Arrow Electronics 2011 Annual Report Download - page 58

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ARROW ELECTRONICS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in thousands except per share data)
56
4. Investments in Affiliated Companies
The company owns a 50% interest in several joint ventures with Marubun Corporation (collectively "Marubun/Arrow") and a
50% interest in Arrow Altech Holdings (Pty.) Ltd. ("Altech Industries"), a joint venture with Allied Technologies Limited. These
investments are accounted for using the equity method.
The following table presents the company's investment in Marubun/Arrow and the company's investment and long-term note
receivable in Altech Industries at December 31:
Marubun/Arrow
Altech Industries
2011
$ 45,626
14,953
$ 60,579
2010
$ 41,971
17,484
$ 59,455
The equity in earnings (loss) of affiliated companies for the years ended December 31 consists of the following:
Marubun/Arrow
Altech Industries
Other
2011
$ 5,338
1,398
—
$ 6,736
2010
$ 5,185
1,184
—
$ 6,369
2009
$ 3,745
1,004
(18)
$ 4,731
Under the terms of various joint venture agreements, the company is required to pay its pro-rata share of the third party debt of
the joint ventures in the event that the joint ventures are unable to meet their obligations. At December 31, 2011, the company's
pro-rata share of this debt was approximately $7,700. The company believes that there is sufficient equity in the joint ventures to
meet their obligations.
5. Accounts Receivable
Accounts receivable, net, consists of the following at December 31:
Accounts receivable
Allowances for doubtful accounts
Accounts receivable, net
2011
$ 4,530,242
(48,125)
$ 4,482,117
2010
$ 4,140,868
(37,998)
$ 4,102,870
The company maintains allowances for doubtful accounts for estimated losses resulting from the inability of its customers to make
required payments. The allowances for doubtful accounts are determined using a combination of factors, including the length of
time the receivables are outstanding, the current business environment, and historical experience.
6. Debt
At December 31, 2011 and 2010, short-term borrowings of $33,843 and $61,210, respectively, were primarily utilized to support
the working capital requirements of certain international operations. The weighted average interest rates on these borrowings at
December 31, 2011 and 2010 were 3.6% and 1.9%, respectively.