Oracle 2008 Annual Report Download - page 45

Table of Contents
• the contribution of the significant majority of the expenses associated with acquired products and
services in fiscal 2009, 2008 and 2007 as the significant majority of these expenses had been fully
integrated into our existing operations.
We caution readers that the contribution from BEA products, which already have been integrated with
Oracle’s Fusion Middleware and are sold together, to our total database and middleware revenues during
fiscal 2009 are based on our internal allocations that have been applied consistently.
We further caution readers that, while pre- and post-acquisition comparisons as well as the quantified
amounts themselves may provide indications of general trends, the information has inherent limitations for
the following reasons:
• the quantifications cannot address the substantial effects attributable to our sales force integration
efforts, in particular the effect of having a single sales force offer similar products. We believe that if
our sales forces had not been integrated, the relative mix of products sold would have been different;
• our acquisitions in the periods presented did not result in our entry into a new line of business or
product category—therefore, we provided multiple products with substantially similar features and
functionality; and
• although substantially all of our customers, including customers from acquired companies, renew their
software license updates and product support contracts when the contracts are eligible for renewal,
amounts shown as support deferred revenues in our supplemental disclosure related to certain charges
and gains (see below) are not necessarily indicative of revenue improvements we will achieve upon
contract renewal to the extent customers do not renew.
Constant Currency Presentation
Our international operations have provided and will continue to provide a significant portion of our total
revenues and expenses. As a result, total revenues and expenses will continue to be affected by changes in the
U.S. Dollar against major international currencies. In order to provide a framework for assessing how our
underlying businesses performed excluding the effect of foreign currency fluctuations, we compare the
percent change in the results from one period to another period in this Annual Report using constant currency
disclosure. To present this information, current and comparative prior period results for entities reporting in
currencies other than U.S. Dollars are converted into U.S. Dollars at constant exchange rates (i.e. the rates in
effect on May 31, 2008, which was the last day of our prior fiscal year) rather than the actual exchange rates
in effect during the respective periods. For example, if an entity reporting in Euros had revenues of
1.0 million Euros from products sold on May 31, 2009 and May 31, 2008, our financial statements would
reflect reported revenues of $1.39 million in fiscal 2009 (using 1.39 as the month-end average exchange rate
for the period) and $1.57 million in fiscal 2008 (using 1.57 as the month-end average exchange rate for the
period). The constant currency presentation would translate the fiscal 2009 results using the fiscal 2008
exchange rate and indicate, in this example, no change in revenues during the period. In each of the tables
below, we present the percent change based on actual, unrounded results in reported currency and in constant
currency.
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Source: ORACLE CORP, 10-K, June 29, 2009 Powered by Morningstar® Document Research℠