Blackberry 2006 Annual Report Download - page 59

Research In Motion Limited • Incorporated Under the Laws of Ontario (In thousands of United States dollars, except per share data, and except as otherwise indicated)
Annual Report 2006 57
For the years ended March 4, 2006, February 26, 2005 and February 28, 2004
7. Intangible Assets
Intangible assets are comprised of the following:

 
     
Acquired technology      
Licenses       
Patents     
          
February 26, 2005
Accumulated Net book
Cost amortization value
Acquired technology $ 12, 1 5 1 $ 6,045 $ 6,1 06
Licenses 86,352 31,1 07 55,245
Patents 28,082 5,693 22,389
$ 126,585 $ 42,845 $ 83,740
During scal 2004, the Company recorded provisions amounting to $4,327 against the carrying values
of certain of its intangible assets as a result of changes in the Company’s current and intended product
offerings. Of this amount $2,750 was included in
Cost of sales with the balance of $1,577 recorded
as Amortization expense . Such charges reected management’s assessment of net realizable values.
For the year ended March 4, 2006, amortization expense related to intangible assets was $23,195
(February 26, 2005 — $19,730; February 28, 2004 — $19,462). Total additions to intangible assets in 2006
were $45,384 (2005 — $37,061).
Based on the carrying value of the identied intangible assets as at March 4, 2006, and assuming no
subsequent impairment of the underlying assets, the annual amortization expense for the next ve years
is expected to be as follows: 2007 — $23 million; 2008 — $17 million; 2009 — $5 million; 2010 — $5 million;
and 2011 — $3 million.
8. Acquisitions
During scal 2006, the Company completed one acquisition. Effective March 24, 2005, the Company
purchased the shares of a company whose proprietary software will be incorporated into the
Company’s software.
During scal 2005, the Company completed two acquisitions. Effective March 19, 2004, the Company
purchased the assets of a company whose proprietary software products enable wireless access to a
corporate email system using a device. Effective February 11, 2005, the Company acquired 100% of the
common shares of a company that offers technology that will be incorporated into the Company’s software.
During scal 2005, and as described in note 9, the Company determined that it was more likely than not
that it can realize its deferred income tax assets. Therefore Company recognized a deferred income tax
benet of $1,083 related to a scal 2003 acquisition. This amount resulted in a reduction of
Goodwill .