Support.com 2011 Annual Report Download - page 33


We plan to continue to make investments in our business during 2012. We believe these investments are essential to creating sustainable growth
in our business in the future. Additionally, we may choose to acquire other businesses or complimentary technologies to enhance our product
capabilities and such acquisitions would likely require the use of cash.

The following summarizes our contractual obligations at December 31, 2011 and the effect these contractual obligations are expected to have on
our liquidity and cash flows in future periods (in thousands).
  
   

  

  

 
Operating leases $ 660 $ 612 $ 48 $ -
These obligations are for non-cancelable operating leases including our headquarters office and offices to carry out research and development
and operations globally. These obligations also include the Company’s outstanding liabilities for payment of leases for facilities that have been
impaired.
Due to the uncertainty with respect to the timing of future cash flows associated with our unrecognized tax benefits at December 31, 2011, we
are unable to make reasonably reliable estimates of the period of cash settlement with the respective taxing authority. Therefore, $0.6 million of
unrecognized tax benefits have been excluded from the contractual obligations table. See Note 9 to the Consolidated Financial Statements for a
discussion on income taxes.

At December 31, 2011, we did not have any significant off-balance sheet arrangements, as defined in Item 303(a)(4)(ii) of Regulation S-K.
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In October 2009 the Financial Accounting Standards Board (the “FASB”) amended the accounting standards applicable to revenue recognition
for multiple-deliverable revenue arrangements that are outside the scope of industry-specific software revenue recognition guidance. This new
guidance amends the criteria for allocating consideration in multiple-deliverable revenue arrangements by establishing a selling price hierarchy. The
selling price used for each deliverable will be based on vendor-specific objective evidence (“VSOE”) if available, third-party evidence (“TPE”) if
VSOE is not available, or estimated selling price (“ESP”) if neither VSOE nor TPE is available. The guidance also eliminates the use of the residual
method of allocation and requires that arrangement consideration be allocated at the inception of the arrangement to all deliverables using the relative
selling price method. We adopted this guidance on a prospective basis on January 1, 2011, and therefore applied it to relevant revenue arrangements
originating or materially modified on or after that date. The adoption of this guidance did not have a material impact on our results of operations or
financial position.
In May 2011, the FASB issued Accounting Standards Update (ASU) No. 2011-04, 
(ASU 2011-04). This update amends
Accounting Standards Codification (ASC) Topic 820, ASU 2011-04 clarifies the application of certain
existing fair value measurement guidance and expands the disclosures for fair value measurements that are estimated using significant unobservable
(Level 3) inputs. ASU 2011-04 is effective for annual and interim reporting periods beginning on or after December 15, 2011. The new guidance is to
be adopted prospectively and early adoption is not permitted. We do not believe that adoption of ASU 2011-04 will have a material effect on the
Company’s consolidated financial statements.
In June 2011, the FASB issued ASU No. 2011-05, “”. This update is to improve the comparability, consistency and
transparency of financial reporting and increases the prominence of items reported in other comprehensive income. Under this amendment, an entity
has the option to present the total of comprehensive income, the components of net income, and the components of other comprehensive income either
in a single continuous statement of comprehensive income or in two separate but consecutive statements. On October 21, 2011, the FASB decided
that the specific requirement to present items that are reclassified from other comprehensive income to net income alongside their respective
components of net income and other comprehensive income will be deferred. With the exception of the requirements of the update subject to deferral,
ASU No. 2011-05 is effective for public entities for fiscal years and interim periods within those years beginning after December 15, 2011. The
Company does not believe that the adoption of this guidance will have a significant impact on the Company’s consolidated financial statements.
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