Financial Instruments. SFAS No. 107,  Disclosures About Fair Value of Financial Instruments , requires disclosure about the fair value of financial instruments. Financial instruments consist of cash equivalents, marketable securities, accounts receivable, and accounts payable. The estimated fair value of these financial instruments approximates their carrying value. The fair market value of marketable securities is based on market quotes. Forrester’s cash equivalents and marketable securities are generally investment grade corporate bonds and obligations of the federal government or municipal issuers. Management Estimates. The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions 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 amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates. Reclassifications. Certain amounts in the prior year’s financial statements have been reclassified to conform with the current year’s presentation. New Accounting Standards. In December 1999, the Securities and Exchange Commission (SEC) issued Staff Accounting Bulletin (SAB) No. 101,  Revenue Recognition in Financial Statements . SAB No. 101 is effective for all periods beginning after December 15, 1999. The adoption of SAB No. 101 had no impact on Forrester’s consolidated financial position or results of operations upon adoption. In June 1998, the Financial Accounting Standards Board (FASB) issued SFAS No. 133,  Accounting for Derivative Instruments and Hedging Activities . SFAS No. 133 is effective for all periods beginning after June 15, 2000, and establishes methods of accounting for derivative financial instruments and hedging activities related to those instruments as well as other hedging activities. Adoption of SFAS No. 133 is not expected to have a material impact on Forrester’s consolidated financial position or results of operations. In March 2000, the FASB issued interpretation No. 44,  Accounting for Certain Transactions Involving Stock Compensation – an Interpretation of Accounting Principles Board (APB), Opinion No. 25 .  The interpretation clarifies the application of APB Opinion No. 25 in certain situations, as defined.  The interpretation was effective July 1, 2000, but covers certain events occurring during the period  after December 15, 1998, but before the effective date. The adoption of this interpretation did not have  a material effect on the accompanying financial statements. In July 2000, the Emerging Issues Task Force reached a consensus on Issue No. 00-15,  Classification in the Statement of Cash Flows of the Income Tax Benefit Received by a Company Upon Exercise of a Nonqualified Employee Stock Option , which requires that stock option income tax benefits be classified as cash from operations in the statement of cash flows. Prior period consolidated statements of cash flows have been restated to conform to this presentation. On October 15, 2000, Forrester acquired 100% of the outstanding shares of FORIT GmbH (FORIT) for $15.0 million in cash and the assumption of approximately $1.0 million in liabilities. FORIT is a provider of technology research to companies primarily located in Germany, Switzerland, and Austria. The acquisition was accounted for under the purchase method, and accordingly, FORIT’s results of operations are included within the consolidated results of Forrester since the date of acquisition. The purchase price was allocated to the assets acquired and the liabilities assumed based upon estimated fair values at the date of acquisition. (2) Acquisitions Forrester Research | Annual Report 2000 f-20 | 21 Notes to Consolidated Financial Statements (continued)