Autodesk 2001 Annual Report Download - page 38

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Autodesk, Inc. FY 01
during periods of product transition and during update
cycles.
Autodesk establishes allowances for product returns,
including allowances for stock balancing and product
rotation,based on estimated future returns of product and
after taking into consideration channel inventory levels at
its resellers, the timing of new product introductions and
other factors. These allowances are recorded as direct
reductions of revenue and accounts receivable at the time
the related revenue is recognized.
Reclassifications
During the fourth quarter of fiscal 2001, Autodesk
adopted EITF consensus No. 99-19, ”Reporting Revenue
Gross as a Principal versus Net as an Agent” and EITF con-
sensus No. 00-10, ”Accounting for Shipping and Handling
Fees and Costs”. As a result, dealer commissions totaling
$24.7 million in fiscal 2001, $25.4 million in fiscal 2000 and
$19.4 million in fiscal 1999, which previously were
recorded as a direct reduction of net revenues, were
reclassified to sales and marketing expenses. Additionally,
shipping and handling amounts billed totaling $2.1 mil-
lion in fiscal 2001, $2.4 million in fiscal 2000, and
$2.5 million in fiscal 1999, which previously were recorded
as a reduction of cost of sales, were reclassified to net rev-
enues. The adoption of these EITF issues did not impact
Autodesk’s current or previously reported net income or
loss.
In addition, certain other reclassifications have been made
to the fiscal 2000 and 1999 consolidated financial state-
ments to conform to the fiscal 2001 presentation.
Advertising Expenses
Advertising costs are expensed the first time the advertis-
ing takes place. Total advertising expenses incurred were
$15.3 million in fiscal 2001, $18.3 million in fiscal 2000 and
$13.1 million in fiscal 1999.
Recently Issued Accounting Standards
Effective November 1, 2000 Autodesk adopted Staff
Accounting Bulletin No. 101, ”Revenue Recognition in
Financial Statements” (”SAB 101”). The adoption of SAB
101 did not have a material impact on Autodesk’s financial
statements.
On February 1, 2001 Autodesk adopted the provisions of
Statement of Financial Accounting Standards No. 133,
”Accounting for Derivative Instruments and Hedging
Activities” (”SFAS 133”). This Statement requires Autodesk
to recognize all derivatives on the balance sheet at fair
value. Had Autodesk adopted SFAS 133 during fiscal 2001,
the impact would not have been material.The adoption of
SFAS 133 on February 1, 2001 did not have a material
impact on Autodesk’s financial position.
Note 2. Net Income Per Share
Basic net income per share is calculated using the
weighted average number of common shares outstand-
ing. Diluted net income per share is computed using the
weighted average number of common shares outstanding
plus the dilutive effect of stock options outstanding. A rec-
onciliation of the numerators and denominators used in
the basic and diluted net income per share amounts
follows:
(in thousands)
Year ended January 31, 2001 2000 1999
Numerator:
Numerator for basic and diluted net income per share—net income $ 93,233 $ 9,808 $97,132
Denominator:
Denominator for basic net income per share—weighted average shares 57,188 60,328 56,394
Effect of dilutive common stock options 1,326 1,078 2,747
Denominator for diluted net income per share 58,514 61,406 59,141