See notes to consolidated financial statements.  17 Applied Industrial Technologies, Inc. and Subsidiaries STATEMENTS OF CONSOLIDATED CASH FLOWS Year Ended June 30,  2012  2011-- 2010--  Cash Flows from Operating Activities  Net income  $ 108,779  $  96,759   $  65,903  Adjustments to reconcile net income to net cash provided by operating activities:  Depreciation and amortization of property  11,236  11,234  11,465  Amortization of intangibles  11,465  11,382  10,151  Amortization of stock appreciation rights and options  2,058  2,473  3,020  Deferred income taxes  8,641  4,784  2,408  Provision for losses on accounts receivable  3,915  2,029  2,508  Unrealized foreign exchange transaction losses (gains)  1,298  — (4)  Other share-based compensation expense  4,592  3,379  2,361  Gain on sale of property  (627) (765) (198)  Changes in assets and liabilities, net of acquisitions:  Accounts receivable  (22,748) (36,271) (48,578)  Inventories  (28,511) (21,197) 83,497  Other operating assets  (14,735) (11,185) 17,408  Accounts payable  14,157  12,926  13,566  Other operating liabilities  (9,098) 1,294  20,817  Net Cash provided by Operating Activities  90,422  76,842  184,324  Cash Flows from Investing Activities  Property purchases  (26,021) (20,431) (7,216)  Proceeds from property sales  1,258  1,326  532  Net cash paid for acquisition of businesses, net of cash acquired of $38 and $168 in 2012 and  2011, respectively  (14,671) (30,504) (100)  Other  — 1,722 — Net Cash used in Investing Activities  (39,434) (47,887) (6,784)  Cash Flows from Financing Activities  Repayments under revolving credit facility  — (50,000) (5,000)  Long-term debt repayment  — (25,000) — Settlements of cross-currency swap agreements  — (12,752) — Purchases of treasury shares  (31,032) (6,085) (3,929)  Dividends paid  (33,800) (29,751) (25,416)  Excess tax benefits from share-based compensation  3,695  6,404  2,492  Exercise of stock appreciation rights and options  321  661  1,339  Net Cash used in Financing Activities  (60,816) (116,523) (30,514)  Effect of Exchange Rate Changes on Cash  (2,822) 2,883  1,109  (Decrease) increase in cash and cash equivalents  (12,650) (84,685) 148,135  Cash and cash equivalents at beginning of year  91,092  175,777  27,642  Cash and Cash Equivalents at End of Year  $  78,442  $  91,092   $ 175,777  Supplemental Cash Flow Information  Cash paid during the year for:  Income taxes  $  53,463  $  47,251   $  31,179  Interest  672  2,248  5,195 