Audiovox 2010 Annual Report Download - page 78

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Audiovox Corporation and Subsidiaries
Notes to Consolidated Financial Statements, continued
February 28, 2010
(Dollars in thousands, except share and per share data)
Summarized information about stock options outstanding as of February 28, 2010 is as follows:
Outstanding and Exercisable
Weighted- Weighted-
Average Average
Exercise Exercise Life
Price Number Price Remaining
Range of Shares of Shares in Years
$ 4.83 - 8.00 1,096,000 $ 6.11 2.79
$ 8.01 – 12.24 219,584 $ 10.90 0.73
The aggregate pre-tax intrinsic value (the difference between the company’s average closing stock price for the last
quarter of fiscal 2010 and the exercise price, multiplied by the number of in-the-money options) that would have been
received by the option holders had all option holders exercised their options on February 28, 2010 was $896. This
amount changes based on the fair market value of the company’s stock. The total intrinsic value of options exercised for
the years ended February 28, 2010, February 28, 2009 and February 29, 2008 were $45, $52 and $3,149, respectively
u) Accumulated Other Comprehensive Income (Loss)
Accumulated other comprehensive income (loss) includes foreign currency translation (losses) gains of ($685) and
($7,486), and unrealized gains (losses) on investment securities classified as available-for-sale of $732 and ($4,686) at
February 28, 2010 and February 28, 2009, respectively.
During the years ended February 28, 2010 and February 29, 2008, ($1,000) and $1,876 of unrealized gains (losses) on
available-for-sale investment securities were transferred into earnings. The Fiscal 2010 charge was as a result of declines
deemed other-than-temporary while the gain in Fiscal 2008 was the result of the disposition of the investment. 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) Other Current Assets
As of February 28, 2010, other current assets included $5.4 million of accounts receivable covered by a put option by an
investment bank.
w) New Accounting Pronouncements
In June 2009, the Financial Accounting Standards Board (“FASB”) issued authoritative guidance which establishes the
FASB Accounting Standards Codification TM (“ASC”) as the single source of authoritative US GAAP, organized by
topic, and creates a new referencing system to identify authoritative guidance such that references to SFAS, EITF, etc.
will no longer be valid. The Codification does not create any new GAAP standards. In addition, the Securities and
Exchange Commission (“SEC”) rules and releases will remain as sources of authoritative US GAAP for SEC registrants.
The standard was effective for the Company’s third quarter of Fiscal 2010 and did not impact the Company’s financial
condition and results of operations. The Company has revised all references to pre-Codification GAAP in its financial
statements.
Effective March 1, 2009, we adopted authoritative guidance under ASC 805 regarding business combinations. The
guidance retains the fundamental requirements that the acquisition method of accounting (previously referred to as the
purchase method of accounting) be used for all business combinations, but requires a number of changes, including
changes in the way assets and liabilities are recognized and measured as a result of business combinations. It also
requires the capitalization of in-process research and development at fair value and requires the expensing of
acquisition-related costs as incurred. Net assets acquired in excess of consideration paid are recorded as a gain.
In April 2009, the FASB issued authoritative guidance under ASC 825 which requires disclosure about fair value of
financial instruments in interim financial statements in order to provide more timely information about the effects of
current market conditions on financial instruments. The guidance is effective for interim periods ending after June 15,
2009. However, the Company early adopted the guidance on March 1, 2009. Since this FSP only requires enhanced
disclosures, the standard did not effect the Company’s financial information or operating performance.
Source: AUDIOVOX CORP, 10-K, May 14, 2010 Powered by Morningstar® Document Research℠