the 2009 Annual Report (pdf) - PLX Technology

December 31, 2008
Amortized Unrealized Unrealized Estimated
Cost Gain Loss Fair Value
Corporate bonds and notes………………………………………… $ 9,898 $ 92 $ (47) $ 9,943
Municipal bonds……………………………………………………… 1,509 6 - 1,515
US treasury and government agencies securities………………… 28,564 240 - 28,804
Total short and long-term available-for-sale investments…… $ 39,971 $ 338 $ (47) $ 40,262
Contractual maturity dates for investments:
Less than one year………………………………………………… 32,677
One to two years…………………………………………………… 7,585
$ 40,262
The Company reviews its available for sale investments for impairment at the end of each period. Investments in
debt securities, which make up the majority of the Company’s investments, are considered impaired when the fair
value of the debt security is below its amortized cost. If an impairment exists and the Company determines it has
intent to sell the debt security or if it is more likely than not that it will be required to sell the debt security before
recovery of its amortized cost basis, an other-than-temporary impairment loss is recognized in earnings to write the
debt security down to its fair value. However, even if the Company does not expect to sell the debt security, it must
evaluate expected cash flows to be received and determine if a credit loss exists. In the event of a credit loss, only the
amount of impairment associated with the credit loss is recognized in earnings. Amounts relating to factors other than
credit losses are recognized in other comprehensive income (loss). The Company did not record any other-thantemporary
write-downs in the accompanying financial statements.
5. Concentrations of Credit, Customer and Supplier Risk
Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of
cash equivalents, short-term investments, long-term investments and trade receivables. The Company generally
invests its excess cash in money market funds, commercial paper of corporations with high credit ratings, municipal
bonds and treasury bills. The Company’s cash, cash equivalents, short and long-term investments were approximately
$40.0 million as of December 31, 2009 which exceeded the amount insured by the Federal Deposit Insurance
Corporation (“FDIC”). The Company has not experienced any significant losses on its cash equivalents or short and
long-term investments.
The Company performs ongoing credit evaluations of its customers and generally requires no collateral.
Customers who accounted for 10% or more of net accounts receivable are as follows:
Years Ended December 31,
2009 2008 2007
Excelpoint Systems Pte Ltd…………………………… 25% 36% 31%
Promate Electronics Co., Ltd………………………… 14% - *%
Answer Technology, Inc.……………………………… 18% 18% 14%
Avnet, Inc.…………………………………………… 21% 10% 13%
∗ Less than 10%
54