Note M - Concentrations Of Credit Risk

12 Months Ended

Dec. 31, 2012

Concentration Risk, Other Risk

NOTE M - CONCENTRATIONS OF CREDIT RISK

Financial instruments that potentially subject the Company to significant concentrations of credit risk consist principally of cash and cash equivalents, trade accounts receivable and financial instruments used in hedging activities.  The Company maintains cash and cash equivalents at financial institutions in excess of the amount insured by the Federal Deposit Insurance Corporation.  For forward exchange contracts, the credit risk the Company is exposed to is limited to the unrealized gains in these contracts should the counterparties fail to perform.  As part of its cash and risk management processes, the Company performs periodic evaluations of the relative credit standing of these financial institutions.

During the years ended December 31, 2012, 2011 and 2010, there were no customers that accounted for more than 10% of total revenues.  At December 31, 2012 and 2011, approximately 14% and 10%, respectively, of accounts receivable was from one customer, which is fully secured by standby letters of credit. Credit risk with respect to trade accounts receivable is generally diversified due to the large number of entities comprising the Company’s customer base and their dispersion across many geographies.  The Company controls credit risk through credit approvals, credit limits and monitoring procedures, and for international receivables from distributors, the use of letters of credit and letters of guarantee.