Nautilus 2011 Annual Report Download - page 37

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Table of Contents
operations or cash flows.
In the fourth quarter of 2011, the Company adopted ASU 2011-
08, which gives companies the option of performing a qualitative assessment that
may allow them to avoid performing the first step of the two-step goodwill impairment test required under Accounting Standards Topic 350 ,
Intangibles
-Goodwill and Other . ASU 2011-08 is effective for annual and interim goodwill impairment tests performed for fiscal years
beginning after December 15, 2011, although early adoption is permitted. The adoption of ASU 2011-08 did not have any effect on the
Company's financial position, results of operations or cash flows.
(2) DISCONTINUED OPERATION
On September 25, 2009, in light of continuing operating losses in its Commercial business and in order to focus exclusively on managing its
Direct and Retail consumer businesses, the Company committed to a plan for the complete divestiture of its Commercial business, which
qualified for held-for-sale accounting treatment. The Commercial business is presented as a discontinued operation in the Company's condensed
consolidated statements of operations for all periods. Following is a summary of the operating results of the Company's former Commercial
business for the years ended December 31, 2011 and 2010 (in thousands):
Disposal of Commercial business assets was completed in April 2011. Revenue for the year ended December 31, 2011 consisted of sales of
small quantities of discontinued product and spare parts inventories that were not acquired by buyers of components of the Commercial business.
The Company may incur additional expenses in future periods in connection with the settlement of contingencies arising from and directly
related to the Commercial business prior to its disposal. For further information regarding contingencies related to the Company's former
Commercial business, see Note 15, Commitments and Contingencies.
The following table presents gain or (loss) recognized on completed disposal transactions for the year ended December 31, 2011 (in thousands):
The following table presents gain or (loss) recognized on completed disposal transactions for the year ended December 31, 2010 (in thousands):
32
2011 2010
Revenue
$
86
$
12,593
Operating loss before income taxes
$
(2,011
)
$
(16,647
)
Disposal gain
946
3,723
Income tax expense
(16
)
(99
)
Total loss from discontinued operation
$
(1,081
)
$
(13,023
)
Previously
Estimated Disposal
Loss as of 12/31/10
Gain (Loss) on
Completed Disposals
Reduction of
Previously
Estimated Disposal
Loss
Disposal Loss
Impairment as of
12/31/11
Sales of real property
$
(666
)
$
(658
)
$
8
$
—
Adjustments of previously completed
disposal transactions —
938
938
—
Total
$
(666
)
$
280
$
946
$
—