Contents - AL-Tax

7.1 Summary of Key Facts 103orders, and schedules production accordingly. It sources raw materials, handlesall aspects of inbound and outbound logistics, manufactures all magnetic disks,invoices customers, collects receivables and contributes very substantially to thedevelopment and implementation of new processes, manufacturing equipmentand testing equipment. As the principal on all sales of magnetic media, FP bearsthe associated market, inventory, credit and collections, foreign exchange andenvironmental liability risks. 1The manufacture of thin film magnetic disks is an exceedingly precise and complexprocess. It entails converting aluminum substrates into finished data storagemedia through the deposition of uniform, microscopic layers of magnetic film. Thefinished product is manufactured to nano-level specifications. The disk manufacturingprocess consists of five stages, most of which are conducted in Class 100(or more restrictive) clean room environments. These five stages are summarizedbelow.1. Substrate machining and grinding: A raw aluminum blank substrate ismachined for edge and surface preparation prior to nickel alloy plating. Thisprocess sets the ultra smooth surface finish for the aluminum substrates. Thesubstrates are annealed to relieve stress in the material and to temper the partsfor the next steps in the manufacturing process.2. Nickel alloy plating: Through a series of chemical baths, ground aluminum substratesare plated with a nickel phosphorus layer in order to provide support forthe magnetic layers.3. Nickel polishing and cleaning: The nickel phosphorus layer is polished to amirror finish and cleaned to enable the read–write heads in the disk drives to flyat low and constant heights over the disks.4. Sputtering and lubricating: Magnetic film is deposited onto the polished substrateby means of a technically demanding vacuum deposition process. Duringthe sputtering process, microscopic magnetic layers are successively depositedon the disk. These layers ultimately provide the magnetic storage capacity fordata. The disk is finished with an ultra-thin carbon overcoat. The properties ofthis final overcoat barrier are equivalent to laying a fine film of diamond over thesurface. After sputtering, a monolayer of lubricant is applied to the disk’s surfaceto improve durability and reduce surface friction.5. Testing and certification: In robotically controlled test cells, disks are opticallyscreened for surface defects. Read/write heads are then positioned over the surfaceto identify microscopic imperfections and ensure superior magnetic properties,which directly influence the storage capacity of the disk. Additional testsmay also be run, as required by individual disk drive manufacturers. (Disks arealso subjected to numerous tests at various phases of the manufacturing process.)1 Environmental liability risks relate to the use, storage, discharge and disposal of hazardous materials,the treatment of water used in the disk manufacturing processes and air quality management.