| Recently Issued or Adopted Accounting Standards |
| 14. |
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Recently Issued or Adopted Accounting Standards |
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In September 2011, the Financial Accounting Standards Board (“FASB”) issued guidance that
simplified how an entity tests goodwill for impairment. The revised guidance provides an entity
the option to make a qualitative evaluation about the likelihood of goodwill impairment. Under
the revised guidance, an entity is permitted to first assess qualitative factors to determine
whether goodwill impairment exists prior to performing analyses comparing the fair value of a reporting
unit to its carrying amount. If,
after assessing the totality of events or circumstances, an
entity determines it is not more likely than not that the fair value of a reporting unit is less
than its carrying amount, then performing the two-step impairment test is unnecessary. The
guidance will be effective for us beginning January 1, 2012; however, early adoption is
permitted. We intend on adopting the FASB’s guidance early and do not believe the adoption of
the guidance will have a significant impact on our financial position, results of operations or
cash flows. |
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In May 2011, the FASB issued new guidance for fair value measurements intended to achieve common
fair value measurement and disclosure requirements in U.S. GAAP and International Financial
Reporting Standards. The amended guidance provides a consistent definition of fair value to
ensure that the fair value measurement and disclosure requirements are similar between U.S. GAAP
and International Financial Reporting Standards. The amended guidance changes certain fair value
measurement principles and enhances the disclosure requirements, particularly for Level 3 fair
value measurements. The amended guidance will be effective for us beginning January 1, 2012. We
do not anticipate that these changes will have a significant impact on our financial position,
results of operations or cash flows. |
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In June 2011, the FASB issued guidance that modified how comprehensive income is presented in an
entity’s financial statements. The guidance issued requires an entity to present the total of
comprehensive income, the components of net income, and the components of other comprehensive
income either in a single continuous statement of comprehensive income or in two separate but
consecutive statements and eliminates the option to present the components of other
comprehensive income as part of the statement of equity. The revised financial statement
presentation for comprehensive income will be effective for us beginning January 1, 2012, with
early adoption permitted. |
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Recently Adopted |
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In December 2010, the FASB revised its guidance for disclosure requirements of supplementary pro
forma information for business combinations. The objective of the revised guidance is to address
diversity in practice regarding proforma disclosures for revenue and earnings of an acquired
entity and specifies that if a public entity presents comparative financial statements, the
entity should disclose revenue and earnings of the combined entity as though the business
combination(s) that occurred during the current year had occurred as of the beginning of the
comparable prior annual reporting period only. The amendments also expand the supplemental pro
forma disclosures to include a description of the nature and amount of material, nonrecurring
pro forma adjustments directly attributable to the business combination included in the reported
pro forma revenue and earnings. The amendments, which went into effect on January 1, 2011, will
be adhered to any future material business combinations. |
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On January 1, 2011, we adopted guidance issued by the FASB on revenue recognition. Under the new
guidance, when vendor specific objective evidence or third party evidence of the selling price
for a deliverable in a multiple element arrangement cannot be determined, a best estimate of the
selling price is required to allocate arrangement consideration using the relative selling price
method. The new guidance includes new disclosure requirements on how the application of the
relative selling price method affects the timing of when revenue is recognized. Adoption of the
new guidance did not have a material impact to our financial position, results of operations or
cash flows. |
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