Logitech 2005 Annual Report Download - page 110

Download and view the complete annual report

Please find page 110 of the 2005 Logitech annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 143

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132
  • 133
  • 134
  • 135
  • 136
  • 137
  • 138
  • 139
  • 140
  • 141
  • 142
  • 143

LOGITECH INTERNATIONAL S.A.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note 1 — The Company:
Logitech International S.A. designs, manufactures and markets personal peripherals for PCs and other
digital platforms. The Company’s products include webcams, mice, trackballs, and keyboards for the PC;
interactive gaming controllers, multimedia speakers, headsets and headphones for the PC and for gaming
consoles; headsets for mobile phones; headsets, headphones and speakers for mobile entertainment platforms;
advanced remote controls; digital writing solutions; and 3D control devices. The Company sells its products to
both original equipment manufacturers (“OEMs”) and to a network of distributors and resellers.
Logitech was founded in Switzerland in 1981, and in 1988 listed its registered shares in an initial public
offering in Switzerland. In 1997, the Company sold shares in a U.S. initial public offering in the form of
American Depositary Shares (“ADSs”) and listed the ADSs on the Nasdaq National Market. The Company’s
registered office is located in Apples, Switzerland. The Company has manufacturing facilities in Asia and offices
in major cities in North America, Europe and Asia Pacific.
Note 2 — Summary of Significant Accounting Policies:
Basis of Presentation
The consolidated financial statements include the accounts of Logitech and its subsidiaries. All
intercompany balances and transactions have been eliminated. The consolidated financial statements are
presented in accordance with accounting principles generally accepted in the United States of America (“U.S.
GAAP”) and comply with Swiss law.
The Company’s fiscal year ends on March 31. Interim quarters are thirteen-week periods, each ending on a
Friday. For purposes of presentation, the Company has indicated its quarterly periods as ending on the month end.
Use of Estimates
The preparation of financial statements in conformity with U.S. GAAP requires management to make
estimates and assumptions that affect the reported amounts of assets, liabilities, net sales and expenses. Actual
results could differ from those estimates.
Foreign Currencies
The functional currency of the Company’s operations is primarily the U.S. dollar. To a lesser extent, certain
operations use the Euro, Swiss franc, Taiwanese dollar and Japanese yen as their functional currencies. The
financial statements of the Company’s subsidiaries whose functional currency is other than the U.S. dollar are
translated to U.S. dollars using period-end rates of exchange for assets and liabilities and using monthly average
rates for revenues and expenses. Cumulative translation gains and losses are included as a component of
shareholders’ equity in accumulated other comprehensive loss. Gains and losses arising from transactions
denominated in currencies other than a subsidiary’s functional currency are reported in other income (expense),
net in the statement of income.
Revenue Recognition
Revenues are recognized when all of the following criteria are met:
• evidence of an arrangement exists between the Company and the customer;
F-7
CG
20-F
LISA