we made this determination based on how we manage our operations and the information provided to our chief operating decision maker who is our chief executive officer . in june 2007 , we entered into a license and research collaboration agreement and separate supply agreement with merck related to our i-vation  ta intravitreal implant . under the terms of the merck agreements , we received an upfront license fee of $ 20.0 million and were eligible to receive up to an additional $ 288.0 million in fees and development milestones associated with the successful product development and attainment of appropriate u.s. and eu regulatory approvals , as well as payment for our research and development activities . in september 2008 , following a strategic review of merck 's business and product development portfolio , merck gave notice to surmodics that it was terminating the collaborative license and research agreement , as well as the supply agreement entered into in june 2007. this decision was not based on any concerns about the safety or efficacy of the i-vation system . the termination was effective in december 2008 , and we recognized revenue related to the termination of approximately $ 45.0 million in fiscal 2009 , principally from amounts that previously had 32 been deferred and amortized under the accounting treatment required by accounting guidance for revenue arrangements with multiple deliverables . the $ 45.0 million included a $ 9.0 million milestone payment from merck associated with the termination of the triamcinolone acetonide development program . overview of research and development activities we manage our customer-sponsored r & d programs ( customer r & d ) , based largely on the requirements of our customers . in this regard , our customers typically establish the various measures and metrics that are used to monitor a program 's progress , including key deliverables , milestones , timelines , and an overall program budget . the customer is ultimately responsible for deciding whether to continue or terminate a program , and does so based on research results ( relative to the above measures and metrics ) and other factors , including their own strategic and or business priorities . customer r & d programs are mainly in our medical device and pharmaceuticals segments and the processes do not differ significantly . for our internal r & d programs ( included in other r & d ) in our three segments , we utilize r & d review committees to prioritize these programs based on a number of factors , including a program 's strategic fit , commercial impact , potential competitive advantage , technical feasibility , and the amount of investment required . the measures and metrics used to monitor a program 's progress varies based on the program , and typically includes many of the same factors discussed above with respect to our customer r & d programs . we typically make decisions to continue or terminate a program based on research results ( relative to the above measures and metrics ) and other factors , including our own strategic and or business priorities , and the amount of additional investment required . with respect to cost components , r & d expenses in each of our three segments consist of labor , materials and overhead costs ( utilities , depreciation , indirect labor , etc . ) for both customer r & d and other r & d programs . we manage our r & d organization in a flexible manner , balancing workloads/resources between customer r & d and other r & d programs primarily based on the level of customer program activity . therefore , costs incurred for customer r & d and other r & d can shift as customer activity increases or decreases . as a result of the recent economic conditions , some customers have delayed , slowed or cancelled development projects , which has affected the r & d expense mix between customer r & d and other r & d . critical accounting policies the discussion and analysis of our financial condition and results of operations is based upon our consolidated financial statements , which have been prepared in accordance with accounting principles generally accepted in the u.s. ( gaap ) . the preparation of these financial statements is based in part on the application of significant accounting policies , many of which require management to make estimates and assumptions ( see note 2 to the consolidated financial statements ) . actual results may differ from these estimates under different assumptions or conditions and could materially impact our results of operations . we believe the following are critical areas in the application of our accounting policies that currently affect our financial condition and results of operations . revenue recognition . in accordance with accounting guidance , revenue is recognized when all of the following criteria are met : ( 1 ) persuasive evidence of an arrangement exists ; ( 2 ) shipment has occurred or delivery has occurred if the terms specify destination ; ( 3 ) the sales price is fixed or determinable ; and ( 4 ) collectability is reasonably assured . when there are additional performance requirements , revenue is recognized when all such requirements have been satisfied . under revenue arrangements with multiple deliverables , the company recognizes each separable deliverable as it is earned . the company licenses technology to third parties and collects royalties . royalty revenue is generated when a customer sells products incorporating the company 's licensed technologies . royalty revenue is recognized as our licensees report it to us , and payment is typically submitted concurrently with the report . for stand-alone license agreements , up-front license fees are recognized over the term of the related licensing agreement . minimum royalty fees are recognized in the period earned . story_separator_special_tag based on our analysis , we utilized the guideline public company method to support the valuation of the reporting units in fiscal 2010. based on the goodwill analysis performed as of august 31 , 2010 , the $ 13.8 million of goodwill in the surmodics pharmaceuticals reporting unit failed step 1 of the impairment test , and step 2 of the impairment test indicated that goodwill was fully impaired . the indicated excess in fair value over carrying value of the company 's in vitro diagnostics reporting unit in step 1 of the impairment test at august 31 , 2010 was approximately 82 % and as such the $ 8.0 million of goodwill related to this reporting unit was not impaired . to the extent that actual results or other assumptions about future economic conditions or potential for our growth and profitability in this business changed , it is possible that our conclusion regarding the goodwill could change , which could have a material effect on our financial position and results of operations . the surmodics drug 37 delivery and hydrophilic coatings operations do not have any goodwill and were included in the fiscal 2010 analysis to assist in reconciling the fair value of all reporting units to the company 's market capitalization at august 31 , 2010. see note 2 to the consolidated financial statements for further information . we did not record any goodwill impairment charges during fiscal 2009. investments . investments consist principally of u.s. government and government agency obligations and mortgage-backed securities and are classified as available-for-sale or held-to-maturity at september 30 , 2011. our investment policy calls for no more than 5 % of investments be held in any one credit issue , excluding u.s. government and government agency obligations . available-for-sale investments are reported at fair value with unrealized gains and losses excluded from operations and reported as a separate component of stockholders ' equity , except for other-than-temporary impairments , which are reported as a charge to current operations and result in a new cost basis for the investment . our evaluation of the available-for-sale investments resulted in no loss recognition in fiscal 2011 , 2010 or 2009. investments for which management has the intent and ability to hold to maturity are classified as held-to-maturity and reported at amortized cost . if there was an other-than-temporary impairment in the fair value of any individual security classified as held-to-maturity , the company would write down the security to fair value with a corresponding adjustment to other income ( loss ) . interest on debt securities , including amortization of premiums and accretion of discounts , is included in other income ( loss ) . realized gains and losses from the sales of debt securities , which are included in other income ( loss ) , are determined using the specific identification method . see notes 2 and 3 to the consolidated financial statements for further information . income tax accruals and valuation allowances . when preparing the consolidated financial statements , we are required to estimate the income tax obligations in each of the jurisdictions in which we operate . this process involves estimating the actual current tax obligations based on expected income , statutory tax rates and tax planning opportunities in the various jurisdictions . in the event there is a significant unusual or one-time item recognized in the results of operations , the tax attributable to that item would be separately calculated and recorded in the period the unusual or one-time item occurred . tax law requires certain items to be included in our tax return at different times than the items are reflected in our results of operations . as a result , the annual effective tax rate reflected in our results of operations is different than that reported on our tax return ( i.e . , our cash tax rate ) . some of these differences are permanent , such as expenses that are not deductible in our tax return , and some are temporary differences that will reverse over time , such as depreciation expense on capital assets . these temporary differences result in deferred tax assets and liabilities , which are included in our consolidated balance sheets . deferred tax assets generally represent items that can be used as a tax deduction or credit in our tax returns in future years , for which we have already recorded the expense in our consolidated statements of operations . we must assess the likelihood that our deferred tax assets will be recovered from future taxable income , and to the extent we believe that recovery is not likely , we must establish a valuation allowance against those deferred tax assets . deferred tax liabilities generally represent items for which we have already taken a deduction in our tax return , but we have not yet recognized the items as expense in our results of operations . significant judgment is required in evaluating our tax positions , and in determining our provision for income taxes , our deferred tax assets and liabilities and any valuation allowance recorded against our deferred tax assets . we had total deferred tax assets in excess of total deferred tax liabilities of $ 9.4 million as of september 30 , 2011 and $ 2.9 million as of september 30 , 2010 , including valuation allowances of $ 7.7 million as of september 30 , 2011 and $ 6.5 million as of september 30 , 2010. the valuation allowances related to impairment losses on investments were recorded because the company does not currently foresee future capital gains within the allowable carryforward and carryback periods to offset these capital losses when they are recognized . as such , no tax benefit has been recorded in the consolidated statements of operations . in addition , we recorded a valuation allowance related to state net operating losses based on the uncertainty regarding the realization of the net operating losses in

liquidity and capital resources operating activities . as of september 30 , 2011 , the company had working capital of $ 42.7 million , of which $ 38.4 million consisted of cash , cash equivalents and short-term investments . working capital increased 46 $ 12.9 million from the september 30 , 2010 level , driven principally by higher cash and short-term investment balances , offset by higher accrued compensation and other current liabilities . our cash , cash equivalents and short-term and long-term investments totaled $ 68.2 million at september 30 , 2011 , an increase of $ 11.4 million from $ 56.8 million at september 30 , 2010. the increase was principally driven by cash generated from operations less payments related to a prior acquisition . the company 's investments principally consist of u.s. government and government agency obligations and investment grade , interest-bearing corporate and municipal debt securities with varying maturity dates , the majority of which are five years or less . the company 's policy requires that no more than 5 % of investments be held in any one credit issue , excluding u.s. government and government agency obligations . the primary investment objective of the portfolio is to provide for the safety of principal and appropriate liquidity while meeting or exceeding a benchmark ( merrill lynch 1-3 year government-corporate index ) total rate of return . management plans to continue to direct its investment advisors to manage the company 's investments primarily for the safety of principal for the foreseeable future as it assesses other investment opportunities and uses of its investments . the company had positive cash flows from operating activities of approximately $ 20.0 million in fiscal 2011 , compared with $ 22.0 million in fiscal 2010. the following table depicts our cash flows from operations for each of fiscal 2011 and 2010 : replace_table_token_8_th net cash provided by operating activities decreased $ 2.1 million in fiscal 2011 compared with fiscal 2010. this decrease was driven by continued lower cypher ® stent royalties , which declined $ 2.7 million compared with fiscal 2010 , as well as to $ 1.3 million higher restructuring related payments . investing activities .


 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 operating activities . as of september 30 , 2011 , the company had working capital of $ 42.7 million , of which $ 38.4 million consisted of cash , cash equivalents and short-term investments . working capital increased 46 $ 12.9 million from the september 30 , 2010 level , driven principally by higher cash and short-term investment balances , offset by higher accrued compensation and other current liabilities . our cash , cash equivalents and short-term and long-term investments totaled $ 68.2 million at september 30 , 2011 , an increase of $ 11.4 million from $ 56.8 million at september 30 , 2010. the increase was principally driven by cash generated from operations less payments related to a prior acquisition . the company 's investments principally consist of u.s. government and government agency obligations and investment grade , interest-bearing corporate and municipal debt securities with varying maturity dates , the majority of which are five years or less . the company 's policy requires that no more than 5 % of investments be held in any one credit issue , excluding u.s. government and government agency obligations . the primary investment objective of the portfolio is to provide for the safety of principal and appropriate liquidity while meeting or exceeding a benchmark ( merrill lynch 1-3 year government-corporate index ) total rate of return . management plans to continue to direct its investment advisors to manage the company 's investments primarily for the safety of principal for the foreseeable future as it assesses other investment opportunities and uses of its investments . the company had positive cash flows from operating activities of approximately $ 20.0 million in fiscal 2011 , compared with $ 22.0 million in fiscal 2010. the following table depicts our cash flows from operations for each of fiscal 2011 and 2010 : replace_table_token_8_th net cash provided by operating activities decreased $ 2.1 million in fiscal 2011 compared with fiscal 2010. this decrease was driven by continued lower cypher ® stent royalties , which declined $ 2.7 million compared with fiscal 2010 , as well as to $ 1.3 million higher restructuring related payments . investing activities .
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 Suspicious Activity Report : we made this determination based on how we manage our operations and the information provided to our chief operating decision maker who is our chief executive officer . in june 2007 , we entered into a license and research collaboration agreement and separate supply agreement with merck related to our i-vation  ta intravitreal implant . under the terms of the merck agreements , we received an upfront license fee of $ 20.0 million and were eligible to receive up to an additional $ 288.0 million in fees and development milestones associated with the successful product development and attainment of appropriate u.s. and eu regulatory approvals , as well as payment for our research and development activities . in september 2008 , following a strategic review of merck 's business and product development portfolio , merck gave notice to surmodics that it was terminating the collaborative license and research agreement , as well as the supply agreement entered into in june 2007. this decision was not based on any concerns about the safety or efficacy of the i-vation system . the termination was effective in december 2008 , and we recognized revenue related to the termination of approximately $ 45.0 million in fiscal 2009 , principally from amounts that previously had 32 been deferred and amortized under the accounting treatment required by accounting guidance for revenue arrangements with multiple deliverables . the $ 45.0 million included a $ 9.0 million milestone payment from merck associated with the termination of the triamcinolone acetonide development program . overview of research and development activities we manage our customer-sponsored r & d programs ( customer r & d ) , based largely on the requirements of our customers . in this regard , our customers typically establish the various measures and metrics that are used to monitor a program 's progress , including key deliverables , milestones , timelines , and an overall program budget . the customer is ultimately responsible for deciding whether to continue or terminate a program , and does so based on research results ( relative to the above measures and metrics ) and other factors , including their own strategic and or business priorities . customer r & d programs are mainly in our medical device and pharmaceuticals segments and the processes do not differ significantly . for our internal r & d programs ( included in other r & d ) in our three segments , we utilize r & d review committees to prioritize these programs based on a number of factors , including a program 's strategic fit , commercial impact , potential competitive advantage , technical feasibility , and the amount of investment required . the measures and metrics used to monitor a program 's progress varies based on the program , and typically includes many of the same factors discussed above with respect to our customer r & d programs . we typically make decisions to continue or terminate a program based on research results ( relative to the above measures and metrics ) and other factors , including our own strategic and or business priorities , and the amount of additional investment required . with respect to cost components , r & d expenses in each of our three segments consist of labor , materials and overhead costs ( utilities , depreciation , indirect labor , etc . ) for both customer r & d and other r & d programs . we manage our r & d organization in a flexible manner , balancing workloads/resources between customer r & d and other r & d programs primarily based on the level of customer program activity . therefore , costs incurred for customer r & d and other r & d can shift as customer activity increases or decreases . as a result of the recent economic conditions , some customers have delayed , slowed or cancelled development projects , which has affected the r & d expense mix between customer r & d and other r & d . critical accounting policies the discussion and analysis of our financial condition and results of operations is based upon our consolidated financial statements , which have been prepared in accordance with accounting principles generally accepted in the u.s. ( gaap ) . the preparation of these financial statements is based in part on the application of significant accounting policies , many of which require management to make estimates and assumptions ( see note 2 to the consolidated financial statements ) . actual results may differ from these estimates under different assumptions or conditions and could materially impact our results of operations . we believe the following are critical areas in the application of our accounting policies that currently affect our financial condition and results of operations . revenue recognition . in accordance with accounting guidance , revenue is recognized when all of the following criteria are met : ( 1 ) persuasive evidence of an arrangement exists ; ( 2 ) shipment has occurred or delivery has occurred if the terms specify destination ; ( 3 ) the sales price is fixed or determinable ; and ( 4 ) collectability is reasonably assured . when there are additional performance requirements , revenue is recognized when all such requirements have been satisfied . under revenue arrangements with multiple deliverables , the company recognizes each separable deliverable as it is earned . the company licenses technology to third parties and collects royalties . royalty revenue is generated when a customer sells products incorporating the company 's licensed technologies . royalty revenue is recognized as our licensees report it to us , and payment is typically submitted concurrently with the report . for stand-alone license agreements , up-front license fees are recognized over the term of the related licensing agreement . minimum royalty fees are recognized in the period earned . story_separator_special_tag based on our analysis , we utilized the guideline public company method to support the valuation of the reporting units in fiscal 2010. based on the goodwill analysis performed as of august 31 , 2010 , the $ 13.8 million of goodwill in the surmodics pharmaceuticals reporting unit failed step 1 of the impairment test , and step 2 of the impairment test indicated that goodwill was fully impaired . the indicated excess in fair value over carrying value of the company 's in vitro diagnostics reporting unit in step 1 of the impairment test at august 31 , 2010 was approximately 82 % and as such the $ 8.0 million of goodwill related to this reporting unit was not impaired . to the extent that actual results or other assumptions about future economic conditions or potential for our growth and profitability in this business changed , it is possible that our conclusion regarding the goodwill could change , which could have a material effect on our financial position and results of operations . the surmodics drug 37 delivery and hydrophilic coatings operations do not have any goodwill and were included in the fiscal 2010 analysis to assist in reconciling the fair value of all reporting units to the company 's market capitalization at august 31 , 2010. see note 2 to the consolidated financial statements for further information . we did not record any goodwill impairment charges during fiscal 2009. investments . investments consist principally of u.s. government and government agency obligations and mortgage-backed securities and are classified as available-for-sale or held-to-maturity at september 30 , 2011. our investment policy calls for no more than 5 % of investments be held in any one credit issue , excluding u.s. government and government agency obligations . available-for-sale investments are reported at fair value with unrealized gains and losses excluded from operations and reported as a separate component of stockholders ' equity , except for other-than-temporary impairments , which are reported as a charge to current operations and result in a new cost basis for the investment . our evaluation of the available-for-sale investments resulted in no loss recognition in fiscal 2011 , 2010 or 2009. investments for which management has the intent and ability to hold to maturity are classified as held-to-maturity and reported at amortized cost . if there was an other-than-temporary impairment in the fair value of any individual security classified as held-to-maturity , the company would write down the security to fair value with a corresponding adjustment to other income ( loss ) . interest on debt securities , including amortization of premiums and accretion of discounts , is included in other income ( loss ) . realized gains and losses from the sales of debt securities , which are included in other income ( loss ) , are determined using the specific identification method . see notes 2 and 3 to the consolidated financial statements for further information . income tax accruals and valuation allowances . when preparing the consolidated financial statements , we are required to estimate the income tax obligations in each of the jurisdictions in which we operate . this process involves estimating the actual current tax obligations based on expected income , statutory tax rates and tax planning opportunities in the various jurisdictions . in the event there is a significant unusual or one-time item recognized in the results of operations , the tax attributable to that item would be separately calculated and recorded in the period the unusual or one-time item occurred . tax law requires certain items to be included in our tax return at different times than the items are reflected in our results of operations . as a result , the annual effective tax rate reflected in our results of operations is different than that reported on our tax return ( i.e . , our cash tax rate ) . some of these differences are permanent , such as expenses that are not deductible in our tax return , and some are temporary differences that will reverse over time , such as depreciation expense on capital assets . these temporary differences result in deferred tax assets and liabilities , which are included in our consolidated balance sheets . deferred tax assets generally represent items that can be used as a tax deduction or credit in our tax returns in future years , for which we have already recorded the expense in our consolidated statements of operations . we must assess the likelihood that our deferred tax assets will be recovered from future taxable income , and to the extent we believe that recovery is not likely , we must establish a valuation allowance against those deferred tax assets . deferred tax liabilities generally represent items for which we have already taken a deduction in our tax return , but we have not yet recognized the items as expense in our results of operations . significant judgment is required in evaluating our tax positions , and in determining our provision for income taxes , our deferred tax assets and liabilities and any valuation allowance recorded against our deferred tax assets . we had total deferred tax assets in excess of total deferred tax liabilities of $ 9.4 million as of september 30 , 2011 and $ 2.9 million as of september 30 , 2010 , including valuation allowances of $ 7.7 million as of september 30 , 2011 and $ 6.5 million as of september 30 , 2010. the valuation allowances related to impairment losses on investments were recorded because the company does not currently foresee future capital gains within the allowable carryforward and carryback periods to offset these capital losses when they are recognized . as such , no tax benefit has been recorded in the consolidated statements of operations . in addition , we recorded a valuation allowance related to state net operating losses based on the uncertainty regarding the realization of the net operating losses in

