page of this Annual Report on Form 10-K).
31.1** Rule 13a-14(a) / 15d-14(a) Certification of Chief Executive Officer.
31.2** Rule 13a-14(a) / 15d-14(a) Certification of Chief Financial Officer.
32.1*** Section 1350 Certifications of Chief Executive Officer and Chief Financial Officer.
101** Inline XBRL Document Set for the consolidated financial statements and accompanying notes in Part II, Item 8, “Financial Statements and Supplementary Data” of this Annual Report on Form 10-K.
104** Inline XBRL for the cover page of this Annual Report on Form 10-K, included in the Exhibit 101 Inline XBRL Document Set.
* Indicates management contract or compensatory plan or arrangement.
** Filed herewith.
*** Furnished herewith.
(1) Certain instruments defining the rights of holders of long-term debt securities of the Registrant are omitted pursuant to Item 601(b)(4)(iii) of Regulation S-K. The Registrant hereby undertakes to furnish to the SEC, upon request, copies of any such instruments.
Item 16. Form 10-K Summary
None.
Apple Inc. | 2020 Form 10-K | 66
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Date: October 29, 2020
Apple Inc.
By: /s/ Luca Maestri
Luca Maestri
Senior Vice President,
Chief Financial Officer
Power of Attorney
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Timothy D. Cook and Luca Maestri, jointly and severally, his or her attorneys-in-fact, each with the power of substitution, for him or her in any and all capacities, to sign any amendments to this Annual Report on Form 10-K, and to file the same, with exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, hereby ratifying and confirming all that each of said attorneys-in-fact, or his substitute or substitutes, may do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated:
Name Title Date
/s/ Timothy D. Cook Chief Executive Officer and Director
(Principal Executive Officer) October 29, 2020
TIMOTHY D. COOK
/s/ Luca Maestri Senior Vice President, Chief Financial Officer
(Principal Financial Officer) October 29, 2020
LUCA MAESTRI
/s/ Chris Kondo Senior Director of Corporate Accounting
(Principal Accounting Officer) October 29, 2020
CHRIS KONDO
/s/ James A. Bell Director October 29, 2020
JAMES A. BELL
/s/ Al Gore Director October 29, 2020
AL GORE
/s/ Andrea Jung Director October 29, 2020
ANDREA JUNG
/s/ Arthur D. Levinson Director October 29, 2020
ARTHUR D. LEVINSON
/s/ Ronald D. Sugar Director October 29, 2020
RONALD D. SUGAR
/s/ Susan L. Wagner Director October 29, 2020
SUSAN L. WAGNER
Apple Inc. | 2020 Form 10-K | 67