Creative 2005 Annual Report Download - page 29

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29
NOTE 3 – BALANCE SHEET DETAIL (in US$’000)
As of June 30
2005 2004
Inventory:
Raw materials $ 166,318 $ 76,020
Work in progress 18,711 13,946
Finished products 210,857 93,933
Total inventory $ 395,886 $ 183,899
Estimated As of June 30
Useful Life 2005 2004
Property and equipment:
Land and buildings 25 years $ 102,028 $ 93,132
Construction in progress – 2,737 998
Machinery and equipment 3 - 6 years 65,163 52,015
Furniture, fixtures and office equipments 2 - 8 years 91,152 91,232
Leasehold improvements Term of lease 11,605 12,963
272,685 250,340
Accumulated depreciation (155,498) (144,142)
Net property and equipment $ 117,187 $ 106,198
As of June 30
2005 2004 2003
Weighted average ordinary shares outstanding 82,661 80,654 79,202
Weighted average dilutive stock options outstanding 2,672 2,976 1,649
Weighted average ordinary shares and
equivalents outstanding 85,333 83,630 80,851
For fiscal year 2003, approximately 0.5 million shares related to the convertible note were excluded from the computation of dilutive
earnings per share as the effect of including such shares would be anti-dilutive.
NOTE 2 – NET INCOME (LOSS) PER SHARE
In accordance with SFAS No. 128, “Earnings per Share,” Creative reports both basic earnings per share and diluted earnings per share.
Basic earnings per share is computed using the weighted average number of ordinary shares outstanding during the period. Diluted
earnings per share is computed using the weighted average number of ordinary and potentially dilutive ordinary equivalent shares
outstanding during the period. Ordinary equivalent shares are excluded from the computation if their effect is anti-dilutive. In computing
the diluted earnings per share, the treasury stock method is used to determine, based on average stock prices for the respective periods,
the ordinary equivalent shares to be purchased using proceeds received from the exercise of such equivalent shares. Other than the
dilutive effect of stock options, there are no other financial instruments that would impact the weighted average number of ordinary
shares outstanding used for computing diluted earnings per share. The potentially dilutive ordinary equivalent shares outstanding under
the employee share purchase plan were not material.
Following is a reconciliation between the average number of ordinary shares outstanding and equivalent shares outstanding (in ’000):