Accounting Project
The True Religion Apparel Inc.

True Religion Apparel Inc. (TRLG)
True Religion Apparel, Inc., which was founded in 2002 by Jeffrey Lubell is a domestic design-based jeans and jeans-related sportswear company. It has become an over $400 million company today as currently sold at 125 standalone stores worldwide and is distributed to 50 countries on six continents.
The company went public in 2003 and is listed on the NASDAQ named TRLG. The company’s headquarters is located on Vernon, CA, and the Chief Executive Officer and Chairman of the Board is Jeffrey Lubell.

Management Discussion and Analysis Section
The management discussion and Analysis (MD&A) is one of the most important aspects of the annual report provided by a company to its investors. It is written by management and attempts to show how the company performed in the previous year, based on internal and external factors. The MD&A also discusses the financial plans the company has for the future.
True Religion begins the MD&A section with a segment on the strategic initiatives the firm has taken in 2011, and initiatives it will undertake in the near future. True Religions main initiative is to expand its markets domestically, internationally and through e-commerce. Domestically from 2008 to 2011 the firm expanded its direct to consumer market by opening 95 retail stores across the country, reaching a total of 109 stores. True Religion also wants to maintain a 30% profit margin by hiring and sustaining experienced retail managers. To expand in the international market True Religion is attempting to focus not just on individual stores but through wholesale channels such as department stores. Along with the company headquarters in Vernon, California, the firm has established headquarters in Hong Kong to help manage the Asian Pacific market (“APAC) and headquarters in Switzerland to manage the markets in Europe, Middle East and Africa (“EMEA”).
Management also has a goal to improve brand awareness and marketability. Over the past two years sales for woman’s merchandise have decreased and True Religion is attempting to seek new avenues to present the innovations of the company and reach out to new and existing customers. True Religions plan is to expand product placement through general advertising, social media, and on-line search.
Financial Condition
Financial Condition shows the status of the firm’s assets, liabilities, and overall financial positions. In this case it summarizes the Net Cash provided by its operating, investing, and financing activities. Cash from operating increased from the prior year which is a strong indication that its core business is improving. Cash flow is further discussed in the Cash flow section of this paper.

Liquidity and Capital Resources
This section describes management’s ability to achieve its stated goals with the cash and capital structure it currently owns. True religions management believes that the cash on hand from the continuing operations and cash on hand will provide adequate funds for the working capital needs and planned capital expenditures.

Tabular Disclosure of Contractual Obligations
Contractual obligations are those long and short term contracts that the firm is currently obliged to pay as a liability. For True Religion this includes operating leases and purchase leases. An exclusion was made for unrecognized tax benefits of $0.9. The reason is because management cannot reasonably estimate of when the liability will be settled, if ever.

Other
The Management Discussion and Analysis provides further material on the performance and outlook of the company. This includes updates to Generally Accepted Accounting Principles, Income Tax Liability, and Uncollectible Accounts. True Religion did not have any material liabilities or significant areas of note to these sections.

Litigation
An important item of note when viewing a firm’s 10-K is any