the takumi brand is for customers that need very high speed , high efficiency performance , such as that required in the production , die/mold , aerospace and medical industries . takumi machines are equipped with industry standard controls instead of the proprietary controls found on hurco and milltronics machines . procobots is our wholly-owned subsidiary that provides automation solutions that can be integrated with any machine tool . in addition , through our wholly-owned subsidiary lcm , we produce high value machine tool components and accessories . we principally sell our products through more than 190 independent agents and distributors throughout the americas , europe and asia . although some distributors carry competitive products , we are the primary line for the majority of our distributors globally . we also have our own direct sales and service organizations in china , france , germany , india , italy , poland , singapore , taiwan , the united kingdom and certain parts of the united states , which are among the world 's principal machine tool consuming markets . the vast majority of our machine tools are manufactured to our specifications primarily by our wholly-owned subsidiary in taiwan , hml . machine castings to support hml 's production are manufactured at our wholly-owned subsidiary in ningbo , china , nhml . components to support our srt line of five-axis machining centers , such as the direct drive spindle , swivel head and rotary table , are manufactured by our wholly-owned subsidiary in italy , lcm . our sales to foreign customers are denominated , and payments by those customers are made , in the prevailing currencies in the countries in which those customers are located ( primarily the euro , pound sterling and chinese yuan ) . our product costs are incurred and paid primarily in the new taiwan dollar and the u.s. dollar . changes in currency exchange rates may have a material effect on our operating results and consolidated financial statements as reported under u.s. generally accepted accounting principles . for example , when the u.s. dollar weakens in value relative to a foreign currency , sales made , and expenses incurred , in that currency when translated to u.s. dollars for reporting in our financial statements , are higher than would be the case when the u.s. dollar is stronger . in the comparison of our period-to-period results , we discuss the effect of currency translation on those results , which reflect translation to u.s. dollars at exchange rates prevailing during the period covered by those financial statements . 26 our high levels of foreign manufacturing and sales also expose us to cash flow risks due to fluctuating currency exchange rates . we seek to mitigate those risks through the use of derivative instruments – principally foreign currency forward exchange contracts . results of operations the following table presents , for the fiscal years indicated , selected items from the consolidated statements of income expressed as a percentage of our worldwide sales and service fees and the year-to-year percentage changes in the dollar amounts of those items . replace_table_token_3_th fiscal 2019 compared to fiscal 2018 sales and service fees . sales and service fees for fiscal 2019 were $ 263.4 million , a decrease of $ 37.3 million , or 12 % , compared to fiscal 2018 , and included an unfavorable currency impact of $ 8.5 million , or 3 % , when translating foreign sales to u.s. dollars for financial reporting purposes . net sales and service fees by geographic region the following table sets forth net sales and service fees by geographic region for the fiscal years ended october 31 , 2019 and 2018 ( dollars in thousands ) : replace_table_token_4_th sales in the americas for fiscal 2019 increased by 9 % , compared to fiscal 2018 , primarily attributable to sales of vertical milling machines from a u.s. machine tool distributor in california acquired by hurco in the fourth quarter of fiscal 2018. european sales for fiscal 2019 decreased by 20 % , compared to fiscal 2018 , and included an unfavorable currency impact of 4 % , when translating foreign sales to u.s. dollars for financial reporting purposes . the decrease in european sales for fiscal 2019 was primarily attributable to a reduced volume of shipments of hurco machines in germany and the united kingdom , as well as a decrease in sales of electro-mechanical components and accessories manufactured by our wholly-owned subsidiary in italy , lcm . asian pacific sales for fiscal 2019 decreased by 30 % , compared to fiscal 2018 , and included an unfavorable currency impact of 2 % , when translating foreign sales to u.s. dollars for financial reporting purposes . the decrease in asian pacific sales for fiscal 2019 was primarily attributable to decreased shipments of hurco vertical milling machines and takumi bridge mill machines in china , partially offset by increased shipments of hurco vertical milling machines in india . 27 net sales and service fees by product category the following table sets forth net sales and service fees by product group and services for the fiscal years ended october 31 , 2019 and 2018 ( dollars in thousands ) : replace_table_token_5_th † amounts shown do not include computer control systems and software sold as an integrated component of computerized machine systems . sales of computerized machine tools and computer control systems and software for fiscal 2019 decreased by 15 % and 2 % , respectively , and each included an unfavorable currency impact of 3 % , compared to fiscal 2018. the year-over-year decrease in sales of computerized machine tools and computer control systems and software were mainly due to decreased sales of hurco and takumi machines in germany , the united kingdom and china , as well as a decrease in sales of electro-mechanical components story_separator_special_tag we record revenues based on a five-step model in accordance with fasb guidance codified in asc 606. in accordance with asc 606 , we have defined contracts as agreements with our customers and distributors in the form of purchase orders , packing or shipping documents , invoices , and , periodically , verbal requests for components and accessories . for each contract , we identify our performance obligations , which is delivering goods or services , determine the transaction price , allocate the contract transaction price to each of the performance obligations ( when applicable ) , and recognize the revenue when ( or as ) the performance obligation to the customer is fulfilled . a good or service is transferred when the customer obtains control of that good or service . our computerized machine tools are general purpose computer-controlled machine tools that are typically used in stand-alone operations . prior to shipment , we test each machine to ensure the machine 's compliance with standard operating specifications . we deem that the customer obtains control upon delivery of the product and that obtaining control is not contingent upon contractual customer acceptance . therefore , we recognize revenue from sales of our machine tool systems upon delivery of the product to the customer or distributor , which is normally at the time of shipment . depending upon geographic location , after shipment , a machine may be installed at the customer 's facilities by a distributor , independent contractor or by one of our service technicians . in most instances , where a machine is sold through a distributor , we have no installation involvement . if sales are direct or through sales agents , we will typically complete the machine installation , which consists of the reassembly of certain parts that were removed for shipping and the re-testing of the machine to ensure that it is performing within the standard specifications . we consider the machine installation process for our three-axis machines to be inconsequential and perfunctory . for our five-axis machines that we install , we estimate the fair value of the installation performance obligation and recognize that installation revenue on a prorata basis over the period of the installation process . from time to time , and depending upon geographic location , we may provide training or freight services . we consider these services to be perfunctory within the context of the contract , as the value of these services typically does not rise to a material level as a component of the total contract value . service fees from maintenance contracts are deferred and recognized in earnings on a prorata basis over the term of the contract and are generally sold on a stand-alone basis . customer discounts and estimated product returns are considered variable consideration and are recorded as a reduction of revenue in the same period that the related sales are recorded . we have reviewed the overall sales transactions for variable consideration and have determined that these amounts are not significant . inventories – we determine at each balance sheet date how much , if any , of our inventory may ultimately prove to be either unsalable or unsalable at its carrying cost . reserves are established to effectively adjust the carrying value of such inventory to lower of cost ( first-in , first-out method ) or net realizable value . to determine the appropriate level of valuation reserves , we evaluate current stock levels in relation to historical and expected patterns of demand for all of our products . we evaluate the need for changes to valuation reserves based on market conditions , competitive offerings and other factors on a regular basis . income taxes – we account for income taxes and the related accounts under the asset and liability method . deferred tax assets and liabilities are measured using enacted income tax rates in each jurisdiction in effect for the year in which the temporary differences are expected to be recovered or settled . these deferred tax assets are reduced by a valuation allowance , which is established when it is more likely than not that some portion or all of the deferred tax assets will not be realized . net deferred tax assets and liabilities are classified as non-current in the consolidated financial statements . our judgment regarding the realization of deferred tax assets may change due to future profitability and market conditions , changes in u.s. or foreign tax laws and other factors . these changes , if any , may require material adjustments to these deferred tax assets and an accompanying reduction or increase in net income in the period when such determinations are made . the determination of our provision for income taxes requires judgment , the use of estimates and the interpretation and application of complex federal , state and foreign tax laws . our provision for income taxes reflects a combination of income earned and taxed at the federal and state level in the u.s. , as well as in various foreign jurisdictions . in addition to the risks to the effective tax rate described above , the future effective tax rate reflected in forward-looking statements is based on currently effective tax laws . significant changes in those laws could materially affect these estimates . 35 we operate in multiple jurisdictions through wholly-owned subsidiaries , and our global structure is complex . the estimates of our uncertain tax positions involve judgments and assessment of the potential tax implications . we recognize uncertain tax positions when it is more likely than not that the tax position will be sustained upon examination by relevant taxing authorities , based on the technical merits of the position . the amount recognized is measured as the largest amount of benefit that is greater than 50 percent likely of being realized upon ultimate settlement . our tax positions are subject to audit by taxing authorities across multiple global jurisdictions and the

liquidity and capital resources at october 31 , 2019 , we had cash and cash equivalents of $ 56.9 million , compared to $ 77.2 million at october 31 , 2018. the decrease in cash and cash equivalents was primarily a result of a decrease in accounts receivable , partially offset by an increase in inventories year-over-year . approximately 44 % of our $ 56.9 million of cash and cash equivalents is held in the u.s. the balance is attributable to our foreign operations and is held in the local currencies of our various foreign entities , subject to fluctuations in currency exchange rates . we do not believe that the indefinite reinvestment of these funds offshore impairs our ability to meet our domestic working capital needs . working capital ( including cash and cash equivalents ) was $ 207.2 million at october 31 , 2019 , compared to $ 194.6 million at october 31 , 2018. the increase in working capital was mostly driven by an increase in inventories and a reduction in accounts payable . inventories were $ 148.9 million at october 31 , 2019 , compared to $ 137.6 million at october 31 , 2018. inventory turns at october 31 , 2019 were 1.3 , compared to 1.6 turns at october 31 , 2018. capital expenditures were $ 4.9 million in fiscal 2019 , compared to $ 5.9 million in fiscal 2018. capital expenditures for fiscal 2019 were primarily for software development costs , purchases of factory equipment for production facilities , and purchases of general software and equipment for sales and service divisions . we funded these expenditures with cash flows from operations . the purchase price for the procobots acquisition has been preliminarily allocated to the assets acquired and the liabilities assumed based on their fair values , which approximated $ 4.4 million . on december 7 , 2012 , we entered into a credit agreement , which was subsequently amended on may 9 , 2014 , june 5 , 2014 , december 5 , 2014 and december 6 , 2016 ( as amended , the “ 2012 credit agreement ” ) with jp morgan chase bank , n.a that provided us with an unsecured revolving credit and letter of credit facility .


 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 at october 31 , 2019 , we had cash and cash equivalents of $ 56.9 million , compared to $ 77.2 million at october 31 , 2018. the decrease in cash and cash equivalents was primarily a result of a decrease in accounts receivable , partially offset by an increase in inventories year-over-year . approximately 44 % of our $ 56.9 million of cash and cash equivalents is held in the u.s. the balance is attributable to our foreign operations and is held in the local currencies of our various foreign entities , subject to fluctuations in currency exchange rates . we do not believe that the indefinite reinvestment of these funds offshore impairs our ability to meet our domestic working capital needs . working capital ( including cash and cash equivalents ) was $ 207.2 million at october 31 , 2019 , compared to $ 194.6 million at october 31 , 2018. the increase in working capital was mostly driven by an increase in inventories and a reduction in accounts payable . inventories were $ 148.9 million at october 31 , 2019 , compared to $ 137.6 million at october 31 , 2018. inventory turns at october 31 , 2019 were 1.3 , compared to 1.6 turns at october 31 , 2018. capital expenditures were $ 4.9 million in fiscal 2019 , compared to $ 5.9 million in fiscal 2018. capital expenditures for fiscal 2019 were primarily for software development costs , purchases of factory equipment for production facilities , and purchases of general software and equipment for sales and service divisions . we funded these expenditures with cash flows from operations . the purchase price for the procobots acquisition has been preliminarily allocated to the assets acquired and the liabilities assumed based on their fair values , which approximated $ 4.4 million . on december 7 , 2012 , we entered into a credit agreement , which was subsequently amended on may 9 , 2014 , june 5 , 2014 , december 5 , 2014 and december 6 , 2016 ( as amended , the “ 2012 credit agreement ” ) with jp morgan chase bank , n.a that provided us with an unsecured revolving credit and letter of credit facility .
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 Suspicious Activity Report : the takumi brand is for customers that need very high speed , high efficiency performance , such as that required in the production , die/mold , aerospace and medical industries . takumi machines are equipped with industry standard controls instead of the proprietary controls found on hurco and milltronics machines . procobots is our wholly-owned subsidiary that provides automation solutions that can be integrated with any machine tool . in addition , through our wholly-owned subsidiary lcm , we produce high value machine tool components and accessories . we principally sell our products through more than 190 independent agents and distributors throughout the americas , europe and asia . although some distributors carry competitive products , we are the primary line for the majority of our distributors globally . we also have our own direct sales and service organizations in china , france , germany , india , italy , poland , singapore , taiwan , the united kingdom and certain parts of the united states , which are among the world 's principal machine tool consuming markets . the vast majority of our machine tools are manufactured to our specifications primarily by our wholly-owned subsidiary in taiwan , hml . machine castings to support hml 's production are manufactured at our wholly-owned subsidiary in ningbo , china , nhml . components to support our srt line of five-axis machining centers , such as the direct drive spindle , swivel head and rotary table , are manufactured by our wholly-owned subsidiary in italy , lcm . our sales to foreign customers are denominated , and payments by those customers are made , in the prevailing currencies in the countries in which those customers are located ( primarily the euro , pound sterling and chinese yuan ) . our product costs are incurred and paid primarily in the new taiwan dollar and the u.s. dollar . changes in currency exchange rates may have a material effect on our operating results and consolidated financial statements as reported under u.s. generally accepted accounting principles . for example , when the u.s. dollar weakens in value relative to a foreign currency , sales made , and expenses incurred , in that currency when translated to u.s. dollars for reporting in our financial statements , are higher than would be the case when the u.s. dollar is stronger . in the comparison of our period-to-period results , we discuss the effect of currency translation on those results , which reflect translation to u.s. dollars at exchange rates prevailing during the period covered by those financial statements . 26 our high levels of foreign manufacturing and sales also expose us to cash flow risks due to fluctuating currency exchange rates . we seek to mitigate those risks through the use of derivative instruments – principally foreign currency forward exchange contracts . results of operations the following table presents , for the fiscal years indicated , selected items from the consolidated statements of income expressed as a percentage of our worldwide sales and service fees and the year-to-year percentage changes in the dollar amounts of those items . replace_table_token_3_th fiscal 2019 compared to fiscal 2018 sales and service fees . sales and service fees for fiscal 2019 were $ 263.4 million , a decrease of $ 37.3 million , or 12 % , compared to fiscal 2018 , and included an unfavorable currency impact of $ 8.5 million , or 3 % , when translating foreign sales to u.s. dollars for financial reporting purposes . net sales and service fees by geographic region the following table sets forth net sales and service fees by geographic region for the fiscal years ended october 31 , 2019 and 2018 ( dollars in thousands ) : replace_table_token_4_th sales in the americas for fiscal 2019 increased by 9 % , compared to fiscal 2018 , primarily attributable to sales of vertical milling machines from a u.s. machine tool distributor in california acquired by hurco in the fourth quarter of fiscal 2018. european sales for fiscal 2019 decreased by 20 % , compared to fiscal 2018 , and included an unfavorable currency impact of 4 % , when translating foreign sales to u.s. dollars for financial reporting purposes . the decrease in european sales for fiscal 2019 was primarily attributable to a reduced volume of shipments of hurco machines in germany and the united kingdom , as well as a decrease in sales of electro-mechanical components and accessories manufactured by our wholly-owned subsidiary in italy , lcm . asian pacific sales for fiscal 2019 decreased by 30 % , compared to fiscal 2018 , and included an unfavorable currency impact of 2 % , when translating foreign sales to u.s. dollars for financial reporting purposes . the decrease in asian pacific sales for fiscal 2019 was primarily attributable to decreased shipments of hurco vertical milling machines and takumi bridge mill machines in china , partially offset by increased shipments of hurco vertical milling machines in india . 27 net sales and service fees by product category the following table sets forth net sales and service fees by product group and services for the fiscal years ended october 31 , 2019 and 2018 ( dollars in thousands ) : replace_table_token_5_th † amounts shown do not include computer control systems and software sold as an integrated component of computerized machine systems . sales of computerized machine tools and computer control systems and software for fiscal 2019 decreased by 15 % and 2 % , respectively , and each included an unfavorable currency impact of 3 % , compared to fiscal 2018. the year-over-year decrease in sales of computerized machine tools and computer control systems and software were mainly due to decreased sales of hurco and takumi machines in germany , the united kingdom and china , as well as a decrease in sales of electro-mechanical components story_separator_special_tag we record revenues based on a five-step model in accordance with fasb guidance codified in asc 606. in accordance with asc 606 , we have defined contracts as agreements with our customers and distributors in the form of purchase orders , packing or shipping documents , invoices , and , periodically , verbal requests for components and accessories . for each contract , we identify our performance obligations , which is delivering goods or services , determine the transaction price , allocate the contract transaction price to each of the performance obligations ( when applicable ) , and recognize the revenue when ( or as ) the performance obligation to the customer is fulfilled . a good or service is transferred when the customer obtains control of that good or service . our computerized machine tools are general purpose computer-controlled machine tools that are typically used in stand-alone operations . prior to shipment , we test each machine to ensure the machine 's compliance with standard operating specifications . we deem that the customer obtains control upon delivery of the product and that obtaining control is not contingent upon contractual customer acceptance . therefore , we recognize revenue from sales of our machine tool systems upon delivery of the product to the customer or distributor , which is normally at the time of shipment . depending upon geographic location , after shipment , a machine may be installed at the customer 's facilities by a distributor , independent contractor or by one of our service technicians . in most instances , where a machine is sold through a distributor , we have no installation involvement . if sales are direct or through sales agents , we will typically complete the machine installation , which consists of the reassembly of certain parts that were removed for shipping and the re-testing of the machine to ensure that it is performing within the standard specifications . we consider the machine installation process for our three-axis machines to be inconsequential and perfunctory . for our five-axis machines that we install , we estimate the fair value of the installation performance obligation and recognize that installation revenue on a prorata basis over the period of the installation process . from time to time , and depending upon geographic location , we may provide training or freight services . we consider these services to be perfunctory within the context of the contract , as the value of these services typically does not rise to a material level as a component of the total contract value . service fees from maintenance contracts are deferred and recognized in earnings on a prorata basis over the term of the contract and are generally sold on a stand-alone basis . customer discounts and estimated product returns are considered variable consideration and are recorded as a reduction of revenue in the same period that the related sales are recorded . we have reviewed the overall sales transactions for variable consideration and have determined that these amounts are not significant . inventories – we determine at each balance sheet date how much , if any , of our inventory may ultimately prove to be either unsalable or unsalable at its carrying cost . reserves are established to effectively adjust the carrying value of such inventory to lower of cost ( first-in , first-out method ) or net realizable value . to determine the appropriate level of valuation reserves , we evaluate current stock levels in relation to historical and expected patterns of demand for all of our products . we evaluate the need for changes to valuation reserves based on market conditions , competitive offerings and other factors on a regular basis . income taxes – we account for income taxes and the related accounts under the asset and liability method . deferred tax assets and liabilities are measured using enacted income tax rates in each jurisdiction in effect for the year in which the temporary differences are expected to be recovered or settled . these deferred tax assets are reduced by a valuation allowance , which is established when it is more likely than not that some portion or all of the deferred tax assets will not be realized . net deferred tax assets and liabilities are classified as non-current in the consolidated financial statements . our judgment regarding the realization of deferred tax assets may change due to future profitability and market conditions , changes in u.s. or foreign tax laws and other factors . these changes , if any , may require material adjustments to these deferred tax assets and an accompanying reduction or increase in net income in the period when such determinations are made . the determination of our provision for income taxes requires judgment , the use of estimates and the interpretation and application of complex federal , state and foreign tax laws . our provision for income taxes reflects a combination of income earned and taxed at the federal and state level in the u.s. , as well as in various foreign jurisdictions . in addition to the risks to the effective tax rate described above , the future effective tax rate reflected in forward-looking statements is based on currently effective tax laws . significant changes in those laws could materially affect these estimates . 35 we operate in multiple jurisdictions through wholly-owned subsidiaries , and our global structure is complex . the estimates of our uncertain tax positions involve judgments and assessment of the potential tax implications . we recognize uncertain tax positions when it is more likely than not that the tax position will be sustained upon examination by relevant taxing authorities , based on the technical merits of the position . the amount recognized is measured as the largest amount of benefit that is greater than 50 percent likely of being realized upon ultimate settlement . our tax positions are subject to audit by taxing authorities across multiple global jurisdictions and the

