Inventories

Inventories consisted of the following (in thousands):



	June 30, 2011			December 31, 2010
Raw materials	$	8,025		$	8,204
Finished goods	11,136			10,521
	19,161			18,725
Less: inventory valuation allowance	(3,207		)	(3,547		)
Inventories, net	$	15,954		$	15,178



	June 30, 2011			December 31, 2010
Inventory deposit ^(A)	$	9,885		$	8,468
Less: inventory deposit valuation allowance	(2,501		)	(2,274		)
Inventory deposit, net	$	7,384		$	6,194



(A)	The Company is contractually obligated to reimburse its contract manufacturers for the cost of excess inventory, purchased based on the Company's forecasted demand when there is no alternative use. The Company's inventory deposit represents a cash deposit paid to its contract manufacturers for inventory in excess of near term demand. The deposit is recorded net of adverse purchase commitment liabilities, and therefore the net balance of the deposit represents inventory the Company believes will be utilized. The deposit will be applied against future adverse purchase commitments owed to the Company's contract manufacturers or reduced based on the usage of inventory. See Note 8 - Commitments and Contingencies for additional information regarding the Company's adverse purchase commitment liability.

Consigned inventory is held at third-party locations, including the Company's contract manufacturing partners and customers. The Company retains title to the inventory until purchased by the third-party. Consigned inventory, consisting of raw materials and finished goods, was $3.3 million and $3.0 million at June 30, 2011 and December 31, 2010.

The Company recorded the following charges associated with the valuation of inventory, inventory deposit and the adverse purchase commitment liability (in thousands):



	For the Three Months Ended					For the Six Months Ended
	June 30,					June 30,
	2011		2010			2011		2010
Inventory, net	$	364	$	283		$	822	$	817
Inventory deposit, net	193		684			408		836
Adverse purchase commitments	546		(37		)	797		61