Vistaprint 2007 Annual Report Download - page 70

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VISTAPRINT LIMITED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Years Ended June 30, 2007, 2006 and 2005
(in thousands, except share and per share data)
The following table summarizes unrealized gains and losses related to our investments in cash
equivalents and marketable securities at June 30, 2007 (in thousands):
Book
Value
Gross
Unrealized
Gains/
(Losses) Fair Value
Cash and cash equivalents............................. $ 69,464 — $ 69,464
Marketable securities:
Asset-backed securities............................ 603 — 603
Corporate Bonds .................................. 12,440 (11) 12,429
Certificates of Deposit ............................. 3,702 (2) 3,700
U.S. Government Agency Issues ................... 4,946 — 4,946
Municipal auction rate securities .................... 16,900 — 16,900
Total marketable securities .................... 38,591 (13) 38,578
Total ................................................. $108,055 (13) $108,042
Fair Value of Financial Instruments
Carrying amounts of financial instruments held by the Company, which include cash equivalents,
accounts receivable, accounts payable, and accrued expenses approximate fair value due to the short
period of time to maturity of those instruments.
Concentrations of Credit Risk
Financial instruments that subject the Company to credit risk consist of cash and cash
equivalents, marketable securities and accounts receivable. The risk with respect to cash and cash
equivalents and marketable securities is reduced by the Company’s policy of investing in financial
instruments (i.e., cash equivalents) with short-term maturities issued by highly rated financial
institutions. The risk with respect to accounts receivables is reduced by the Company’s policy of
monitoring the creditworthiness of its customers to which it grants credit terms in the normal course of
business. One customer accounted for 42% of the Company’s total accounts receivable at June 30,
2007, and one customer accounted for 85% of the Company’s total accounts receivable at June 30,
2006.
The Company maintains an allowance for doubtful accounts for potential credit losses based
upon specific customer accounts and historical trends, and such losses in the aggregate have not
exceeded the Company’s expectations.
Inventories
Inventories consist primarily of raw materials and are stated at the lower of first-in, first-out cost or
market.
66