TeleNav 2015 Annual Report Download - page 94

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, automobile
manufacturers and original equipment manufacturers, or OEMs, and we do not require collateral for accounts receivable. To manage the credit
risk associated with accounts receivable, we evaluate the creditworthiness of our 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, other than those customers for which an allowance for doubtful accounts has been established.
Revenue related to products and services provided through Ford Motor Company, or Ford, comprised 61% , 46% and 36% of revenue for
fiscal 2015 , 2014 and 2013 , respectively. Receivables due from Ford were 58% and 47% of total accounts receivable at June 30, 2015 and
2014 , respectively. Revenue related to services provided through AT&T Mobility LLC., or AT&T, comprised 15% , 24% and 28% of revenue
for fiscal 2015 , 2014 and 2013 , respectively. Receivables due from AT&T were 14% and 19% of total accounts receivable at June 30, 2015
and
2014 , respectively. Revenue related to services provided through Sprint Nextel Corporation, or Sprint, comprised less than 10% of revenue for
fiscal 2015 and 2014 , and 16% of revenue for fiscal 2013
. No other customer represented 10% of our revenue or 10% of our receivables for any
period presented.
Our licensed map, POI and traffic data have been provided principally through TomTom North America, Inc., or TomTom, and HERE
North America, LLC, a Nokia company, or HERE, in fiscal
2015 , 2014 and 2013 . To date, we are not aware of circumstances that may impair
either party’s intent or ability to continue providing such services to us.
Restricted cash
As of June 30, 2015 and 2014 , we had restricted cash of $4.9 million and $6.0 million, respectively, on our consolidated balance sheets.
As of June 30, 2015 and 2014 , restricted cash is comprised primarily of an overpayment from a customer that will either be refunded or be
applied to future amounts owed to us.
Fair value of financial instruments
The estimated fair market value of financial instruments, including cash, accounts receivable and accounts payable, approximates the
carrying values of those instruments due to their relatively short maturities.
We measure certain other 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, 2015 and 2014 , we did not have any Level 3 financial instruments.
Property and equipment
Property and equipment are stated at cost, less accumulated depreciation and amortization. Depreciation is computed using the straight-
line
method over the estimated useful lives of the respective assets. Computers, software, automobiles and equipment have useful lives of three years
and fixtures and furniture have useful lives of five years. Leasehold improvements are amortized using the straight-line method over the shorter
of the estimated useful lives of the assets or the term of the related lease.
Long-term investments
Our long-term investments consist of privately-held investments, and are included in other assets in our consolidated balance sheets. As of
June 30, 2015 , the carrying value of our total privately-held investments was $2.5 million . Of this
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