QIAGEN N.V. Annual Report 2001

in affiliated companies that are 50 percent or less owned and where the Company exercises significant influence
over the operations are accounted for using the equity method. All other investments are accounted for under the
cost method.
b. Risks and Uncertainties
The preparation of financial statements in conformity with accounting principles generally accepted in the United
States requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities
and disclosure of contingencies at the date of the financial statements as well as the reported amounts of revenues
and expenses during the reporting period. Actual results could differ from those estimates.
The Company’s accounts receivable are unsecured and the Company is at risk to the extent such amounts become
uncollectible. The Company continually monitors account receivable balances, and provides for an allowance of
doubtful accounts at the time collection may become questionable based on payment history or age of the receivable.
As of December 31, 2001 and 2000, no single customer represented more than ten percent of accounts receivable
or consolidated net sales.
c. Reclassification
Certain prior year balances have been reclassified to conform to the current year presentation.
d. Cash and Cash Equivalents
37
Cash and cash equivalents consist of cash on deposit in banks and other cash invested temporarily in various
instruments that are short-term and highly liquid. The Company maintains its cash accounts in highly qualified institutions.
e. Marketable Securities
The Company accounts for marketable securities in accordance with Statement of Financial Accounting Standard
(SFAS) No. 115, ”Accounting for Certain Investments in Debt and Equity Securities.” All investments are stated at fair
value, interest income is accrued when earned, and changes in market values are reflected as unrealized gains and
losses, calculated on the specific identification method, as a component of accumulated other comprehensive income.
f. Inventories
Inventories are stated at the lower of cost or market (first-in, first-out) and consist of materials, labor and overhead.
The components of inventories consist of the following as of December 31, 2001 and 2000:
Raw materials
Work in process
Finished goods
Total inventories
g. Property, Plant and Equipment
2001
$ 8,786,000
8,352,000
14,745,000
$ 31,883,000
2000
$ 10,381,000
5,652,000
13,198,000
$ 29,231,000
Property, plant and equipment, including equipment under capital lease, are stated at cost. Depreciation is computed
using the straight-line and declining balance methods over the following estimated useful lives: buildings for ten to
twenty-five years; machinery and equipment for two to six years; computer software for one to five years; furniture
and office equipment for two and one-half to ten years; and leasehold improvements are computed on a straight-line
basis over the lesser of the remaining life of the lease or the estimated useful life. The Company has a policy of
capitalizing expenditures that materially increase assets’ useful lives and charging ordinary maintenance and repairs
to operations as incurred. When property or equipment is disposed of, the cost and related accumulated depreciation
and amortization are removed from the accounts and any gain or loss is included in other miscellaneous income.