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&lt;p style="margin-top: 12px; margin-bottom: 0px;"&gt;&lt;font style="font-family: Times New Roman;" class="_mt" size="2"&gt;&lt;b&gt;Note 1 &amp;ndash; Basis of Presentation &lt;/b&gt;&lt;/font&gt;&lt;/p&gt;
&lt;p style="margin-top: 6px; margin-bottom: 0px; margin-left: 2%;"&gt;&lt;font style="font-family: Times New Roman;" class="_mt" size="2"&gt;&lt;b&gt;&lt;i&gt;Basis of Presentation &lt;/i&gt;&lt;/b&gt;&lt;/font&gt;&lt;/p&gt;
&lt;p style="margin-top: 6px; margin-bottom: 0px;"&gt;&lt;font style="font-family: Times New Roman;" class="_mt" size="2"&gt;References to "we," "us," "our," the "Company" and "Harman" refer to Harman International Industries, Incorporated and its consolidated subsidiaries unless the context specifically requires otherwise. &lt;/font&gt;&lt;/p&gt;
&lt;p style="margin-top: 12px; margin-bottom: 0px;"&gt;&lt;font style="font-family: Times New Roman;" class="_mt" size="2"&gt;Our unaudited, condensed consolidated financial statements at September&amp;nbsp;30, 2010 and for the three months ended September&amp;nbsp;30, 2010 and 2009, have been prepared pursuant to rules and regulations of the Securities and Exchange Commission (the "SEC").&amp;nbsp;These unaudited condensed consolidated financial statements have been prepared in accordance with the accounting policies described in our Annual Report on Form 10-K for the fiscal year ended June&amp;nbsp;30, 2010 (our "2010 Form 10-K") and do not include all information and footnote disclosures included in our audited financial statements.&amp;nbsp;In the opinion of management, the accompanying unaudited, condensed consolidated financial statements include all adjustments, consisting of normal recurring adjustments and accruals, necessary to present fairly, in all material respects, the consolidated financial condition, results of operations and cash flows for the periods presented.&amp;nbsp;Operating results for the three months ended September&amp;nbsp;30, 2010 are not necessarily indicative of the results that may be expected for the full fiscal year ending June&amp;nbsp;30, 2011 due to seasonal, economic and other factors. Where necessary, information for prior periods has been reclassified to conform to the consolidated financial statement presentation for the corresponding periods in the current fiscal year. &lt;/font&gt;&lt;/p&gt;
&lt;p style="margin-top: 12px; margin-bottom: 0px;"&gt;&lt;font style="font-family: Times New Roman;" class="_mt" size="2"&gt;The methods, estimates and judgments we use in applying our accounting policies, in conformity with generally accepted accounting principles in the United States ("GAAP"), have a significant impact on the results we report in our financial statements.&amp;nbsp;We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances.&amp;nbsp;The estimates affect the carrying values of assets and liabilities.&amp;nbsp;Actual results may differ from these estimates under different assumptions or conditions. &lt;/font&gt;&lt;/p&gt;
&lt;p style="margin-top: 12px; margin-bottom: 0px;"&gt;&lt;font style="font-family: Times New Roman;" class="_mt" size="2"&gt;These unaudited Condensed Consolidated Financial Statements should be read in conjunction with our audited consolidated financial statements and accompanying notes included in our 2010 Form 10-K. &lt;/font&gt;&lt;/p&gt;
&lt;p style="margin-top: 12px; margin-bottom: 0px;"&gt;&lt;font style="font-family: Times New Roman;" class="_mt" size="2"&gt;&lt;b&gt;Allowance for Doubtful Accounts: &lt;/b&gt;We reserve an estimated amount for accounts receivable that may not be collected. Methodologies for estimating the allowance for doubtful accounts are primarily based on specific identification of uncollectible accounts. Historical collection rates and customer credit worthiness are considered in determining specific reserves. At September&amp;nbsp;30, 2010 and June&amp;nbsp;30, 2010, we had $8.2&amp;nbsp;million and $8.1&amp;nbsp;million, respectively, reserved for possible uncollectible accounts receivable. &lt;/font&gt;&lt;/p&gt;
&lt;p style="margin-top: 12px; margin-bottom: 0px;"&gt;&lt;font style="font-family: Times New Roman;" class="_mt" size="2"&gt;&lt;b&gt;Discontinued Operations:&lt;/b&gt; The results of operations of businesses that have been sold are presented separately as Income from discontinued operations, net of income taxes, in our Condensed Consolidated Statement of Operations, in the current and prior periods, where applicable. Amounts in prior periods have been restated in the Notes to the Condensed Consolidated Financial Statements to reflect continuing operations. Refer to Note&amp;nbsp;19&amp;#8212;&lt;i&gt;Discontinued Operations&lt;/i&gt; for further information.&lt;/font&gt;&lt;/p&gt;&lt;/div&gt;&lt;/div&gt; &lt;/div&gt;</NonNumbericText>
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