World Fuel Services 2014 Annual Report Download - page 56

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The following reconciles the aggregate purchase price for the 2012 acquisitions to the cash paid for the acquisitions, net of
cash acquired (in thousands):
Purchase price $ 226,449
Less: Cash acquired 12,793
Purchase price, net of cash acquired 213,656
Less: Promissory notes issued 7,214
Less: Amounts due to sellers 75
Cash paid for acquisition of businesses $ 206,367
During 2013, we completed the valuation of the assets acquired and liabilities assumed for the 2012 acquisitions. As a
result, during 2013, we completed the purchase price allocation which primarily resulted in a $2.0 million reduction in
goodwill, a $3.3 million increase in identifiable intangible assets, partially offset by a $0.9 million decrease in other acquired
assets and a $0.4 million increase in assumed liabilities. Additionally, in 2013, we paid $17.5 million of the amounts due to
sellers that were outstanding as of December 31, 2012.
The purchase price for each of the 2012 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 2012
acquisitions is as follows (in thousands):
Assets acquired:
Cash and cash equivalents $ 12,793
Accounts receivable 134,966
Inventories 7,311
Property and equipment 10,323
Identifiable intangible assets 87,150
Goodwill 121,188
Other current and long-term assets 4,851
Liabilities assumed:
Accounts payable (130,297)
Accrued expenses and other current liabilities (18,321)
Other long-term liabilities (3,515)
Purchase price $ 226,449
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, accounts receivable, accounts payable and accrued expenses
approximate fair value based on the short maturities of these instruments.
We measure our cash surrender value of life insurance contracts, derivative contracts and related hedged items 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.