HR Block 2007 Annual Report Download - page 91

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NOTE 2: BUSINESS COMBINATIONS
Acquisitions during fiscal years 2007, 2006 and 2005 are as follows. Results for each acquisition are included since the date of acquisition.
(dollars in 000s)
Asset Acquired Weighted Average Life Asset Value at Acquisition
Fiscal Year 2007 –
TaxWorks LLC and affiliated entities Property and equipment $368
Goodwill 29,428
Customer relationships 7 years 7,800
Unpatented technology 7 years 12,500
Trade name 10 years 1,000
Noncompete agreements 5years 600
Present value of fixed acquisition payments (26,921)
Weighted average life 7 years $24,775
Other Goodwill $17,579
Customer relationships 10 years 8,636
Noncompete agreements 5years 2,696
Other assets 3,868
Weighted average life 9 years $32,779
Fiscal Year 2006 –
American Express Tax and Business Services, Inc. Property and equipment $17,759
Goodwill 72,123
Customer relationships 11 years 18,800
Noncompete agreements 6years 3,900
Trade name 2 years 2,600
63 m
Other assets 128,998
Liabilities (53,442)
Weighted average life 9 years $190,738
Other Goodwill $13,616
Customer relationships 9 years 8,397
Noncompete agreements 9years 2,024
Other assets (liabilities) (4,353)
Weighted average life 9 years $19,684
Fiscal Year 2005 –
Non-accounting firm Business Services acquisitions Property and equipment $2,497
Goodwill 9,666
Customer relationships 10 years 7,730
Noncompete agreements 15 years 100
Weighted average life 10 years $19,993
During fiscal year 2007 we acquired TaxWorks LLC, a provider of recognized in this transaction is included in the Tax Services segment
commercial tax preparation software targeting the independent tax and is deductible for tax purposes.
preparer market. The initial cash purchase price was $24.8 million, During fiscal year 2006, we acquired all outstanding common stock of
including the present value of a payment of $10.0 million due in May American Express Tax and Business Services, Inc. (AmexTBS) for an
2007 and a payment of $23.6 million due in May 2012. The $10.0 million aggregate purchase price of $190.7 million. The customer relationships
payment due in May 2007 was paid on April 30, 2007. An additional and noncompete agreements are amortized on a straight-line basis and
payment of up to $8.0 million, contingent on meeting certain have a weighted average life of 11 years and six years, respectively.
performance targets, could be paid in April 2012 and would typically be Goodwill recognized in this transaction is included in the Business
recorded as additional purchase price, generally goodwill. Goodwill Services segment and is not deductible for tax purposes. The purchase
price was subject to certain contractual post-closing adjustments, which
H&R BLOCK 2007 Form 10K