negative impact of an increase in self-insured medical costs in 2012 ; and · the negative impact of an increase in general and administrative expenses in 2012. our product offerings consist of a significantly large number of products that have a wide variation in selling price and manufacturing cost , which results in certain practical limitations on our ability to quantify the impact of changes in individual product sales quantities and selling prices on our net sales , cost of goods sold and gross profit . in addition , small variations in period-to-period net sales , cost of goods sold and gross profit can result from changes in the relative mix of our products sold . - 13 - results of operations - 2013 compared to 2012 and 2012 compared to 2011 replace_table_token_3_th net sales . net sales increased approximately $ 8.8 million in 2013 principally due to higher demand for high security pin tumbler locks within the security products segment , and to a lesser extent from an increase in marine component sales outside of the high performance boat market through gains in market share . relative changes in selling prices did not have a material impact on net sales comparisons . net sales increased approximately $ 3.4 million in 2012 principally due to growth in customer demand within both of our segments resulting from somewhat improved economic conditions in north america . additionally , marine components experienced a $ 900,000 increase in sales to the ski/wakeboard boat market . relative changes in selling prices did not have a material impact on net sales comparisons . costs of goods sold and gross margin . cost of goods sold and gross profit both increased from 2012 to 2013 primarily due to increased sales volumes . as a percentage of sales , cost of goods sold decreased 1 % resulting in an increase in gross margin of 1 % primarily due to improved cost efficiencies from higher sales , partially offset by higher self-insured medical costs in 2013 as discussed below . cost of goods sold and gross profit both increased from 2011 to 2012 primarily due to increased sales volumes . as a percentage of sales , cost of goods sold increased 1 % resulting in a decrease in gross margin of 1 % primarily due to the net effects of the increase in sales partially offset by higher self-insured medical costs as discussed below . operating costs and expenses . operating costs and expenses consists primarily of sales and administrative related personnel costs , sales commissions and advertising expenses directly related to product sales and administrative costs relating to business unit and corporate management activities , as well as gains and losses on plant , property and equipment . operating costs and expenses increased in 2013 compared to 2012 , and increased in 2012 as compared to 2011 , as a result of increased administrative support costs relating to the higher sales . additionally , in 2012 we incurred higher costs relating to the assets held for sale . write-down and loss on disposal of assets held for sale . we recorded write-downs on assets held for sale of $ 1.1 million and $ 1.2 million ( including a $ 757,000 loss on disposal of assets held for sale ) in 2011 and 2012 , respectively , relating to certain facilities held for sale that were no longer in use . the write-downs are included in corporate operating expense . see note 7 to the consolidated financial statements . - 14 - operating income . as a percentage of net sales , operating income increased by 3 % in 2013 compared to 2012 , and decreased by 1 % in 2012 compared to 2011 and was primarily impacted by the factors impacting cost of goods sold , gross margin and operating costs , and write-down and loss on disposal of assets held for sale discussed above . general our profitability primarily depends on our ability to utilize our production capacity effectively , which is affected by , among other things , the demand for our products and our ability to control our manufacturing costs , primarily comprised of labor costs and materials . the materials used in our products consist of purchased components and raw materials some of which are subject to fluctuations in the commodity markets such as zinc , brass and stainless steel . total material costs represented approximately 44 % of our cost of sales in 2013 , with commodity related raw materials accounting for approximately 11 % of our cost of sales . worldwide commodity raw material costs increased throughout 2011 , although during 2012 and 2013 they were mostly stable . we occasionally enter into short-term commodity related raw material supply arrangements to mitigate the impact of future increases in commodity related raw material costs . these arrangements generally provide for stated unit prices based upon specified purchase volumes , which helps us to stabilize commodity related raw material purchase prices to a certain extent . we enter into such arrangements for zinc and brass . we expect commodity related raw material prices to moderately increase in 2014 in conjunction with higher demand as a result of the expected growth in the world wide economy . these raw materials purchased on the spot market are sometimes subject to unanticipated and sudden price increases . we generally seek to mitigate the impact of fluctuations in commodity raw material costs on our margins through improvements in production efficiencies or other operating cost reductions . story_separator_special_tag in the event of any such transaction , we may consider using available cash , issuing additional equity securities or increasing our indebtedness or that of our subsidiaries . contractual obligations . as more fully described in the notes to the consolidated financial statements , we are a party to various debt , lease and other agreements that contractually and unconditionally commit us to pay certain amounts in the future . see note 13 to the consolidated financial statements . the following table summarizes such contractual commitments as of december 31 , 2013 by the type and date of payment . replace_table_token_7_th the timing and amount shown for our commitments related to operating leases and fixed asset acquisitions are based upon the contractual payment amount and the contractual payment date for those commitments . the timing and amount shown for purchase obligations , which consist of all open purchase orders and contractual obligations ( primarily commitments to purchase raw materials ) is also based on the contractual payment amount and the contractual payment date for those commitments . the amount shown for income taxes is the consolidated amount of income taxes payable at december 31 , 2013 , which is assumed to be paid during 2014. fixed asset acquisitions include firm purchase commitments for capital projects . commitments and contingencies . see note 13 to the consolidated financial statements . recent accounting pronouncements . not applicable . - 21 - critical accounting policies and estimates we have based the accompanying “ management 's discussion and analysis of financial condition and results of operations ” upon our consolidated financial statements . we prepared our consolidated financial statements in accordance with gaap . in preparing our consolidated financial statements , we are required to make estimates and judgments that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements , and the reported amount of revenues and expenses during the reported period . on an on-going basis , we evaluate our estimates , including those related to inventory reserves , the recoverability of long-lived assets ( including goodwill and other intangible assets ) and the realization of deferred income tax assets . we base our estimates on historical experience and on various other assumptions that we believe are reasonable under the circumstances , the results of which form the basis for making judgments about the reported amounts of assets , liabilities , revenues and expenses . our actual future results might differ from previously estimated amounts under different assumptions or conditions . we believe the following critical accounting policies affect our more significant judgments and estimates used in the preparation of our consolidated financial statements and are applicable to all of our operating segments : · goodwill – our goodwill totaled $ 23.7 million at december 31 , 2013. we perform a goodwill impairment test annually in the third quarter of each year . goodwill is also evaluated for impairment at other times whenever an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying value . all of our goodwill at december 31 , 2013 is related to our security products segment . in september 2011 , the financial accounting standards board issued asu no . 2011-08 , which provided new guidance on testing goodwill for impairment . the new guidance allows an entity to first assess qualitative factors to determine whether it is necessary to perform the two-step quantitative goodwill impairment test . an entity is no longer required to calculate the fair value of a reporting unit unless the entity determines , based on a qualitative assessment considering the totality of relevant events and circumstances , that it is more likely than not that its fair value of the reporting unit is less than its carrying amount . we adopted this accounting standard in the third quarter of 2013. considerable management judgment is necessary to evaluate the qualitative impact of events and circumstances on the fair value of a reporting unit . events and circumstances considered in our impairment evaluations , such as historical profits and stability of the markets served , are consistent with factors utilized with our internal projections and operating plan . however , future events and circumstances could result in materially different findings which could result in the recognition of a material goodwill impairment . no goodwill impairment was deemed to exist as a result of our annual impairment review completed during the third quarter of 2013 , as based on our qualitative assessment , a quantitative assessment was not required for 2013. see notes 1 and 6 to the consolidated financial statements . · long lived assets – we assess property and equipment for impairment only when circumstances ( as specified in asc 360-10-35 , property , plant , and equipment ) indicate an impairment may exist . our determination is based upon , among other things , our estimates of the amount of future net cash flows to be generated by the long-lived asset ( level 3 inputs ) and out estimates of the current fair value of the asset . considerable management judgment is necessary to evaluate the impact of operating changes and to estimate future cash flows . assumptions used in our impairment evaluations , such as forecasted growth rates and our cost of capital , are consistent with our internal projections and operating plans . as a result of continued losses in the marine components segment , we evaluated the recoverability of the marine components long-lived assets during the third quarter of 2013. we determined that the undiscounted cash flows exceed the current net asset value and therefore the marine components long-lived assets are not impaired . however , if our future cash flows from operations less capital expenditures were to drop significantly below our current expectations ( approximately 85 % below our expectations for each

cash flo ws from operating activities resulted in a net use of cash in 2013 due primarily to a cash payment for taxes of approximately $ 11.6 million related to the sale of our disposed operations which was paid in the first quarter of 2013. under gaap , cash paid for income taxes on the disposal of a business unit is reported as a reduction of cash flows from operating activities , while the pre-tax proceeds from disposal are reported as a component of cash flows from investing activities . consequently , we expect to generate positive cash flows from operating activities in 2014. in addition , the operating cash flow comparison for the year ended december 31 , 2013 was negatively impacted by the sale , since the operating cash flows of the disposed operations are included in our total cash flows from operating activities in 2012 , through the december 2012 date of sale . see note 2 to the consolidated financial statements . cash provided by operating activities was $ 13.8 million in 2012 compared to $ 16.0 million in 2011 . the $ 2.1 million decrease in cash provided by both continuing and discontinued operating activities is primarily the net result of : · the negative impact of lower operating income in 2012 attributable to continuing operations of approximately $ 1.0 million , and lower operating income attributable to discontinued operations of $ 1.7 million ; · the positive impact of higher net cash provided by relative changes in our inventories , receivables , payables and non-tax related accruals of $ 2.2 million in 2012 ; ·


 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 flo ws from operating activities resulted in a net use of cash in 2013 due primarily to a cash payment for taxes of approximately $ 11.6 million related to the sale of our disposed operations which was paid in the first quarter of 2013. under gaap , cash paid for income taxes on the disposal of a business unit is reported as a reduction of cash flows from operating activities , while the pre-tax proceeds from disposal are reported as a component of cash flows from investing activities . consequently , we expect to generate positive cash flows from operating activities in 2014. in addition , the operating cash flow comparison for the year ended december 31 , 2013 was negatively impacted by the sale , since the operating cash flows of the disposed operations are included in our total cash flows from operating activities in 2012 , through the december 2012 date of sale . see note 2 to the consolidated financial statements . cash provided by operating activities was $ 13.8 million in 2012 compared to $ 16.0 million in 2011 . the $ 2.1 million decrease in cash provided by both continuing and discontinued operating activities is primarily the net result of : · the negative impact of lower operating income in 2012 attributable to continuing operations of approximately $ 1.0 million , and lower operating income attributable to discontinued operations of $ 1.7 million ; · the positive impact of higher net cash provided by relative changes in our inventories , receivables , payables and non-tax related accruals of $ 2.2 million in 2012 ; ·
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 Suspicious Activity Report : negative impact of an increase in self-insured medical costs in 2012 ; and · the negative impact of an increase in general and administrative expenses in 2012. our product offerings consist of a significantly large number of products that have a wide variation in selling price and manufacturing cost , which results in certain practical limitations on our ability to quantify the impact of changes in individual product sales quantities and selling prices on our net sales , cost of goods sold and gross profit . in addition , small variations in period-to-period net sales , cost of goods sold and gross profit can result from changes in the relative mix of our products sold . - 13 - results of operations - 2013 compared to 2012 and 2012 compared to 2011 replace_table_token_3_th net sales . net sales increased approximately $ 8.8 million in 2013 principally due to higher demand for high security pin tumbler locks within the security products segment , and to a lesser extent from an increase in marine component sales outside of the high performance boat market through gains in market share . relative changes in selling prices did not have a material impact on net sales comparisons . net sales increased approximately $ 3.4 million in 2012 principally due to growth in customer demand within both of our segments resulting from somewhat improved economic conditions in north america . additionally , marine components experienced a $ 900,000 increase in sales to the ski/wakeboard boat market . relative changes in selling prices did not have a material impact on net sales comparisons . costs of goods sold and gross margin . cost of goods sold and gross profit both increased from 2012 to 2013 primarily due to increased sales volumes . as a percentage of sales , cost of goods sold decreased 1 % resulting in an increase in gross margin of 1 % primarily due to improved cost efficiencies from higher sales , partially offset by higher self-insured medical costs in 2013 as discussed below . cost of goods sold and gross profit both increased from 2011 to 2012 primarily due to increased sales volumes . as a percentage of sales , cost of goods sold increased 1 % resulting in a decrease in gross margin of 1 % primarily due to the net effects of the increase in sales partially offset by higher self-insured medical costs as discussed below . operating costs and expenses . operating costs and expenses consists primarily of sales and administrative related personnel costs , sales commissions and advertising expenses directly related to product sales and administrative costs relating to business unit and corporate management activities , as well as gains and losses on plant , property and equipment . operating costs and expenses increased in 2013 compared to 2012 , and increased in 2012 as compared to 2011 , as a result of increased administrative support costs relating to the higher sales . additionally , in 2012 we incurred higher costs relating to the assets held for sale . write-down and loss on disposal of assets held for sale . we recorded write-downs on assets held for sale of $ 1.1 million and $ 1.2 million ( including a $ 757,000 loss on disposal of assets held for sale ) in 2011 and 2012 , respectively , relating to certain facilities held for sale that were no longer in use . the write-downs are included in corporate operating expense . see note 7 to the consolidated financial statements . - 14 - operating income . as a percentage of net sales , operating income increased by 3 % in 2013 compared to 2012 , and decreased by 1 % in 2012 compared to 2011 and was primarily impacted by the factors impacting cost of goods sold , gross margin and operating costs , and write-down and loss on disposal of assets held for sale discussed above . general our profitability primarily depends on our ability to utilize our production capacity effectively , which is affected by , among other things , the demand for our products and our ability to control our manufacturing costs , primarily comprised of labor costs and materials . the materials used in our products consist of purchased components and raw materials some of which are subject to fluctuations in the commodity markets such as zinc , brass and stainless steel . total material costs represented approximately 44 % of our cost of sales in 2013 , with commodity related raw materials accounting for approximately 11 % of our cost of sales . worldwide commodity raw material costs increased throughout 2011 , although during 2012 and 2013 they were mostly stable . we occasionally enter into short-term commodity related raw material supply arrangements to mitigate the impact of future increases in commodity related raw material costs . these arrangements generally provide for stated unit prices based upon specified purchase volumes , which helps us to stabilize commodity related raw material purchase prices to a certain extent . we enter into such arrangements for zinc and brass . we expect commodity related raw material prices to moderately increase in 2014 in conjunction with higher demand as a result of the expected growth in the world wide economy . these raw materials purchased on the spot market are sometimes subject to unanticipated and sudden price increases . we generally seek to mitigate the impact of fluctuations in commodity raw material costs on our margins through improvements in production efficiencies or other operating cost reductions . story_separator_special_tag in the event of any such transaction , we may consider using available cash , issuing additional equity securities or increasing our indebtedness or that of our subsidiaries . contractual obligations . as more fully described in the notes to the consolidated financial statements , we are a party to various debt , lease and other agreements that contractually and unconditionally commit us to pay certain amounts in the future . see note 13 to the consolidated financial statements . the following table summarizes such contractual commitments as of december 31 , 2013 by the type and date of payment . replace_table_token_7_th the timing and amount shown for our commitments related to operating leases and fixed asset acquisitions are based upon the contractual payment amount and the contractual payment date for those commitments . the timing and amount shown for purchase obligations , which consist of all open purchase orders and contractual obligations ( primarily commitments to purchase raw materials ) is also based on the contractual payment amount and the contractual payment date for those commitments . the amount shown for income taxes is the consolidated amount of income taxes payable at december 31 , 2013 , which is assumed to be paid during 2014. fixed asset acquisitions include firm purchase commitments for capital projects . commitments and contingencies . see note 13 to the consolidated financial statements . recent accounting pronouncements . not applicable . - 21 - critical accounting policies and estimates we have based the accompanying “ management 's discussion and analysis of financial condition and results of operations ” upon our consolidated financial statements . we prepared our consolidated financial statements in accordance with gaap . in preparing our consolidated financial statements , we are required to make estimates and judgments that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements , and the reported amount of revenues and expenses during the reported period . on an on-going basis , we evaluate our estimates , including those related to inventory reserves , the recoverability of long-lived assets ( including goodwill and other intangible assets ) and the realization of deferred income tax assets . we base our estimates on historical experience and on various other assumptions that we believe are reasonable under the circumstances , the results of which form the basis for making judgments about the reported amounts of assets , liabilities , revenues and expenses . our actual future results might differ from previously estimated amounts under different assumptions or conditions . we believe the following critical accounting policies affect our more significant judgments and estimates used in the preparation of our consolidated financial statements and are applicable to all of our operating segments : · goodwill – our goodwill totaled $ 23.7 million at december 31 , 2013. we perform a goodwill impairment test annually in the third quarter of each year . goodwill is also evaluated for impairment at other times whenever an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying value . all of our goodwill at december 31 , 2013 is related to our security products segment . in september 2011 , the financial accounting standards board issued asu no . 2011-08 , which provided new guidance on testing goodwill for impairment . the new guidance allows an entity to first assess qualitative factors to determine whether it is necessary to perform the two-step quantitative goodwill impairment test . an entity is no longer required to calculate the fair value of a reporting unit unless the entity determines , based on a qualitative assessment considering the totality of relevant events and circumstances , that it is more likely than not that its fair value of the reporting unit is less than its carrying amount . we adopted this accounting standard in the third quarter of 2013. considerable management judgment is necessary to evaluate the qualitative impact of events and circumstances on the fair value of a reporting unit . events and circumstances considered in our impairment evaluations , such as historical profits and stability of the markets served , are consistent with factors utilized with our internal projections and operating plan . however , future events and circumstances could result in materially different findings which could result in the recognition of a material goodwill impairment . no goodwill impairment was deemed to exist as a result of our annual impairment review completed during the third quarter of 2013 , as based on our qualitative assessment , a quantitative assessment was not required for 2013. see notes 1 and 6 to the consolidated financial statements . · long lived assets – we assess property and equipment for impairment only when circumstances ( as specified in asc 360-10-35 , property , plant , and equipment ) indicate an impairment may exist . our determination is based upon , among other things , our estimates of the amount of future net cash flows to be generated by the long-lived asset ( level 3 inputs ) and out estimates of the current fair value of the asset . considerable management judgment is necessary to evaluate the impact of operating changes and to estimate future cash flows . assumptions used in our impairment evaluations , such as forecasted growth rates and our cost of capital , are consistent with our internal projections and operating plans . as a result of continued losses in the marine components segment , we evaluated the recoverability of the marine components long-lived assets during the third quarter of 2013. we determined that the undiscounted cash flows exceed the current net asset value and therefore the marine components long-lived assets are not impaired . however , if our future cash flows from operations less capital expenditures were to drop significantly below our current expectations ( approximately 85 % below our expectations for each

