World Fuel Services 2012 Annual Report Download - page 73

The purchase price for each of the 2010 acquisitions was allocated to the assets acquired and liabilities
assumed based on their estimated fair value at the acquisition date. On an aggregate basis, the purchase
price allocation for the 2010 acquisitions is as follows (in thousands):
Assets acquired:
Cash and cash equivalents $ 6,840
Accounts receivable 115,075
Inventories 25,548
Property and equipment 19,565
Identifiable intangible assets 45,171
Goodwill 148,436
Other current and long-term assets 9,976
Liabilities assumed:
Accounts payable (86,987)
Assumed pension fund exit fee (post employment benefits) (11,306)
Accrued expenses and other current liabilities (24,349)
Other long-term liabilities (7,156)
Purchase price $240,813
The payment of the assumed pension fund exit fee has been classified as a financing activity in the
consolidated statement of cash flows due to the fact that the liability was paid on behalf of the seller
subsequent to closing as the actuarially calculated amount was not available prior to the acquisition. The
terms of the acquisition agreement called for the termination of participation in the applicable pension
plan and a dollar for dollar decrease in the purchase consideration for amounts paid to exit from the plan.
Significant Accounting Policies
Basis of Consolidation
The accompanying consolidated financial statements and related notes include the accounts of our
wholly-owned and majority-owned subsidiaries and joint ventures where we exercise operational control
or have a primary benefit of its profits. All significant intercompany accounts, transactions and profits are
eliminated upon consolidation.
Use of Estimates
The preparation of consolidated financial statements in conformity with accounting principles generally
accepted in the United States requires us to make certain estimates and assumptions that affect the
reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the
financial statements and the reported amounts of revenue and expenses during the reporting period.
Accordingly, actual results could materially differ from estimated amounts. We evaluate our estimated
assumptions based on historical experience and on various other assumptions that are believed to be
reasonable, the results of which form the basis for making judgments about the carrying values of assets
and liabilities.
Fair Value of Financial Instruments
The carrying amounts of cash, cash equivalents other than money market mutual funds, accounts
receivable, accounts payable and accrued expenses approximate fair value based on the short maturities
of these instruments.
We measure our money market mutual funds, short-term investments and derivative contracts at their
fair value in accordance with accounting guidance for fair value measurement. We believe the carrying
value of our debt approximates fair value since these obligations bear interest at variable rates or fixed
rates which are not significantly different than market rates.
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