Computer Associates 2007 Annual Report Download - page 113

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doubtful accounts. These balances do not include unbilled contractual commitments executed under the Company’s current
business model. Trade and installment accounts receivable are composed of the following components:
(IN MILLIONS)
MARCH 31,
2007
MARCH 31,
2006
Current:
Accounts receivable $ 779 $ 828
Other receivables 101 77
Unbilled amounts due within the next 12 months — prior business model 146 149
Less: Allowance for doubtful accounts (32) (25)
Less: Unearned revenue — current (604) (477)
Net trade and installment accounts receivable — current $ 390 $ 552
Noncurrent:
Unbilled amounts due beyond the next 12 months — prior business model $ 357 $ 511
Less: Allowance for doubtful accounts (5) (20)
Less: Unearned revenue — noncurrent (21) (42)
Net installment accounts receivable — noncurrent $ 331 $ 449
The components of unearned revenue consist of the following:
(IN MILLIONS)
MARCH 31,
2007
MARCH 31,
2006
Current:
Unamortized discounts $32 $44
Unearned maintenance 14
Deferred subscription revenue (billed, uncollected) 571 429
Total unearned revenue — current $ 604 $ 477
Noncurrent:
Unamortized discounts $18 $34
Unearned maintenance 38
Total unearned revenue — noncurrent $21 $42
During fiscal years 2007 and 2006, the Company transferred its rights and interest in future committed installments under
ratable software license agreements to third party financial institutions with an aggregate contract value of approximately
$111 million and $65 million, respectively, for which the Company received cash of approximately $104 million and
$60 million, respectively. If the Company transfers its financial interest in future committed installments under a license
agreement to a third party financing institution, for which revenue has not yet been recognized, the Company records the
liability associated with the receipt of the cash as “Financing obligations (collected)” in the Consolidated Balance Sheets. The
amounts received from third party financing institutions are classified as either current or non-current, depending upon when
amounts are expected to be payable by the customer under the license agreement. When the payment is due from the
customer to the third party, the Company relieves its liability to the financing institution and recognizes the previously
financed amount as “Deferred subscription revenue (collected)” in the Consolidated Balance Sheets. As of March 31, 2007
and 2006, the aggregate remaining amounts due to the third party financing institutions classified as “Financing obligations
(collected)” in the Consolidated Balance Sheets were approximately $102 million and $50 million, respectively. The financing
agreements may contain limited recourse provisions with respect to the Company’s continued performance under the license
agreements. Based on our historical experience, the Company believes that any liability which may be incurred as a result of
these limited recourse provisions is remote.
Note 7 — Debt
Credit Facilities
As of March 31, 2007 and 2006, the Company’s committed bank credit facilities consisted of a $1 billion, unsecured bank
revolving credit facility expiring in December 2008 (the 2004 Revolving Credit Facility).
101