Vistaprint 2009 Annual Report Download - page 100

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VISTAPRINT LIMITED
(predecessor to Vistaprint N.V.)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Years Ended June 30, 2009, 2008 and 2007
(in thousands, except share and per share data)
of a preliminary and permanent injunction, and damages. This lawsuit is in its earliest stages and the
Company is unable to express an opinion as to its likely outcome.
The Company is not currently party to any other material legal proceedings. The Company is
involved, from time to time, in various legal proceedings arising from the normal course of business
activities. Although the results of litigation and claims cannot be predicted with certainty, the Company
does not expect resolution of these matters to have a material adverse impact on its consolidated
results of operations, cash flows or financial position. However, an unfavorable resolution of such a
proceeding could, depending on its amount and timing, materially affect the Company’s results of
operations, cash flows or financial position in a future period. Regardless of the outcome, litigation can
have an adverse impact on the Company because of defense costs, diversion of management
resources and other factors.
12. Allowance for Doubtful Accounts
The Company offsets gross trade accounts receivable with an allowance for doubtful accounts.
The allowance for doubtful accounts is the Company’s best estimate of the amount of probable credit
losses in the Company’s existing accounts receivable. The Company reviews its allowance for doubtful
accounts on a monthly basis and all past due balances are reviewed individually for collectibility.
Account balances are charged off against the allowance after all means of collection have been
exhausted and the potential for recovery is considered remote.
Below is a summary of the changes in the Company’s allowance for doubtful accounts for the
years ended June 30, 2009, 2008 and 2007:
Balance at
Beginning of
Period Provision
Write-
offs/
Recovery
Balance at
End of Period
Year ended June 30, 2009.......................... $213 $ (41) $0 $172
Year ended June 30, 2008.......................... $148 $ 65 $0 $213
Year ended June 30, 2007.......................... $ 50 $106 $8 $148
13. Subsequent Events
In May 2009, the FASB issued SFAS No. 165, Subsequent Events (“SFAS 165”), which is
effective for fiscal periods ending after June 15, 2009. The Company adopted SFAS 165 as of June 30,
2009. There was no cumulative effect of adoption related to SFAS 165 and the adoption did not have
an impact on the Company’s financial position, results of operations, or cash flows. SFAS 165
establishes the period during which management of a reporting entity shall evaluate, the recognition
criteria for and the disclosures an entity shall make about events or transactions that may occur
subsequent to the balance sheet date. In accordance with SFAS 165 the Company evaluated
subsequent events through the date these financial statements were filed.
Change of Domicile
On April 30, 2009, the Company announced that its Board of Directors approved a proposal to
move the place of incorporation of the publicly-traded parent entity of the Vistaprint group of companies
94