in the third and fourth quarters of 2007 , we added sales resources in europe , japan , the u.s. and latin america to increase our ability to capture available business . 28 in our continuing operations , we may experience significant variations in demand for our products from quarter to quarter . this is particularly true for our pc security products , many of which are targeted at new smart card-based id programs run by various u.s. , european and asian governments . sales of our smart card readers and chips for government programs are impacted by testing and compliance schedules of government bodies as well as roll-out schedules for application deployments , both of which contribute to variability in demand from quarter to quarter . sales of our digital media reader products are less subject to this variability based on market or project demands ; however , we are dependent on a small number of customers in both of our primary product segments , which can result in fluctuations in sales levels from one period to another . in may 2006 , we completed the sale of our dtv solutions business to kudelski s.a. as a result , we have accounted for the dtv solutions business as discontinued operations , and the statements of operations and cash flows for all periods presented reflect the discontinuance of this business . ( see note 3 to our consolidated financial statements included in this annual report on form 10-k. ) critical accounting policies and estimates management 's discussion and analysis of financial condition and results of operations discusses our consolidated financial statements , which have been prepared in accordance with accounting principles generally accepted in the united states of america ( u.s. gaap ) . the preparation of these financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period . on an on-going basis , management evaluates its estimates and judgments , including those related to product returns , customer incentives , bad debts , inventories , asset impairment , deferred tax assets , accrued warranty reserves , restructuring costs , contingencies and litigation . management bases its estimates and judgments on historical experience and on various other factors that are believed to be reasonable under the circumstances , the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources . actual results may differ from these estimates under different assumptions or conditions . management believes the following critical accounting policies , among others , affect our more significant judgments and estimates used in the preparation of our consolidated financial statements . we recognize product revenue upon shipment provided that risk and title have transferred , a purchase order has been received , collection is determined to be reasonably assured and no significant obligations remain . maintenance revenue is deferred and amortized over the period of the maintenance contract . provisions for estimated warranty repairs and returns and allowances are provided for at the time products are shipped . we maintain allowances for doubtful accounts for estimated losses resulting from the inability of our customers to make required payments . if the financial condition of our customers were to deteriorate , resulting in an impairment of their ability to make payments , additional allowances might be required , which could have a material impact on our results of operations . we typically plan our production and inventory levels based on internal forecasts of customer demand , which are highly unpredictable and can fluctuate substantially . we regularly review inventory quantities on hand and record an estimated provision for excess inventory , technical obsolescence and no sale-ability based primarily on our historical sales and expectations for future use . actual demand and market conditions may be different from those projected by our management . this could have a material effect on our operating results and financial position . if we were to make different judgments or utilize different estimates , the amount and timing of our write-down of inventories could be materially different . excess inventory frequently remains saleable . when excess inventory is sold , it yields a gross profit margin of up to 100 % . sales of excess inventory have the effect of increasing the gross profit margin beyond that which would otherwise occur , because of previous write-downs . once we have written down inventory below cost , we do not subsequently write it up . we adopted the financial accounting standards board 's ( fasb ) interpretation no . 48 , accounting for uncertain tax positions ( fin 48 ) in the first quarter of 2007. we are required to make certain judgments and estimates in determining income tax expense for financial statement purposes . significant changes to 29 these estimates may result in an increase or decrease to our tax provision in a subsequent period . the calculation of our tax liabilities requires dealing with uncertainties in the application of complex tax regulations . fin 48 prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return . it is inherently difficult and subjective to estimate such amounts . we reevaluate such uncertain tax positions on a quarterly basis based on factors such as , but not limited to , changes in tax laws , issues settled under audit and changes in facts or circumstances . such changes in recognition or measurement might result in the recognition of a tax benefit or an additional charge to the tax provision in the period . story_separator_special_tag general and administrative replace_table_token_9_th general and administrative expenses consist primarily of compensation expenses for employees performing our administrative functions , and professional fees arising from legal , auditing and other consulting services . in 2007 , general and administrative expenses were $ 7.1 million , or 23 % of revenue , compared with $ 7.5 million , or 22 % of revenue in 2006 , a decrease of 6 % . the decrease primarily was due to the consolidation and transfer of our corporate finance and compliance functions from the u.s. to germany and the completion of the transfer of local finance functions from singapore and the u.s. to germany at the end of 2006 , offset in part by the payment of $ 1.4 million in severance and other costs related to our former ceo in the second quarter of 2007. general and administrative expenses in 2006 decreased 18 % from $ 9.2 million in 2005 , which represented 33 % of revenue . this reduction primarily related to the consolidation and transfer of our corporate finance and compliance functions from the u.s. to germany and the transfer of local finance functions from singapore and the u.s. to germany , which resulted in a more streamlined and efficient audit process , a decrease in the number of personnel required to prepare our financial statements and a reduction in expenditures for third-party professional fees . the majority of the decrease occurred in the fourth quarter of 2006 , which also resulted in a more favorable comparison for the year as a whole . amortization of intangibles amortization of intangible assets was $ 0.3 million in 2007 , $ 0.7 million in 2006 and $ 0.7 million in 2005. the decrease in amortization amounts in 2007 compared with previous periods reflects the completion of amortization of intangible assets in the second quarter of 2007. no further amounts remain to be amortized in future periods as the intangible assets have been fully amortized . restructuring and other charges ( credits ) during 2006 , we recorded restructuring and other charges of $ 1.4 million , primarily related to severance costs for general and administrative personnel that were affected by our decision to relocate corporate finance and compliance functions from the u.s. to germany and local finance functions from the u.s. and singapore to germany , as well as the outsourcing of our manufacturing operations from our singapore facility to contract manufacturers . severance costs for manufacturing personnel of approximately $ 0.3 million have been recorded in cost of revenue ( see note 8 to our consolidated financial statements included in this annual report on form 10-k ) . during 2005 , we incurred restructuring and other charges of $ 0.8 million , which included $ 0.2 million of severance costs related to a reduction in force of non-manufacturing personnel at our singapore facility , resulting from our decision to outsource manufacturing operations to contract manufacturers . severance costs for manufacturing personnel of $ 0.5 million were recorded in cost of revenue . ( see note 8 to our consolidated financial statements included in this annual report on form 10-k. ) restructuring and other charges in 2005 also included $ 0.1 million primarily related to changes in estimates for european tax related matters . 35 interest income interest income consists of interest earned on invested cash . interest income resulting from cash balances was $ 1.6 million in 2007 , $ 1.4 million in 2006 and $ 0.7 million in 2005. higher interest income in 2007 compared with 2006 resulted primarily from higher interest rates in 2007. higher interest income in 2006 compared with 2005 resulted from higher interest rates and a greater amount of cash invested . the 2005 period includes a cumulative adjustment to interest income taken in the second quarter for the correction of an error in accounting for the amortization of premiums and discounts on investments . the correction of the error resulted in a reduction of interest income in the second quarter and the year of 2005 of approximately $ 0.3 million . foreign currency gains and losses and other income and expense we recorded foreign currency exchange losses and other expense of $ 0.3 million in 2007 and $ 0.2 million in 2006 , and we recorded foreign currency exchange gains and other income of $ 1.7 million in 2005. changes in currency valuation in all periods presented were primarily a result of exchange rate movements between the u.s. dollar and the euro . during 2007 , foreign currency losses were $ 0.3 million , due primarily to the devaluation of the u.s. dollar . no other income was recorded . during 2006 , foreign currency losses were $ 0.3 million , due primarily to the devaluation of the u.s. dollar . other income was $ 0.1 million . during 2005 , foreign currency gains were $ 1.6 million , due primarily to the revaluation of dollar holdings in an entity where the euro is the functional currency . other income was $ 0.1 million , primarily attributable to the settlement of transactional tax issues in europe . income taxes in 2007 , 2006 and 2005 , we recorded provisions for income taxes of $ 0.1 million , $ 0.1 million and $ 0.2 million , respectively , primarily resulting from minimum taxation and taxes payable in foreign jurisdictions that are not offset by operating loss carryforwards . discontinued operations on may 22 , 2006 , we completed the sale of substantially all the assets and some of the liabilities associated with our dtv solutions business to kudelski s.a. revenue for the dtv solutions business was $ 0.5 million , $ 13.5 million and $ 20.8 million in 2007 , 2006 and 2005 , respectively . operating gain ( loss ) for the dtv solutions business was $ 0.1 million , $ ( 1.3 ) million and $ ( 1.9 ) million in 2007 , 2006 and

liquidity and capital resources as of december 31 , 2007 , our working capital , which we have defined as current assets less current liabilities , was $ 34.0 million , compared to $ 32.0 million as of december 31 , 2006. working capital increased in 2007 by approximately $ 2.0 million . current assets decreased by $ 2.6 million , resulting from a reduction in cash , cash equivalents and short-term investments of $ 4.5 million and a reduction of other current assets of $ 1.0 million , which was only partly offset by increases in accounts receivable of $ 2.1 million and in inventories of $ 0.8 million . current liabilities decreased by $ 4.7 million , resulting from a reduction in accounts payable of $ 1.5 million , a reduction in accruals of $ 1.6 million and a decrease in income taxes payable by $ 1.6 million . in 2007 , cash and cash equivalents decreased by $ 13.5 million , primarily due to cash used for additional purchases of short-term investments . while operating activities used $ 5.4 million and investing activities used $ 9.3 million , financing activities resulted in a positive cash flow of $ 0.1 million and the effect of exchange rates on cash and cash equivalents was $ 1.1 million . cash used in continuing operations of $ 6.0 million was primarily due to a net loss before discontinued operations , depreciation and amortization and stock-based compensation expenses of $ 2.0 million . the remaining $ 4.0 million cash used in continuing operations resulted mainly from the net effect of changes in working capital .


 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 as of december 31 , 2007 , our working capital , which we have defined as current assets less current liabilities , was $ 34.0 million , compared to $ 32.0 million as of december 31 , 2006. working capital increased in 2007 by approximately $ 2.0 million . current assets decreased by $ 2.6 million , resulting from a reduction in cash , cash equivalents and short-term investments of $ 4.5 million and a reduction of other current assets of $ 1.0 million , which was only partly offset by increases in accounts receivable of $ 2.1 million and in inventories of $ 0.8 million . current liabilities decreased by $ 4.7 million , resulting from a reduction in accounts payable of $ 1.5 million , a reduction in accruals of $ 1.6 million and a decrease in income taxes payable by $ 1.6 million . in 2007 , cash and cash equivalents decreased by $ 13.5 million , primarily due to cash used for additional purchases of short-term investments . while operating activities used $ 5.4 million and investing activities used $ 9.3 million , financing activities resulted in a positive cash flow of $ 0.1 million and the effect of exchange rates on cash and cash equivalents was $ 1.1 million . cash used in continuing operations of $ 6.0 million was primarily due to a net loss before discontinued operations , depreciation and amortization and stock-based compensation expenses of $ 2.0 million . the remaining $ 4.0 million cash used in continuing operations resulted mainly from the net effect of changes in working capital .
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 Suspicious Activity Report : in the third and fourth quarters of 2007 , we added sales resources in europe , japan , the u.s. and latin america to increase our ability to capture available business . 28 in our continuing operations , we may experience significant variations in demand for our products from quarter to quarter . this is particularly true for our pc security products , many of which are targeted at new smart card-based id programs run by various u.s. , european and asian governments . sales of our smart card readers and chips for government programs are impacted by testing and compliance schedules of government bodies as well as roll-out schedules for application deployments , both of which contribute to variability in demand from quarter to quarter . sales of our digital media reader products are less subject to this variability based on market or project demands ; however , we are dependent on a small number of customers in both of our primary product segments , which can result in fluctuations in sales levels from one period to another . in may 2006 , we completed the sale of our dtv solutions business to kudelski s.a. as a result , we have accounted for the dtv solutions business as discontinued operations , and the statements of operations and cash flows for all periods presented reflect the discontinuance of this business . ( see note 3 to our consolidated financial statements included in this annual report on form 10-k. ) critical accounting policies and estimates management 's discussion and analysis of financial condition and results of operations discusses our consolidated financial statements , which have been prepared in accordance with accounting principles generally accepted in the united states of america ( u.s. gaap ) . the preparation of these financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period . on an on-going basis , management evaluates its estimates and judgments , including those related to product returns , customer incentives , bad debts , inventories , asset impairment , deferred tax assets , accrued warranty reserves , restructuring costs , contingencies and litigation . management bases its estimates and judgments on historical experience and on various other factors that are believed to be reasonable under the circumstances , the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources . actual results may differ from these estimates under different assumptions or conditions . management believes the following critical accounting policies , among others , affect our more significant judgments and estimates used in the preparation of our consolidated financial statements . we recognize product revenue upon shipment provided that risk and title have transferred , a purchase order has been received , collection is determined to be reasonably assured and no significant obligations remain . maintenance revenue is deferred and amortized over the period of the maintenance contract . provisions for estimated warranty repairs and returns and allowances are provided for at the time products are shipped . we maintain allowances for doubtful accounts for estimated losses resulting from the inability of our customers to make required payments . if the financial condition of our customers were to deteriorate , resulting in an impairment of their ability to make payments , additional allowances might be required , which could have a material impact on our results of operations . we typically plan our production and inventory levels based on internal forecasts of customer demand , which are highly unpredictable and can fluctuate substantially . we regularly review inventory quantities on hand and record an estimated provision for excess inventory , technical obsolescence and no sale-ability based primarily on our historical sales and expectations for future use . actual demand and market conditions may be different from those projected by our management . this could have a material effect on our operating results and financial position . if we were to make different judgments or utilize different estimates , the amount and timing of our write-down of inventories could be materially different . excess inventory frequently remains saleable . when excess inventory is sold , it yields a gross profit margin of up to 100 % . sales of excess inventory have the effect of increasing the gross profit margin beyond that which would otherwise occur , because of previous write-downs . once we have written down inventory below cost , we do not subsequently write it up . we adopted the financial accounting standards board 's ( fasb ) interpretation no . 48 , accounting for uncertain tax positions ( fin 48 ) in the first quarter of 2007. we are required to make certain judgments and estimates in determining income tax expense for financial statement purposes . significant changes to 29 these estimates may result in an increase or decrease to our tax provision in a subsequent period . the calculation of our tax liabilities requires dealing with uncertainties in the application of complex tax regulations . fin 48 prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return . it is inherently difficult and subjective to estimate such amounts . we reevaluate such uncertain tax positions on a quarterly basis based on factors such as , but not limited to , changes in tax laws , issues settled under audit and changes in facts or circumstances . such changes in recognition or measurement might result in the recognition of a tax benefit or an additional charge to the tax provision in the period . story_separator_special_tag general and administrative replace_table_token_9_th general and administrative expenses consist primarily of compensation expenses for employees performing our administrative functions , and professional fees arising from legal , auditing and other consulting services . in 2007 , general and administrative expenses were $ 7.1 million , or 23 % of revenue , compared with $ 7.5 million , or 22 % of revenue in 2006 , a decrease of 6 % . the decrease primarily was due to the consolidation and transfer of our corporate finance and compliance functions from the u.s. to germany and the completion of the transfer of local finance functions from singapore and the u.s. to germany at the end of 2006 , offset in part by the payment of $ 1.4 million in severance and other costs related to our former ceo in the second quarter of 2007. general and administrative expenses in 2006 decreased 18 % from $ 9.2 million in 2005 , which represented 33 % of revenue . this reduction primarily related to the consolidation and transfer of our corporate finance and compliance functions from the u.s. to germany and the transfer of local finance functions from singapore and the u.s. to germany , which resulted in a more streamlined and efficient audit process , a decrease in the number of personnel required to prepare our financial statements and a reduction in expenditures for third-party professional fees . the majority of the decrease occurred in the fourth quarter of 2006 , which also resulted in a more favorable comparison for the year as a whole . amortization of intangibles amortization of intangible assets was $ 0.3 million in 2007 , $ 0.7 million in 2006 and $ 0.7 million in 2005. the decrease in amortization amounts in 2007 compared with previous periods reflects the completion of amortization of intangible assets in the second quarter of 2007. no further amounts remain to be amortized in future periods as the intangible assets have been fully amortized . restructuring and other charges ( credits ) during 2006 , we recorded restructuring and other charges of $ 1.4 million , primarily related to severance costs for general and administrative personnel that were affected by our decision to relocate corporate finance and compliance functions from the u.s. to germany and local finance functions from the u.s. and singapore to germany , as well as the outsourcing of our manufacturing operations from our singapore facility to contract manufacturers . severance costs for manufacturing personnel of approximately $ 0.3 million have been recorded in cost of revenue ( see note 8 to our consolidated financial statements included in this annual report on form 10-k ) . during 2005 , we incurred restructuring and other charges of $ 0.8 million , which included $ 0.2 million of severance costs related to a reduction in force of non-manufacturing personnel at our singapore facility , resulting from our decision to outsource manufacturing operations to contract manufacturers . severance costs for manufacturing personnel of $ 0.5 million were recorded in cost of revenue . ( see note 8 to our consolidated financial statements included in this annual report on form 10-k. ) restructuring and other charges in 2005 also included $ 0.1 million primarily related to changes in estimates for european tax related matters . 35 interest income interest income consists of interest earned on invested cash . interest income resulting from cash balances was $ 1.6 million in 2007 , $ 1.4 million in 2006 and $ 0.7 million in 2005. higher interest income in 2007 compared with 2006 resulted primarily from higher interest rates in 2007. higher interest income in 2006 compared with 2005 resulted from higher interest rates and a greater amount of cash invested . the 2005 period includes a cumulative adjustment to interest income taken in the second quarter for the correction of an error in accounting for the amortization of premiums and discounts on investments . the correction of the error resulted in a reduction of interest income in the second quarter and the year of 2005 of approximately $ 0.3 million . foreign currency gains and losses and other income and expense we recorded foreign currency exchange losses and other expense of $ 0.3 million in 2007 and $ 0.2 million in 2006 , and we recorded foreign currency exchange gains and other income of $ 1.7 million in 2005. changes in currency valuation in all periods presented were primarily a result of exchange rate movements between the u.s. dollar and the euro . during 2007 , foreign currency losses were $ 0.3 million , due primarily to the devaluation of the u.s. dollar . no other income was recorded . during 2006 , foreign currency losses were $ 0.3 million , due primarily to the devaluation of the u.s. dollar . other income was $ 0.1 million . during 2005 , foreign currency gains were $ 1.6 million , due primarily to the revaluation of dollar holdings in an entity where the euro is the functional currency . other income was $ 0.1 million , primarily attributable to the settlement of transactional tax issues in europe . income taxes in 2007 , 2006 and 2005 , we recorded provisions for income taxes of $ 0.1 million , $ 0.1 million and $ 0.2 million , respectively , primarily resulting from minimum taxation and taxes payable in foreign jurisdictions that are not offset by operating loss carryforwards . discontinued operations on may 22 , 2006 , we completed the sale of substantially all the assets and some of the liabilities associated with our dtv solutions business to kudelski s.a. revenue for the dtv solutions business was $ 0.5 million , $ 13.5 million and $ 20.8 million in 2007 , 2006 and 2005 , respectively . operating gain ( loss ) for the dtv solutions business was $ 0.1 million , $ ( 1.3 ) million and $ ( 1.9 ) million in 2007 , 2006 and

