Nautilus 2002 Annual Report Download - page 49

recorded goodwill or indefinite life intangibles. More frequent testing will be performed if material changes in events or circumstances arise.
SFAS No. 144, ACCOUNTING FOR THE IMPAIRMENT OR DISPOSAL OF LONG-LIVED ASSETS, addresses accounting and reporting
for the impairment or disposal of long-lived assets. SFAS No. 144 supersedes SFAS No. 121, ACCOUNTING FOR THE IMPAIRMENT OF
LONG-LIVED ASSETS AND FOR LONG-LIVED ASSETS TO BE DISPOSED OF. SFAS No. 144 establishes a single accounting model for
long-lived assets to be disposed of by sale and expands on the guidance provided by SFAS No. 121 with respect to cash flow estimations. SFAS
No. 144 was effective for the Company's fiscal year beginning January 1, 2002. The adoption of SFAS No. 144 has not had a material effect on
the Company's financial position, results of operations, or cash flows.
In July 2002, the Financial Accounting Standards Board ("the FASB") issued SFAS No. 146, ACCOUNTING FOR COSTS ASSOCIATED
WITH EXIT OR DISPOSAL ACTIVITIES. The standard requires companies to recognize costs associated with exit or disposal activities
when they are incurred rather than at the date of a commitment to an exit or disposal plan. Costs covered by the standard include lease
termination costs and certain employee severance costs that are associated with a restructuring, discontinued operation, plant closing, or other
exit or disposal activity. This statement is to be applied prospectively to exit or disposal activities initiated after December 31, 2002.
In November 2002, the FASB issued Interpretation ("FIN") No. 45, GUARANTOR'S ACCOUNTING AND DISCLOSURE
REQUIREMENTS FOR GUARANTEES, INCLUDING INDIRECT GUARANTEES OF INDEBTEDNESS OF OTHERS. FIN No. 45 is an
interpretation of FASB Statements No. 5, 57 and 107 and rescinds FIN No.
35. This Interpretation elaborates on the disclosures to be made by a guarantor in its interim and annual financial statements about its
obligations under certain guarantees that it has issued. The disclosure requirements in FIN No. 45 are effective for the year ended December 31,
2002. The Company has adopted the provisions of FIN No. 45 in these financial statements with respect to product warranty disclosures.
In December 2002, the FASB issued SFAS No. 148, ACCOUNTING FOR STOCK-BASED COMPENSATION - TRANSITION AND
DISCLOSURE. SFAS No. 148 amends SFAS No. 123, ACCOUNTING FOR STOCK-BASED COMPENSATION to provide alternative
methods of transition for an entity that voluntarily changes to the fair value based method of accounting for stock-based employee
compensation. This statement is effective for the year ended December 31, 2002.
2. OPERATING SEGMENTS
The Company's operating segments include its direct segment that includes all products marketed directly to consumers through a variety of
direct marketing channels. The Bowflex line of fitness equipment and Nautilus Sleep Systems are the principal products in the Company's direct
segment. The other operating segment is the commercial/retail segment, which includes products and operations that are not direct marketed to
consumers. Products in this segment include Nautilus, Schwinn, and StairMaster commercial and retail fitness equipment and accessories.
Accounting policies used by the segments are the same as those disclosed in Note 1.
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2003. EDGAR Online, Inc.