The Board of Directors and Stockholders of Virco Mfg. Corporation:
Note 2 of the Notes to the consolidated financial statements of Virco Mfg. Corporation
included in its Form 10-K for the year ended
January 31, 2011 describes a change in
the method of accounting for the valuation of the material component of inventory from
the lower of cost or market using the last-in first-out method to the lower of cost or
market using the first-in first-out method. There are no authoritative criteria for
determining a ‘preferable’ inventory valuation method based on the particular
circumstances; however, we conclude that such change in the method of accounting is to
an acceptable alternative method which, based on your business judgment to make this
change and for the stated reasons, is preferable in your circumstances.
