Audiovox 2006 Annual Report Download - page 110

Download and view the complete annual report

Please find page 110 of the 2006 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 120

  • 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
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120

Audiovox Specialized Applications, LLC and Subsidiary
(A Limited Liability Company)
Notes to Financial Statements
comparing the carrying value of the long-lived assets with the estimated future net undiscounted cash
flows expected to result from the use of the assets, including cash flows from disposition. Should the
sum of the expected future net cash flows be less that the carrying value, the Company would
recognize an impairment loss at that date. An impairment loss would be measured by comparing the
amount by which the carrying value exceeds the fair value of the long-lived assets. There was no
impairments of long-lived assets for the years ended November 30, 2006, 2005 and 2004.
New accounting pronouncements:
In July 2006, the FASB issued Interpretation No. 48. ‘‘Accounting for Uncertainty in Income
Taxes’’ (‘‘FIN 48’’). FIN 48 clarifies the accounting for uncertain income tax positions that are
recognized in the Company’s financial statements in accordance with the provisions of FASB
Statement No. 109, ‘‘Accounting for Income Taxes’’. FIN 48 also provides guidance on the
derecognition of uncertain positions, financial statement classification, accounting for interest and
penalties, accounting for interim periods and adds new disclosure requirements. FIN 48 is effective for
fiscal years beginning after December 15, 2006. The Company is currently evaluating the impact that
FIN 48 will have on its financial position and results of operations.
In September 2006, the FASB issued SFAS No. 157, ‘‘Fair Value Measurements’’. This statement
clarifies the definition of fair value, establishes a framework for measuring fair value and expands the
disclosures on fair value measurements. SFAS No. 157 is effective for fiscal years beginning after
November 15, 2007. The Company is currently evaluating the impact that this statement will have on
its financial position or results of operations.
Note 2. Available-for-Sale Securities
The following is a summary of the Company’s investment securities as of November 30, 2006 and
2005:
2006
Cost
Gross
Unrealized
Gains
Gross
Unrealized
Losses Fair Value
Government Bonds .......................... $3,570,000 $— $— $3,570,000
2005
Cost
Gross
Unrealized
Gains
Gross
Unrealized
Losses Fair Value
Government bonds .......................... $10,250,000 $— $— $10,250,000
The cost and fair value of debt securities by contractual maturities as of November 30, 2006 are
as follows:
Cost Fair Value
Due after three years ......... $3,570,000 $3,570,000
Expected maturities may differ from contractual maturities because the issuers of certain debt
securities have the right to prepay their obligations without penalty.
10