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Cash Flows from Discontinued Operations
In accordance with ASC 230, Statement of Cash Flows, entities are permitted but not required to separately disclose, either in the statement of cash flows or footnotes to the financial statements, cash flows pertaining to discontinued operations. Entities that do not present separate operating cash flow information related to discontinued operations must do so consistently for all periods presented, which may include periods long after the sale or liquidation of the operation.
We believe we will continue to have sufficient liquidity to fund our future growth strategies for our remaining business in the foreseeable future.
Cash Flows from Operating Activities
The cash flow from operating activities primarily resulted from our net income, adjusted for non-cash items, and changes in our operating assets and liabilities.
Operating activities, which include our discontinued operations, provided
$8.6 millionof cash during fiscal 2013. We had net income of $1.2 millionduring fiscal 2013, which included non-cash stock-based compensation expense of $0.6 millionassociated with the issuance of stock option awards primarily to our directors and officers and depreciation and amortization expense of $1.1 millionassociated with our property and equipment as well as amortization of our intangible assets. Changes in our operating assets and liabilities, net of effects of acquired businesses, provided $7.4 millionof cash during fiscal 2013, due primarily to the decrease in inventory of $2.5 million, decrease in our accounts receivable of $1.8 million, partially offset by an increase to our prepaid expenses of $0.3 million. The decrease in our inventory was the result of reduced inventory purchases during fiscal 2013 due to the decline in net sales. The decrease in our receivables of $1.8 millionwas due primarily to the improvement in our day sales outstanding and lower sales volume. The increase in prepaid expenses of $0.3 millionwas due primarily to the renewal of our liability insurance coverage. Cash used in operating activities, including our discontinued operations, during fiscal 2012 was $48.7 million. The $48.7 millionof cash used in operating activities primarily reflects a decrease of $50.1 millionin accrued liabilities, a $5.2 milliondecrease in long-term tax liabilities, a $6.6 millionincrease in income tax receivable, and an increase of $4.9 millionin inventory, offset by a $5.1 milliondecrease in prepaid expenses and other assets. The $50.1 milliondecrease in accrued liabilities, excluding the impact of foreign exchange of $0.8 million, was due primarily to our tax payment related to the sale of RFPD during fiscal 2012. The $5.2 milliondecrease in long-term tax liabilities, excluding the impact of foreign exchange of $0.3 million, relates primarily to adjustments to our deferred tax liabilities as a result of changes to the amounts of permanently reinvested foreign earnings. The $6.6 millionin income tax receivable relates to an overpayment in our estimated tax during fiscal 2012. The $4.9 millionin inventory, excluding the impact of foreign exchange of $1.3 million, was due primarily to increased purchasing to support future sales growth. The $5.1 milliondecrease in prepaid expenses and other assets, excluding the impact of foreign exchange of less than $0.1 million, was due primarily to the final payment received of $4.2 million, from Arrow for the sale of RFPD.