Logitech 2007 Annual Report Download - page 138

LOGITECH INTERNATIONAL S.A.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Trademark/trade name relates to the Slim Devices product brand names. The value of the trademark/
tradename was determined using the royalty savings approach, which estimates the value of the assets by
capitalizing the royalties saved as a result of acquiring the assets. The intangible assets acquired are amortized on
a straight-line basis over their estimated useful lives, ranging from one month to 7 years. The technology
associated with the acquisition includes $1.0 million of in-process research and development, which had not
reached technological feasibility at the time of the acquisition and had no further alternative uses, and was
expensed to research and development expense upon consummation of the acquisition. The values of the existing
technology, in-process technology and customer relationships were determined by estimating the expected cash
flows from the projects once commercially viable, discounting the net cash flows back to their present value and
then applying a percentage of completion to the calculated value. The goodwill associated with the acquisition is
not subject to amortization and is not expected to be deductible for income tax purposes.
Note 6 — Balance Sheet Components
The following provides a breakout of certain balance sheet components (in thousands):
March 31,
2007 2006
Accounts receivable:
Accounts receivable ................................................. $404,373 $ 356,883
Allowance for doubtful accounts ....................................... (3,322) (2,988)
Allowance for returns ............................................... (15,821) (11,653)
Allowance for customer programs ...................................... (74,853) (52,393)
$ 310,377 $ 289,849
Inventories:
Raw materials ..................................................... $ 41,542 $ 34,860
Work-in-process .................................................... 251 184
Finished goods ..................................................... 176,171 161,820
$ 217,964 $ 196,864
Other current assets:
Tax and VAT refund receivables ....................................... $ 19,695 $ 11,565
Deferred taxes ..................................................... 22,705 8,517
Prepaid expenses and other ........................................... 25,857 14,397
$ 68,257 $ 34,479
Property, plant and equipment:
Plant and buildings .................................................. $ 31,351 $ 32,181
Equipment ........................................................ 103,016 80,379
Computer equipment ................................................ 34,469 28,829
Computer software .................................................. 42,703 32,019
211,539 173,408
Less: accumulated depreciation ........................................ (135,225) (116,915)
76,314 56,493
Construction-in-progress ............................................. 7,715 15,288
Land ............................................................. 3,025 3,029
$ 87,054 $ 74,810
Other assets:
Deferred taxes ..................................................... $ 20,639 $ 21,560
Cash surrender value of life insurance contracts ........................... 10,888 9,421
Deposits and other .................................................. 2,537 2,082
$ 34,064 $ 33,063
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