through this network approach , we seek to enable high-capacity , configurable infrastructures that can adapt to the changing needs of end-users and the applications that they require , while providing flexible interfaces for the integration of computing , storage and network resources . by increasing network flexibility for service delivery , reducing required network elements and enabling increased scale at reduced cost , our solutions simplify networks . at the same time , our approach facilitates the creation of new service offerings , creating business and operational value for our customers . our op n architecture , which underpins our solutions offering and guides our research and development strategy , is described more fully in the “ strategy ” section of the description of our business under item 1 of part 1 of this annual report . our quarterly reports on form 10-q , annual reports on form 10-k and current reports on form 8-k filed with the sec are available through the sec 's website at www.sec.gov or free of charge on our website as soon as reasonably practicable after we file these documents . we routinely post the reports above , recent news and announcements , financial results and other information about ciena that is important to investors in the `` investors `` section of our website at www.ciena.com . investors are encouraged to review the “ investors ” section of our website because , as with the other disclosure channels that we use , from time to time we may post material information on that site that is not otherwise disseminated by us . 33 market opportunity and strategy we believe that the shift that is underway in network architectures to next-generation , converged infrastructures represents significant , long-term opportunities for our business . we believe that market trends underlying this shift , including the proliferation of devices running mobile web applications , the prevalence of video applications , the increase in machine-to-machine connections , and the shift of enterprise and consumer applications to cloud-based or virtualized network environments , are indicative of increasing use and dependence by consumers and enterprises upon a growing variety of broadband applications and services . we expect that these drivers will continue to require network operators to invest in converged next-generation network infrastructures that are more automated , open and software programmable . our corporate strategy to capitalize on these market dynamics , promote operational efficiency and drive profitable growth of our business includes the initiatives set forth in the `` strategy `` section of the description of our business in item 1 of part 1 of this annual report . global market conditions and competitive landscape during fiscal 2013 , we gained considerable momentum in our business and financial results and experienced a steadily improving market environment , particularly as reflected in the spending patterns and decisions of our largest north american service provider customers . we believe that this spending reflects customer preference of , and a shift in network spending toward , high-capacity , next-generation network architectures . improved conditions during fiscal 2013 followed a lengthy period of macroeconomic uncertainty and volatility , which caused cautious customer behavior in our industry and markets . these conditions , most notably in europe , had previously resulted in lower levels of capital expenditure on communications network infrastructure . because the market opportunity and improved conditions during fiscal 2013 described above are in their early stages , we remain uncertain as to their longer-term effect on the growth of our markets and business , as well as our results of operations . although we are beginning to see network operators adopt converged network architectures that align well with our op n architecture and solutions offering , particularly in north america , competition in our sector remains significant . we continue to encounter a highly competitive marketplace , particularly for our converged packet optical products , as we and our competitors have introduced new , high-capacity , high-speed network solutions and have aggressively sought to capture market share . in this intense and fragmented competitive environment , securing new opportunities , particularly in international markets , often requires that we agree to unfavorable commercial terms that can elongate the revenue recognition cycle , add startup costs to deployment of our solutions in customer networks , require financial commitments or performance bonds that place cash resources at risk , and other onerous contractual commitments that place a disproportionate allocation of risk upon the vendor . these terms can adversely affect our results of operations and contribute to fluctuations in our results . we expect the competitive landscape to remain challenging and dynamic as we and other multinational equipment vendors introduce new , competing , next-generation platforms , seek adoption of network architectural approaches and compete to obtain new business or retain incumbent positions with large customers around the world . as networking technologies , features or layers converge , our competitive landscape may broaden beyond traditional competitors to include additional competitors focused on ip routing , information technology and software . operational reorganization to address the growing need to transport , aggregate and manage multiple types of services , network operators are increasingly demanding and adopting solutions that enable the convergence of both network functions and network layers , particularly the integration of transport , otn switching and packet switching capabilities . our op n architecture and our continued development and addition of features to our solutions portfolio are intended to address the market and networking design dynamics faced by network operators . specifically , we continue to converge otn switching and packet switching functionality into our coherent optical transport solutions . at the same time , we are integrating more transport functionality and packet switching into our switching platforms . story_separator_special_tag our gross profit as a percentage of revenue , or “ gross margin , ” is susceptible to fluctuations due to a number of factors . in any given period , gross margin can vary significantly depending upon the mix and concentration of revenue by segment , product line within a particular segment , geography , and customers . gross margin can also be affected by our concentration of lower margin `` common `` equipment sales and higher margin channel cards , the mix of lower margin installation services within our service revenue , our introduction of new products , and changes in expense for excess and obsolete inventory and warranty obligations . we expect that gross margins will be subject to fluctuation based on our level of success in driving product cost reductions , rationalizing our supply chain and consolidating third party contract manufacturers and distribution sites as part of our effort to optimize our operations . gross margin can also be adversely affected by the level of pricing pressure and competition that we encounter in the market . in an effort to retain or secure customers , enter new markets or capture market share , we may agree to pricing or other unfavorable commercial terms that result in lower or negative gross margins on a particular order or group of orders . these market dynamics and factors may adversely affect our gross margin and results of operations in certain periods . service gross margin can be affected by the mix of customers and services , particularly the mix between deployment and maintenance services , geographic mix and the timing and extent of any investments in internal resources to support this business . the tables below ( in thousands , except percentage data ) set forth the changes in revenue , cost of goods sold and gross profit for the periods indicated : replace_table_token_5_th _ * denotes % of total revenue * * denotes % change from 2012 to 2013 39 replace_table_token_6_th _ * denotes % of product revenue * * denotes % change from 2012 to 2013 replace_table_token_7_th _ * denotes % of service revenue * * denotes % change from 2012 to 2013 gross profit as a percentage of revenue increased as a result of the factors described below . gross profit on products as a percentage of product revenue increased primarily due to improved mix of higher-margin packet platforms with software content , including within our packet networking and converged packet optical segments , higher sales of integrated network service management software , lower warranty costs , and greater leverage from efforts to streamline and optimize our supply chain activities . gross profit on services as a percentage of services revenue increased primarily due to improved margins on installation and deployment services due to improved operational efficiencies , and increased consulting service revenue from our network transformation solutions offering . operating expense we expect operating expense to increase in fiscal 2014 from the level reported for fiscal 2013 to support the growth of our business and fund our research and development initiatives . operating expense consists of the component elements described below . research and development expense primarily consists of salaries and related employee expense ( including share-based compensation expense ) , prototype costs relating to design , development , and testing of our products , depreciation expense and third party consulting costs . selling and marketing expense primarily consists of salaries , commissions and related employee expense ( including share-based compensation expense ) , and sales and marketing support expense , including travel , demonstration units , trade show expense and third party consulting costs . general and administrative expense primarily consists of salaries and related employee expense ( including share-based compensation expense ) , and costs for third party consulting and other services . amortization of intangible assets primarily reflects purchased technology and customer relationships from our acquisitions . restructuring costs primarily reflect actions ciena has taken to better align its workforce , facilities and operating costs with perceived market opportunities , business strategies and changes in market and business conditions . 40 the table below ( in thousands , except percentage data ) sets forth the changes in operating expense for the periods indicated : replace_table_token_8_th _ * denotes % of total revenue * * denotes % change from 2012 to 2013 research and development expense benefited from $ 4.0 million as a result of foreign exchange rates , primarily due to the strengthening of the u.s. dollar in relation to the canadian dollar and the indian rupee . the $ 19.2 million increase primarily reflects increases of $ 15.9 million in employee compensation and related costs , $ 7.5 million in prototype expense , $ 5.2 million in facilities and information systems expense and $ 2.1 million in technology-related purchases . the increase in employee compensation is primarily related to incentive-based compensation . these increases were partially offset by a $ 12.5 million decrease in professional services . selling and marketing expense increased by $ 37.8 million , primarily reflecting increases of $ 26.5 million in employee compensation and related costs , $ 6.8 million in facilities and information systems expense , $ 4.5 million of travel and related costs , $ 2.0 million in trade show and related expense and $ 1.1 million in professional services . a significant portion of our increased employee compensation and related costs reflect commissions-based compensation associated with strong order flows achieved during fiscal 2013. these increases were partially offset by decreases of $ 1.9 million of freight and logistic costs and $ 1.3 million for customer demonstration equipment . general and administrative expense increased by $ 8.4 million primarily reflecting an increase of $ 10.8 million in employee compensation and related costs , partially offset by a $ 2.7 million decrease in facilities and information systems expense . the increase in employee compensation is primarily related to incentive-based compensation . amortization of intangible assets decreased

cash used by increases in accounts receivable during fiscal 2013 , net of $ 2.3 million in provision for doubtful accounts , was $ 145.4 million . our days sales outstanding ( dsos ) increased from 69 days for fiscal 2012 to 84 days for fiscal 2013 . this increase was primarily due to a high volume of sales towards the end of the fourth quarter of fiscal 2013. the following table sets forth ( in thousands ) changes to our accounts receivable , net of allowance for doubtful accounts , from the end of fiscal 2012 through the end of fiscal 2013 : october 31 , increase 2012 2013 ( decrease ) accounts receivable , net $ 345,496 $ 488,578 $ 143,082 inventory cash used by increases in inventory during fiscal 2013 was $ 8.9 million . our inventory turns increased from 3.3 turns during fiscal 2012 to 3.9 turns during fiscal 2013 . during fiscal 2013 , changes in inventory reflect a $ 19.9 million non-cash provision for excess and obsolescence . the following table sets forth changes ( in thousands ) to the components of our inventory from the end of fiscal 2012 through the end fiscal 2013 : replace_table_token_20_th 48 prepaid expenses and other cash used by prepaid expense and other during fiscal 2013 was $ 82.8 million and primarily related to increases in prepaid value added tax , maintenance spares and deferred deployment expense . accounts payable , accruals and other obligations cash generated by a lower utilization of cash resources for accounts payable , accruals and other obligations during fiscal 2013 was $ 115.3 million . changes in accrued liabilities reflect a $ 24.6 million non-cash provision related to warranties .


 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.
     ```cash used by increases in accounts receivable during fiscal 2013 , net of $ 2.3 million in provision for doubtful accounts , was $ 145.4 million . our days sales outstanding ( dsos ) increased from 69 days for fiscal 2012 to 84 days for fiscal 2013 . this increase was primarily due to a high volume of sales towards the end of the fourth quarter of fiscal 2013. the following table sets forth ( in thousands ) changes to our accounts receivable , net of allowance for doubtful accounts , from the end of fiscal 2012 through the end of fiscal 2013 : october 31 , increase 2012 2013 ( decrease ) accounts receivable , net $ 345,496 $ 488,578 $ 143,082 inventory cash used by increases in inventory during fiscal 2013 was $ 8.9 million . our inventory turns increased from 3.3 turns during fiscal 2012 to 3.9 turns during fiscal 2013 . during fiscal 2013 , changes in inventory reflect a $ 19.9 million non-cash provision for excess and obsolescence . the following table sets forth changes ( in thousands ) to the components of our inventory from the end of fiscal 2012 through the end fiscal 2013 : replace_table_token_20_th 48 prepaid expenses and other cash used by prepaid expense and other during fiscal 2013 was $ 82.8 million and primarily related to increases in prepaid value added tax , maintenance spares and deferred deployment expense . accounts payable , accruals and other obligations cash generated by a lower utilization of cash resources for accounts payable , accruals and other obligations during fiscal 2013 was $ 115.3 million . changes in accrued liabilities reflect a $ 24.6 million non-cash provision related to warranties .
```    
 Suspicious Activity Report : through this network approach , we seek to enable high-capacity , configurable infrastructures that can adapt to the changing needs of end-users and the applications that they require , while providing flexible interfaces for the integration of computing , storage and network resources . by increasing network flexibility for service delivery , reducing required network elements and enabling increased scale at reduced cost , our solutions simplify networks . at the same time , our approach facilitates the creation of new service offerings , creating business and operational value for our customers . our op n architecture , which underpins our solutions offering and guides our research and development strategy , is described more fully in the “ strategy ” section of the description of our business under item 1 of part 1 of this annual report . our quarterly reports on form 10-q , annual reports on form 10-k and current reports on form 8-k filed with the sec are available through the sec 's website at www.sec.gov or free of charge on our website as soon as reasonably practicable after we file these documents . we routinely post the reports above , recent news and announcements , financial results and other information about ciena that is important to investors in the `` investors `` section of our website at www.ciena.com . investors are encouraged to review the “ investors ” section of our website because , as with the other disclosure channels that we use , from time to time we may post material information on that site that is not otherwise disseminated by us . 33 market opportunity and strategy we believe that the shift that is underway in network architectures to next-generation , converged infrastructures represents significant , long-term opportunities for our business . we believe that market trends underlying this shift , including the proliferation of devices running mobile web applications , the prevalence of video applications , the increase in machine-to-machine connections , and the shift of enterprise and consumer applications to cloud-based or virtualized network environments , are indicative of increasing use and dependence by consumers and enterprises upon a growing variety of broadband applications and services . we expect that these drivers will continue to require network operators to invest in converged next-generation network infrastructures that are more automated , open and software programmable . our corporate strategy to capitalize on these market dynamics , promote operational efficiency and drive profitable growth of our business includes the initiatives set forth in the `` strategy `` section of the description of our business in item 1 of part 1 of this annual report . global market conditions and competitive landscape during fiscal 2013 , we gained considerable momentum in our business and financial results and experienced a steadily improving market environment , particularly as reflected in the spending patterns and decisions of our largest north american service provider customers . we believe that this spending reflects customer preference of , and a shift in network spending toward , high-capacity , next-generation network architectures . improved conditions during fiscal 2013 followed a lengthy period of macroeconomic uncertainty and volatility , which caused cautious customer behavior in our industry and markets . these conditions , most notably in europe , had previously resulted in lower levels of capital expenditure on communications network infrastructure . because the market opportunity and improved conditions during fiscal 2013 described above are in their early stages , we remain uncertain as to their longer-term effect on the growth of our markets and business , as well as our results of operations . although we are beginning to see network operators adopt converged network architectures that align well with our op n architecture and solutions offering , particularly in north america , competition in our sector remains significant . we continue to encounter a highly competitive marketplace , particularly for our converged packet optical products , as we and our competitors have introduced new , high-capacity , high-speed network solutions and have aggressively sought to capture market share . in this intense and fragmented competitive environment , securing new opportunities , particularly in international markets , often requires that we agree to unfavorable commercial terms that can elongate the revenue recognition cycle , add startup costs to deployment of our solutions in customer networks , require financial commitments or performance bonds that place cash resources at risk , and other onerous contractual commitments that place a disproportionate allocation of risk upon the vendor . these terms can adversely affect our results of operations and contribute to fluctuations in our results . we expect the competitive landscape to remain challenging and dynamic as we and other multinational equipment vendors introduce new , competing , next-generation platforms , seek adoption of network architectural approaches and compete to obtain new business or retain incumbent positions with large customers around the world . as networking technologies , features or layers converge , our competitive landscape may broaden beyond traditional competitors to include additional competitors focused on ip routing , information technology and software . operational reorganization to address the growing need to transport , aggregate and manage multiple types of services , network operators are increasingly demanding and adopting solutions that enable the convergence of both network functions and network layers , particularly the integration of transport , otn switching and packet switching capabilities . our op n architecture and our continued development and addition of features to our solutions portfolio are intended to address the market and networking design dynamics faced by network operators . specifically , we continue to converge otn switching and packet switching functionality into our coherent optical transport solutions . at the same time , we are integrating more transport functionality and packet switching into our switching platforms . story_separator_special_tag our gross profit as a percentage of revenue , or “ gross margin , ” is susceptible to fluctuations due to a number of factors . in any given period , gross margin can vary significantly depending upon the mix and concentration of revenue by segment , product line within a particular segment , geography , and customers . gross margin can also be affected by our concentration of lower margin `` common `` equipment sales and higher margin channel cards , the mix of lower margin installation services within our service revenue , our introduction of new products , and changes in expense for excess and obsolete inventory and warranty obligations . we expect that gross margins will be subject to fluctuation based on our level of success in driving product cost reductions , rationalizing our supply chain and consolidating third party contract manufacturers and distribution sites as part of our effort to optimize our operations . gross margin can also be adversely affected by the level of pricing pressure and competition that we encounter in the market . in an effort to retain or secure customers , enter new markets or capture market share , we may agree to pricing or other unfavorable commercial terms that result in lower or negative gross margins on a particular order or group of orders . these market dynamics and factors may adversely affect our gross margin and results of operations in certain periods . service gross margin can be affected by the mix of customers and services , particularly the mix between deployment and maintenance services , geographic mix and the timing and extent of any investments in internal resources to support this business . the tables below ( in thousands , except percentage data ) set forth the changes in revenue , cost of goods sold and gross profit for the periods indicated : replace_table_token_5_th _ * denotes % of total revenue * * denotes % change from 2012 to 2013 39 replace_table_token_6_th _ * denotes % of product revenue * * denotes % change from 2012 to 2013 replace_table_token_7_th _ * denotes % of service revenue * * denotes % change from 2012 to 2013 gross profit as a percentage of revenue increased as a result of the factors described below . gross profit on products as a percentage of product revenue increased primarily due to improved mix of higher-margin packet platforms with software content , including within our packet networking and converged packet optical segments , higher sales of integrated network service management software , lower warranty costs , and greater leverage from efforts to streamline and optimize our supply chain activities . gross profit on services as a percentage of services revenue increased primarily due to improved margins on installation and deployment services due to improved operational efficiencies , and increased consulting service revenue from our network transformation solutions offering . operating expense we expect operating expense to increase in fiscal 2014 from the level reported for fiscal 2013 to support the growth of our business and fund our research and development initiatives . operating expense consists of the component elements described below . research and development expense primarily consists of salaries and related employee expense ( including share-based compensation expense ) , prototype costs relating to design , development , and testing of our products , depreciation expense and third party consulting costs . selling and marketing expense primarily consists of salaries , commissions and related employee expense ( including share-based compensation expense ) , and sales and marketing support expense , including travel , demonstration units , trade show expense and third party consulting costs . general and administrative expense primarily consists of salaries and related employee expense ( including share-based compensation expense ) , and costs for third party consulting and other services . amortization of intangible assets primarily reflects purchased technology and customer relationships from our acquisitions . restructuring costs primarily reflect actions ciena has taken to better align its workforce , facilities and operating costs with perceived market opportunities , business strategies and changes in market and business conditions . 40 the table below ( in thousands , except percentage data ) sets forth the changes in operating expense for the periods indicated : replace_table_token_8_th _ * denotes % of total revenue * * denotes % change from 2012 to 2013 research and development expense benefited from $ 4.0 million as a result of foreign exchange rates , primarily due to the strengthening of the u.s. dollar in relation to the canadian dollar and the indian rupee . the $ 19.2 million increase primarily reflects increases of $ 15.9 million in employee compensation and related costs , $ 7.5 million in prototype expense , $ 5.2 million in facilities and information systems expense and $ 2.1 million in technology-related purchases . the increase in employee compensation is primarily related to incentive-based compensation . these increases were partially offset by a $ 12.5 million decrease in professional services . selling and marketing expense increased by $ 37.8 million , primarily reflecting increases of $ 26.5 million in employee compensation and related costs , $ 6.8 million in facilities and information systems expense , $ 4.5 million of travel and related costs , $ 2.0 million in trade show and related expense and $ 1.1 million in professional services . a significant portion of our increased employee compensation and related costs reflect commissions-based compensation associated with strong order flows achieved during fiscal 2013. these increases were partially offset by decreases of $ 1.9 million of freight and logistic costs and $ 1.3 million for customer demonstration equipment . general and administrative expense increased by $ 8.4 million primarily reflecting an increase of $ 10.8 million in employee compensation and related costs , partially offset by a $ 2.7 million decrease in facilities and information systems expense . the increase in employee compensation is primarily related to incentive-based compensation . amortization of intangible assets decreased

