Green Dot 2010 Annual Report Download - page 71

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Note 2 — Summary of Significant Accounting Policies (continued)
Five Months Ended
December 31, 2008
(In thousands,
except per share data)
Loss per common share
Basic . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ (0.07)
Diluted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ (0.07)
Weighted-average common shares issued and outstanding . . . . . . . . . . 12,028
Weighted-average diluted common shares issued and outstanding . . . . 12,028
Five Months Ended
December 31, 2008
(In thousands)
Net cash provided by operating activities . . . . . . . . . . . . . . . . . . . . . . . . . . $ 5,999
Net cash used in operating activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (2,452)
Net cash used in financing activities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (26,140)
Net decrease in unrestricted cash and cash equivalents . . . . . . . . . . . . . . $(22,593)
Use of Estimates and Assumptions
The preparation of financial statements in conformity with GAAP requires us to make estimates and
assumptions that affect the amounts reported in the consolidated financial statements, including the
accompanying notes. We base our estimates and assumptions on historical factors, current circum-
stances, and the experience and judgment of management. We evaluate our estimates and assumptions
on an ongoing basis. Actual results could differ from those estimates.
Unrestricted Cash and Cash Equivalents
We consider all unrestricted highly liquid investments with an original maturity of three months or less
to be unrestricted cash and cash equivalents.
Restricted Cash
We maintain restricted deposits in bank accounts to collateralize our line of credit.
Settlement Assets and Obligations
Our retail distributors collect customer funds for purchases of new cards and cash transfer products
and then remit these funds directly to bank accounts established for the benefit of these customers by the
third-party card issuing banks. The remittance of these funds by our retail distributors takes an average of
three business days.
Settlement assets represent the amounts due from our retail distributors for customer funds collected
at the point of sale that have not yet been remitted to the card issuing banks.
Settlement obligations represent the amounts due from us to the card issuing banks for funds
collected but not yet remitted by our retail distributors and not funded by our line of credit.
We have no control over or access to customer funds remitted by our retail distributors to the bank
accounts. Customer funds therefore are not our assets, and we do not recognize them in our consolidated
financial statements. As of December 31, 2010 and 2009, total funds held in the bank accounts for the
62
GREEN DOT CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)