Question-and-Answer Session
Operator
(Operator's Instructions) Your first question comes from the line of Peter Park.
Peter Park - Park West Asset Management
Hi. How should I think about commissions as a percentage of sales going forward? Is the second quarter a blip or should we think about it being permanently higher like this?
Wayne L. Badovinus
Hi, Peter, good morning. The commissions rate in the qualifying period each year for our travel incentive contest generally shows an elevation compared to the third and fourth quarters of the year, if you go back and take a look at quarter-over-quarter comparisons.
This year we were very pleased by the high level of recruiting success and frankly by the sheer numbers of new associates attracted to the business and our products. The accompanying number of specific bonuses which I mentioned during the main portion of the call which were triggered by many, many of the new associates that have joined us, elevated the rate higher than we've seen in the past couple of years due to a certain extent because those numbers are much lower in general terms, and the approach that appears to have been taken by a number of our existing and new associates as well is directed towards directly building their downline businesses to a much higher degree than we've seen over the last couple of years.
So I would project that the elevation seen a little bit in the first quarter and then much higher in the second quarter, will begin to return to much more normalized levels as we transition through the third quarter, and further on from there different parameters will be in effect concerning a number of those bonuses, okay?
Peter Park - Park West Asset Management
So you mean that those bonuses will be cut in future periods because —
Wayne L. Badovinus
Actually, the parameter for triggering the bonuses will be strengthened.
Peter Park - Park West Asset Management
So making it harder for people to get those bonuses.
Wayne L. Badovinus
There will be additional results required in order to trigger the bonuses, Peter.
Peter Park - Park West Asset Management
Got it, okay. Let's talk about your cash position, can you walk me through your cash that's available domestically and walk us through how you will fund yourself in future periods?
Wayne L. Badovinus
Well as you're aware we operate in a number of countries around the world and that gives us the ability to move cash to areas where we need it on a fairly regular basis. So we do have quite a bit of movement of cash that goes on during a given quarter and from month to month. There are different times when inventory investment is required, say in some of our international operations and our Swiss office coordinates that. There are other times when we have other needs here. So we have the ability to move the cash around to the points where we specifically need it.
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