Avid 2000 Annual Report Download - page 45

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38
amortized over the vesting period of the options. Additionally, deferred compensation is recorded for restricted stock
granted to employees based on the fair market value of the Companys stock at date of grant and is amortized over the
period in which the restrictions lapse. The Company has adopted the provisions of SFAS No. 123, Accounting for Stock-
Based Compensation, through disclosure only. All stock-based awards to nonemployees are accounted for at their fair
value in accordance with SFAS No. 123.
Recent Accounting Pronouncements
In June 2000 and 1999, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards
Nos. 138 and 137 ("SFAS 138" and SFAS 137), "Accounting for Certain Derivative Instruments and Certain Hedging
Activities - an Amendment of FASB Statement No. 133." SFAS 138 clarifies certain provisions of SFAS 133, and SFAS
137 defers the implementation of SFAS 133 by one year. SFAS 133, as amended by SFAS 137 and SFAS 138, is effective
for fiscal quarters beginning on January 1, 2001 for the Company, and its adoption is not expected to have a material impact
on the Company's financial position or results of operations.
In September 2000, the Financial Accounting Standard Board issued Statement of Financial Accounting Standards No. 140
(SFAS 140), Accounting for Transfers and Servicing of Financial Assets and Extinguishments of Liabilities  a
Replacement of FASB Statement No. 125. SFAS 140 revises the standards of accounting for securitizations and other
transfers of financial assets and collateral and requires certain disclosures, and reiterates many of the provisions of SFAS
125. SFAS 140 is effective for transfers and servicing of financial assets and extinguishments of liabilities occurring after
March 31, 2001. SFAS 140 is effective for recognition and reclassification of collateral and for disclosures relating to
securitization transactions and collateral for the Companys fiscal year ending December 31, 2001. The Company does not
expect the application of SFAS 140 to have a material impact on the Companys financial position or results of operations.
C. MARKETABLE SECURITIES
The cost (amortized cost of debt instruments) and fair value of marketable securities as of December 31, 2000 and 1999 are
as follows (in thousands):
Cost
Gross
Unrealized
Gains (Losses)
Fair
Value
2000
Government and government agency obligations $16,605 $13 $16,618
Corporate common stock 1,713 1,713
$16,605 $1,726 $18,331
1999
Federal, state and municipal obligations $26,747 ($14) $26,733
For the years ended December 31, 2000, 1999 and 1998, realized gains and losses from the sale of each type of security
were immaterial. All federal, state and municipal obligations held at December 31, 2000 and 1999 mature within one year.
Gross realized gains and losses are calculated on a specific identification basis.
Corporate common stock at December 31, 2000 consists of common stock of a U.S. public company received in June 2000
in exchange for the Companys minority ownership interest in Avid Sports LLC. No gain or loss was recorded upon that
transaction.
D. INVENTORIES