LensCrafters 2004 Annual Report Download - page 111

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
110
In November 2004, the FASB issued SFAS No. 151,
Inventory Costs - an amendment of ARB No. 43,
Chapter 4 to clarify that abnormal amounts of idle
facility expense, freight, handling costs, and wasted
material should be recognized as period costs. In
addition, this statement requires that the allocation of
fixed production costs of conversion be based on
the normal capacity of the production facilities. The
adoption of such standard is for fiscal years
beginning after June 15, 2005. The Company
believes the adoption will not have a material effect
on the consolidated financial statements.
In December 2004, the FASB issued SFAS No. 123-R
(revised 2004), Share-Based Payment (“SFAS 123-R”)
which replaces the existing SFAS 123 and
supersedes Accounting Principles Board Opinions
(“APB”) No. 25 Accounting for Stock Issued to
Employees. SFAS 123-R requires companies to
measure and record compensation expense for stock
options and other share-based payment methods
based on the instruments’ fair value. SFAS 123-R is
effective for the Company on January 1, 2006. The
Company is currently evaluating the impact of the
adoption of SFAS 123-R.
In December 2004, the FASB issued SFAS No. 153,
Exchanges of Nonmonetary Assets - an amendment
of APB Opinion No. 29 (“SFAS153”). SFAS 153
amends APB No. 29, Accounting for Nonmonetary
Transactions, to eliminate the exception for
nonmonetary exchanges of similar productive assets
and replaces it with a general exception for
exchanges of nonmonetary assets that do not have
commercial substance. A nonmonetary exchange
has commercial substance if the future cash flows of
the entity are expected to change significantly as a
result of the exchange. SFAS 153 is effective for
reporting periods beginning after June 15, 2005. The
adoption of SFAS 153 is not expected to have a
material effect on the Company’s consolidated
financial statements.
INFORMATION EXPRESSED IN U.S. DOLLARS
The Company’s consolidated financial statements
are stated in Euro, the currency of the country in
which the parent company is incorporated and
operates. The translation of Euro amounts into U.S.
Dollar amounts is included solely for the
convenience of international readers and has been
made at the rate of Euro 1 to US$ 1.3538. Such rate
was determined by using the noon buying rate of
the Euro to U.S. Dollar as certified for custom
purposes by the Federal Reserve Bank of New York
as of December 31, 2004. Such translations should
not be construed as representations that Euro
amounts could be converted into U.S. Dollar at that
or any other rate.
RECLASSIFICATIONS
The presentation of certain prior year information has
been reclassified to conform to the current year
presentation.