Significant Accounting Policies (Policies)

12 Months Ended

Nov. 26, 2016

Basis of Accounting, Policy [Policy Text Block]

Basis of Presentation and Principles of Consolidation

Our fiscal year ends on the last Saturday in

November,

which periodically results in a

- week year. Fiscal

2016,

2015

and

2014

each contained

weeks. The Consolidated Financial Statements include the accounts of Bassett Furniture Industries, Incorporated and our majority - owned subsidiaries in which we have a controlling interest. All significant intercompany balances and transactions are eliminated in consolidation. Accordingly, the results of Zenith have been consolidated with our results since the date of the acquisition. Sales of logistical services from Zenith to our wholesale and retail segments have been eliminated, and Zenith’s operating costs and expenses since the date of acquisition are included in selling, general and administrative expenses in our condensed consolidated statements of net income. The financial statements have been prepared in accordance with generally accepted accounting principles in the United States ("GAAP"). Unless otherwise indicated, references in the Consolidated Financial Statements to fiscal

2016,

2015

and

2014

are to Bassett's fiscal year ended

November

26,

2016,

November

28,

2015

and

November

29,

2014,

respectively. References to the “ASC” included hereinafter refer to the Accounting Standards Codification established by the Financial Accounting Standards Board as the source of authoritative GAAP.

For comparative purposes, certain amounts in the

2015

and

2014

financial statements have been reclassified to conform to the

2016

presentation. See “Recent Accounting Pronouncements” below regarding the impact of our adoption of Accounting Standards Update

2016

upon the classification of excess tax benefits from stock - based compensation in our consolidated statements of cash flows.

The equity method of accounting was used for our investment in Zenith prior to the date of acquisition because we exercised significant influence but did not maintain a controlling interest. Consolidated net income includes our proportionate share of the net income or net loss of Zenith prior to the date of the acquisition.

We analyzed our licensees under the requirements for variable interest entities (“VIEs”). All of these licensees operate as BHF stores and are furniture retailers. We sell furniture to these licensees, and in some cases have extended credit beyond normal terms, made lease guarantees, guaranteed loans, or loaned directly to the licensees. We have recorded reserves for potential exposures related to these licensees. See Note

for disclosure of leases and lease guarantees. Based on financial projections and best available information, all licensees have sufficient equity to carry out their principal operating activities without subordinated financial support. Furthermore, we believe that the power to direct the activities that most significantly impact the licensees’ operating performance continues to lie with the ownership of the licensee dealers. Our rights to assume control over or otherwise influence the licensees’ significant activities only exist pursuant to our license and security agreements and are in the nature of protective rights as contemplated under ASC Topic

810.

We completed our assessment for other potential VIEs, and concluded that there were none. We will continue to reassess the status of potential VIEs including when facts and circumstances surrounding each potential VIE change.

Use of Estimates, Policy [Policy Text Block]

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Some of the more significant estimates include allowances for doubtful accounts, calculation of inventory reserves, valuation of income tax reserves, lease guarantees, insurance reserves and assumptions related to our post - employment benefit obligations. Actual results could differ from those estimates.

Revenue Recognition, Policy [Policy Text Block]

Revenue Recognition

Revenue is recognized when the risks and rewards of ownership and title to the product have transferred to the buyer. This occurs upon the shipment of goods to independent dealers or, in the case of Company - owned retail stores, upon delivery to the customer. We offer terms varying from

days for wholesale customers. For retail sales, we typically collect a significant portion of the purchase price as a customer deposit upon order, with the balance typically collected upon delivery. These deposits are carried on our balance sheet as a current liability until delivery is fulfilled.

Estimates for returns and allowances have been recorded as a reduction to revenue. The contracts with our licensee store owners do not provide for any royalty or license fee to be paid to us. Revenue is reported net of any taxes collected. For our logistical services segment, line - haul freight revenue and home delivery revenue are recognized upon the completion of delivery to the destination. Warehousing services revenue is based upon warehouse space occupied by a customer’s goods and inventory movements in and out of a warehouse and is recognized as such services are provided.

Staff Accounting Bulletin No.

104,

Revenue Recognition

(“SAB

104”)

outlines the

four

basic criteria for recognizing revenue as follows:

(1)

persuasive evidence of an arrangement exists,

(2)

delivery has occurred or services have been rendered,

(3)

the seller’s price to the buyer is fixed or determinable, and

(4)

collectability is reasonably assured. SAB

104

further asserts that if collectability of all or a portion of the revenue is not reasonably assured, revenue recognition should be deferred until payment is received. During fiscal

2016,

2015

and

2014,

there were no dealers for which these criteria were not met.

Cash and Cash Equivalents, Policy [Policy Text Block]

Cash Equivalents

The Company considers cash on hand, demand deposits in banks and all highly liquid investments with an original maturity of

three

months or less to be cash and cash equivalents. Our short - term investments, which consist of certificates of deposit, are not considered cash equivalents since they have original maturities of greater than

three

months.

Receivables, Policy [Policy Text Block]

Accounts Receivable

Substantially all of our trade accounts receivable is due from customers located within the United States. We maintain an allowance for doubtful accounts for estimated losses resulting from the inability of our customers to make required payments. The allowance for doubtful accounts is based on a review of specifically identified accounts in addition to an overall aging analysis. Judgments are made with respect to the collectibility of accounts receivable based on historical experience and current economic trends. Actual losses could differ from those estimates.

Concentration Risk, Credit Risk, Policy [Policy Text Block]

Concentrations of Credit Risk and Major Customers

Financial instruments that subject us to credit risk consist primarily of investments, accounts and notes receivable and financial guarantees. Investments are managed within established guidelines to mitigate risks. Accounts and notes receivable and financial guarantees subject us to credit risk partially due to the concentration of amounts due from and guaranteed on behalf of independent licensee customers. At

November

26,

2016

and

November

28,

2015,

our aggregate exposure from receivables and guarantees related to customers consisted of the following:

	2016		2015
Accounts receivable, net of allowances (Note 5)	$	18,358	$	21,197
Notes receivable, net of allowances		10		10
Contingent obligations under lease and loan guarantees, less amounts recognized (Note 17)		1,865		2,441
Total credit risk exposure related to customers	$	20,233	$	23,648

November

26,

2016,

approximately

30%

of the aggregate risk exposure, net of reserves, shown above was attributable to

four

customers. At

November

28,

2015,

approximately

26%

of the aggregate risk exposure, net of reserves, shown above was attributable to

three

customers. In fiscal

2016,

2015

and

2014,

customer accounted for more than

10%

of total consolidated net sales. However,

one

customer accounted for approximately

36%

and

26%

of our consolidated revenue from logistical services during

2016

and

2015,

respectively.

We have no foreign manufacturing or retail operations. We define export sales as sales to any country or territory other than the United States or its territories or possessions. Our export sales were approximately

$3,607,

$4,516,

and

$4,774

in fiscal

2016,

2015,

and

2014,

respectively. All of our export sales are invoiced and settled in U.S. dollars.

Inventory, Policy [Policy Text Block]

Inventories

Inventories (retail merchandise, finished goods, work in process and raw materials) are stated at the lower of cost or market. Cost is determined for domestic manufactured furniture inventories using the last - in,

first

- out (“LIFO”) method because we believe this methodology provides better matching of revenue and expenses. The cost of imported inventories is determined on a

first

- in,

first

- out (“FIFO”) basis. Inventories accounted for under the LIFO method represented

53%

and

43%

of total inventory before reserves at

November

26,

2016

and

November

28,

2015,

respectively. We estimate inventory reserves for excess quantities and obsolete items based on specific identification and historical write - offs, taking into account future demand and market conditions. If actual demand or market conditions in the future are less favorable than those estimated, additional inventory write - downs

may

be required.

Property, Plant and Equipment, Policy [Policy Text Block]

Property and Equipment

Property and equipment is comprised of all land, buildings and leasehold improvements and machinery and equipment used in the manufacturing and warehousing of furniture, our Company - owned retail operations, our logistical services operations, and corporate administration. This property and equipment is stated at cost less accumulated depreciation. Depreciation is computed over the estimated useful lives of the respective assets utilizing the straight - line method. Buildings and improvements are generally depreciated over a period of

years. Machinery and equipment are generally depreciated over a period of

years. Leasehold improvements are amortized based on the underlying lease term, or the asset’s estimated useful life, whichever is shorter.

Goodwill and Intangible Assets, Goodwill, Policy [Policy Text Block]

Goodwill

Goodwill represents the excess of the fair value of consideration given over the fair value of the tangible assets and liabilities and identifiable intangible assets of businesses acquired. The acquisition of assets and liabilities and the resulting goodwill is allocated to the respective reporting unit: Wood, Upholstery, Retail or Logistical Services. We review goodwill at the reporting unit level annually for impairment or more frequently if events or circumstances indicate that assets might be impaired.

In accordance with ASC Topic

350,

Intangibles – Goodwill & Other

the goodwill impairment test consists of a

two

- step process, if necessary. However, we

first

assess qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount as a basis for determining whether it is necessary to perform the

two

- step goodwill impairment test described in ASC Topic

350.

The more likely than not threshold is defined as having a likelihood of more than

percent. If, after assessing the totality of events or circumstances, we determine that it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, then performing the

two

- step impairment test is unnecessary and our goodwill is considered to be unimpaired. However, if based on our qualitative assessment we conclude that it is more likely than not that the fair value of a reporting unit is less than its carrying amount, we will proceed with performing the

two

- step process.

Based on our qualitative assessment as described above, we have concluded that our goodwill is not impaired as of

November

26,

2016.

The

first

step compares the carrying value of each reporting unit that has goodwill with the estimated fair value of the respective reporting unit. Should the carrying value of a reporting unit be in excess of the estimated fair value of that reporting unit, the

second

step is performed whereby we must calculate the implied fair value of goodwill by deducting the fair value of all tangible and intangible net assets of the reporting unit from the fair value of the reporting unit. This

second

step represents a hypothetical application of the acquisition method of accounting as if we had acquired the reporting unit on that date. Our impairment methodology uses a discounted cash flow analysis requiring certain assumptions and estimates to be made regarding future profitability of the reporting unit and industry economic factors. While we believe such assumptions and estimates are reasonable, the actual results

may

differ materially from the projected amounts.

Goodwill and Intangible Assets, Intangible Assets, Policy [Policy Text Block]

Other Intangible Assets

Intangible assets acquired in a business combination and determined to have an indefinite useful life are not amortized but are tested for impairment annually or between annual tests when an impairment indicator exists. The recoverability of indefinite - lived intangible assets is assessed by comparison of the carrying value of the asset to its estimated fair value. If we determine that the carrying value of the asset exceeds its estimated fair value, an impairment loss equal to the excess would be recorded.

Definite - lived intangible assets are amortized over their respective estimated useful lives and reviewed for impairment whenever events or changes in circumstances indicate that their carrying amounts

may

not be recoverable. We estimate the useful lives of our intangible assets and ratably amortize the value over the estimated useful lives of those assets. If the estimates of the useful lives should change, we will amortize the remaining book value over the remaining useful lives or, if an asset is deemed to be impaired, a write - down of the value of the asset

may

be required at such time.

Impairment or Disposal of Long-Lived Assets, Policy [Policy Text Block]

Impairment of Long Lived Assets

We periodically evaluate whether events or circumstances have occurred that indicate long - lived assets

may

not be recoverable or that the remaining useful life

may

warrant revision. When such events or circumstances are present, we assess the recoverability of long - lived assets by determining whether the carrying value will be recovered through the expected undiscounted future cash flows resulting from the use and eventual disposition of the asset. In the event the sum of the expected undiscounted future cash flows is less than the carrying value of the asset, an impairment loss equal to the excess of the asset’s carrying value over its fair value is recorded. Fair value is determined based on discounted cash flows or appraised values depending on the nature of the assets. The long - term nature of these assets requires the estimation of cash inflows and outflows several years into the future.

When analyzing our real estate properties for potential impairment, we consider such qualitative factors as our experience in leasing and selling real estate properties as well as specific site and local market characteristics. Upon the closure of a Bassett Home Furnishings store, we generally write off all

tenant

improvements which are only suitable for use in such a store.

Income Tax, Policy [Policy Text Block]

Income Taxes

We account for income taxes under the liability method which requires that we recognize deferred tax assets and liabilities for the future tax consequences attributable to differences between the financial statement carrying amount of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.

We recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. Despite our belief that our liability for unrecognized tax benefits is adequate, it is often difficult to predict the final outcome or the timing of the resolution of any particular tax matters. We

may

adjust these liabilities as relevant circumstances evolve, such as guidance from the relevant tax authority or our tax advisors, or resolution of issues in the courts. These adjustments are recognized as a component of income tax expense in the period in which they are identified.

We evaluate our deferred income tax assets to determine if valuation allowances are required or should be adjusted. A valuation allowance is established against our deferred tax assets based on consideration of all available evidence, both positive and negative, using a “more likely than not” standard. This assessment considers, among other matters, the nature, frequency and severity of recent losses, forecasts of future profitability, the duration of statutory carryforward periods, our experience with tax attributes expiring unused and tax planning alternatives. In making such judgments, significant weight is given to evidence that can be objectively verified. See Note

11.

New Store Pre Opening Costs [Policy Text Block]

New Store Pre - Opening Costs

Income (loss) from operations for fiscal

2016,

2015

and

2014

includes new store pre - opening costs of

$1,148,

$623

and

$1,217,

respectively. Such costs consist of expenses incurred at the new store location during the period prior to its opening and include, among other things, facility occupancy costs such as rent and utilities and local store personnel costs related to pre - opening activities including training. New store pre - opening costs do not include costs which are capitalized in accordance with our property and equipment capitalization policies, such as leasehold improvements and store fixtures and equipment. Such capitalized costs associated with new stores are depreciated commencing with the opening of the store. There are no pre - opening costs associated with stores acquired from licensees, as such locations were already in operation at the time of their acquisition.

Shipping and Handling Cost, Policy [Policy Text Block]

Shipping and Handling Costs

Costs incurred to deliver wholesale merchandise to customers are recorded in selling, general and administrative expense and totaled

$18,451,

$18,624,

and

$16,162

for fiscal

2016,

2015

and

2014,

respectively. Costs incurred to deliver retail merchandise to customers are also recorded in selling, general and administrative expense and totaled

$15,946,

$15,383,

and

$12,844

for fiscal

2016,

2015

and

2014,

respectively.

Advertising Costs, Policy [Policy Text Block]

Advertising

Costs incurred for producing and distributing advertising and advertising materials are expensed when incurred and are included in selling, general and administrative expenses. Advertising costs totaled

$16,688,

$16,228,

and

$15,614

in fiscal

2016,

2015,

and

2014,

respectively.

Liability Reserve Estimate, Policy [Policy Text Block]

Insurance Reserves

We have self - funded insurance programs in place to cover workers’ compensation and health insurance. These insurance programs are subject to various stop - loss limitations. We accrue estimated losses using historical loss experience. Although we believe that the insurance reserves are adequate, the reserve estimates are based on historical experience, which

may

not be indicative of current and future losses. We adjust insurance reserves, as needed, in the event that future loss experience differs from historical loss patterns.

Supplemental Cash Flow Information [Policy Text Block]

Supplemental Cash Flow Information

In connection with our acquisition of Zenith, non - cash financing activities during fiscal

2015

included the issuance of

89,485

shares of our common stock valued at

$1,675,

and the issuance of a note payable with a discounted fair value of

$8,436.

See Note

for additional information regarding the fair value of the consideration given for the acquisition of Zenith. There were no material non - cash investing or financing activities during fiscal

2016

2014.

New Accounting Pronouncements, Policy [Policy Text Block]

Recent Accounting Pronouncements

Adoption of Accounting Standards Update

2016

March

2016,

the FASB issued Accounting Standards Update No.

2016

09,

Compensation – Stock Compensation (Topic

718):

Improvements to Employee Share - Based Payment Accounting

(ASU

2016

09).

While the effective date of ASU

2016

is for fiscal years beginning after

December

15,

2016,

earlier adoption is permitted and we adopted the amendments in ASU

2016

during the

second

quarter of fiscal

2016.

This standard simplifies or clarifies several aspects of the accounting for equity - based payment awards, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. Certain of these changes are required to be applied retrospectively, while other changes are required to be applied prospectively.

The impact of early adoption resulted in the following:

We recorded

$87

of tax benefits within income tax expense for the year ended

November

26,

2016

related to the excess tax benefit on stock based compensation. Prior to adoption this amount would have been recorded as additional paid - in capital. This change could create future volatility in our effective tax rate depending upon the amount of exercise or vesting activity from our stock based awards.

We elected to recognize forfeitures as they occur. There was no cumulative effect adjustment as a result of the adoption of this amendment on a modified retrospective basis.

We elected to apply the change in classification of cash flows resulting from excess tax benefits or deficiencies on a retrospective basis. Accordingly,

$1,998

and

$300

of excess tax benefits previously reported as a cash flow provided by financing activities during the years ended

November

28,

2015

and

November

29,

2014,

respectively, has been reclassified to be included in cash flows provided by operating activities.

We excluded the excess tax benefits from the assumed proceeds available to repurchase shares in the computation of our diluted earnings per share for the year ended

November

26,

2016.

The effect of this change on our diluted earnings per share was not significant.

ASU

2016

also requires the presentation of employee taxes paid by the Company through the withholding of shares as a financing activity on the statement of cash flows, which is where we had previously reclassified these items.

There were no other material impacts to our consolidated financial statements as a result of adopting this updated standard.

Recent Pronouncements Not Yet Adopted

May

2014,

the FASB issued Accounting Standards Update No.

2014

(ASU

2014

09),

which creates ASC Topic

606,

Revenue from Contracts with Customers

, and supersedes the revenue recognition requirements in Topic

605,

Revenue Recognition, including most industry - specific revenue recognition guidance throughout the Industry Topics of the Codification. In addition, ASU

2014

supersedes the cost guidance in Subtopic

605

35,

Revenue Recognition—Construction - Type and Production - Type Contracts, and creates new Subtopic

340

40,

Other Assets and Deferred Costs—Contracts with Customers. In summary, the core principle of Topic

606

is to recognize revenue when promised goods or services are transferred to customers in an amount that reflects the consideration that is expected to be received for those goods or services. Companies are allowed to select between

two

transition methods:

(1)

a full retrospective transition method with the application of the new guidance to each prior reporting period presented, or

(2)

a retrospective transition method that recognizes the cumulative effect on prior periods at the date of adoption together with additional footnote disclosures. In addition, during

2016

the FASB has issued ASU

2016

08,

ASU

2016

and ASU

2016

12,

all of which clarify certain implementation guidance within ASU

2014

09,

and ASU

2016

11,

which rescinds certain SEC guidance within the ASC effective upon an entity’s adoption of ASU

2014

09.

The amendments in ASU

2014

are effective for annual reporting periods beginning after

December

15,

2017,

including interim periods within that reporting period, and early application is not permitted. Therefore the amendments in ASU

2014

will become effective for us as of the beginning of our

2019

fiscal year. We are currently evaluating the impact that the adoption of ASU

2014

will have on our consolidated financial statements and have not made any decision on the method of adoption.

July

2015,

the FASB issued Accounting Standards Update No.

2015

11,

Inventory (Topic

330):

Simplifying the Measurement of Inventory

. ASU

2015

requires that inventory within the scope of this Update be measured at the lower of cost and net realizable value. Net realizable value is the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. The amendments in this Update do not apply to inventory that is measured using last - in,

first

- out (LIFO) or the retail inventory method. The amendments apply to all other inventory, which includes inventory that is measured using

first

- in,

first

- out (FIFO) or average cost. For all entities, the guidance is effective for annual periods, and interim periods within those annual periods, beginning after

December

15,

2016.

Early adoption is permitted. Therefore the amendments in ASU

2015

will become effective for us as of the beginning of our

2018

fiscal year. The adoption of this guidance is not expected to have a material impact upon our financial condition or results of operations.

July

2015,

the FASB issued Accounting Standards Update No.

2015

16,

Business Combinations (Topic

805):

Simplifying the Accounting for Measurement Period Adjustments

. ASU

2015

requires that an acquirer recognize adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined. The amendments in this Update require that the acquirer record, in the same period’s financial statements, the effect on earnings of changes in depreciation, amortization, or other income effects, if any, as a result of the change to the provisional amounts, calculated as if the accounting had been completed at the acquisition date. Any current period adjustments to provisional amounts that would have impacted a prior period’s earnings had they been recognized at the acquisition date are required to be presented separately on the face of the income statement or disclosed in the notes. The amendments in this Update are effective for fiscal years beginning after

December

15,

2015,

including interim periods within those fiscal years.

The amendments in this Update should be applied prospectively to adjustments to provisional amounts that occur after the effective date of this Update with earlier application permitted for financial statements that have not been issued. Therefore the amendments in ASU

2015

will become effective for us as of the beginning of our

2017

fiscal year. The adoption of this guidance is not expected to have a material impact upon our financial condition or results of operations.

January

2016,

the FASB issued Accounting Standards Update No.

2016

01,

Financial Instruments - Overall (Subtopic

825

10):

Recognition and Measurement of Financial Assets and Financial Liabilities

. ASU

2016

requires that equity investments (except those accounted for under the equity method of accounting or those that result in consolidation of the investee) are to be measured at fair value with changes in fair value recognized in net income. However, an entity

may

choose to measure equity investments that do not have readily determinable fair values at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer. Furthermore, equity investments without readily determinable fair values are to be assessed for impairment using a quantitative approach. The amendments in ASU

2016

should be applied by means of a cumulative - effect adjustment to the balance sheet as of the beginning of the fiscal year of adoption, with other amendments related specifically to equity securities without readily determinable fair values applied prospectively. The amendments in ASU

2016

will become effective for us as of the beginning of our

2019

fiscal year. The adoption of this guidance is not expected to have a material impact upon our financial condition or results of operations.

February

2016,

the FASB issued Accounting Standards Update No.

2016

02,

Leases (Topic

842)

. The guidance in ASU

2016

requires that a lessee recognize in the statement of financial position a liability to make lease payments (the lease liability) and a right - of - use asset representing its right to use the underlying asset for the lease term. For leases with a term of

months or less, a lessee is permitted to make an accounting policy election by class of underlying asset not to recognize lease assets and lease liabilities. As with previous guidance, there continues to be a differentiation between finance leases and operating leases, however this distinction now primarily relates to differences in the manner of expense recognition over time and in the classification of lease payments in the statement of cash flows. Lease assets and liabilities arising from both finance and operating leases will be recognized in the statement of financial position. ASU

2016

leaves the accounting for leases by lessors largely unchanged from previous GAAP. The transitional guidance for adopting the requirements of ASU

2016

calls for a modified retrospective approach that includes a number of optional practical expedients that entities

may

elect to apply. The guidance in ASU

2016

will become effective for us as of the beginning of our

2020

fiscal year. We are currently evaluating the impact that the adoption of ASU

2016

will have on our consolidated financial statements, which we expect will have a material effect on our statement of financial position, and have not made any decision on the method of adoption with respect to the optional practical expedients.

August

2016,

the FASB issued Accounting Standards Update No.

2016

15,

Statement of Cash Flows (Topic

230):

Classification of Certain Cash Receipts and Cash Payments

. ASU

2016

addresses how certain cash receipts and cash payments are presented and classified in the statement of cash flows with the objective of reducing existing diversity in practice with respect to these items. Among the types of cash flows addressed are payments for costs related to debt prepayments or extinguishments, payments representing accreted interest on discounted debt, payments of contingent consideration after a business combination, proceeds from insurance claims and company - owned life insurance, and distributions from equity method investees, among others. The amendments in ASU

2016

are to be adopted retrospectively and will become effective for as at the beginning of our

2019

fiscal year. Early adoption, including adoption in an interim period, is permitted. The adoption of this guidance is not expected to have a material impact upon our presentation of cash flows.