UNITED STATES SECURITIES AND
    EXCHANGE COMMISSION
 Washington, D.C.
    20549
  Form 10-K
  (Mark one)þ

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934For the fiscal year ended
    March 31, 2008ORo

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934For the transition period
    from          to   Commission file number 1-2661
 CSS INDUSTRIES, INC.
 (Exact name of registrant as
    specified in its charter)
  Delaware

13-1920657(State or other jurisdiction
    of
    incorporation or organization)

(I.R.S. Employer
    Identification No.)1845 Walnut Street, Philadelphia, PA(Address of principal
    executive offices)

19103(Zip Code)   Registrants telephone number, including area code:
 (215)569-9900
  Securities registered pursuant to Section 12(b) of the
    Act:
  Title of Each Class

Name of Each Exchange on which RegisteredCommon Stock, $.10 par value

New York Stock Exchange   Securities registered pursuant to Section 12(g) of the
    Act:
 None
  (Title of class)
  o þ
  o þ
  þ o
  Regulation S-K Form 10-K Form 10-K. þ
  Rule 12b-2
  Large
    accelerated
    filer o
    Accelerated
    filer þ
    Non-accelerated
    filer o
    Smaller
    reporting
    company o   Rule 12b-2 o þ
      DOCUMENTS
    INCORPORATED BY REFERENCE
  Form 10-K.




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##### 





CSS
    INDUSTRIES, INC.FORM 10-K
    FOR THE FISCAL YEAR ENDED MARCH 31, 2008
    INDEX
  PagePART IItem 1.

Business


1Item 1A.

Risk Factors


3Item 1B.

Unresolved Staff Comments


7Item 2.

Properties


7Item 3.

Legal Proceedings


7Item 4.

Submission of Matters to a Vote of Security Holders


7PART IIItem 5.

Market for Registrants Common Equity, Related Stockholder
    Matters and Issuer Purchases of Equity Securities


8Item 6.

Selected Financial Data


11Item 7.

Managements Discussion and Analysis of Financial Condition
    and Results of Operations


11Item 7A.

Quantitative and Qualitative Disclosures About Market Risk


18Item 8.

Financial Statements and Supplementary Data


19Item 9.

Changes in and Disagreements with Accountants on Accounting and
    Financial Disclosure


44Item 9A.

Controls and Procedures


44Item 9B.

Other Information


46PART IIIItem 10.

Directors, Executive Officers and Corporate Governance


46Item 11.

Executive Compensation


46Item 12.

Security Ownership of Certain Beneficial Owners and Management
    and Related Stockholder Matters


46Item 13.

Certain Relationships and Related Transactions, and Director
    Independence


46Item 14.

Principal Accounting Fees and Services


46PART IVItem 15.

Exhibits, Financial Statement Schedules


47Signatures


51




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##### 



PART I  Item 1.
    Business.  General
  make-up and/or
    Principal Products ® make-up,
  and/or and/or
  
    Boxed greeting cards are produced by Asian manufacturers to our
    specifications. Domestically distributed products are warehoused
    in a distribution facility in Pennsylvania.
    Gift tags and classroom exchange Valentine products are
    domestically manufactured or imported from Asian manufacturers.
    Manufacturing processes include a wide range of finishing,
    assembly and packaging operations. Domestically distributed
    products are warehoused in a facility in Pennsylvania.
    Halloween
    make-up and
    Easter egg dye products are manufactured in Asia to specific
    formulae by contract manufacturers who meet regulatory
    requirements for the formularization and packaging of such
    products. Domestically distributed products are warehoused in a
    distribution facility in Pennsylvania. 1




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
    Ribbons and bows are primarily manufactured and warehoused in
    seven facilities located in Pennsylvania, Maryland, South
    Carolina and Texas. The manufacturing process is vertically
    integrated. Non-woven ribbon and bow products are primarily made
    from polypropylene resin, a petroleum-based product, which is
    mixed with color pigment, melted and pressed through an
    extruder. Large rolls of extruded film go through various
    combinations of manufacturing processes before being made into
    bows or packaged on ribbon spools or reels as required by
    various markets and customers. Woven fabric ribbons are
    manufactured domestically or sourced from Mexico and Asia.
    Domestic woven products are either narrow woven or converted
    from bulk rolls of wide width textiles.
    Gift wrap is primarily manufactured in one facility in Memphis,
    Tennessee. Manufacturing includes web printing, finishing,
    rewinding and packaging. Finished gift wrap products are
    warehoused and shipped from both the production facility and a
    separate facility in Memphis. A small portion of gift wrap
    products are imported from Asia.
    Memory books, stationery, journals and notecards, infant and
    wedding photo albums and scrapbooks, and other gift items are
    imported from Asian manufacturers and warehoused and distributed
    from a distribution facility in Florence, Alabama.      Intellectual Property Rights
  Sales and Marketing
 2




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Competition
    Employees
        SEC
    Filings
  www.cssindustries.com Form 10-K, Form 10-Q, Form 8-K
  Item 1A.
    Risk
    Factors.  Form 10-K
  Our
    results of operations fluctuate on a seasonal basis, and quarter
    to quarter comparisons may not be a good indicator of our
    performance. Seasonal demand fluctuations may adversely affect
    our cash flow and our ability to sell our
    products.
   3




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##### 



We
    rely on a few mass market retailers, warehouse clubs and
    national drug store chains for a significant portion of our
    sales. The loss of sales, or a significant reduction of sales,
    to one or more of our large customers may adversely affect our
    business, results of operations and financial condition. Past
    and future consolidation within the retail sector also may lead
    to reduced profit margins, which may adversely affect our
    business, results of operations and financial
    condition.
    Increases
    in raw material and energy costs, resulting from general
    economic conditions, acts of nature, such as hurricanes,
    earthquakes or influenza pandemics, or other factors, may raise
    our cost of goods sold and adversely affect our business,
    results of operations and financial condition.
    Risks
    associated with our use of foreign suppliers may adversely
    affect our business, results of operations and financial
    condition.
   4




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##### 



Increased
    overseas sourcing by our competitors and our customers may
    reduce our market share and profit margins, adversely affecting
    our business, results of operations and financial
    condition.
    Bankruptcy
    of our key customers may increase our exposure to losses from
    bad debts, and may adversely affect our business, results of
    operations and financial condition.
    Our
    business, results of operations and financial condition may be
    adversely affected by volatility in the demand for our
    products.
    Our
    business, results of operations and financial condition may be
    adversely affected if we are unable to hire and retain
    sufficient qualified personnel.
    Our
    business, results of operations and financial condition may be
    adversely affected if we fail to extend or renegotiate our
    collective bargaining contracts with our labor unions as they
    expire from time to time, or if our unionized employees were to
    engage in a strike, or other work stoppage.
   5




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Our
    acquisition strategy involves risks, and difficulties in
    integrating potential acquisitions may adversely affect our
    business, results of operations and financial
    condition.
    Our
    inability to protect our intellectual property rights, or
    infringement claims asserted against us by others, may adversely
    affect our business, results of operations and financial
    condition.
      Various
    laws and governmental regulations applicable to a manufacturer
    or distributor of consumer products may adversely affect our
    business, results of operations and financial
    condition.
   6




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Our
    business, results of operations and financial condition may be
    adversely affected by national or global changes in economic or
    political conditions.
    Item 1B.
    Unresolved
    Staff Comments.    Item 2.
    Properties.    Approximate Square FeetLocation

Use

Owned


LeasedDanville, PA

Distribution


133,000



Berwick, PA

Manufacturing and distribution


213,000



Berwick, PA

Manufacturing and distribution


220,000



Berwick, PA

Distribution


226,000



Berwick, PA

Distribution






547,000Memphis, TN

Manufacturing and distribution






1,006,000Memphis, TN

Distribution






404,000Hagerstown, MD

Manufacturing and distribution


284,000



Hartwell, SC

Manufacturing


229,000



El Paso, TX

Distribution






100,000Florence, AL

Distribution






180,000Total




1,305,000



2,237,000       Item 3.
    Legal
    Proceedings.    Item 4.
    Submission
    of Matters to a Vote of Security Holders.   7




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PART II  Item 5.
    Market
    for Registrants Common Equity, Related Stockholder Matters
    and Issuer Purchases of Equity Securities.    DividendsFiscal 2008

High


Low


DeclaredFirst Quarter

$
42.29


$
35.18


$
.14Second Quarter


42.48



29.23



.14Third Quarter


42.16



35.00



.14Fourth Quarter


38.40



27.47



.14   DividendsFiscal 2007

High


Low


DeclaredFirst Quarter

$
32.84


$
26.60


$
.12Second Quarter


31.86



26.35



.12Third Quarter


35.77



28.46



.12Fourth Quarter


37.48



32.43



.12       Issuer
    Purchases of Equity Securities
    MaximumTotal Number of Shares


Number of SharesTotal Number





Purchased as Part


that May Yet Beof Shares


Average Price


of Publicly Announced


Purchased UnderPurchased(1)


Paid per Share


Program(1)(2)


the Program(2)January 1 through January 31, 2008


260,400


$
31.67



260,400



191,924February 1 through February 29, 2008


106,600



32.43



106,600



85,324March 1 through March 31, 2008


85,324



34.71



85,324



Total Fourth Quarter


452,324


$
32.38



452,324



     (1)
    
    All share repurchases were effected in open-market transactions
    and in accordance with the safe harbor provisions of
    Rule 10b-18
    of the Securities Exchange Act. 8




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##### 



(2)
    
    The Companys Board of Directors (Board)
    authorized on February 18, 1998 the repurchase of up to
    1,000,000 shares of the Companys common stock (the
    Repurchase Program). Thereafter, the Companys
    Board increased the number of shares authorized to be
    repurchased by the Company pursuant to the Repurchase Program as
    follows: November 9, 1998 (500,000 additional shares);
    May 4, 1999 (500,000 additional shares); September 28,
    1999 (500,000 additional shares); September 26, 2000
    (500,000 additional shares); and February 27, 2003 (400,000
    additional shares). As a result of the Companys
    three-for-two stock split distributed on July 10, 2003, the
    number of shares authorized for repurchase pursuant to the
    Repurchase Program was automatically increased to
    5,100,000 shares. On November 12, 2007, the
    Companys Board authorized the repurchase of an additional
    500,000 shares of the Companys common stock for a
    total of 5,600,000 shares. The aggregate number of shares
    repurchased by the Company pursuant to the Repurchase Program as
    of March 31, 2008 was 5,600,000 on a split-adjusted basis. 9




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##### 



Performance
    Graph
    
  and/or
 10




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##### 



Item 6.
    Selected
    Financial Data.  Years Ended March 31,2008


2007


2006


2005


2004(In thousands, except per share amounts)Statement of Operations Data:Net sales

$
498,253


$
530,686


$
525,494


$
536,362


$
539,349Income before income taxes


38,833



36,804



32,716



47,118



46,297Net income


25,358



23,889



21,841



30,692



29,850Net income per common share:Basic

$
2.36


$
2.25


$
2.08


$
2.58


$
2.54Diluted

$
2.31


$
2.19


$
2.00


$
2.45


$
2.42Balance Sheet Data:Working capital

$
136,000


$
188,309


$
161,482


$
151,878


$
187,813Total assets


345,041



343,070



334,149



333,906



370,397Current portion of long-term debt


10,246



10,195



10,169



10,442



335Long-term debt


10,192



20,392



30,518



40,000



50,251Stockholders equity


262,353



261,110



232,510



216,489



249,152Cash dividends declared per common share

$
.56


$
.48


$
.48


$
.40


$
.307   Item 7.
    Managements
    Discussion and Analysis of Financial Condition and Results of
    Operations.  Overview
      trim-a-package, trim-a-package,
   11




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##### 



Litigation
    Results
    of Operations
  Fiscal
    2008 Compared to Fiscal 2007
                 12




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##### 



Fiscal
    2007 Compared to Fiscal 2006
        non-material,
          Reconciliation
    of Certain Non-GAAP Measures
    13




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##### 



Year Ended March 31, 2007DilutedIncome Before





EarningsIncome Taxes


Net Income


per Share(In thousands, except per share amounts)As Reported

$
36,804


$
23,889


$
2.19- Restructuring expenses


2,327



1,489



.14- Inventory write-down due to facility closure


660



423



.04- Other incremental costs related to restructuring plan


954



611



.06Non-GAAP Measurement

$
40,745


$
26,412


$
2.42   Year Ended March 31, 2006DilutedIncome Before





EarningsIncome Taxes


Net Income


per Share(In thousands, except per share amounts)As Reported

$
32,716


$
21,841


$
2.00- Restructuring expenses


37



25



- Expensing stock options  SFAS No. 123R
    adopted April 1, 2006


(2,722
)


(2,318
)


(.18
)Non-GAAP Measurement

$
30,031


$
19,548


$
1.82     Liquidity
    and Capital Resources
       14




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##### 



Less than 1


1-3


4-5


After 5Contractual Obligations

Year


Years


Years


Years


TotalShort-term debt

$



$



$



$



$
Capital lease obligations


246



192











438Operating leases


8,318



10,059



2,161



759



21,297Long-term debt(1)


10,762



10,314











21,076Other long-term obligations(2)






422



287



2,587



3,296$
19,326


$
20,987


$
2,448


$
3,346


$
46,107     (1)
    
    Interest on long-term debt is based on amounts outstanding and
    on the fixed interest rate of 4.48%.(2)
    
    Other long-term obligations consist primarily of postretirement
    medical liabilities and deferred compensation arrangements.
    Future timing of payments for other long-term obligations is
    estimated by management.      Less than 1

1-3

4-5

After 5Year

Years

Years

Years

TotalLetter of credit

$
3,883


$



$



$



$
3,883       Critical
    Accounting Policies
   15




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##### 



Revenue
    Accounts
    Receivable
    Inventory
    Valuation
  first-in, last-in,
  Goodwill
    Accounting
    for Income Taxes
   16




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##### 



Share-Based
    Compensation
      Accounting
    Pronouncements
    Forward-Looking
    and Cautionary Statements
  and/or
 17




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##### 



Form 10-K
  Item 7A.
    Quantitative
    and Qualitative Disclosures About Market Risk.    Interest
    Rate Risk
    Foreign
    Currency Risk
   18




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##### 



Item 8.
    Financial
    Statements and Supplementary Data.  CSS
    INDUSTRIES, INC. AND SUBSIDIARIES
  INDEX
  PageReport of Independent Registered Public Accounting Firm


20Consolidated Balance Sheets  March 31, 2008 and
    2007


21Consolidated Statements of Operations and Comprehensive
    Income  for the years ended March 31, 2008, 2007
    and 2006


22Consolidated Statements of Cash Flows  for the years
    ended March 31, 2008, 2007 and 2006


23Consolidated Statements of Stockholders Equity 
    for the years ended March 31, 2008, 2007 and 2006


24Notes to Consolidated Financial Statements


25Financial Statement Schedule:Schedule II. Valuation and Qualifying Accounts


50  19




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Report of
    Independent Registered Public Accounting Firm  
        Share-Based Payment Accounting for Uncertainty in Income Taxes
  Internal Control 
    Integrated Framework
     20




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##### 



CSS
    INDUSTRIES, INC. AND SUBSIDIARIES
  CONSOLIDATED
    BALANCE SHEETS
  March 31,2008


2007(In thousands, except share and per share amounts)ASSETSCURRENT ASSETSCash and cash equivalents

$
28,109


$
100,091Accounts receivable, net of allowances of $5,291 and $4,850


39,144



37,169Inventories


105,532



82,138Deferred income taxes


7,276



8,645Assets held for sale


3,590



2,564Other current assets


16,242



13,665Total current assets


199,893



244,272PROPERTY, PLANT AND EQUIPMENTLand


2,619



2,739Buildings, leasehold interests and improvements


47,135



55,352Machinery, equipment and other


126,904



124,164176,658



182,255Less  Accumulated depreciation


(126,026
)


(123,358
)Net property, plant and equipment


50,632



58,897OTHER ASSETSGoodwill


48,361



30,952Intangible assets, net of accumulated amortization of $1,093 and
    $619


42,454



4,328Other


3,701



4,621Total other assets


94,516



39,901Total assets

$
345,041


$
343,070LIABILITIES AND STOCKHOLDERS EQUITYCURRENT LIABILITIESNote payable

$



$
Current portion of long-term debt


10,246



10,195Accounts payable


18,275



12,212Accrued income taxes


822



444Accrued payroll and other compensation


11,526



10,687Accrued customer programs


9,438



10,290Accrued other expenses


13,586



12,135Total current liabilities


63,893



55,963LONG-TERM DEBT, NET OF CURRENT PORTION


10,192



20,392OTHER LONG-TERM OBLIGATIONS


6,121



3,221DEFERRED INCOME TAXES


2,482



2,384COMMITMENTS AND CONTINGENCIES (Notes 10 and 12)STOCKHOLDERS EQUITYPreferred stock, Class 2, $.01 par,
    1,000,000 shares authorized, no shares issued






Common stock, $.10 par, 25,000,000 shares authorized,
    14,703,084 shares issued at March 31, 2008 and 2007


1,470



1,470Additional paid-in capital


44,150



40,680Retained earnings


342,688



325,246Accumulated other comprehensive loss, net of tax


(90
)


(1
)Common stock in treasury, 4,437,325 and 3,857,571 shares,
    at cost


(125,865
)


(106,285
)Total stockholders equity


262,353



261,110Total liabilities and stockholders equity

$
345,041


$
343,070    21




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CSS
    INDUSTRIES, INC. AND SUBSIDIARIES
  CONSOLIDATED
    STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
  For the Years Ended March 31,2008


2007


2006(In thousands, except per share amounts)NET SALES

$
498,253


$
530,686


$
525,494COSTS AND EXPENSESCost of sales


360,708



394,045



399,605Selling, general and administrative expenses


96,703



96,125



90,211Restructuring expenses


1,717



2,327



37Interest expense, net of interest income of $1,163, $1,295
    and $474


974



2,285



3,279Other income, net


(682
)


(900
)


(354
)459,420



493,882



492,778INCOME BEFORE INCOME TAXES


38,833



36,804



32,716INCOME TAX PROVISION


13,475



12,915



10,875NET INCOME

$
25,358


$
23,889


$
21,841NET INCOME PER COMMON SHAREBasic

$
2.36


$
2.25


$
2.08Diluted

$
2.31


$
2.19


$
2.00COMPREHENSIVE INCOMENet income

$
25,358


$
23,889


$
21,841Foreign currency translation adjustment


2



1



Postretirement medical plan, net of tax


(91
)






Comprehensive income

$
25,269


$
23,890


$
21,841    22




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##### 



CSS
    INDUSTRIES, INC. AND SUBSIDIARIES
  CONSOLIDATED
    STATEMENTS OF CASH FLOWS
  For the Years Ended March 31,2008


2007


2006(In thousands)Cash flows from operating activities:Net income

$
25,358


$
23,889


$
21,841Adjustments to reconcile net income to net cash provided by
    operating activities:Depreciation and amortization


13,218



14,335



14,499Provision for doubtful accounts


5



26



399Asset impairments


1,222



422



Deferred tax provision (benefit)


2,622



(3,621
)


(1,512
)(Gain) loss on sale or disposal of assets


(386
)


(418
)


153Compensation expense related to stock options


2,830



2,825



172Changes in assets and liabilities, net of effects of acquisition:Decrease (increase) in accounts receivable


9,204



(1,613
)


1,292(Increase) decrease in inventories


(10,737
)


21,632



(1,903
)(Increase) decrease in other assets


(1,274
)


4,575



(4,778
)Decrease in accounts payable


(196
)


(2,282
)


(843
)Increase (decrease) in accrued income taxes


3,493



(3,466
)


2,790Decrease in accrued expenses and other long-term obligations


(3,665
)


(957
)


(4,510
)Net cash provided by operating activities


41,694



55,347



27,600Cash flows from investing activities:Purchase of a business, net of cash received of $2


(71,145
)






Purchase of property, plant and equipment


(8,330
)


(5,289
)


(9,515
)Proceeds from sale of assets


3,092



732



361Net cash used for investing activities


(76,383
)


(4,557
)


(9,154
)Cash flows from financing activities:Payments on long-term debt obligations


(10,149
)


(10,241
)


(10,484
)Borrowings on notes payable


186,900



172,360



243,845Payments on notes payable


(186,900
)


(172,360
)


(243,845
)Dividends paid


(5,983
)


(5,100
)


(5,040
)Purchase of treasury stock


(25,449
)


(323
)


(7,167
)Proceeds from exercise of stock options


3,936



5,486



4,568Tax benefit realized for stock options exercised


350



1,822



Net cash used for financing activities


(37,295
)


(8,356
)


(18,123
)Effect of exchange rate changes on cash and cash equivalents


2



1



Net (decrease) increase in cash and cash equivalents


(71,982
)


42,435



323Cash and cash equivalents at beginning of period


100,091



57,656



57,333Cash and cash equivalents at end of period

$
28,109


$
100,091


$
57,656    23




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##### 



CSS
    INDUSTRIES, INC. AND SUBSIDIARIES
  CONSOLIDATED
    STATEMENTS OF STOCKHOLDERS EQUITY
  AccumulatedAdditional





Other


Common StockPreferred Stock


Common Stock


Paid-in


Retained


Comprehensive


in TreasuryShares


Amount


Shares


Amount


Capital


Earnings


Loss


Shares


Amount


Total(In thousands, except share and per share amounts)BALANCE, APRIL 1, 2005





$




14,703,084


$
1,470


$
34,214


$
303,022


$
(2
)


(4,321,380
)

$
(122,215
)

$
216,489Tax benefit associated with exercise of stock options


















1,647



















1,647Compensation expense related to stock options


















172



















172Issuance of common stock upon exercise of stock options






















(5,944
)






322,896



10,512



4,568Increase in treasury shares






























(218,100
)


(7,167
)


(7,167
)Cash dividends ($.48 per common share)






















(5,040
)














(5,040
)Net income






















21,841















21,841BALANCE, MARCH 31, 2006










14,703,084



1,470



36,033



313,879



(2
)


(4,216,584
)


(118,870
)


232,510Tax benefit associated with exercise of stock options


















1,822



















1,822Compensation expense related to stock options


















2,825



















2,825Issuance of common stock upon exercise of stock options






















(7,422
)






368,813



12,908



5,486Increase in treasury shares






























(9,800
)


(323
)


(323
)Foreign currency translation adjustment


























1











1Cash dividends ($.48 per common share)






















(5,100
)














(5,100
)Net income






















23,889















23,889BALANCE, MARCH 31, 2007










14,703,084



1,470



40,680



325,246



(1
)


(3,857,571
)


(106,285
)


261,110Tax benefit associated with exercise of stock options


















640



















640Compensation expense related to stock options


















2,830



















2,830Issuance of common stock upon exercise of stock options






















(1,933
)






167,670



5,869



3,936Increase in treasury shares






























(747,424
)


(25,449
)


(25,449
)Foreign currency translation adjustment


























2











2Cash dividends ($.56 per common share)






















(5,983
)














(5,983
)Postretirement medical plan, net of tax


























(91
)










(91
)Net income






















25,358















25,358BALANCE, MARCH 31, 2008





$




14,703,084


$
1,470


$
44,150


$
342,688


$
(90
)


(4,437,325
)

$
(125,865
)

$
262,353    24




---



##### 



CSS
    INDUSTRIES, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 MARCH 31,
    2008
  (1)
    SUMMARY
    OF SIGNIFICANT ACCOUNTING POLICIES  Principles
    of Consolidation
    Foreign
    Currency Translation and Transactions
    Nature
    of Business
  make-up and/or
    Reclassification
    Use of
    Estimates
   25




---



##### 



CSS
    INDUSTRIES, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Accounts
    Receivable
    Inventories
  first-in, last-in,
  March 31,2008


2007Raw material

$
22,836


$
14,442Work-in-process


29,827



31,283Finished goods


52,869



36,413$
105,532


$
82,138   Assets
    Held for Sale
   26




---



##### 



CSS
    INDUSTRIES, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Property,
    Plant and Equipment
    Buildings, leasehold interests and improvements

Lease term to 45 yearsMachinery, equipment and other

3 to 15 years     Impairment
    of Long-Lived Assets
    Goodwill
    and Intangible Assets
      Derivative
    Financial Instruments
     27




---



##### 



CSS
    INDUSTRIES, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
        Income
    Taxes
      Revenue
    Recognition
    Product
    Development Costs
     28




---



##### 



CSS
    INDUSTRIES, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Shipping
    and Handling Costs
    Stock-Based
    Compensation
      Net
    Income Per Common Share
    For the Years Ended March 31,2008


2007


2006(In thousands, except per share amounts)Numerator:Net income

$
25,358


$
23,889


$
21,841Denominator:Weighted average shares outstanding for basic income per common
    share


10,732



10,622



10,482Effect of dilutive stock options


261



297



453Adjusted weighted average shares outstanding for diluted income
    per common share


10,993



10,919



10,935Basic net income per common share

$
2.36


$
2.25


$
2.08Diluted net income per common share

$
2.31


$
2.19


$
2.00     Statements
    of Cash Flows
   29




---



##### 



CSS
    INDUSTRIES, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Supplemental
    Schedule of Cash Flow Information
  For the Years Ended March 31,2008


2007


2006(In thousands)Cash paid during the year for:Interest

$
2,413


$
3,780


$
3,971Income taxes

$
8,445


$
17,874


$
9,579Details of acquisitions:Fair value of assets acquired

$
82,442


$



$
Liabilities assumed


8,595







Net assets acquired


73,847







Amount due seller for purchase price adjustment


2,700







Cash paid


71,147







Less cash acquired


2







Net cash paid for acquisitions

$
71,145


$



$
   (2)
    BUSINESS
    ACQUISITION      Current assets

$
25,470Property, plant and equipment


963Intangible assets


38,600Goodwill


17,409Total assets acquired


82,442Current liabilities


8,595Total liabilities assumed


8,595Net assets acquired

$
73,847  30




---



##### 



CSS
    INDUSTRIES, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Years Ended March 31,2008


2007Net sales

$
536,192


$
582,494Net income


24,537



23,883Income per common share:Basic

$
2.29


$
2.25Diluted

$
2.23


$
2.19     (3)
    GOODWILL
    AND OTHER INTANGIBLE ASSETS      Balance as of March 31, 2007

$
30,952Acquisition of C.R. Gibson


17,409Balance as of March 31, 2008

$
48,361       March 31,2008


2007Tradenames

$
23,790


$
4,290Customer relationships, net


18,480



Non-compete, net


184



38$
42,454


$
4,328  31




---



##### 



CSS
    INDUSTRIES, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Fiscal 2009

$
1,310Fiscal 2010


1,310Fiscal 2011


1,310Fiscal 2012


1,293Fiscal 2013


1,260$
6,483   (4)
    BUSINESS
    RESTRUCTURING      Termination


OtherCosts


Costs


TotalInitial accrual

$
1,200


$
123


$
1,323Additional charges  fiscal 2007


457



125



582Cash paid  fiscal 2007


(304
)


(145
)


(449
)Restructuring reserve as of March 31, 2007


1,353



103



1,456Cash paid  fiscal 2008


(1,168
)


(155
)


(1,323
)Non cash adjustments  fiscal 2008


(185
)


52



(133
)Restructuring reserve as of March 31, 2008

$



$



$
    32




---



##### 



CSS
    INDUSTRIES, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      Termination


OtherCosts


Costs


TotalInitial accrual

$
355


$
273


$
628Cash paid  fiscal 2008


(46
)


(263
)


(309
)Restructuring reserve as of March 31, 2008

$
309


$
10


$
319   (5)
    TREASURY
    STOCK TRANSACTIONS    (6)
    STOCK
    OPTION PLANS       33




---



##### 



CSS
    INDUSTRIES, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
        (In thousands, exceptper share data)Net income, as reported

$
21,841Add: Total stock-based employee compensation expense included in
    the determination of net income, net of related tax effects


111Deduct: Total stock-based employee compensation expense
    determined under fair-value based method for all awards, net of
    related tax effects


(2,429
)Pro forma net income

$
19,523Net income per share:Basic  as reported

$
2.08Basic  pro forma

$
1.86Diluted  as reported

$
2.00Diluted  pro forma

$
1.82       For the Years Ended March 31,2008


2007


2006Expected dividend yield at time of grant


1.64
%


1.60
%


1.44
%Expected stock price volatility


30
%


25
%


35
%Risk-free interest rate


4.20
%


4.91
%


4.10
%Expected life of option (in years)


4.3



4.7



4.9  34




---



##### 



CSS
    INDUSTRIES, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Weighted


Weighted


AggregateNumber


Option Price


Average


Average Life


Intrinsicof Shares


per Share


Price


Remaining


Value(In thousands)Options outstanding at April 1, 2005


1,847,016


$
12.71  35.00


$
21.35



5.5 yearsGranted


362,100



29.66  36.60



33.52Exercised


(394,733
)


12.71  34.12



17.85Forfeited/canceled


(76,777
)


16.70  34.12



29.06Options outstanding at March 31, 2006


1,737,606



12.71  36.60



24.35



4.7 yearsGranted


399,100



27.60  36.10



30.15Exercised


(451,600
)


12.71  35.00



17.84Forfeited/canceled


(176,996
)


16.70  35.00



32.00Options outstanding at March 31, 2007


1,508,110



12.71  36.60



26.94



3.9 yearsGranted


234,000



29.69  39.58



34.41Exercised


(175,245
)


13.21  35.98



24.17Forfeited/canceled


(43,775
)


18.50  34.12



29.14Options outstanding at March 31, 2008


1,523,090


$
12.71  39.58


$
28.34



3.2 years


$
9,628Options exercisable at March 31, 2008


837,090


$
12.71  36.60


$
24.92



3.0 years


$
8,009       (7)
    RETIREMENT
    BENEFIT PLANS  Profit
    Sharing Plans
    Pension
    Plan
   35




---



##### 



CSS
    INDUSTRIES, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Postretirement
    Medical Plan
      2008


2007Benefit obligation at beginning of year

$
825


$
938Interest cost


48



55Actuarial loss (gain) and other adjustments


212



(119
)Benefits paid


(48
)


(49
)Benefit obligation recognized in the consolidated balance sheet

$
1,037


$
825         (8)
    INCOME
    TAXES    For the Years Ended March 31,2008


2007


2006United States

$
22,281


$
20,957


$
22,684Foreign


16,552



15,847



10,032$
38,833


$
36,804


$
32,716  36




---



##### 



CSS
    INDUSTRIES, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    For the Years Ended March 31,2008


2007


2006Current:Federal

$
8,147


$
12,679


$
9,967State


(311
)


899



659Foreign


3,017



2,958



1,76110,853



16,536



12,387Deferred:Federal


2,344



(3,172
)


(1,738
)State


278



(449
)


2262,622



(3,621
)


(1,512
)$
13,475


$
12,915


$
10,875     For the Years Ended March 31,2008


2007


2006U.S. federal statutory rate


35.0
%


35.0
%


35.0
%State income taxes, less federal benefit


.8



1.7



2.0Tax exempt interest


(.7
)






Changes in tax reserves and valuation allowance


.1



(1.6
)


(1.3
)Foreign dividend repatriation










(1.3
)Other, net


(.5
)






(1.2
)34.7
%


35.1
%


33.2
%      37




---



##### 



CSS
    INDUSTRIES, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    March 31,2008


2007Deferred income tax assets:Accounts receivable

$
324


$
259Inventories


3,886



4,138Accrued expenses


5,265



5,750State net operating loss and credit carryforwards


11,522



11,672Stock based compensation


1,433



66622,430



22,485Valuation allowance


(11,389
)


(11,543
)11,041



10,942Deferred income tax liabilities:Property, plant and equipment


1,221



2,039Intangibles


1,607



473Unremitted earnings of foreign subsidiaries


2,205



221Other


1,214



1,9486,247



4,681Net deferred income tax asset

$
4,794


$
6,261        38




---



##### 



CSS
    INDUSTRIES, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Gross unrecognized tax benefits upon adoption at April 1,
    2007

$
2,169Additions based on tax positions related to the current year


84Additions for tax positions of prior years


196Reductions for tax positions of prior years


(403
)Reductions relating to settlements with taxing authorities


(23
)Reductions as a result of a lapse of the applicable statute of
    limitations


(36
)Gross unrecognized tax benefits at March 31, 2008

$
1,987     and/or
    (9)
    LONG-TERM
    DEBT AND CREDIT ARRANGEMENTS    March 31,2008


20074.48% Senior Notes due December 13, 2009

$
20,000


$
30,000Other


438



58720,438



30,587Less  current portion


(10,246
)


(10,195
)$
10,192


$
20,392      39




---



##### 



CSS
    INDUSTRIES, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    back-up
      2009

$
2612010


196Total minimum lease obligations


457Less amount representing interest


(19
)Present value of future minimum lease obligations

$
438     2009

$
10,2462010


10,192Total

$
20,438  40




---



##### 



CSS
    INDUSTRIES, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  (10)
    OPERATING
    LEASES    2009

$
8,3182010


6,3142011


3,7452012


1,2392013


922Thereafter


759Total

$
21,297     (11)
    FAIR
    VALUE OF FINANCIAL INSTRUMENTS      
    Cash and cash equivalents, accounts receivable and accounts
    payable  The carrying amounts of these items are a
    reasonable estimate of their fair values at March 31, 2008
    and 2007.
    Short-term borrowings  Borrowings under the revolving
    credit facility have variable rates that reflect currently
    available terms and conditions for similar debt. The carrying
    amount of this debt is a reasonable estimate of its fair value.
    Foreign currency contracts  The fair value is based
    on quotes obtained from financial institutions. There were no
    foreign currency contracts outstanding as of March 31, 2008
    and the fair value of foreign currency contracts was immaterial
    as of March 31, 2007.
    Long-term debt  The fair value of long-term debt
    instruments is estimated using a discounted cash flow analysis.
    As of March 31, 2008, the carrying amount of long-term debt
    was $20,438,000 and the fair value was estimated to be
    $20,557,000. As of March 31, 2007, the carrying amount of
    long-term debt was $30,587,000 and the fair value was estimated
    to be $29,995,000.  (12)
    COMMITMENTS
    AND CONTINGENCIES   41




---



##### 



CSS
    INDUSTRIES, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  (13)
    SEGMENT
    DISCLOSURE      For the Years Ended March 31,2008


2007


2006Christmas

$
285,848


$
346,866


$
323,380All occasion


151,410



127,163



143,307Other seasonal


60,995



56,657



58,807Total

$
498,253


$
530,686


$
525,494     (14)
    RECENT
    ACCOUNTING PRONOUNCEMENTS      No. 06-10, (EITF 06-10). EITF 06-10 EITF 06-10 EITF 06-10
   42




---



##### 



CSS
    INDUSTRIES, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    (15)
    QUARTERLY
    FINANCIAL DATA (UNAUDITED)  Quarters2008

First


Second


Third


Fourth(In thousands, except per share amounts)Net sales

$
46,802


$
172,882


$
222,170


$
56,399Gross profit

$
13,283


$
46,199


$
61,382


$
16,681Net (loss) income

$
(4,427
)

$
13,535


$
22,854


$
(6,604
)Net (loss) income per common share:Basic(1)

$
(.41
)

$
1.25


$
2.12


$
(.63
)Diluted(1)

$
(.41
)

$
1.22


$
2.07


$
(.63
)   Quarters2007

First


Second


Third


Fourth(In thousands, except per share amounts)Net sales

$
47,533


$
173,830


$
264,065


$
45,258Gross profit

$
13,470


$
44,827


$
66,370


$
11,974Net (loss) income

$
(5,507
)

$
11,703


$
23,290


$
(5,597
)Net (loss) income per common share:Basic(1)

$
(.52
)

$
1.11


$
2.19


$
(.52
)Diluted(1)

$
(.52
)

$
1.08


$
2.13


$
(.52
)     (1)
    
    Net (loss) income per common share amounts for each quarter are
    required to be computed independently and may not equal the
    amount computed for the total year.       43




---



##### 



Item 9.
    Changes
    in and Disagreements with Accountants on Accounting and
    Financial Disclosure.    Item 9A.
    Controls
    and Procedures.  (a)
    Evaluation
    of Disclosure Controls and Procedures.  Rules 13a-15(e) 15d-15(e)) Rules 13a-15 15d-15.
  (b)
    Managements
    Report on Internal Control over Financial Reporting.            (c)
    Changes
    in Internal Control over Financial Reporting.   44




---



##### 



(d)
    Report of
    Independent Registered Public Accounting Firm.     Internal Control 
    Integrated Framework
        Internal Control  Integrated Framework
         45




---



##### 



Item 9B.
    Other
    Information.   Part III  Item 10.
    Directors,
    Executive Officers and Corporate Governance.    Item 11.
    Executive
    Compensation.    Item 12.
    Security
    Ownership of Certain Beneficial Owners and Management and
    Related Stockholder Matters.    Item 13.
    Certain
    Relationships and Related Transactions, and Director
    Independence.    Item 14.
    Principal
    Accounting Fees and Services.   46




---



##### 



Part IV  Item 15.
    Exhibits,
    Financial Statement Schedules.    Financial Statements
      Consolidated Statements of Operations and Comprehensive
    Income  for the years ended March 31, 2008, 2007
    and 2006    Consolidated Statements of Stockholders Equity 
    for the years ended March 31, 2008, 2007 and 2006    Financial Statement Schedules
    Exhibits required by Item 601 of
    Regulation S-K,
    Including Those Incorporated by Reference
  Articles of Incorporation and By-Laws3
.1

Restated Certificate of Incorporation filed December 5,
    1990 (incorporated by reference to Exhibit 3.1 to the
    Registrants Annual Report on
    Form 10-K
    for the fiscal year ended March 31, 2006).3
.2

Amendment to Restated Certificate of Incorporation filed
    May 8, 1992 (incorporated by reference to Exhibit 3.2
    to the Registrants Annual Report on
    Form 10-K
    for the fiscal year ended March 31, 2006).3
.3

Certificate eliminating Class 2, Series A, $1.35
    Preferred stock filed September 27, 1991 (incorporated by
    reference to Exhibit 3.3 to the Registrants Annual
    Report on
    Form 10-K
    for the fiscal year ended March 31, 2006).3
.4

Certificate eliminating Class 1, Series B, Convertible
    Preferred Stock filed January 28, 1993 (incorporated by
    reference to Exhibit 3.4 to the Registrants Annual
    Report on
    Form 10-K
    for the fiscal year ended March 31, 2006).3
.5

Amendment to Restated Certificate of Incorporation filed
    August 4, 2004 (incorporated by reference to
    Exhibit 3.1 to the Registrants Quarterly Report on
    Form 10-Q
    dated November 8, 2004).3
.6

Restated Certificate of Incorporation, as amended to date (as
    last amended August 4, 2004) (incorporated by reference to
    Exhibit 3.2 to the Registrants Quarterly Report on
    Form 10-Q
    dated November 8, 2004)3
.7

By-laws of the Company, as amended to date (as last amended
    August 2, 2007) (incorporated by reference to
    Exhibit 3.1 to the Registrants Quarterly Report on
    Form 10-Q
    dated October 25, 2007).Material Contracts10
.1

Receivables Purchase Agreement among CSS Funding LLC, CSS
    Industries, Inc., Market Street Funding Corporation and PNC
    Bank, National Association, dated as of April 30, 2001
    (incorporated by reference to Exhibit 10.9 to the
    Registrants Annual Report on
    Form 10-K/A
    for the fiscal year ended March 31, 2002).10
.2

Purchase and Sale Agreement between Various Entities Listed on
    Schedule I, as the Originators, CSS Industries, Inc. and
    CSS Funding LLC, dated as of April 30, 2001 (incorporated
    by reference to Exhibit 10.10 to the Registrants
    Annual Report on
    Form 10-K/A
    for the fiscal year ended March 31, 2002).10
.3

First Amendment to Receivables Purchase Agreement dated as of
    August 24, 2001 (incorporated by reference to
    Exhibit 10.12 to the Registrants Annual Report on
    Form 10-K/A
    for the fiscal year ended March 31, 2002).10
.4

First Amendment to Purchase and Sale Agreement dated as of
    August 24, 2001 (incorporated by reference to
    Exhibit 10.13 to the Registrants Annual Report on
    Form 10-K/A
    for the fiscal year ended March 31, 2002).10
.5

$50,000,000 4.48% Senior Notes due December 13, 2009
    Note Purchase Agreement dated December 12, 2002
    (incorporated by reference to Exhibit 10.17 to the
    Registrants Annual Report on
    Form 10-K
    for the fiscal year ended March 31, 2003). 47




---



##### 



10
.6

Amended and Restated Loan Agreement dated April 23, 2004
    (incorporated by reference to Exhibit 10.1 to the
    Registrants Quarterly Report on
    Form 10-Q
    dated November 8, 2004).10
.7

Second Amendment to Purchase and Sale Agreement dated as of
    July 29, 2003 (incorporated by reference to
    Exhibit 10.2 to the Registrants Quarterly Report on
    Form 10-Q
    dated November 8, 2004).10
.8

Third Amendment to Purchase and Sale Agreement dated
    June 1, 2004 (incorporated by reference to
    Exhibit 10.3 to the Registrants Quarterly Report on
    Form 10-Q
    dated November 8, 2004).10
.9

Second Amendment to Receivables Purchase Agreement dated as of
    July 29, 2003 (incorporated by reference to
    Exhibit 10.4 to the Registrants Quarterly Report on
    Form 10-Q
    dated November 8, 2004).10
.10

Third Amendment to Receivables Purchase Agreement dated as of
    April 26, 2004 (incorporated by reference to
    Exhibit 10.5 to the Registrants Quarterly Report on
    Form 10-Q
    dated November 8, 2004).10
.11

Fourth Amendment to Receivables Purchase Agreement dated
    June 1, 2004 (incorporated by reference to
    Exhibit 10.6 to the Registrants Quarterly Report on
    Form 10-Q
    dated November 8, 2004).10
.12

First Amendment to Note Purchase Agreements dated
    October 27, 2004 (incorporated by reference to
    Exhibit 10.8 to the Registrants Quarterly Report on
    Form 10-Q
    dated November 8, 2004).10
.13

Amendment to Amended and Restated Loan Agreement dated
    January 27, 2005 (incorporated by reference to
    Exhibit 10.17 to the Registrants Annual Report on
    Form 10-K
    for the fiscal year ended March 31, 2005).10
.14

Asset Purchase Agreement dated as of October 31, 2007,
    among CSS Industries, Inc., Delta Acquisition, LLC, C.R. Gibson,
    Inc. and the shareholders of C.R. Gibson, Inc. (incorporated by
    reference to Exhibit 2.1 to the Registrants Current
    Report on
    Form 8-K
    filed on December 7, 2007).10
.15

Closing letter dated November 30, 2007 by and among Delta
    Acquisition, LLC, CSS Industries, Inc. and C.R. Gibson, Inc., on
    behalf of itself and its shareholders (incorporated by reference
    to Exhibit 2.2 to the Registrants Current Report on
    Form 8-K
    filed on December 7, 2007).10
.16

Fifth Amendment to Receivables Purchase Agreement dated as of
    August 1, 2007 (incorporated by reference to
    Exhibit 10.1 to the Registrants Quarterly Report on
    Form 10-Q
    dated January 31, 2008).Management Contracts, Compensatory Plans or Arrangements10
.17

CSS Industries, Inc. 1995 Stock Option Plan for Non-Employee
    Directors (incorporated by reference to Exhibit 10.2 to the
    Registrants Annual Report on
    Form 10-K
    for the fiscal year ended December 31, 1996).10
.18

CSS Industries, Inc. 2000 Stock Option Plan for Non-Employee
    Directors (incorporated by reference to Exhibit 10.14 to
    the Registrants Annual Report on
    Form 10-K/A
    for the fiscal year ended March 31, 2002).10
.19

CSS Industries, Inc. Non-Qualified Supplemental Executive
    Retirement Plan Guidelines, dated January 25, 1994
    (incorporated by reference to Exhibit 10.19 to the
    Registrants Annual Report on
    Form 10-K
    for the fiscal year ended March 31, 2006).10
.20

Amendment
    1998-1 to
    the Non-Qualified Supplemental Executive Retirement Plan
    Covering Officer-Employees of CSS Industries, Inc., dated
    November 13, 1998 (incorporated by reference to
    Exhibit 10.20 to the Registrants Annual Report on
    Form 10-K
    for the fiscal year ended March 31, 2006).10
.21

Berwick Industries, Inc. Non-Qualified Supplemental Executive
    Retirement Plan, dated November 18, 1996 (incorporated by
    reference to Exhibit 10.26 to the Registrants Annual
    Report on
    Form 10-K
    for the fiscal year ended December 31, 1996).10
.22

Amendment
    1998-1 to
    the Non-Qualified Supplemental Executive Retirement Plan
    Covering Officer-Employees of Berwick Industries, Inc. and its
    Subsidiaries in the United States, dated November 18, 1998
    (incorporated by reference to Exhibit 10.22 to the
    Registrants Annual Report on
    Form 10-K
    for the fiscal year ended March 31, 2006).10
.23

The Paper Magic Group, Inc. Non-Qualified Supplemental Executive
    Retirement Plan, dated December 5, 1996 (incorporated by
    reference to Exhibit 10.27 to the Registrants Annual
    Report on
    Form 10-K
    for the fiscal year ended December 31, 1996).10
.24

Amendment
    1998-1 to
    the Non-Qualified Supplemental Executive Retirement Plan
    Covering Officer-Employees of The Paper Magic Group, Inc. and
    its Subsidiaries in the United States, dated November 23,
    1998 (incorporated by reference to Exhibit 10.24 to the
    Registrants Annual Report on
    Form 10-K
    for the fiscal year ended March 31, 2006). 48




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##### 



10
.25

Cleo Inc Non-Qualified Supplemental Executive Retirement Plan
    dated November 26, 1996 (incorporated by reference to
    Exhibit 10.18 to the Registrants Annual Report on
    Form 10-K
    for the fiscal year ended December 31, 1998).10
.26

Amendment
    1998-1 to
    the Non-Qualified Supplemental Executive Retirement Plan
    Covering Officer-Employees of Cleo Inc and its Subsidiaries in
    the United States, dated November 23, 1998 (incorporated by
    reference to Exhibit 10.26 to the Registrants Annual
    Report on
    Form 10-K
    for the fiscal year ended March 31, 2006).10
.27

CSS Industries, Inc. 1994 Equity Compensation Plan (as last
    amended August 7, 2002) (incorporated by reference to
    Exhibit 10.29 to the Registrants Annual Report on
    Form 10-K
    for the fiscal year ended March 31, 2004).10
.28

CSS Industries, Inc. 2004 Equity Compensation Plan (incorporated
    by reference to Exhibit 10.7 to the Registrants
    Quarterly Report on
    Form 10-Q
    dated November 8, 2004).10
.29

Employment Agreement dated as of July 11, 2005 between CSS
    Industries, Inc. and William G. Kiesling (incorporated by
    reference to Exhibit 10.1 to the Registrants
    Quarterly Report on
    Form 10-Q
    dated November 9, 2005).10
.30

Employment Agreement dated as of May 12, 2006 between CSS
    Industries, Inc. and Christopher J. Munyan (incorporated by
    reference to Exhibit 10.2 to the Registrants
    Quarterly Report on
    Form 10-Q
    dated August 9, 2006).10
.31

CSS Industries, Inc. Severance Pay Plan for Senior Management
    and Summary Plan Description (incorporated by reference to
    Exhibit 10.1 to the Registrants Quarterly Report on
    Form 10-Q
    dated February 2, 2007).10
.32

CSS Industries, Inc. 2006 Stock Option Plan for Non-Employee
    Directors (incorporated by reference to Exhibit 10.34 to
    the Registrants Annual Report on
    Form 10-K
    for the fiscal year ended March 31, 2007).10
.33

Amendment
    2006-1 to
    the Non-Qualified Supplemental Executive Retirement Plan
    Covering Officer-Employees of CSS Industries, Inc. (incorporated
    by reference to Exhibit 10.35 to the Registrants
    Annual Report on
    Form 10-K
    for the fiscal year ended March 31, 2007).10
.34

CSS Industries, Inc. Management Incentive Program (incorporated
    by reference to Exhibit 10.1 to the Registrants
    Quarterly Report on
    Form 10-Q
    dated August 3, 2007).10
.35

CSS Industries, Inc. FY 2008 Management Incentive Program
    Criteria for CSS Industries, Inc. (incorporated by reference to
    Exhibit 10.2 to the Registrants Quarterly Report on
    Form 10-Q
    dated August 3, 2007).10
.36

CSS Industries, Inc. FY 2008 Management Incentive Program
    Criteria for BOC Design Group (incorporated by Reference to
    Exhibit 10.3 to the Registrants Quarterly Report on
    Form 10-Q
    dated August 3, 2007).10
.37

CSS Industries, Inc. FY 2008 Management Incentive Program
    Criteria for Paper Magic Group, Inc. (incorporated by reference
    to Exhibit 10.4 to the Registrants Quarterly Report
    on
    Form 10-Q
    dated August 3, 2007).Other*21
.

List of Significant Subsidiaries of the Registrant.*23
.

Consent of Independent Registered Public Accounting Firm.*31
.1

Certification of the Chief Executive Officer of CSS Industries,
    Inc. required by
    Rule 13a-14(a)
    under the Securities Exchange Act of 1934.*31
.2

Certification of the Chief Financial Officer of CSS Industries,
    Inc. required by
    Rule 13a-14(a)
    under the Securities Exchange Act of 1934.*32
.1

Certification of the Chief Executive Officer of CSS Industries,
    Inc. required by
    Rule 13a-14(b)
    under the Securities Exchange Act of 1934 and 18 U.S.C.
    Section 1350.*32
.2

Certification of the Chief Financial Officer of CSS Industries,
    Inc. required by
    Rule 13a-14(b)
    under the Securities Exchange Act of 1934 and 18 U.S.C.
    Section 1350.     *
    
    Filed or furnished with this Annual Report on
    Form 10-K. 49




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##### 



CSS
    INDUSTRIES, INC. AND SUBSIDIARIES



SCHEDULE II

VALUATION
    AND QUALIFYING ACCOUNTS  Column A

Column B


Column C


Column D


Column EAdditionsBalance


Chargedat


to Costs


Charged





BalanceBeginning


and


to Other





at End ofof Period


Expenses


Accounts


Deductions


Period(In thousands)Year ended March 31, 2008Accounts receivable allowances

$
4,850


$
4,542


$
997
(d)

$
5,098
(a)

$
5,291Accrued restructuring expenses


1,456



628







1,765
(b)


319Year ended March 31, 2007Accounts receivable allowances

$
4,119


$
4,086


$



$
3,355
(a)

$
4,850Accrued restructuring expenses


4



1,905







453
(c)


1,456Year ended March 31, 2006Accounts receivable allowances

$
5,428


$
3,326


$



$
4,635
(a)

$
4,119Accrued restructuring expenses


599



37







632
(b)


4     Notes:  (a)
    
    Includes amounts written off as uncollectible, net of recoveries.(b)
    
    Includes payments and non cash reductions.(c)
    
    Includes payments.(d)
    
    Balance at acquisition of C.R. Gibson. 50




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##### 



SIGNATURES
         By
    /s/  Christopher
    J. Munyan  
       
  
     
  
     
      
      
      
      
      
      
     51