8x8 2012 Annual Report Download - page 57

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Quoted Prices
in Active
Markets Other Significant
for Identical Observable Unobservable
Assets Inputs Inputs Balance at
(Level 1) (Level 2) (Level 3) 3/31/2011
Cash equivalents:
Money market funds $ 14,358 $ - $ - $ 14,358
Short-term investments:
Mutual funds (1) - 1,927 - 1,927
Total $ 14,358 $ 1,927 $ - $ 16,285
(1) The fair value of mutual funds is determined based on published net asset values. The Company uses such pricing data as
the primary input to make its assessments and determinations as to the ultimate valuation of its investment portfolio.
4. COMMITMENTS AND CONTINGENCIES
Guarantees
Indemnifications
In the normal course of business, the Company may agree to indemnify other parties, including customers, lessors and parties
to other transactions with the Company, with respect to certain matters such as breaches of representations or covenants or
intellectual property infringement or other claims made by third parties. These agreements may limit the time within which an
indemnification claim can be made and the amount of the claim. In addition, the Company has entered into indemnification
agreements with its officers and directors.
It is not possible to determine the maximum potential amount of the Company’ s exposure under these indemnification
agreements due to the limited history of prior indemnification claims and the unique facts and circumstances involved in each
particular agreement. Historically, payments made by the Company under these agreements have not had a material impact on
the Company’ s operating results, financial position or cash flows. Under some of these agreements, however, the Company’ s
potential indemnification liability might not have a contractual limit.
Product Warranties
The Company accrues for the estimated costs that may be incurred under its product warranties upon revenue recognition.
Changes in the Company’ s product warranty liability, which is included in cost of product revenues in the consolidated
statements of operations were as follows (in thousands):
2012 2011 2010
Balance at beginning of yea
r
$362 $ 331 $ 328
Accruals for warranties 496 446 446
Payments (471) (415) (404)
Changes in estimates - - (39)
Balance at end of year $ 387 $ 362 $ 331
Years Ended March 31,
55