XML 20 R8.htm IDEA: XBRL DOCUMENT v2.3.0.15
Note 1 - Significant Accounting Policies
9 Months Ended
Sep. 30, 2011
Significant Accounting Policies [Text Block]
Note 1.    Significant Accounting Policies

Basis of Presentation

The consolidated condensed financial statements include the accounts of Covenant Transportation Group, Inc., a Nevada holding company, and its wholly-owned subsidiaries. References in this report to "we," "us," "our," the "Company," and similar expressions refer to Covenant Transportation Group, Inc. and its wholly-owned subsidiaries.  All significant intercompany balances and transactions have been eliminated in consolidation.

The accompanying unaudited consolidated condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X promulgated under the Securities Act of 1933.  In preparing financial statements, it is necessary for management to make assumptions and estimates affecting the amounts reported in the consolidated condensed financial statements and related notes.  These estimates and assumptions are developed based upon all information available.  Actual results could differ from estimated amounts.  In the opinion of management, the accompanying financial statements include all adjustments which are necessary for a fair presentation of the results for the interim periods presented, such adjustments being of a normal recurring nature.  Certain information and footnote disclosures have been condensed or omitted pursuant to such rules and regulations.  The December 31, 2010 consolidated condensed balance sheet was derived from our audited balance sheet as of that date.  These consolidated condensed financial statements and notes thereto should be read in conjunction with the consolidated financial statements and notes thereto included in our Form 10-K for the year ended December 31, 2010.  Results of operations in interim periods are not necessarily indicative of results to be expected for a full year.

Recent Accounting Pronouncements

Fair Value Measurement - In May 2011, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update 2011-04.  ASU 2011-04 represents the converged guidance of the FASB and the International Accounting Standards Board on fair value measurement.  The guidance clarifies certain existing requirements and changes certain principles to achieve convergence between U.S. GAAP and IFRS.  ASU 2011-04 also expands the disclosures for fair value measurements.  ASU 2011-04 is effective for interim and annual periods beginning after December 15, 2011.

Presentation of Comprehensive Income - In June 2011, the FASB issued Accounting Standards Update   2011-05.  ASU 2011-05 amends guidance on the presentation of comprehensive income in financial statements to improve the comparability, consistency and transparency of financial reporting and to increase the prominence of items that are recorded in other comprehensive income.  The guidance requires entities to report components of comprehensive income in either a continuous statement of comprehensive income or two separate, but consecutive, statements.  The provisions of this new guidance are effective for interim and annual periods beginning after December 15, 2011.

We do not expect these standards to have a significant impact on our consolidated financial statements.

Reclassifications

Certain reclassifications have been made to the prior year's consolidated condensed financial statements to conform to the 2011 presentation, including $0.7 million and $1.3 million from general supplies and expenses to salaries, wages, and related expenses related to agent fees and contract labor and $2.4 million and $3.9 million from insurance and claims to operations and maintenance related to a change in the threshold used to classify certain-over-the road damage not specifically related to an accident for the three and nine months periods ended September 30, 2011, respectively.  The reclassifications did not affect the previously reported 2010 stockholders' equity or net income.