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Table of Contents
Recent Accounting Pronouncements
In December 2007, the FASB issued Statement of Financial Accounting Standards No. 141 (revised), "Business Combinations" (SFAS 141R). The
standard changes the accounting for business combinations by requiring that an acquiring entity measure and recognize identifiable assets acquired and
liabilities assumed at the acquisition date fair value with limited exceptions. The changes include the treatment of acquisition-related transaction costs, the
valuation of any noncontrolling interest at acquisition date fair value, the recording of acquired contingent liabilities at acquisition date fair value and the
subsequent re-measurement of such liabilities after the acquisition date, the recognition of capitalized in-process research and development, the accounting for
acquisition-related restructuring cost accruals subsequent to the acquisition date, and the recognition of changes in the acquirer's income tax valuation
allowance. SFAS 141R is effective for fiscal years beginning after December 15, 2008, with early adoption prohibited. The adoption of SFAS 141R is not
expected to have a significant impact on the Company's consolidated financial statements or financial position, but the nature and magnitude of the specific
effects will depend upon the nature, terms and size of the acquisitions the Company consummates after the effective date.
In February 2008, the FASB issued Financial Staff Positions (FSP) FAS 157-2, "Effective Date of FASB Statement No. 157" (FSP FAS 157-2), which
delays the effective date of SFAS No. 157, "Fair Value Measurement" (SFAS 157), for all nonfinancial assets and nonfinancial liabilities, except those that
are recognized or disclosed at fair value in the financial statements on a recurring basis (at least annually). SFAS 157 establishes a framework for measuring
fair value and expands disclosures about fair value measurements. FSP FAS 157-2 partially defers the effective date of SFAS 157 to fiscal years beginning
after November 15, 2008, and interim periods within those fiscal years for items within the scope of this FSP for non-financial assets and liabilities. The
Company is currently evaluating the potential impact of the adoption of those provisions of SFAS 157, for which effectiveness was delayed by FSP SFAS
157-2, on its consolidated financial position and results of operations.
In April 2008, the FASB issued FSP No. 142-3, Determination of the Useful Life of Intangible Assets. FSP 142-3 amends the factors that should be
considered in developing assumptions about renewal or extension used in estimating the useful life of a recognized intangible asset under SFAS No. 142,
Goodwill and Other Intangible Assets. This standard is intended to improve the consistency between the useful life of a recognized intangible asset under
SFAS No. 142 and the period of expected cash flows used to measure the fair value of the asset under SFAS No. 141R, Business Combinations, and other
Generally Accepted Accounting Principles (GAAP). FSP No.142-3 is effective for financial statements issued for fiscal years beginning after December 15,
2008. The measurement provisions of this standard will apply only to intangible assets of the Company acquired after February 1, 2009.
In October 2008, the FASB issued FSP 157-3, "Determining the Fair Value of a Financial Asset When the Market for That Asset Is Not Active" (FSP
157-3). FSP 157-3 clarifies the application of SFAS No. 157 in a market that is not active and addresses application issues such as the use of internal
assumptions when relevant observable data does not exist, the use of observable market information when the market is not active, and the use of market
quotes when assessing the relevance of observable and unobservable data. FSP 157-3 is effective for all periods presented in accordance with SFAS No. 157.
The adoption of FSP 157-3 did not have a significant impact on the Company's consolidated financial statements or the fair values of its financial assets and
liabilities.
In November 2008, the FASB issued EITF Issue No. 08-7, "Accounting for Defensive Intangible Assets" (EITF 08-7). EITF 08-7 addresses the
accounting for assets acquired in a business combination or asset acquisition that an entity does not intend to actively use, otherwise referred to as a defensive
asset.' EITF 08-7 requires defensive intangible assets to be initially accounted for as a separate unit of accounting and not included as part of the cost of the
acquirer's existing intangible asset(s) because it is separately identifiable. EITF 08-7 also requires that defensive intangible assets be assigned a useful life in
accordance with paragraph 11 of SFAS 142 and is effective for financial statements issued for fiscal years beginning after December 15, 2008.The Company
does not anticipate that the adoption of this statement will have a material impact on its financial position, results of operations, or cash flows.
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