Incredimail 2009 Annual Report Download - page 98

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INCREDIMAIL LTD .
AND ITS SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
The Company's marketable securities are classified as available-for-sale securities and are carried at fair value. The
following table summarizes amortized costs, gross unrealized holding gains and losses and market value of
marketable securities as of December 31, 2008 and 2009:
On April 1, 2009, the Company adopted the accounting pronouncement that provides guidance on recognition and
presentation of other-than-temporary impairments and assessed whether the unrealized losses for the investments in
its portfolio were other-than-temporary under this guidance. For securities the Company intends to sell or it is more
likely than not that it will be required to sell the securities before recovery, the entire difference between amortized
cost and fair value is recognized in earnings. For securities that the Company does not intend to sell and it is not more
likely than not that the Company will be required to sell, the Company used a discounted cash flow analysis to
determine the portion of the impairment that relates to credit loss. To the extent that the net present value of the
projected cash flows is less than the amortized cost of the security, the difference is considered a credit loss and is
recorded through earnings. The inputs on the future performance of the underlying assets used in the cash flow
models include prepayments, defaults and loss severity assumptions.
A non-credit related amount of $210,000 for other-than-temporary impairment losses recognized in earnings prior to
April 1, 2009 was reclassified as a cumulative effect adjustment that increased retained earnings and decreased
accumulated other comprehensive income at April 1, 2009.
The carrying amount of available-for-sale debt marketable securities as of December 31, 2009 was $5,225,000 of
which $355,000 is scheduled to mature within one year and the remaining $4,870,000 is scheduled to mature after one
year and up to five years.
NOTE 3:
-
MARKETABLE
SECURITIES AND LONG
-
TERM INVESTMENT
Amortized cost
Gross unrealized
gains
Gross unrealized
losses
Fair value
December 31,
December 31,
December 31,
December 31,
2008
2009
2008
2009
2008
2009
2008
2009
U.S. dollars in thousands
Corporate debentures
$
8,370
$
3
,
262
$
131
$
210
$
82
$
1
$
8,419
$
3,471
Government debentures
10,404
1,687
8
67
41
-
10,371
1,754
$
18,774
$
4,949
$
139
$
277
$
123
$
1
$
18,790
$
5,225
NOTE 4:
-
OTHER RECEIVABLES AND PREPAID EXPENSES
December 31,
2008
2009
U.S. dollars in thousands
Government authorities
$
4,333
$
4,387
Prepaid expenses
320
223
Other
288
209
$
4,941
$
4,819
F-17