Revenue from the sale of diagnostic products is recorded when there is
persuasive evidence that an arrangement exists, delivery has occurred, the price
is fixed and determinable and collectability is reasonably assured. Allowances,
if any, are established for uncollectible amounts, estimated product returns and
discounts. Since allowances are recorded based on management's estimates, actual
amounts may be different in the future.
Foreign Currency Risks
For subsidiaries outside of
the United Statesthat operate in a local currency environment, income and expense items are translated to United Statesdollars at the monthly average rates of exchange prevailing during the year, assets and liabilities are translated at the period-end exchange rates, and equity accounts are translated at historical exchange rates. Translation adjustments are accumulated in a separate component of stockholders' equity and are included in the determination of comprehensive income (loss), including long-term investments in consolidated subsidiaries. Transaction gains and losses are included in the determination of net income (loss).
Stock Based Compensation
We currently have an Employee Share Option Plan, or the Plan, which permits the grant of share options and shares to our employees, of which 4.5 million stock options were still available for future grant. A summary of this plan is provided in Note 6 to the consolidated financial statements. We believe that such awards better align the interests of our employees with those of our shareholders. Option awards are generally granted with an exercise price equal to the market price of our stock at the date of grant; those option awards generally vest based on four years of continuous service and have seven year contractual terms. Certain options provide for accelerated vesting if there is a change in control (as defined in the Plan). 34
The fair value of each option granted during the years ended
June 30, 2013, 2012 and 2011 is estimated on the date of grant using the Black-Scholes option-pricing model with the following weighted-average assumptions in the following table: Years ended June 30, 2013 2012 2011 Expected dividend yield 0% 0% 0% Expected option term (years) 5.35 5.32
Expected stock price volatility 69% 80% 88% Risk-free interest rate 0.98% - 1.84% 1.01% - 2.46% 2.33% - 2.86% The weighted average fair value at the date of grant for options granted during the years ended
June 30, 2013, 2012 and 2011 were $2.12, $2.23and $2.53per share, respectively. We used historical data to estimate forfeitures. The expected term of options granted represents the period of time that options granted are expected to be outstanding. Expected stock price volatility was calculated using our daily stock trading history. The risk-free rate for periods within the contractual life of the option is based on the U.S. Treasury yield curve in effect at the time of grant.