Vistaprint 2012 Annual Report Download - page 64

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Interest and dividends on securities classified as available-for-sale are included in interest income.We review our
investments for other-than-temporary impairment whenever the fair value of an investment is less than amortized
cost and evidence indicates that an investment’s carrying amount is not recoverable within a reasonable period of
time. At June 30, 2011, we held one municipal auction rate security (“ARS”) as a result of failed auctions. The issuer
of the ARS initiated a tender offer in June 2011 and, on July 14, 2011, the securities were redeemed. As of June 30,
2011, the ARS was included in marketable securities at its redemption value and a realized loss of $71 was
included in other expense, net, of which $40 was reclassified from other comprehensive income. There were no
other-than-temporary impairments during the years ended June 30, 2012 or 2010.
Cash and cash equivalents as of June 30, 2012 consisted of the following:
Amortized
Cost
Gross
Unrealized
Gains (Losses) Fair Value
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 62,203 $ — $ 62,203
Total cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 62,203 $ — $ 62,203
Cash, cash equivalents and marketable securities as of June 30, 2011 consisted of the following:
Amortized
Cost
Gross
Unrealized
Gains (Losses) Fair Value
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 236,552 $ — $ 236,552
Marketable securities:
Municipal auction rate security . . . . . . . . . . . . . . . . . . . . . . . . . . . 529 — 529
Total cash, cash equivalents, and marketable securities . . . . . . . . . . $ 237,081 $ — $ 237,081
Accounts Receivable
Accounts receivable includes amounts due from customers, affiliates and partners. We offset gross trade
accounts receivable with an allowance for doubtful accounts, which is our best estimate of the amount of probable
credit losses in existing accounts receivable. Account balances are charged off against the allowance when the
potential for recovery is considered remote.
Inventories
Inventories consist primarily of raw materials and are recorded at the lower of cost or market value using a
first-in, first-out method. Costs to produce free products are included in cost of revenues as incurred.
Property, Plant and Equipment
Property, plant and equipment are stated at cost less accumulated depreciation and amortization. Additions
and improvements that substantially extend the useful life of a particular asset are capitalized while repairs and
maintenance costs are expensed as incurred. Depreciation of plant and equipment is recorded on a straight-line
basis over the estimated useful lives of the assets.
Software and Web Site Development Costs
We capitalize eligible salaries and payroll-related costs of employees who devote time to the development
of websites and internal-use computer software. Capitalization begins when the preliminary project stage is
complete, management with the relevant authority authorizes and commits to the funding of the software project,
and it is probable that the project will be completed and the software will be used to perform the function intended.
These costs are amortized on a straight-line basis over the estimated useful life of the software, which is generally
two years. Costs associated with preliminary stage software development, repair, maintenance or the development
of website content are expensed as incurred.