Note 1 - Basis of Presentation
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9 Months Ended |
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Mar. 31, 2012
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Business Description and Basis of Presentation [Text Block] |
(1) Basis
of Presentation
Ethan
Allen Interiors Inc. ("Interiors") is a Delaware
corporation incorporated on May 25, 1989. The consolidated
financial statements include the accounts of Interiors, its
wholly owned subsidiary Ethan Allen Global, Inc.
("Global"), and Global’s subsidiaries (collectively
"We", "Us", "Our", "Ethan Allen", or the "Company"). All
intercompany accounts and transactions have been eliminated
in the consolidated financial statements. All of
Global’s capital stock is owned by Interiors, which
has no assets or operating results other than those
associated with its investment in Global.
We
prepare our consolidated financial statements in conformity
with accounting principles generally accepted in the United
States, which requires management to make estimates and
assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and
liabilities at the date of the consolidated financial
statements and the reported amounts of revenues and
expenses during the reporting period. Due to the inherent
uncertainty involved in making those estimates, actual
results could differ from those estimates. Areas in which
significant estimates have been made include, but are not
limited to, revenue recognition, the allowance for doubtful
accounts receivable, inventory obsolescence, tax valuation
allowances, useful lives for property, plant and equipment
and intangible assets, goodwill and indefinite-lived
intangible asset impairment analyses, the evaluation of
uncertain tax positions and the fair value of assets
acquired and liabilities assumed in business
combinations.
In
October 2011 the Company and one of its independent
retailers formed a new business entity which began
operating a new Ethan Allen design center in Florida. Our
consolidated financial statements include the accounts of
this entity because we are a majority shareholder and have
the power to direct the activities that most significantly
impact the entity’s performance. Noncontrolling
interest amounts in the net loss of this entity of $40
thousand and $69 thousand, respectively net of tax, for the
three and nine months ended March 31, 2012, are included in
the Consolidated Statement of Operations within interest
and other miscellaneous income, net. Additionally, changes
to noncontrolling investment interests of $0.2 million are
presented in the equity section of the Consolidated Balance
Sheets at March 31, 2012.
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