Callaway 2011 Annual Report Download - page 82

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beginning after December 15, 2011. Based on the Company’s evaluation of this ASU, the adoption of this
amendment will not have a material impact on the Company’s consolidated financial statements.
In June 2011, the FASB issued ASU No. 2011-05, “Comprehensive Income (Topic 220): Presentation of
Comprehensive Income”. This ASU amends the FASB Accounting Standards Codification (Codification) to
allow an entity the option to present the total of comprehensive income, the components of net income, and the
components of other comprehensive income either in a single continuous statement of comprehensive income or
in two separate but consecutive statements. ASU 2011-05 eliminates the option to present the components of
other comprehensive income as part of the statement of changes in stockholders’ equity. The amendments to the
Codification in the ASU do not change the items that must be reported in other comprehensive income or when
an item of other comprehensive income must be reclassified to net income. In addition, in December 2011, the
FASB issued an amendment to ASU No. 2011-05 that defers the requirement to present components of
reclassifications of other comprehensive income on the face of the income statement. ASU 2011-05 will be
applied retrospectively, and is effective for fiscal years and interim periods within those years beginning after
December 15, 2011. Based on the Company’s evaluation of this ASU, the adoption of this amendment will only
impact the presentation of comprehensive income (loss) on the Company’s consolidated financial statements.
In May 2011, the FASB issued ASU No. 2011-04, “Fair Value Measurement (Topic 820): Amendments to
Achieve Common Fair Value Measurement and Disclosure Requirements.” This ASU represents the converged
guidance of the FASB and the International Accounting Standards Board (the Boards) on fair value
measurement. The collective efforts of the Boards and their staffs, reflected in ASU 2011-04, have resulted in
common requirements for measuring fair value and for disclosing information about fair value measurements,
including a consistent meaning of the term “fair value.” The Boards have concluded the common requirements
will result in greater comparability of fair value measurements presented and disclosed in financial statements
prepared in accordance with U.S. GAAP and International Financial Reporting Standards. ASU No. 2011-04 will
be applied prospectively and is effective for interim and annual periods beginning after December 15, 2011.
Based on the Company’s evaluation of this ASU, the adoption of this amendment will not have a material impact
on the Company’s consolidated financial statements.
Revenue Recognition
Sales are recognized in accordance with Accounting Standards Codification (“ASC”) Topic 605, “Revenue
Recognition,” as products are shipped to customers, net of an allowance for sales returns and sales programs. The
criteria for recognition of revenue are met when persuasive evidence that an arrangement exists and both title and
risk of loss have passed to the customer, the price is fixed or determinable and collectability is reasonably
assured. Sales returns are estimated based upon historical returns, current economic trends, changes in customer
demands and sell-through of products. The Company also records estimated reductions to revenue for sales
programs such as incentive offerings. Sales program accruals are estimated based upon the attributes of the sales
program, management’s forecast of future product demand, and historical customer participation in similar
programs.
Revenues from gift cards are deferred and recognized when the cards are redeemed. In addition, the
Company recognizes revenue from unredeemed gift cards when the likelihood of redemption becomes remote
and under circumstances that comply with any applicable state escheatment laws. The Company’s gift cards have
no expiration. To determine when redemption is remote, the Company analyzes an aging of unredeemed cards
(based on the date the card was last used or the activation date if the card has never been used) and compares that
information with historical redemption trends. The deferred revenue associated with outstanding gift cards
decreased from $3,247,000 at December 31, 2010 to $1,988,000 at December 31, 2011.
Revenues from course credits in connection with the use of uPro GPS on-course range finders are deferred
when purchased and recognized when customers download the course credits for usage. Deferred revenue
associated with unused course credits was $2,945,000 and $2,898,000 at December 31, 2011 and 2010,
respectively.
F-8