Computer Associates 2013 Annual Report Download - page 93

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The following table presents the carrying amounts and estimated fair values of the Company’s other financial instruments
that are not measured at fair value on a recurring basis at March 31, 2013 and 2012:
AT MARCH 31, 2013 AT MARCH 31, 2012
CARRYING ESTIMATED CARRYING ESTIMATED
(in millions) VALUE FAIR VALUE VALUE FAIR VALUE
Liabilities:
Total debt(1) $ 1,290 $ 1,413 $ 1,301 $ 1,408
Facilities abandonment reserve(2) $23$27$42$48
(1) Estimated fair value of total debt is based on quoted prices for similar liabilities for which significant inputs are observable except for certain long-term lease obligations, for which
fair value approximates carrying value (Level 2).
(2) Estimated fair value for the facilities abandonment reserve is determined using the Company’s incremental borrowing rate at March 31, 2013 and 2012. At March 31, 2013 and
2012, the facilities abandonment reserve included approximately $6 million and $16 million, respectively, in ‘‘Accrued expenses and other current liabilities’’ and approximately
$17 million and $26 million, respectively, in ‘‘Other noncurrent liabilities’’ in the Company’s Consolidated Balance Sheets (Level 3).
Note 11 — Commitments and Contingencies
The Company leases real estate, data processing and other equipment with lease terms expiring through fiscal year 2023.
Certain leases provide for renewal options and additional rentals based on escalations in operating expenses and real estate
taxes.
Rental expense, including short-term leases, maintenance charges and taxes on leased facilities, was approximately
$124 million, $168 million and $150 million for fiscal years 2013, 2012 and 2011, respectively. Rental expense for fiscal years
2013, 2012 and 2011 included sublease income of approximately $6 million, $9 million and $10 million, respectively.
Future minimum lease payments under non-cancelable operating leases at March 31, 2013, were as follows:
Fiscal Year (in millions)
2014 $97
2015 86
2016 68
2017 56
2018 50
Thereafter 140
Total $ 497
Less income from sublease (24)
Net minimum operating lease payments $ 473
The Company has additional commitments to purchase goods and services of approximately $140 million in future periods,
approximately $136 million of which expires by fiscal year 2018.
Litigation: The Company, various subsidiaries, and certain current and former officers have been or, from time to time, may
be named as defendants in various lawsuits and claims arising in the normal course of business. The Company also
addresses contract issues and disputes with customers, including government customers. The Company believes that it has
meritorious defenses in connection with these lawsuits, claims and disputes, and intends to vigorously contest each of them.
Based on the Company’s experience, management believes that the damages amounts claimed in a case are not a
meaningful indicator of the potential liability. Claims, suits, investigations and proceedings are inherently uncertain and it is
not possible to predict the ultimate outcome of cases.
In the opinion of the Company’s management based upon information currently available to the Company, while the
outcome of these lawsuits and claims is uncertain, the likely results of these lawsuits and claims against the Company are
not expected, either individually or in the aggregate, to have a material adverse effect on the Company’s financial position,
results of operations or cash flows, although the effect could be material to the Company’s results of operations or cash
flows for any interim reporting period. For some of these matters, the Company is unable to estimate a range of reasonably
possible loss due to the stage of the matter and/or other particular circumstances of the matter. For others, a range of
reasonably possible loss can be estimated. For those matters for which such a range can be estimated, the Company
estimates that, in the aggregate, the range of reasonably possible loss is from zero to $30 million. This is in addition to
amounts, if any, that have been accrued for those matters.
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