Note 3. Recent Accounting Pronouncements

6 Months Ended

Jun. 30, 2011

Schedule of New Accounting Pronouncements and Changes in Accounting Principles [Table Text Block]

3. RECENT ACCOUNTING PRONOUNCEMENTS

In June 2011, the Financial Accounting Standards Board (“FASB”) and the International Accounting Standards Board (“IASB”) updated the guidance on presentation of items within other comprehensive income.  In this update, an entity has the option 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.  For both options, an entity is required to present each component of net income along with total net income, each component of other comprehensive income along with a total for other comprehensive income, and a total amount for comprehensive income.  This update eliminates the option to present the components of other comprehensive income as part of the statement of changes in stockholders' equity.  The amendments in this update do not change the items that must be reported in other comprehensive income or when an item of other comprehensive income must be reclassified to net income.  The amendments in this update should be applied retrospectively.  For public entities, the amendments are effective for fiscal years, and interim periods within those years, beginning after December 15, 2011.  The adoption of this standard is only expected to impact the presentation of the Company’s financial statements, and not the results of operations or financial position of the Company.

In May 2011, FASB and the IASB published converged standards on fair value measurement and disclosure.  The standards do not require additional fair value measurements and are not intended to establish valuation standards or affect valuation practices outside of financial reporting.  The standards clarified some existing rules and provided guidance for additional disclosures: (1) the concepts of “highest and best use” and “valuation premise” in a fair value measurement are relevant only when measuring the fair value of nonfinancial assets and are not relevant when measuring the fair value of financial assets or of liabilities; (2) when measuring the fair value of instruments classified in equity (e.g., equity issued in a business combination), the entity should measure it from the perspective of a market participant that holds that instrument as an asset; and (3) quantitative information about the unobservable inputs used in Level 3 measurements should be included.  The amendments in this update are to be applied prospectively.  For public entities, the amendments are effective during interim and annual periods beginning after December 15, 2011.  Early application by public entities is not permitted.  The Company has not yet adopted this standard or determined the impact of this standard on its results of operations, cash flows and financial position.

In December 2010, FASB issued additional guidance on when to perform Step 2 of the goodwill impairment test for reporting units with zero or negative carrying amounts.  The criteria for evaluating Step 1 of the goodwill impairment test and proceeding to Step 2 was amended for reporting units with zero or negative carrying amounts and requires performing Step 2 if qualitative factors indicate that it is more likely than not that a goodwill impairment exists.  For public entities, this guidance is effective for fiscal years, and interim periods within those years, beginning after December 15, 2010.  Upon adoption of the amended guidance, any impairment will be recorded as an adjustment to beginning retained earnings.  The adoption of this new accounting pronouncement has no impact on the Company’s condensed consolidated financial statements for the six months ended June 30, 2011.

In April 2010, FASB issued new guidance for recognizing revenue under the milestone method.  This new guidance allows an entity to make a policy election to recognize a substantive milestone in its entirety in the period in which the milestone is achieved.  This guidance is effective on a prospective basis for milestones achieved in fiscal years and interim periods within those years, beginning on or after June 15, 2010 with early adoption permitted.  The adoption of this new accounting pronouncement on January 1, 2011 had no impact on the Company’s condensed consolidated financial statements for the six months ended June 30, 2011.

In October 2009, FASB issued new standards for revenue recognition with multiple deliverables.  These new standards impact the determination of when the individual deliverables included in a multiple-element arrangement may be treated as separate units of accounting.  Additionally, these new standards modify the manner in which the transaction consideration is allocated across the separately identified deliverables by no longer permitting the residual method of allocating arrangement consideration.  This guidance is effective on a prospective basis for multiple-element arrangements entered or materially modified in fiscal years, and interim periods within those years, beginning on or after June 15, 2010 with early adoption permitted.  The adoption of these new standards on January 1, 2011 had no impact on the Company’s condensed consolidated financial statements for the six months ended June 30, 2011.  However, the adoption may result in different accounting treatment for future collaboration arrangements than the accounting treatment applied to existing collaboration arrangements.