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CHECK POINT SOFTWARE
FORM 20-F DFN ON-BOA
ˆ200FDMqj#xe%Mxm79Š
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RR Donnelley ProFile wcrdoc1
10.10.12 WCRgildt0px 30-Mar-2012 01:13 EST
229899 FIN 23 2*
PAL
09-Apr-2012 13:21 EST CURR
PS PMT 1C
CHECK POINT SOFTWARE TECHNOLOGIES LTD.
AND ITS SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.)
w. Treasury stock:
The Company repurchases its Ordinary shares from time to time on the open market and holds such
shares as treasury stock. The Company presents the cost to repurchase treasury stock as a reduction of
shareholders’ equity.
From time to time the Company reissues treasury shares under the stock purchase plan, upon exercise
of option and upon vesting of restricted stock units. When treasury stock is reissued, the Company
accounts for the re-issuance in accordance with ASC No. 505-30, “Treasury Stock” and charges the
excess of the purchase cost, including related stock-based compensation expenses, over the re-issuance
price to retained earnings. The purchase cost is calculated based on the specific identification method.
In case the purchase cost is lower than the re-issuance price, the Company credits the difference to
additional paid-in capital.
x. Impact of recently issued accounting standards:
In May 2011, the Financial Accounting Standards Board (FASB) issued guidance that changed the
requirement for presenting “Comprehensive Income” in the consolidated financial statements. The
update requires an entity to present the components of other comprehensive income either in a single
continuous statement of comprehensive income or in two separate but consecutive statements. The
currently available option to disclose the components of other comprehensive income within the
statement of stockholders’ equity will no longer be available. The update is effective for fiscal years,
and interim periods within those years, beginning after December 15, 2011 and should be applied
retrospectively. The adoption of the standard will have no impact on our financial position or results of
operations, but will result in a change in the presentation of our basic consolidated financial statements.
The Company is still evaluating whether to present other comprehensive income in a single continuous
statement of comprehensive income or in two separate but consecutive statements.
In May 2011, the FASB issued ASU 2011-04 Amendments to Achieve Common Fair Value
Measurement and Disclosure Requirements in U.S. GAAP and IFRSs, codified in ASC 820 “Fair
Value Measurement”. The guidance requires an entity to provide 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 guidance changes certain fair value measurement
principles and enhances the disclosure requirements particularly for Level 3 fair value measurements,
and will become effective for the Company beginning January 1, 2012. The Company does not expect
the adoption of this new guidance to have a material impact on its financial statements.
In September 2011, the FASB amended the guidance on the annual testing of goodwill for impairment.
The amended guidance will allow companies to assess qualitative factors to determine if it is more
likely than not that goodwill might be impaired and whether it is necessary to perform the two-step
goodwill impairment test required under current accounting standards. The guidance is effective for
annual and interim goodwill impairment tests performed for fiscal years beginning after December 15,
2011, with early adoption permitted. The adoption of this guidance is not expected to have a material
impact on the Company’s financial statements.
NOTE 3:- ACQUISITIONS
a. On April 14, 2009, the Company completed the acquisition of the security appliance business of Nokia
Corporation (“Nokia”). Prior to the completion of the acquisition, Check Point had collaborated with
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