Adobe 2007 Annual Report Download - page 81

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81
Purchased and other intangible assets, subject to amortization, were as follows as of December 1, 2006:
December 2,
2005
Cost
December 2,
2005
Net Additions
Amortization
Expense
December 1,
2006
Net
Purchased technology..................... $ 18,785 $ 7,632 $ 384,456 $ (142,366 ) $ 249,722
Localization............................. $ 20,512 $ 8,611 $ 7,703 $ (9,515 ) $ 6,799
Trademarks............................. 225 143 130,700 (26,775 ) 104,068
Customer contracts and relationships........ — — 188,402 (42,877 ) 145,525
Other intangibles......................... 301 91 503 (303 ) 291
Total other intangible assets................ $ 21,038 $ 8,845 $ 327,308 $ (79,470 ) $ 256,683
Total purchased and other intangible
assets................................ $ 39,823 $ 16,477 $ 711,764 $ (221,836 ) $ 506,405
Amortization expense related to identifiable intangible assets was $235.3 million, $221.8 million and $20.4 million for
fiscal 2007, 2006 and 2005, respectively. Of the total amortization expense for fiscal 2007 and 2006, $164.4 and $152.4
million, respectively, was charged to cost of sales. There was no amortization charge to cost of sales for fiscal 2005.
Amortization expense for each of the next five years and thereafter is as follows:
Fiscal Year
Purchased
Technology
Other Intangible
Assets
2008.............................................. $ 90,819 $ 86,617
2009.............................................. 59,120 60,027
2010.............................................. 10,472 48,508
2011.............................................. 7,406 11,917
2012.............................................. 5,956 1,009
Thereafter ......................................... 19,591 1,177
Total expected amortization expense ................. $ 193,364 $ 209,255
Note 6. Other Assets
Other assets consisted of the following as of November 30, 2007 and December 1, 2006:
2007 2006
Investments................................................................ $ 52,830 $ 46,273
Prepaid royalties ............................................................ 13,289 3,337
Restricted cash.............................................................. 7,367 2,341
Security deposits............................................................ 6,650 7,510
Prepaid rent................................................................ 4,285 2,765
Prepaid land lease........................................................... 3,224 3,263
Deferred compensation plan assets ............................................. 3,145 —
Unbilled receivables ......................................................... — 2,400
Other ..................................................................... 2,194 294
Total other assets.......................................................... $ 92,984 $ 68,183
Our long-term investments include investments in privately-held companies that we make either directly or indirectly
through venture capital limited partnerships. We own a limited partnership interest in Adobe Ventures. Our limited
partnership interest in Adobe Ventures is consolidated in accordance with FASB Interpretation No. 46R (“FIN 46R”) a
revision to FASB Interpretation No. 46 (“FIN 46”), “Consolidation of Variable Interest Entities”. The partnership is
controlled by Granite Ventures, an independent venture capital firm and sole general partner of Adobe Ventures.
Adobe Ventures carries its investments in equity securities at estimated fair value and investment gains and losses are
included in our consolidated statements of income. The stock of a number of technology investments held by Adobe