while we expect the severe downturn in new residential construction to continue to adversely affect our operating results into 2011 , we anticipate a slight increase in housing starts in 2011 versus 2010 based on recent signs of economic stabilization coupled with industry forecasts for 2011. in reaction to the housing downturn , the company has been restructuring its operations since the second quarter of 2006. since then , the company closed , consolidated or sold 20 distribution centers . additionally , the company reduced its workforce by approximately 1,300 and had approximately 900 employees at the end of 2010. these actions , along with other cost reduction efforts , are primarily responsible for an approximate $ 100 million reduction in operating expenses from 2006 to 2010. various factors historically have caused our results of operations to fluctuate from period to period . these factors include levels of construction , home improvement and remodeling activity , weather , prices of commodity wood and steel products , interest rates , competitive pressures , availability of credit and other local , regional , national and economic conditions . many of these factors are cyclical or seasonal in nature . we anticipate that further fluctuations in operating results from period to period will continue in the future . our first quarter and fourth quarter are generally adversely affected by winter weather patterns in the midwest and northeast , which typically result in seasonal decreases in levels of construction activity in these areas . because much of our overhead and expenses remain relatively fixed throughout the year , our operating profits tend to be lower during the first and fourth quarters . we believe we have the product offering , distribution channel , personnel , systems infrastructure and financial and competitive resources necessary for continued operations . our future revenues , costs and profitability , however , are all likely to be influenced by a number of risks and uncertainties , including those in item 1a  risk factors . critical accounting policies we prepare our consolidated financial statements in accordance with u.s. generally accepted accounting principles , which require management to make estimates and assumptions . management bases these estimates and assumptions on historical results and known trends as well as management forecasts . actual results could differ from these estimates and assumptions . accounts receivable  trade accounts receivable consist of amounts owed for orders shipped to customers and are stated net of an allowance for doubtful accounts . huttig 's corporate management establishes an overall credit policy for sales to customers and delegates responsibility for most credit decisions to credit personnel located within huttig 's two regions . the allowance for doubtful accounts is determined based on a number of factors including when customer accounts exceed 90 days past due and specific customer account reviews . our credit policies , together with careful monitoring of customer balances , have resulted in bad debt expense of approximately 0.1 % of net sales in 2010 , 0.2 % in 2009 and 0.3 % during 2008. due to the current downturn in new housing activity , we expect that our bad debt expense could increase as our customers experience greater financial difficulties . inventory  inventories are valued at the lower of cost or market . we utilize the lifo cost method to value the majority of our inventories . we review inventories on hand and record a provision for slow-moving and obsolete inventory based on historical and expected sales . valuation of goodwill and other long-lived assets  we test the carrying value of our goodwill at each reporting unit for impairment on an annual basis and between annual tests in certain circumstances when there are indicators of potential impairment . the carrying value of goodwill is considered impaired when a reporting unit 's fair value is less than its carrying value . in that event , goodwill impairment is recognized to the extent recorded goodwill exceeds the implied fair value of that goodwill . circumstances that can lead to interim goodwill testing include significant negative variances from forecasted sales or operating profits or changes in other circumstances that indicate the carrying amount of goodwill may not be recoverable . we utilize a discounted cash flows model to -15- estimate fair value of a reporting unit . in our estimate of fair value of a reporting unit , the following significant assumptions , and changes therein , are considered : publicly available and internal projections of single and multi-family housing starts used to project a reporting unit 's revenue in future years ; the reporting unit 's gross margin and operating expenses that reflect cost reduction actions already taken by the company ; projected variable costs associated with the variable revenue streams projected in the future ; projected reporting unit working capital changes and capital expenditure requirements ; and an estimate of a discount rate commensurate with the weighted average cost of capital for a market participant and a related growth factor . at december 31 , 2010 , the company had $ 8.6 million of goodwill recorded across 17 reporting units . significant changes in our assumptions and the related projected cash flows utilized in calculating the reporting unit 's fair value could result in future goodwill impairment related to any of our reporting units . in 2009 , we recorded goodwill impairment of $ 1.0 million as a result of carrying value at one reporting unit exceeding its respective fair value . we test the carrying value of other long-lived assets , including intangible and other tangible assets , for impairment when events and circumstances warrant such review . story_separator_special_tag the 2009 and 2008 gross margins were also negatively impacted by pricing pressure in the down housing market , which pressure may continue into 2010. operating expenses including goodwill impairment charges decreased $ 53.3 million to $ 106.7 million , or 23.4 % of sales , in 2009 , compared to $ 160.0 million , or 23.8 % of sales , in 2008. operating expenses for 2009 include $ 2.1 million of expenses comprised of a $ 1.0 million goodwill impairment charge and $ 1.1 million of branch closure costs related to the shut down or consolidation of three branches during 2009. operating expenses for 2008 include $ 10.8 million of expenses primarily comprised of an $ 8.7 million goodwill impairment charge and $ 2.1 million of branch closure costs associated with the shut down or consolidation of five branches during 2008. excluding these 2009 and 2008 charges , operating expenses decreased by $ 44.5 million in 2009 , primarily due to a lower employee headcount and a lower cost structure , as a result of prior restructuring activities , as well as lower variable costs associated with decreased sales volumes . we recorded total stock-based compensation expense of $ 0.9 million in 2009 compared to $ 1.3 million in 2008. our results for the year ended december 31 , 2009 included a gain on disposal of capital assets of $ 1.5 million primarily from the sale of two previously closed facilities . the results for the year ended december 31 , 2008 included a gain on disposal of capital assets of $ 1.0 million primarily from the sale of a previously closed facility . net interest expense was $ 1.5 million in 2009 compared to $ 2.6 million in 2008 primarily due to lower average debt outstanding and lower libor-based borrowing rates in 2009 versus 2008. additionally , we reduced the credit facility size from $ 160.0 million to $ 120.0 million in 2009. income tax benefit as a percentage of pre-tax loss for 2009 and 2008 was approximately 12 % and 10 % , respectively . in 2009 , we benefited from a change in federal tax law that allowed us to carry back 2008 operating losses to prior years and receive tax refunds . in 2008 , we were able to carry back the 2007 federal net operating loss -18- to prior years and receive tax refunds . at december 31 , 2009 , our federal net operating loss carry forward is approximately $ 42.6 million . as a result of the foregoing factors , we incurred a loss from continuing operations of $ 19.8 million in 2009 as compared to a loss from continuing operations of $ 35.2 million in 2008. discontinued operations we recorded a $ 0.7 million after tax loss from discontinued operations related to a note receivable impairment and environmental and litigation expenses in 2009 compared to a $ 0.2 million after tax loss for environmental and litigation expenses in 2008 associated with previously reported discontinued operations . story_separator_special_tag necessary to satisfy this covenant if it were required to be tested . under the amended and restated credit agreement , if we were unable to maintain excess borrowing availability of more than the applicable amount in the range of $ 10.0 million to $ 15.0 million , and were also unable to comply with this financial covenant , our lenders would have the right , but not the obligation , to terminate the loan commitments and accelerate the repayment of the entire amount outstanding under the credit facility . the lenders could also foreclose on our assets that secure the credit facility . in that event , we would be forced to seek alternative sources of financing , which may not be available on terms acceptable to it , or at all . off-balance sheet arrangements in addition to funds available from operating cash flows and our bank credit facility as described above , we use operating leases as a principal off balance sheet technique . operating leases are employed as an alternative to purchasing certain property , plant and equipment . future rental commitments , extending through the year 2020 , under all non-cancelable operating leases in effect at december 31 , 2010 total $ 40.7 million . commitments and contingencies the table below summarizes our contractual obligations as of december 31 , 2010 ( in millions ) : replace_table_token_5_th -20- replace_table_token_6_th cautionary statement relevant to forward-looking information for the purpose of safe harbor provisions of the private securities litigation reform act of 1995 this annual report on form 10-k and our annual report to shareholders contain forward-looking statements within the meaning of the private securities litigation reform act of 1995 , including but not limited to statements regarding : our belief that cash generated from operations and funds available under our credit facility will be sufficient to meet our future liquidity and capital expenditure needs ; our belief that we have the product offerings , warehouse and builder support facilities , personnel , systems infrastructure and financial and competitive resources necessary for continued business operations ; our expectation that the severe downturn in new housing activity will continue into 2011 and will continue to adversely affect our operating results , liquidity and financial condition ; our expectation that there will be a slight increase in housing starts in 2011 as compared to 2010 ; our expectation that the bad debt expense could continue to increase as our customers experience greater financial difficulties as a result of the current downturn in new housing activity ; our belief that we may incur non-cash goodwill impairment charges in the future which could have a material adverse effect on our operating results ; our belief that we will not achieve sufficient financial results to satisfy the financial covenant under our credit facility if it were required to be tested ; our expectation that the disposition of the various claims and litigation in which we are

liquidity and capital resources we depend on cash flow from operations and funds available under our revolving credit facility to finance seasonal working capital needs , capital expenditures and any acquisitions that we may undertake . our working capital requirements are generally greatest in the second and third quarters , which reflect the seasonal nature of our business . the second and third quarters are also typically our strongest operating quarters , largely due to more favorable weather throughout many of our markets compared to the first and fourth quarters . we typically generate cash from working capital reductions in the fourth quarter of the year and build working capital during the first quarter in preparation for our second and third quarters . we also maintain significant inventories to meet rapid delivery requirements of our customers and to enable us to obtain favorable pricing , delivery and service terms with our suppliers . at december 31 , 2010 and 2009 , inventories constituted approximately 37 % and 33 % of our total assets , respectively . we also closely monitor operating expenses and inventory levels during seasonally affected periods and , to the extent possible , manage variable operating costs to minimize seasonal effects on our profitability . operations cash from operating activities increased by $ 6.3 million to a usage of $ 7.1 million in 2010 , compared to a $ 13.4 million usage of cash in 2009. in 2010 , our net loss decreased $ 1.6 million compared to 2009. the net loss included goodwill impairment charges of $ 1.0 million in 2009. accounts receivable decreased by $ 4.7 million during 2010 compared to an increase of $ 8.8 million a year ago . days sales outstanding ( dso ) decreased by 3.9 days to 32.8 days at december 31 , 2010 from 36.7 days at december 31 , 2009 based on annualized fourth quarter sales and quarter ended accounts receivable balances for the respective periods . the decrease in dso is directly related to extended terms provided in the fourth quarter of 2009 to a small number of large credit worthy customers .


 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 we depend on cash flow from operations and funds available under our revolving credit facility to finance seasonal working capital needs , capital expenditures and any acquisitions that we may undertake . our working capital requirements are generally greatest in the second and third quarters , which reflect the seasonal nature of our business . the second and third quarters are also typically our strongest operating quarters , largely due to more favorable weather throughout many of our markets compared to the first and fourth quarters . we typically generate cash from working capital reductions in the fourth quarter of the year and build working capital during the first quarter in preparation for our second and third quarters . we also maintain significant inventories to meet rapid delivery requirements of our customers and to enable us to obtain favorable pricing , delivery and service terms with our suppliers . at december 31 , 2010 and 2009 , inventories constituted approximately 37 % and 33 % of our total assets , respectively . we also closely monitor operating expenses and inventory levels during seasonally affected periods and , to the extent possible , manage variable operating costs to minimize seasonal effects on our profitability . operations cash from operating activities increased by $ 6.3 million to a usage of $ 7.1 million in 2010 , compared to a $ 13.4 million usage of cash in 2009. in 2010 , our net loss decreased $ 1.6 million compared to 2009. the net loss included goodwill impairment charges of $ 1.0 million in 2009. accounts receivable decreased by $ 4.7 million during 2010 compared to an increase of $ 8.8 million a year ago . days sales outstanding ( dso ) decreased by 3.9 days to 32.8 days at december 31 , 2010 from 36.7 days at december 31 , 2009 based on annualized fourth quarter sales and quarter ended accounts receivable balances for the respective periods . the decrease in dso is directly related to extended terms provided in the fourth quarter of 2009 to a small number of large credit worthy customers .
```    
 Suspicious Activity Report : while we expect the severe downturn in new residential construction to continue to adversely affect our operating results into 2011 , we anticipate a slight increase in housing starts in 2011 versus 2010 based on recent signs of economic stabilization coupled with industry forecasts for 2011. in reaction to the housing downturn , the company has been restructuring its operations since the second quarter of 2006. since then , the company closed , consolidated or sold 20 distribution centers . additionally , the company reduced its workforce by approximately 1,300 and had approximately 900 employees at the end of 2010. these actions , along with other cost reduction efforts , are primarily responsible for an approximate $ 100 million reduction in operating expenses from 2006 to 2010. various factors historically have caused our results of operations to fluctuate from period to period . these factors include levels of construction , home improvement and remodeling activity , weather , prices of commodity wood and steel products , interest rates , competitive pressures , availability of credit and other local , regional , national and economic conditions . many of these factors are cyclical or seasonal in nature . we anticipate that further fluctuations in operating results from period to period will continue in the future . our first quarter and fourth quarter are generally adversely affected by winter weather patterns in the midwest and northeast , which typically result in seasonal decreases in levels of construction activity in these areas . because much of our overhead and expenses remain relatively fixed throughout the year , our operating profits tend to be lower during the first and fourth quarters . we believe we have the product offering , distribution channel , personnel , systems infrastructure and financial and competitive resources necessary for continued operations . our future revenues , costs and profitability , however , are all likely to be influenced by a number of risks and uncertainties , including those in item 1a  risk factors . critical accounting policies we prepare our consolidated financial statements in accordance with u.s. generally accepted accounting principles , which require management to make estimates and assumptions . management bases these estimates and assumptions on historical results and known trends as well as management forecasts . actual results could differ from these estimates and assumptions . accounts receivable  trade accounts receivable consist of amounts owed for orders shipped to customers and are stated net of an allowance for doubtful accounts . huttig 's corporate management establishes an overall credit policy for sales to customers and delegates responsibility for most credit decisions to credit personnel located within huttig 's two regions . the allowance for doubtful accounts is determined based on a number of factors including when customer accounts exceed 90 days past due and specific customer account reviews . our credit policies , together with careful monitoring of customer balances , have resulted in bad debt expense of approximately 0.1 % of net sales in 2010 , 0.2 % in 2009 and 0.3 % during 2008. due to the current downturn in new housing activity , we expect that our bad debt expense could increase as our customers experience greater financial difficulties . inventory  inventories are valued at the lower of cost or market . we utilize the lifo cost method to value the majority of our inventories . we review inventories on hand and record a provision for slow-moving and obsolete inventory based on historical and expected sales . valuation of goodwill and other long-lived assets  we test the carrying value of our goodwill at each reporting unit for impairment on an annual basis and between annual tests in certain circumstances when there are indicators of potential impairment . the carrying value of goodwill is considered impaired when a reporting unit 's fair value is less than its carrying value . in that event , goodwill impairment is recognized to the extent recorded goodwill exceeds the implied fair value of that goodwill . circumstances that can lead to interim goodwill testing include significant negative variances from forecasted sales or operating profits or changes in other circumstances that indicate the carrying amount of goodwill may not be recoverable . we utilize a discounted cash flows model to -15- estimate fair value of a reporting unit . in our estimate of fair value of a reporting unit , the following significant assumptions , and changes therein , are considered : publicly available and internal projections of single and multi-family housing starts used to project a reporting unit 's revenue in future years ; the reporting unit 's gross margin and operating expenses that reflect cost reduction actions already taken by the company ; projected variable costs associated with the variable revenue streams projected in the future ; projected reporting unit working capital changes and capital expenditure requirements ; and an estimate of a discount rate commensurate with the weighted average cost of capital for a market participant and a related growth factor . at december 31 , 2010 , the company had $ 8.6 million of goodwill recorded across 17 reporting units . significant changes in our assumptions and the related projected cash flows utilized in calculating the reporting unit 's fair value could result in future goodwill impairment related to any of our reporting units . in 2009 , we recorded goodwill impairment of $ 1.0 million as a result of carrying value at one reporting unit exceeding its respective fair value . we test the carrying value of other long-lived assets , including intangible and other tangible assets , for impairment when events and circumstances warrant such review . story_separator_special_tag the 2009 and 2008 gross margins were also negatively impacted by pricing pressure in the down housing market , which pressure may continue into 2010. operating expenses including goodwill impairment charges decreased $ 53.3 million to $ 106.7 million , or 23.4 % of sales , in 2009 , compared to $ 160.0 million , or 23.8 % of sales , in 2008. operating expenses for 2009 include $ 2.1 million of expenses comprised of a $ 1.0 million goodwill impairment charge and $ 1.1 million of branch closure costs related to the shut down or consolidation of three branches during 2009. operating expenses for 2008 include $ 10.8 million of expenses primarily comprised of an $ 8.7 million goodwill impairment charge and $ 2.1 million of branch closure costs associated with the shut down or consolidation of five branches during 2008. excluding these 2009 and 2008 charges , operating expenses decreased by $ 44.5 million in 2009 , primarily due to a lower employee headcount and a lower cost structure , as a result of prior restructuring activities , as well as lower variable costs associated with decreased sales volumes . we recorded total stock-based compensation expense of $ 0.9 million in 2009 compared to $ 1.3 million in 2008. our results for the year ended december 31 , 2009 included a gain on disposal of capital assets of $ 1.5 million primarily from the sale of two previously closed facilities . the results for the year ended december 31 , 2008 included a gain on disposal of capital assets of $ 1.0 million primarily from the sale of a previously closed facility . net interest expense was $ 1.5 million in 2009 compared to $ 2.6 million in 2008 primarily due to lower average debt outstanding and lower libor-based borrowing rates in 2009 versus 2008. additionally , we reduced the credit facility size from $ 160.0 million to $ 120.0 million in 2009. income tax benefit as a percentage of pre-tax loss for 2009 and 2008 was approximately 12 % and 10 % , respectively . in 2009 , we benefited from a change in federal tax law that allowed us to carry back 2008 operating losses to prior years and receive tax refunds . in 2008 , we were able to carry back the 2007 federal net operating loss -18- to prior years and receive tax refunds . at december 31 , 2009 , our federal net operating loss carry forward is approximately $ 42.6 million . as a result of the foregoing factors , we incurred a loss from continuing operations of $ 19.8 million in 2009 as compared to a loss from continuing operations of $ 35.2 million in 2008. discontinued operations we recorded a $ 0.7 million after tax loss from discontinued operations related to a note receivable impairment and environmental and litigation expenses in 2009 compared to a $ 0.2 million after tax loss for environmental and litigation expenses in 2008 associated with previously reported discontinued operations . story_separator_special_tag necessary to satisfy this covenant if it were required to be tested . under the amended and restated credit agreement , if we were unable to maintain excess borrowing availability of more than the applicable amount in the range of $ 10.0 million to $ 15.0 million , and were also unable to comply with this financial covenant , our lenders would have the right , but not the obligation , to terminate the loan commitments and accelerate the repayment of the entire amount outstanding under the credit facility . the lenders could also foreclose on our assets that secure the credit facility . in that event , we would be forced to seek alternative sources of financing , which may not be available on terms acceptable to it , or at all . off-balance sheet arrangements in addition to funds available from operating cash flows and our bank credit facility as described above , we use operating leases as a principal off balance sheet technique . operating leases are employed as an alternative to purchasing certain property , plant and equipment . future rental commitments , extending through the year 2020 , under all non-cancelable operating leases in effect at december 31 , 2010 total $ 40.7 million . commitments and contingencies the table below summarizes our contractual obligations as of december 31 , 2010 ( in millions ) : replace_table_token_5_th -20- replace_table_token_6_th cautionary statement relevant to forward-looking information for the purpose of safe harbor provisions of the private securities litigation reform act of 1995 this annual report on form 10-k and our annual report to shareholders contain forward-looking statements within the meaning of the private securities litigation reform act of 1995 , including but not limited to statements regarding : our belief that cash generated from operations and funds available under our credit facility will be sufficient to meet our future liquidity and capital expenditure needs ; our belief that we have the product offerings , warehouse and builder support facilities , personnel , systems infrastructure and financial and competitive resources necessary for continued business operations ; our expectation that the severe downturn in new housing activity will continue into 2011 and will continue to adversely affect our operating results , liquidity and financial condition ; our expectation that there will be a slight increase in housing starts in 2011 as compared to 2010 ; our expectation that the bad debt expense could continue to increase as our customers experience greater financial difficulties as a result of the current downturn in new housing activity ; our belief that we may incur non-cash goodwill impairment charges in the future which could have a material adverse effect on our operating results ; our belief that we will not achieve sufficient financial results to satisfy the financial covenant under our credit facility if it were required to be tested ; our expectation that the disposition of the various claims and litigation in which we are

