Computer Associates 2011 Annual Report Download - page 35

•Announced the availability of several innovations, including CA Mainframe Chorus, CA Automation Suite, CA 3Tera»
AppLogic», and five new products in our CA Virtual Suite;
•Enhanced our abilities to address both our growth accounts and growth geographies with the introduction of new SaaS,
virtualization, cloud computing and security solutions, including technologies from our fiscal 2010 acquisition of Nimsoft
AS (Nimsoft) and our fiscal 2011 acquisition of Arcot;
•Aligned our organization to be more responsive to customer needs and emerging trends through the combination of the
assets we have developed and those that we have acquired;
•Re-branded our company; and
•Increased the number of product and capacity sales, both outside of and in connection with renewals.
As our growth strategy has evolved, our management also looks within bookings at total new product and capacity sales,
which we define as sales of products or capacity that are new or in addition to products or capacity previously contracted for
by a customer. The amount of new product and capacity sales for a period, as currently tracked by us, requires estimation by
management and has not been historically reported. Within a given period, the amount of new product and capacity sales
may not be material to the change in our total bookings or revenue compared with prior periods. New product and capacity
sales can be reflected as subscription and maintenance bookings in the period (for which revenue would be recognized
ratably over the term of the contract) or in software fees and other bookings (which are recognized as software fees and other
revenue in the current period).
CA Technologies business model
We generate revenue from the following sources: license fees — licensing our products on a right-to-use basis; maintenance
fees — providing customer technical support and product enhancements; and service fees — providing professional services
such as product implementation, consulting and education. The timing and amount of fees recognized as revenue during a
reporting period are determined in accordance with generally accepted accounting principles in the United States of America
(GAAP). Revenue is reported net of applicable sales taxes.
Under our business model, we offer customers a wide range of licensing options, including the flexibility to license software
under month-to-month licenses or to fix their costs by committing to longer-term agreements. Licenses sold for most of our
software products permit customers to change their software product mix as their business and technology needs change and
include the right to receive software products in the future within defined product lines for no additional fee, commonly
referred to as unspecified future software products, as well as maintenance included during the term of each license. In some
instances, we sell certain products without the right to receive unspecified future software products.
Executive summary
The following is a summary of the analysis of our results contained in our MD&A.
During the first quarter of fiscal 2011, we sold our Information Governance business, consisting primarily of the CA Records
Manager and CA Message Manager software offerings and related professional services. At the end of fiscal 2011, we
identified our Internet Security business as available for sale, and on April 28, 2011 signed an agreement for the sale of this
business. The results of these business operations are presented in income from discontinued operations for all periods.
Total revenue backlog at March 31, 2011 of $8,763 million increased 8% compared with $8,125 million at March 31, 2010.
The current portion of revenue backlog represents revenue to be recognized within the next 12 months. The current portion of
revenue backlog at March 31, 2011 of $3,727 million increased by 7% compared with the balance of $3,469 million at
March 31, 2010. Generally, we believe that an increase in the current portion of revenue backlog is a positive indicator of
future revenue growth.
Total bookings in fiscal 2011 increased 1% to $4,888 million compared with $4,843 million from the prior period, due
primarily to favorable results for new product sales in connection with software fees and other bookings (recognized as
software fees and other revenue in the current period), which was partially offset by a decrease in subscription and
maintenance bookings for fiscal 2011. Total new product sales and mainframe capacity grew in the low single digits for the
fiscal year. Within new product and capacity sales in fiscal 2011, the increase in new distributed products was partially offset
by a decrease in mainframe capacity and new mainframe product sales. Generally, total new product and capacity sales
consist of new sales of distributed products, mainframe products and mainframe capacity. Renewal bookings increased
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