Columbia Sportswear 2000 Annual Report Download - page 41

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COLUMBIA SPORTSWEAR COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
adjustments are included as a separate component of shareholders' equity and are not currently adjusted for
income taxes as they relate to indeÑnite net investments in non-U.S. operations.
Fair value of Ñnancial instruments:
Based on borrowing rates currently available to the Company for bank loans with similar terms and
maturities, the fair value of the Company's long-term debt approximates the carrying value. Furthermore, the
carrying value of all other Ñnancial instruments potentially subject to valuation risk (principally consisting of
cash and cash equivalents, accounts receivable and accounts payable) also approximate fair value because of
their short-term maturities.
Advertising costs:
Advertising costs are expensed as incurred. Advertising expense was $27,343,000, $20,725,000, and
$18,666,000 for the years ended December 31, 2000, 1999, and 1998, respectively.
Product warranty:
Substantially all of the Company's products carry lifetime warranty provisions for defects in quality and
workmanship. Warranty expense was approximately $3,325,000, $3,127,000, and $2,852,000 for the years
ended December 31, 2000, 1999 and 1998, respectively.
Recent Accounting Pronouncements
In December 1999, the Securities and Exchange Commission issued StaÅ Accounting Bulletin
(SAB) No. 101, ""Revenue Recognition in Financial Statements.'' The eÅective date of the bulletin was
delayed by the issuance of SAB No. 101A and SAB No. 101B and was eÅective for the Company's fourth
quarter of Ñscal year 2000. The adoption of this bulletin did not have a material eÅect on the Company's
consolidated Ñnancial statements.
Note 3 Ì Inventories, Net
Inventories consist of the following (in thousands):
December 31,
2000 1999
Raw materialsÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $ 4,298 $ 3,459
Work in process ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 9,217 9,197
Finished goods ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 94,828 76,406
108,343 89,062
Less inventory valuation allowance ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ (3,055) (2,597)
$105,288 $86,465
29