Nautilus 2007 Annual Report Download - page 48

Table of Contents
New Accounting Pronouncements
– In February 2007, the FASB issued SFAS No. 159, The Fair Value Option for Financial Assets and
Financial Liabilities
(“SFAS 159”),
which gives entities the option to measure eligible financial assets, and financial liabilities at fair value on an
instrument by instrument basis, that are otherwise not permitted to be accounted for at fair value under other accounting standards. The election
to use the fair value option is available when an entity first recognizes a financial asset or financial liability. Subsequent changes in fair value
must be recorded in earnings. This statement is effective as of January 1, 2008. The Company does not expect the adoption of SFAS 159 to have
a material impact on its financial statements.
In September 2006, the FASB issued SFAS No. 157, Fair Value Measurements (“SFAS 157”). This statement defines fair value, establishes a
framework for measuring fair value in U.S. GAAP, and expands disclosures about fair value measurements. SFAS 157 is effective for financial
statements issued for fiscal years beginning after November 15, 2007. The Company does not expect the adoption of SFAS 157 to have a
material impact on its financial statements.
In July 2006, the FASB issued FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes – an interpretation of FASB Statement
No. 109
(“FIN 48”). The Company adopted the provisions of this interpretation on January 1, 2007. The disclosure requirements and cumulative
effect of the adoption of FIN 48 are presented in Note 9.
In December 2007, the FASB issued SFAS No. 141 (revised 2007), Business Combinations (“SFAS No. 141(R)”).
SFAS No. 141(R) establishes
principles and requirements for how an acquirer recognizes and measures in its financial statements the identifiable assets acquired, the liabilities
assumed, any noncontrolling interest in the acquiree, and the goodwill acquired. SFAS No. 141(R) also establishes disclosure requirements to
enable the evaluation of the nature and financial effects of the business combination. SFAS No. 141(R) is effective for fiscal years beginning
after December 15, 2008. The Company is in the process of analyzing the impact of SFAS No. 141(R) on its financial statements.
In December 2007, the FASB issued SFAS No. 160, Noncontrolling Interests in Consolidated Financial Statements—an amendment of
Accounting Research Bulletin No. 51
(“SFAS No. 160”).
SFAS No. 160 establishes accounting and reporting standards for ownership interests in
subsidiaries held by parties other than the parent, the amount of consolidated net income attributable to the parent and to the noncontrolling
interest, changes in a parent’s ownership interest, and the valuation of retained, noncontrolling equity investments when a subsidiary is
deconsolidated. SFAS No. 160 also establishes disclosure requirements that clearly identify and distinguish between the interests of the parent
and the interests of the noncontrolling owners. SFAS No. 160 is effective for fiscal years beginning after December 15, 2008. The Company is in
the process of analyzing the impact of SFAS No. 160 on its financial statements.
2. DISCONTINUED OPERATIONS
In the fourth quarter of 2007, management committed to a plan to sell the operations of our fitness apparel division. Our fitness apparel division
consists of Pearl Izumi which designs, markets and sells branded fitness apparel and footwear sold primarily under the Pearl Izumi brand on a
global basis. In February 2008 the Company entered into an agreement to sell Pearl Izumi and the Company anticipates completing the sale of
Pearl Izumi late in the first quarter of 2008. Accordingly, all assets and liabilities and results of operations associated with these assets have been
presented in the consolidated financial statements as discontinued operations separate from continuing operations in accordance with SFAS 144,
“Accounting for the Impairment or Disposal of Long-Lived Assets”.
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