LeapFrog 2011 Annual Report Download - page 66
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LEAPFROG ENTERPRISES, INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands, except per share data)
$2,681 at December 31, 2011, which represents an overall decline in value of $1,319 from par. The
assumptions used in preparing the discounted cash flow model are based on data available as of
December 31, 2011 and include estimates of interest rates, timing and amount of cash flows, credit
and liquidity premiums, and expected holding periods of the ARS. Given the current market
environment, these assumptions are volatile and subject to change. Contractual maturity for the
Company’s ARS investments ranges from 2033 to 2050.
The following table presents the Company’s fair value hierarchy for assets and liabilities measured at fair
value on a recurring basis as of December 31, 2011 and 2010:
Estimated Fair Value Measurements
Carrying Value
Quoted Prices in
Active Markets
(Level 1)
Significant Other
Observable Inputs
(Level 2)
Significant
Unobservable Inputs
(Level 3)
December 31, 2011:
Financial Assets:
Money market funds ...... $45,000 $45,000 $ — $ —
Forward currency contracts. . 40 — 40 —
Long-term investments..... 2,681 — — 2,681
Total financial assets .... $47,721 $45,000 $ 40 $2,681
December 31, 2010:
Financial Assets:
Long-term investments..... $ 2,681 $ — $ — $2,681
Financial Liabilities:
Forward currency contracts. . $ (132) $ — $(132) $ —
For the year ended December 31, 2011, the Company did not dispose of any ARS investments. For the year
ended December 31, 2010, the Company accounted for the sale of ARS investments as follows:
Long-term
Investments
Accumulated Other
Comprehensive
Income (Loss)
Accumulated Losses
on Investments
(Balance Sheets) (Balance Sheets) (Statements of
Operations)
Balance at December 31, 2009 ............... $3,685 $ 435 $(9,326)
Sale of ARS investments .................. (1,004) (194) 454
Balance at December 31, 2010 ............... $2,681 $ 241 $(8,872)
During the year ended December 31, 2010, the Company tendered for sale four of its ARS investments
resulting in a cumulative realized gain of $454. The tendered holdings had been written down in previous
years by $7,191. In addition, the Company did not incur any unrealized gains or losses on its remaining
ARS investments for the years ended December 31, 2011 and 2010.
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