In support of this, we are bringing Office, Windows, and devices together for an enhanced and more cohesive customer experience.Windows 10 continues to gain traction in the enterprise as the most secure and productive operating system. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements.
We monitor our foreign currency exposures daily to maximize the economic effectiveness of our foreign currency positions. Many customers are committing to our products and services for longer contract terms, which is increasing the percentage of contracted revenue that will be recognized beyond the next 12 months.We have operating and finance leases for datacenters, corporate offices, research and development facilities, retail stores, and certain equipment. Certain income and expenses are not reported in tax returns and financial statements in the same year. We adopted the guidance effective July 1, 2018.

Changes in value are recorded in other income (expense), net.We lend certain fixed-income and equity securities to increase investment returns. We also purchase or license technology that we incorporate into our products and services. Certain cloud services, primarily Office 365, depend on a significant level of integration, interdependency, and interrelation between the desktop applications and cloud services, and are accounted for together as one performance obligation. Adoption of the standard resulted in an increase in long-term deferred tax assets of $2.8 billion, an increase in long-term deferred tax liabilities of $2.1 billion, and a reduction in other current assets of $152 million. And the We are enabling our customers to digitize not only their business processes but to bridge the physical and digital worlds with our investments in mixed-reality cloud. Each day we practice customer obsession — listening and then innovating to meet customers’ unarticulated needs. Net realizable value is the estimated selling price less estimated costs of completion, disposal, and transportation. We have paid transition tax of approximately $2.0 billion, which included $1.5 billion for fiscal year 2019. Equity investments were $2.6 billion and $1.9 billion as of June 30, 2019 and 2018, respectively. Shares of our common stock may be purchased by employees at three-month intervals at 90% of the fair market value on the last trading day of each three-month period. Market price risk is managed relative to broad-based global and domestic equity indices using certain convertible preferred investments, options, futures, and swap contracts not designated as hedging instruments. Most prominent among the changes in the standard is the requirement for changes in the fair value of our equity investments, with certain exceptions, to be recognized through net income rather than OCI.We adopted the standard effective July 1, 2018.
Our devices are designed to enable people and organizations to connect to the people and content that matter most using Windows and integrated Microsoft products and services. Advertising costs are expensed as incurred. Microsoft cannot fulfill our mission to empower every person and every organization on the planet to achieve more just by providing products and services that let our users do great things. Adoption of the standard will be applied using a modified retrospective approach through a cumulative-effect adjustment to retained earnings as of the effective date to align our credit loss methodology with the new standard. Each industry shift is an opportunity to conceive new products, new technologies, or new ideas that can further transform the industry and our business. The accounting for changes in the fair value of a derivative depends on the intended use of the derivative and the resulting designation.For derivative instruments designated as fair value hedges, gains and losses are recognized in other income (expense), net with offsetting gains and losses on the hedged items.For derivative instruments designated as cash flow hedges, the effective portion of the gains and losses are initially reported as a component of OCI and subsequently recognized in revenue when the hedged exposure is recognized in revenue. Overall, more than half of our nominees (54 percent) represent gender or ethnic diversity. Lease expense for lease payments is recognized on a straight-line basis over the lease term.We have lease agreements with lease and non-lease components, which are generally accounted for separately.

This segment primarily comprises:Office Commercial is designed to increase personal, team, and organizational productivity through a range of products and services. In June 2018, the court denied the plaintiffs’ motion for class certification. These manufacturers, many of which are also current or potential partners and customers, include Apple and our Windows OEMs.Our gaming platform competes with console platforms from Nintendo and Sony, both of which have a large, established base of customers. The proceeds of these issuances were or will be used for general corporate purposes, which may include, among other things, funding for working capital, capital expenditures, repurchases of capital stock, acquisitions, and repayment of existing debt. Certain cloud services, primarily Office 365, depend on a significant level of integration, interdependency, and interrelation between the desktop applications and cloud services, and are accounted for together as one performance obligation.