Basis Of Presentation And Principles Of Consolidation

6 Months Ended

Jun. 30, 2011

Basis Of Presentation And Principles Of Consolidation

Basis Of Presentation And Principles Of Consolidation

2. Basis of Presentation and Principles of Consolidation

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X.  Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States for complete financial statements.  These accounting principles were applied on a basis consistent with those of the consolidated financial statements contained in the Company's Annual Report on Form 10-K for the year ended December 31, 2010.  In our opinion, the accompanying unaudited consolidated financial statements include all adjustments, consisting of normal recurring accruals, necessary for a fair presentation of our financial statements for interim periods in accordance with accounting principles generally accepted in the United States.  The condensed consolidated balance sheet data as of December 31, 2010 was derived from audited financial statements but does not include all disclosures required by accounting principles generally accepted in the United States.  These interim financial statements should be read in conjunction with the audited financial statements for the year ended December 31, 2010 included in our Annual Report on Form 10-K.  The results of operations for the three and six months ended June 30, 2011 are not necessarily indicative of the results to be expected for the full year.

The financial statements of our subsidiaries with functional currencies other than the U.S. dollar are translated into U.S. dollars using period-end exchange rates for assets and liabilities, historical exchange rates for stockholders' equity and weighted average exchange rates for operating results.  Translation gains and losses are included in accumulated other comprehensive income (loss), net of tax, in stockholders' equity.  Foreign currency transaction gains and losses are included in the results of operations in other income and expense.

The accompanying unaudited condensed consolidated financial statements include the accounts of Alexion Pharmaceuticals, Inc. and its subsidiaries.  All intercompany balances and transactions have been eliminated in consolidation.

On May 20, 2011, we effected a two-for-one stock split, paid in the form of a 100% stock dividend.  Stockholders of record at the close of trading on May 2, 2011 were issued one additional share of common stock for each share owned by such shareholder.  All share and per share data presented in the accompanying consolidated financial statements and notes has been retroactively restated to reflect the stock split. 

Our significant accounting policies are described in Note 1 of the Notes to the Consolidated Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2010.

New Accounting Pronouncements

In May 2011, the Financial Accounting Standards Board (FASB) issued a new standard on fair value measurement and disclosure requirements.  The new standard changes fair value measurement principles and disclosure requirements including measuring the fair value of financial instruments that are managed within a portfolio, the application of applying premiums and discounts in a fair value measurement, and additional disclosure about fair value measurements.  The new standard is effective for interim and annual period beginning after December 15, 2011.  We do not expect a material impact with the adoption of this new standard.

In June 2011, the FASB issued a new standard on the presentation of comprehensive income.  The new standard eliminated the current option to report other comprehensive income and its components in the statement of changes in equity.  Under the new standard, companies can elect to present items of net income and other comprehensive income in one continuous statement or in two separate, but consecutive statements.  The new standard is effective at the beginning of fiscal years beginning after December 15, 2011.