Polaris 2008 Annual Report Download - page 50

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which builds engines in the United States for recreational and industrial products. Potential advantages to Polaris of
having these additional sources of engines include reduced foreign exchange risk, lower shipping costs and less
dependence in the future on a single supplier for engines.
Polaris holds approximately 0.3 million KTM shares which have been classified as available for sale securities
under FASB Statement 115, Accounting for Certain Investments in Debt and Equity Securities (SFAS 115). The
shares have a fair value equal to the trading price of KTM shares on the Vienna stock exchange, (26.50 Euros as of
December 31, 2008). The total fair value of these securities as of December 31, 2008 is $12.9 million and unrealized
holding losses of $6.7 million and unrealized currency translation gains of $1.8 million relating to these securities
are included as a component of Accumulated other comprehensive income (loss) in the December 31, 2008
consolidated balance sheet. In accordance with SFAS 115, the Company assessed the situation where the fair value
of the KTM shares has dropped below the cost basis of the shares. Based upon the expected limited duration of the
KTM share price decline and the Company’s ability and intent to retain this investment, the Company has classified
the impairment of this investment as temporary and has recorded the unrealized holding loss as a component of
Accumulated other comprehensive income (loss) rather than in the income statement.
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