Audiovox 2005 Annual Report Download - page 76

Download and view the complete annual report

Please find page 76 of the 2005 Audiovox annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 111

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111

The per share weighted average fair value of stock options
granted during the year ended November 30, 2005 was $2.51 on the
date of grant. This fair value was determined using the
Black−Scholes option−pricing model with the following weighted
average assumptions:
Expected dividend yield 0%
Expected volatility 19.4%
Risk−free interest rate 4.70%
Expected life (years) 2.6
(u) Accumulated Other Comprehensive Income (Loss)
Other comprehensive income (loss) includes accumulated foreign
currency translation losses of $1,045 and $1,202, and unrealized
losses on investment securities classified as available−for−sale
of $796 and $1,106 at November 30, 2004 and 2005, respectively.
During the year ended November 30, 2005, $1,758 of unrealized
losses were transferred into earnings as a result of an other
than temporary impairment charge. During the year ended November
30, 2004 and 2005, $914 and $(1,365) of translation gains
(losses), respectively, were transferred from the cumulative
foreign currency translation account and included in
discontinued operations (Note 2). The currency translation
adjustments are not adjusted for income taxes as they relate to
indefinite investments in non−U.S. subsidiaries and equity
investments.
(v) New Accounting Pronouncements
In December 2004, the Financial Accounting Standards Board
("FASB") issued FASB Statement No. 123R ("Statement 123R"),
"Share Based Payment". Statement 123R is a revision of FASB
Statement 123, "Accounting for Stock Based Compensation" and
supersedes APB
Opinion No. 25, "Accounting for Stock issued to Employees" (APB
No. 25). Statement 123R requires a public entity to measure the
cost of employee services recognized in exchange for an award of
equity instruments based on the grant−date fair value of the
award (with limited exceptions). Statement 123R is effective the
first annual period that begins after June 15, 2005 or the
Company's first quarter of fiscal 2006. The adoption of
Statement 123R will rescind the Company's current accounting for
stock based compensation under the intrinsic method as outlined
in APB No. 25. Under APB No. 25, the issuance of stock options
to employees generally resulted in no compensation expense to
the Company. The adoption of Statement 123R will require the
Company to measure the cost of stock options based on the
grant−date fair value of the award. The impact of Statement 123R
is further discussed in Note 1(t).
(w) Reclassifications
Certain reclassifications have been made to the fiscal 2003 and
2004 consolidated financial statements in order to conform to
the fiscal 2005 presentation.
F−22