Citrix 2012 Annual Report Download - page 55

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51
included in Other assets in our accompanying consolidated balance sheets. Realized losses included in earnings for the period
are reported in Other income (expense), net in the accompanying consolidated statements of income.
Assets Measured at Fair Value on a Non-recurring Basis Using Significant Unobservable Inputs (Level 3)
During 2012, certain of our cost method investments with a carrying value of $13.0 million were determined to be
impaired and have been written down to their combined fair value of $9.5 million, resulting in an impairment charge of $3.5
million, which is included in Other income (expense), net in our consolidated financial statements for the year ended
December 31, 2012. In determining the fair value of cost method investments we consider many factors including but not
limited to operating performance of the investee, the amount of cash that the investee has on-hand, the ability to obtain
additional financing and the overall market conditions in which the investee operates. The fair value of the cost method
investment represents a Level 3 valuation as the assumptions used in valuing this investment were not directly or indirectly
observable.
Additional Disclosures Regarding Fair Value Measurements
The carrying value of accounts receivable, accounts payable and accrued expenses and other current liabilities
approximate their fair value due to the short maturity of these items.
Accounts Receivable, Net
December 31, 2012
Compared to
2011
2012 2011
(In thousands)
Accounts receivable $ 637,403 $ 488,356 $ 149,047
Allowance for returns (2,564)(1,361)(1,203)
Allowance for doubtful accounts (3,883)(2,564)(1,319)
Accounts receivable, net $ 630,956 $ 484,431 $ 146,525
The increase in accounts receivable at December 31, 2012 compared to December 31, 2011 was primarily due to increase
in sales, particularly in the last month of 2012 compared to the last month of 2011. The activity in our allowance for returns
was comprised primarily of $10.7 million of provisions for returns recorded during 2012 partially offset by $9.5 million in
credits issued for returns. The activity in our allowance for doubtful accounts was comprised primarily of $2.9 million in
additional provisions for doubtful accounts of which $1.1 million was in connection with our acquisitions during 2012, offset
by $1.6 million of uncollectible accounts written off, net of recoveries.
From time to time, we could maintain individually significant accounts receivable balances from our distributors or
customers, which are comprised of large business enterprises, governments and small and medium-sized businesses. If the
financial condition of our distributors or customers deteriorates, our operating results could be adversely affected. At
December 31, 2012, one distributor, Ingram Micro, accounted for 11% of our accounts receivable. At December 31, 2011, one
distributor, Ingram Micro, accounted for 14% of our accounts receivable. For more information regarding significant customers
see Note 11 to our consolidated financial statements included in this Annual Report on Form 10-K for the year ended
December 31, 2012.
Stock Repurchase Program
Our Board of Directors authorized an ongoing stock repurchase program with a total repurchase authority granted to us of
$3.4 billion. We may use the approved dollar authority to repurchase stock at any time until the approved amounts are
exhausted. The objective of our stock repurchase program is to improve stockholders’ returns. At December 31, 2012,
approximately $335.6 million was available to repurchase common stock pursuant to the stock repurchase program. All shares
repurchased are recorded as treasury stock in our consolidated balance sheets included in this Annual Report on Form 10-K for
the year ended December 31, 2012. A portion of the funds used to repurchase stock over the course of the program was
provided by proceeds from employee stock option exercises and the related tax benefit.
We are authorized to make open market purchases of our common stock using general corporate funds through open
market purchases or pursuant to a Rule 10b5-1 plan. Additionally, from time to time, we may enter into structured stock
repurchase arrangements with large financial institutions using general corporate funds in order to lower the average cost to
acquire shares. These programs include terms that require us to make up-front payments to the counterparty financial institution
and result in the receipt of stock during or at the end of the agreement or the receipt of either stock or cash at the maturity of the
agreement, depending on market conditions. We did not enter into any structured stock repurchase agreements in 2012 or 2011.