OMPI » Topics » Accounts receivable

These excerpts taken from the OMPI 10-K filed Mar 4, 2008.

Accounts receivable

        The Company performs periodic credit evaluations of the financial condition of its customers, monitors collections and payments from customers, and generally does not require collateral. Receivables are generally due within 30 days. The Company provides for the possible inability to collect accounts receivable by recording an allowance for doubtful accounts. The Company writes off an account when it is considered to be uncollectible. The Company estimates its allowance for doubtful accounts based on historical experience, aging of accounts receivable, and information regarding the creditworthiness of its customers. The Company estimates its allowance for doubtful accounts pursuant to sales returns based on the Company's historical rate of returns and current market conditions. To date, losses have been within the range of management's expectations.

        Concentrations of credit risk, with respect to trade receivables, are limited due to the large number of customers comprising the Company's customer base and their dispersion across different geographic regions. As of December 31, 2007 and 2006, no single customer represented more than 10% of the net accounts receivable balance.

F-7


Obagi Medical Products, Inc.

Notes to Consolidated Financial Statements (Continued)

(Dollars in thousands, except share and per share amounts)

Note 2: Summary of significant accounting policies (Continued)

Accounts receivable



        The Company performs periodic credit evaluations of the financial condition of its customers, monitors collections and payments from customers, and generally does
not require collateral. Receivables are generally due within 30 days. The Company provides for the possible inability to collect accounts receivable by recording an allowance for doubtful
accounts. The Company writes off an account when it is considered to be uncollectible. The Company estimates its allowance for doubtful accounts based on
historical experience, aging of accounts receivable, and information regarding the creditworthiness of its customers. The Company estimates its allowance for doubtful accounts pursuant to sales
returns based on the Company's historical rate of returns and current market conditions. To date, losses have been within the range of management's expectations.



        Concentrations
of credit risk, with respect to trade receivables, are limited due to the large number of customers comprising the Company's customer base and their dispersion across
different geographic regions. As of December 31, 2007 and 2006, no single customer represented more than 10% of the net accounts receivable balance.



F-7








Obagi Medical Products, Inc.



Notes to Consolidated Financial Statements (Continued)



(Dollars in thousands, except share and per share amounts)



Note 2: Summary of significant accounting policies (Continued)




This excerpt taken from the OMPI 10-K filed Mar 15, 2007.

Accounts receivable

The Company performs periodic credit evaluations of the financial condition of its customers, monitors collections and payments from customers, and generally does not require collateral. Receivables are generally due within 30 days. The Company provides for the possible inability to collect accounts receivable by recording an allowance for doubtful accounts. The Company writes off an account when it is considered to be uncollectible. The Company estimates its allowance for doubtful accounts based on historical experience, aging of accounts receivable, and information regarding the creditworthiness of its customers. The Company estimates its allowance for doubtful accounts pursuant to sales returns based on

F-7




Obagi Medical Products, Inc.
Notes to Consolidated Financial Statements (Continued)
(Dollars in thousands, except share and per share amounts)

the Company’s historical rate of returns and current market conditions. To date, losses have been within the range of management’s expectations.

Concentrations of credit risk, with respect to trade receivables, are limited due to the large number of customers comprising the Company’s customer base and their dispersion across different geographic regions. As of December 31, 2006 and 2005, no single customer represented more than 10% of the net accounts receivable balance.

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