overall financial performance ( including net sales and net income ) for the year ended december 31 , 2012 improved as compared to the same period in 2011. the company 's total net sales for the period were up 22 % to $ 366,190 compared to $ 301,080 for the year ended december 31 , 2011. net sales of our crop business in 2012 were $ 329,540 , which constitutes an increase of 21 % over the net sales of $ 272,068 for that segment in 2011. net sales of our non-crop products in 2012 were $ 36,650 , which constitutes an increase of 26 % over the net sales of $ 29,012 in the same period last year . a more detailed discussion of product groups and products having a material effect on net sales for each of the crop and non-crop segments appears below . 20 american vanguard corporation and subsidiaries ( dollars in thousands , except per share data ) in the crop segment of our business , net sales of insecticides in 2012 increased to $ 194,060 which represents a 41 % increase as compared to $ 137,460 for the comparable period in 2011. this included approximately 6 % related to price and 35 % to increased volume . within this segment , annual net sales of our granular soil insecticides were up more than 50 % over 2011 , driven by a strong performance from our primary corn soil insecticides  aztec , smartchoice ® , counter ® and force . our mocap and nemacur granular insecticides/nematicides benefited from an average 3 % selling price increase and remained relatively flat on volume with improved supply of mocap , offsetting some volume shortfall on nemacur . annual net sales of thimet grew by nearly 33 % over the prior year including approximately 5 % related to price , primarily on peanut acres , in sugar cane fields and as a preferred substitute for a withdrawn competitive insecticide ( aldicarb ) . among our non-granular insecticide products , net sales for crop applications grew by 11 % led by our foliar cotton insecticide bidrin . sales of bifenthrin , permethrin and acephate remained flat with the prior year , as we continued to de-emphasize the applications of these products that have become susceptible to low-priced generic competition . within the product group of herbicides/fungicides/fumigants , our crop net sales in 2012 were down about 1 % to $ 89,899 vs. $ 90,782 in 2011. within this group , we had mixed results . net sales of our herbicide products were down 24 % , resulting from the timing of sales and supply availability for our post-emergent corn herbicide , impact . actual on-the-ground use of impact increased 22 % in 2012 despite supply limitations and the effects of the severe midwest summer drought . our fumigants sales volume increased approximately 3 % as our vapam and k-pam ® products continue to be domestic market leaders in this product category . net sales of our fungicides were up 36 % in 2012 , as we continue to recapture market share in potatoes with our pcnb product range . there were no price increases on pcnb . within the crop segment of other products group ( which includes plant growth regulators , molluscicides and third party manufacturing activity ) , we experienced an increase of 4 % in net sales during 2012 , $ 45,581 vs. $ 43,826 in 2011. we had record sales performance for folex , a defoliant used in cotton harvest management . this included slightly lower overall volumes in line with cotton acres harvested but increased pricing as the market recognized the benefits of this brand . naa ® , our leading plant growth regulator , primarily used in apples to stop apple drop , the return of bloom and later in the season for thinning blossom , had a significant gain of 31 % . net sales of metaldehyde , ( a molluscicide ) were up 5 % over the comparable 2011 period ; and third party manufacturing revenues decreased by approximately 28 % in 2012 as compared to 2011. within our non-crop segment , 2012 net sales were up over 26 % to $ 36,650 vs. $ 29,012 compared to 2011. naled ® sales ( our dibrom brand mosquito adulticide ) were up by 19 % ( including average 6 % selling price increase ) , with moderate storm and hurricane activity and despite continued drought conditions in portions of the southeast . net sales of pest strips increased 20 % in volume and approximately 4 % in selling price as compared to the prior year , as professional pest control operators continue to recognize that these products are among the most effective residual pest deterrents in commercial applications . additionally , net sales of our pcnb fungicide for turf uses tripled , as we continue to recover market share following our reentry to the market . the company has yet to re-enter the canadian market following the expiration of its registration at the end of 2010. we are also pleased to report that initial sales from envance ( our new joint venture with tyratech ) were recorded in the weeks leading up to december 31 , 2012. the business sells very effective organic aerosol products through home depot stores . these products target crawling , flying or stinging insects . offsetting these gains , we experienced a decline in pharmaceutical sales of approximately 26 % primarily due to generic competition from china . our cost of sales for 2012 was $ 205,065 or 56 % of net sales . this compared to $ 178,012 or 59 % of net sales for 2011. the decline in cost of sales as a percentage of net sales in 2012 arose primarily from these factors . in 2012 the company continued to focus on selling those products having higher margins or lower costs . story_separator_special_tag as detailed in the above table , the change in volume , mix , price and manufacturing activity resulted overall in a 3 % improvement in gross margin to 41 % in 2011 as compared to 38 % for the same period of the prior year . 25 american vanguard corporation and subsidiaries ( dollars in thousands , except per share data ) the 2011 financial statements have been revised to appropriately reflect the correct application of generally accepted accounting principles . net sales and cost of sales for the year ended december 31 , 2011 have each been decreased by $ 3,349 to appropriately reverse an improper gross-up . this revision had no impact on previously reported 2011 amounts for stockholders ' equity , gross margin , net income , earnings per share or cash flows from operations . the company concluded that this revision was not material to previously issued financial statements . operating expenses in 2011 increased by $ 16,712 to $ 83,842 or 28 % of sales as compared to $ 67,130 or 30 % in 2010. the differences in operating expenses by department are as follows : replace_table_token_9_th selling expenses increased by $ 3,665 to $ 23,318 for the year ended december 31 , 2011 , as compared to the same period of 2010. the main driver for increased overall cost was from expenses in support of our proprietary delivery system and other stewardship activities , wages , and travel expenses to support our expanded business . general and administrative expenses increased by $ 3,548 to end at $ 21,429 for the year ended december 31 , 2011 as compared to the same period of 2010. the four main drivers of this increase were an increase in amortization expense that resulted from the acquisitions made in december 2010 , an increase in stock based compensation expense relating to grants issued in december 2010 , and an increase in incentive compensation expense from the increase in overall financial performance . offsetting these increases , the company re-assessed the fair value of certain discounted deferred liabilities related to product line acquisition . research , product development costs and regulatory expenses increased by $ 5,406 to $ 18,041 for the year ended december 31 , 2011 , as compared to the same period of 2010. this is mainly due to increased studies on our new and existing products including spending related to the pcnb ssuro . freight , delivery and warehousing costs for the year ended december 31 , 2011 were $ 21,054 or 7 % of sales as compared to $ 16,961 or 8 % of sales for the same period in 2010. total interest expense was $ 3,457 in 2011 , as compared to $ 3,017 in 2010. interest costs are summarized in the following table : replace_table_token_10_th the company 's average overall debt for the year ended december 31 , 2011 was $ 72,908 as compared to $ 62,150 for the comparable period of the previous year . early in the year we paid the revolving credit facility down to zero and did not draw further funds as a result of continued focus on inventory , receivables and program management . as can be seen from the table above , on a gross basis , our effective interest rate was 3.4 % as compared to 4.9 % in 2010. the reduction was as a result of the new credit agreement that was signed on january 10 , 2011. after deduction of capitalized interest and including expenses relating to amortization of deferred liabilities , our effective interest rate was 4.7 % as compared to 4.8 % in 2010. this is effectively flat in comparison to the prior year . it should also be noted that the company paid out substantially all its program liabilities for the crop year ended september 30 , 2011 during the final quarter of the year . in the prior year approximately 70 % of program liabilities were paid in the three months ended december 31 , 2010 . 26 american vanguard corporation and subsidiaries ( dollars in thousands , except per share data ) income tax expense for 2011 amounted to $ 13,155 as compared to $ 5,190 for 2010. the 2011 effective tax rate is at 37.3 % , as compared to an effective rate of 32.1 % for 2010. the increase in effective tax rate is primarily due to lower tax benefits from federal and california r & d due to substantially higher pre-tax book income in 2011 as compared to 2010 , lower than expected domestic production activities deduction claimed in the 2010 federal income tax return , and the benefit related to stock options in 2010. net income ended at $ 22,068 or $ .79 per diluted share in 2011 as compared to $ 10,984 or $ .40 per diluted share in 2010 . 27 american vanguard corporation and subsidiaries ( dollars in thousands , except per share data ) story_separator_special_tag the senior secured revolving line of credit and the term loans mature on january 10 , 2016. the company has four key covenants under the credit agreement ( with which it was in compliance throughout the year and as of december ) 31 , 2012 ) . the covenants are as follows : the company must ( 1 ) maintain its borrowings below a certain consolidated funded debt ratio , ( 2 ) limit its annual spending on the acquisition of fixed asset capital additions , ( 3 ) maintain a certain consolidated fixed charge coverage ratio , and ( 4 ) maintain a certain modified current ratio . at december 31 , 2012 total indebtedness was $ 52,443 as compared to $ 66,377 at december 31 , 2011. at december 31 , 2012 , based on its performance against the most restrictive covenants listed above , the company had the capacity to increase its borrowings by up to $ 75,000 under the new credit facility

liquidity and capital resources the company generated $ 40,424 of cash from operating activities during the twelve months ended december 31 , 2012 as compared to $ 39,266 in the same period of the prior year . net income of $ 36,826 , non-cash depreciation , amortization of intangibles , other assets and discounted future liabilities of $ 17,230 ( $ 16,900 in the prior year ) plus stock based compensation of $ 2,329 provided a net cash inflow of $ 56,385 as compared to $ 40,962 for the same period of 2011. as of december 31 , 2012 , our working capital has increased to $ 108,647 as compared to $ 104,713 as of december 31 , 2011. this increase was mainly driven by slightly elevated inventory levels as we build in preparation for the start of the new growing season , slightly higher receivable levels following a very strong final quarter . these pressures were substantially offset by increased levels of programs and deferred revenues . inventories ended the year at $ 87,951 up $ 16,883 as compared to the same period of the prior year . this is a reflection of strong indications from the field about early season demand that will go out to the market in the first and second quarters of 2013. inventory also increased as a result of receipts into inventory of the company 's leading herbicide , impact , which arrived close to year end . it should also be noted that the company purchases and holds raw material , intermediate or finished goods inventory from time to time based on a single annual purchase from a single source or supplier , potentially resulting in peaks in the carrying value of raw materials . furthermore , in order to achieve efficient manufacturing runs , the company may manufacture one time per year of a particular product and then carry high levels of that inventory for a period .


 Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.
     ```liquidity and capital resources the company generated $ 40,424 of cash from operating activities during the twelve months ended december 31 , 2012 as compared to $ 39,266 in the same period of the prior year . net income of $ 36,826 , non-cash depreciation , amortization of intangibles , other assets and discounted future liabilities of $ 17,230 ( $ 16,900 in the prior year ) plus stock based compensation of $ 2,329 provided a net cash inflow of $ 56,385 as compared to $ 40,962 for the same period of 2011. as of december 31 , 2012 , our working capital has increased to $ 108,647 as compared to $ 104,713 as of december 31 , 2011. this increase was mainly driven by slightly elevated inventory levels as we build in preparation for the start of the new growing season , slightly higher receivable levels following a very strong final quarter . these pressures were substantially offset by increased levels of programs and deferred revenues . inventories ended the year at $ 87,951 up $ 16,883 as compared to the same period of the prior year . this is a reflection of strong indications from the field about early season demand that will go out to the market in the first and second quarters of 2013. inventory also increased as a result of receipts into inventory of the company 's leading herbicide , impact , which arrived close to year end . it should also be noted that the company purchases and holds raw material , intermediate or finished goods inventory from time to time based on a single annual purchase from a single source or supplier , potentially resulting in peaks in the carrying value of raw materials . furthermore , in order to achieve efficient manufacturing runs , the company may manufacture one time per year of a particular product and then carry high levels of that inventory for a period .
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 Suspicious Activity Report : overall financial performance ( including net sales and net income ) for the year ended december 31 , 2012 improved as compared to the same period in 2011. the company 's total net sales for the period were up 22 % to $ 366,190 compared to $ 301,080 for the year ended december 31 , 2011. net sales of our crop business in 2012 were $ 329,540 , which constitutes an increase of 21 % over the net sales of $ 272,068 for that segment in 2011. net sales of our non-crop products in 2012 were $ 36,650 , which constitutes an increase of 26 % over the net sales of $ 29,012 in the same period last year . a more detailed discussion of product groups and products having a material effect on net sales for each of the crop and non-crop segments appears below . 20 american vanguard corporation and subsidiaries ( dollars in thousands , except per share data ) in the crop segment of our business , net sales of insecticides in 2012 increased to $ 194,060 which represents a 41 % increase as compared to $ 137,460 for the comparable period in 2011. this included approximately 6 % related to price and 35 % to increased volume . within this segment , annual net sales of our granular soil insecticides were up more than 50 % over 2011 , driven by a strong performance from our primary corn soil insecticides  aztec , smartchoice ® , counter ® and force . our mocap and nemacur granular insecticides/nematicides benefited from an average 3 % selling price increase and remained relatively flat on volume with improved supply of mocap , offsetting some volume shortfall on nemacur . annual net sales of thimet grew by nearly 33 % over the prior year including approximately 5 % related to price , primarily on peanut acres , in sugar cane fields and as a preferred substitute for a withdrawn competitive insecticide ( aldicarb ) . among our non-granular insecticide products , net sales for crop applications grew by 11 % led by our foliar cotton insecticide bidrin . sales of bifenthrin , permethrin and acephate remained flat with the prior year , as we continued to de-emphasize the applications of these products that have become susceptible to low-priced generic competition . within the product group of herbicides/fungicides/fumigants , our crop net sales in 2012 were down about 1 % to $ 89,899 vs. $ 90,782 in 2011. within this group , we had mixed results . net sales of our herbicide products were down 24 % , resulting from the timing of sales and supply availability for our post-emergent corn herbicide , impact . actual on-the-ground use of impact increased 22 % in 2012 despite supply limitations and the effects of the severe midwest summer drought . our fumigants sales volume increased approximately 3 % as our vapam and k-pam ® products continue to be domestic market leaders in this product category . net sales of our fungicides were up 36 % in 2012 , as we continue to recapture market share in potatoes with our pcnb product range . there were no price increases on pcnb . within the crop segment of other products group ( which includes plant growth regulators , molluscicides and third party manufacturing activity ) , we experienced an increase of 4 % in net sales during 2012 , $ 45,581 vs. $ 43,826 in 2011. we had record sales performance for folex , a defoliant used in cotton harvest management . this included slightly lower overall volumes in line with cotton acres harvested but increased pricing as the market recognized the benefits of this brand . naa ® , our leading plant growth regulator , primarily used in apples to stop apple drop , the return of bloom and later in the season for thinning blossom , had a significant gain of 31 % . net sales of metaldehyde , ( a molluscicide ) were up 5 % over the comparable 2011 period ; and third party manufacturing revenues decreased by approximately 28 % in 2012 as compared to 2011. within our non-crop segment , 2012 net sales were up over 26 % to $ 36,650 vs. $ 29,012 compared to 2011. naled ® sales ( our dibrom brand mosquito adulticide ) were up by 19 % ( including average 6 % selling price increase ) , with moderate storm and hurricane activity and despite continued drought conditions in portions of the southeast . net sales of pest strips increased 20 % in volume and approximately 4 % in selling price as compared to the prior year , as professional pest control operators continue to recognize that these products are among the most effective residual pest deterrents in commercial applications . additionally , net sales of our pcnb fungicide for turf uses tripled , as we continue to recover market share following our reentry to the market . the company has yet to re-enter the canadian market following the expiration of its registration at the end of 2010. we are also pleased to report that initial sales from envance ( our new joint venture with tyratech ) were recorded in the weeks leading up to december 31 , 2012. the business sells very effective organic aerosol products through home depot stores . these products target crawling , flying or stinging insects . offsetting these gains , we experienced a decline in pharmaceutical sales of approximately 26 % primarily due to generic competition from china . our cost of sales for 2012 was $ 205,065 or 56 % of net sales . this compared to $ 178,012 or 59 % of net sales for 2011. the decline in cost of sales as a percentage of net sales in 2012 arose primarily from these factors . in 2012 the company continued to focus on selling those products having higher margins or lower costs . story_separator_special_tag as detailed in the above table , the change in volume , mix , price and manufacturing activity resulted overall in a 3 % improvement in gross margin to 41 % in 2011 as compared to 38 % for the same period of the prior year . 25 american vanguard corporation and subsidiaries ( dollars in thousands , except per share data ) the 2011 financial statements have been revised to appropriately reflect the correct application of generally accepted accounting principles . net sales and cost of sales for the year ended december 31 , 2011 have each been decreased by $ 3,349 to appropriately reverse an improper gross-up . this revision had no impact on previously reported 2011 amounts for stockholders ' equity , gross margin , net income , earnings per share or cash flows from operations . the company concluded that this revision was not material to previously issued financial statements . operating expenses in 2011 increased by $ 16,712 to $ 83,842 or 28 % of sales as compared to $ 67,130 or 30 % in 2010. the differences in operating expenses by department are as follows : replace_table_token_9_th selling expenses increased by $ 3,665 to $ 23,318 for the year ended december 31 , 2011 , as compared to the same period of 2010. the main driver for increased overall cost was from expenses in support of our proprietary delivery system and other stewardship activities , wages , and travel expenses to support our expanded business . general and administrative expenses increased by $ 3,548 to end at $ 21,429 for the year ended december 31 , 2011 as compared to the same period of 2010. the four main drivers of this increase were an increase in amortization expense that resulted from the acquisitions made in december 2010 , an increase in stock based compensation expense relating to grants issued in december 2010 , and an increase in incentive compensation expense from the increase in overall financial performance . offsetting these increases , the company re-assessed the fair value of certain discounted deferred liabilities related to product line acquisition . research , product development costs and regulatory expenses increased by $ 5,406 to $ 18,041 for the year ended december 31 , 2011 , as compared to the same period of 2010. this is mainly due to increased studies on our new and existing products including spending related to the pcnb ssuro . freight , delivery and warehousing costs for the year ended december 31 , 2011 were $ 21,054 or 7 % of sales as compared to $ 16,961 or 8 % of sales for the same period in 2010. total interest expense was $ 3,457 in 2011 , as compared to $ 3,017 in 2010. interest costs are summarized in the following table : replace_table_token_10_th the company 's average overall debt for the year ended december 31 , 2011 was $ 72,908 as compared to $ 62,150 for the comparable period of the previous year . early in the year we paid the revolving credit facility down to zero and did not draw further funds as a result of continued focus on inventory , receivables and program management . as can be seen from the table above , on a gross basis , our effective interest rate was 3.4 % as compared to 4.9 % in 2010. the reduction was as a result of the new credit agreement that was signed on january 10 , 2011. after deduction of capitalized interest and including expenses relating to amortization of deferred liabilities , our effective interest rate was 4.7 % as compared to 4.8 % in 2010. this is effectively flat in comparison to the prior year . it should also be noted that the company paid out substantially all its program liabilities for the crop year ended september 30 , 2011 during the final quarter of the year . in the prior year approximately 70 % of program liabilities were paid in the three months ended december 31 , 2010 . 26 american vanguard corporation and subsidiaries ( dollars in thousands , except per share data ) income tax expense for 2011 amounted to $ 13,155 as compared to $ 5,190 for 2010. the 2011 effective tax rate is at 37.3 % , as compared to an effective rate of 32.1 % for 2010. the increase in effective tax rate is primarily due to lower tax benefits from federal and california r & d due to substantially higher pre-tax book income in 2011 as compared to 2010 , lower than expected domestic production activities deduction claimed in the 2010 federal income tax return , and the benefit related to stock options in 2010. net income ended at $ 22,068 or $ .79 per diluted share in 2011 as compared to $ 10,984 or $ .40 per diluted share in 2010 . 27 american vanguard corporation and subsidiaries ( dollars in thousands , except per share data ) story_separator_special_tag the senior secured revolving line of credit and the term loans mature on january 10 , 2016. the company has four key covenants under the credit agreement ( with which it was in compliance throughout the year and as of december ) 31 , 2012 ) . the covenants are as follows : the company must ( 1 ) maintain its borrowings below a certain consolidated funded debt ratio , ( 2 ) limit its annual spending on the acquisition of fixed asset capital additions , ( 3 ) maintain a certain consolidated fixed charge coverage ratio , and ( 4 ) maintain a certain modified current ratio . at december 31 , 2012 total indebtedness was $ 52,443 as compared to $ 66,377 at december 31 , 2011. at december 31 , 2012 , based on its performance against the most restrictive covenants listed above , the company had the capacity to increase its borrowings by up to $ 75,000 under the new credit facility

