TeleNav 2011 Annual Report Download - page 88

Table of Contents
TELENAV, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Concentrations of risk and significant customers
Financial instruments that subject us to significant concentrations of credit risk primarily consist of cash, cash equivalents, short-term
investments and accounts receivable. We maintain our cash, cash equivalents and short-term investments with well-capitalized financial
institutions. Cash equivalents consist primarily of money-market accounts. Our primary customers are wireless carriers and we do not require
collateral for accounts receivable. To manage the credit risk associated with accounts receivable, we evaluate the creditworthiness of our
wireless carrier customers. We evaluate our accounts receivable on an ongoing basis to determine those amounts not collectible. To date, we are
not aware of circumstances that may impair a specific customer’s ability to meet its financial obligations to us.
Revenue related to services provided through Sprint Nextel Corporation, or Sprint, comprised 42%, 55% and 61% of revenue for fiscal
2011, 2010 and 2009, respectively. Receivables due from Sprint were 6% and 49% of total accounts receivable at June 30, 2011 and 2010,
respectively. Revenue related to services provided through AT&T Mobility LLC., or AT&T, comprised 37%, 34% and 29% of revenue for fiscal
2011, 2010 and 2009, respectively. Receivables due from AT&T were 50% and 38% of total accounts receivable at June 30, 2011 and 2010,
respectively. As of June 30, 2011, receivables due from Ford Motor Company, or Ford and T-Mobile were 17% and 11%, respectively. No other
customer represented 10% of our revenue or 10% of our receivables for any period presented.
Our map and points of interest data have been provided principally through Tele Atlas North America, Inc., now known as TomTom Maps
and Navigation Technologies Corporation or NAVTEQ in fiscal 2011, 2010 and 2009. To date, we are not aware of circumstances that may
impair either party’s intent or ability to continue providing such services to us.
Fair value of financial instruments
The estimated fair market value of financial instruments, which include cash and cash equivalents, short-term investments, accounts
receivable, accounts payable and accrued expenses, approximates the carrying values of those instruments due to their relatively short maturities.
We measure certain financial instruments at fair value on a recurring basis. We have established a hierarchy, which consists of three levels,
for disclosure of the inputs used to determine the fair value of our financial instruments.
Level 1 valuations are based on quoted prices in active markets for identical assets or liabilities.
Level 2 valuations are based on inputs that are observable, either directly or indirectly, other than quoted prices included within Level 1.
Such inputs used in determining fair value for Level 2 valuations include quoted prices in active markets for similar assets or liabilities, quoted
prices for identical or similar assets or liabilities in markets that are not active, or other inputs that are observable or can be corroborated by
observable market data for substantially the full term of the assets or liabilities.
Level 3 valuations are based on information that is unobservable and significant to the overall fair value measurement.
As of June 30, 2011 and 2010, we did not have any Level 3 financial instruments.
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