GUID » Topics » Investments in Marketable Debt Securities

These excerpts taken from the GUID 10-K filed Mar 17, 2008.

Investments in Marketable Debt Securities

We account for our investments in marketable debt securities in accordance with Financial Accounting Standards Board (“FASB”) Statement No. 115, “Accounting for Certain Investments in Debt and Equity Securities”. We determine the appropriate classification of our investments in marketable debt securities at the time of purchase and reevaluate such designation at each balance sheet date. In response to changes in the availability of and the yield on alternative investments as well as liquidity requirements, we may sell these debt securities prior to their stated maturities. Accordingly, our marketable debt securities have been classified and accounted for as available for sale. These securities are carried at fair value, based on market quotes, with the unrealized gains and losses, net of taxes, reported as a component of stockholders’ equity. When the fair value of an investment declines below its original cost, we consider all available evidence to evaluate whether the decline

 

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is other-than-temporary. Among other things, we consider the duration and extent of the decline and economic factors influencing the markets. To date, we have had no such other-than-temporary declines below cost. Any realized gains or losses on the sale of marketable securities are determined on a specific identification method and are reflected as a component of other expense.

Investments in Marketable Debt
Securities

We account for our investments in marketable debt securities in accordance with Financial Accounting Standards Board
(“FASB”) Statement No. 115, “Accounting for Certain Investments in Debt and Equity Securities”. We determine the appropriate classification of our investments in marketable debt securities at the time of purchase and
reevaluate such designation at each balance sheet date. In response to changes in the availability of and the yield on alternative investments as well as liquidity requirements, we may sell these debt securities prior to their stated maturities.
Accordingly, our marketable debt securities have been classified and accounted for as available for sale. These securities are carried at fair value, based on market quotes, with the unrealized gains and losses, net of taxes, reported as a component
of stockholders’ equity. When the fair value of an investment declines below its original cost, we consider all available evidence to evaluate whether the decline

 


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is other-than-temporary. Among other things, we consider the duration and extent of the decline and economic factors influencing the markets. To date, we
have had no such other-than-temporary declines below cost. Any realized gains or losses on the sale of marketable securities are determined on a specific identification method and are reflected as a component of other expense.

STYLE="margin-top:18px;margin-bottom:0px; text-indent:4%">Fair Value of Financial Instruments

SIZE="2">The carrying amounts of cash equivalents, accounts receivable, and accounts payable approximate fair value because of the short-term maturities of these instruments. Based on borrowing rates currently available to us for borrowings with
similar terms, the carrying values of our capital lease obligations also approximate fair value. Marketable debt securities are stated at fair value based on market quotes.

STYLE="margin-top:18px;margin-bottom:0px; text-indent:4%">Trade Receivables

Trade
receivables are carried at original invoice amount less an allowance for doubtful accounts. The allowance is established through a provision for bad debt expense. We determine the adequacy of this allowance by evaluating individual customer accounts
receivable, through consideration of the customer’s financial condition, credit history and current economic conditions. In addition, we analyze our historical credit loss history and apply these loss rates to our current accounts receivable
balances to verify the reasonableness of our allowance. Trade receivables are written off when deemed uncollectible. A trade receivable is generally considered past due if any portion of the receivable balance is outstanding for more than 45 days
unless alternate terms are provided.

This excerpt taken from the GUID 10-K filed Mar 30, 2007.

Investments in Marketable Debt Securities

The Company accounts for its investments in marketable debt securities in accordance with Financial Accounting Standards Board (“FASB”) No. 115, “Accounting for Certain Investments in Debt and Equity Securities”. The Company determines the appropriate classification of its investments in marketable debt securities at the time of purchase and reevaluates such designation at each balance sheet date. In response to changes in the availability of and the yield on alternative investments as well as liquidity requirements, we may sell these debt securities prior to their stated maturities. Accordingly, marketable debt securities have been classified and accounted for as available for sale. These securities are carried at fair value, with the unrealized gains and losses, net of taxes, reported as a component of stockholders equity. When the fair value of an investment declines below its original cost, the Company considers all available evidence to evaluate whether the

 

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decline is other-than-temporary. Among other things, the Company considers the duration and extent of the decline and economic factors influencing the markets. To date, the Company has had no such other-than-temporary declines below cost. Any realized gains or losses on the sale of marketable securities are determined on a specific identification method and are reflected as a component of other expense.

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