Oracle 2010 Annual Report Download - page 174

issued Accounting Standards Update No. 2010-28, When to Perform Step 2 of the
Goodwill Impairment Test for Reporting Units with Zero or Negative Carrying Amounts
(Topic 350)—Intangibles—Goodwill and Other (ASU 2010-28). ASU 2010-28 amends
the criteria for performing Step 2 of the goodwill impairment test for reporting units with
zero or negative carrying amounts and requires performing Step 2 if qualitative factors
indicate that it is more likely than not that a goodwill impairment exists. We will adopt
ASU 2010-28 in fiscal 2012 and any impairment to be recorded upon adoption will be
recognized as an adjustment to our beginning retained earnings. We will adopt ASU
2010-28 in fiscal 2012 and do not believe it will have a material impact on our
consolidated financial statements.
Milestone Method of Revenue Recognition: In April 2010, the FASB issued
Accounting Standards Update No. 2010-17, Revenue Recognition—Milestone Method
(Topic 605)—Revenue Recognition (ASU 2010-17). ASU 2010-17 provides guidance on
defining the milestone and determining when the use of the milestone method of revenue
recognition for research or development transactions is appropriate. It provides criteria
for evaluating if the milestone is substantive and clarifies that a vendor can recognize
consideration that is contingent upon achievement of a milestone as revenue in the period
in which the milestone is achieved, if the milestone meets all the criteria to be considered
substantive. ASU 2010-17 is effective for us in our first quarter of fiscal 2012 and should
be applied prospectively. Early adoption is permitted. If we were to adopt ASU 2010-17
prior to the first quarter of fiscal 2012, we must apply it retrospectively to the beginning
of the fiscal year of adoption and to all interim periods presented. We will adopt ASU
2010-17 in fiscal 2012 and do not believe it will have a material impact on our
consolidated financial statements.
Disclosure Requirements Related to Fair Value Measurements: In January 2010, the
FASB issued Accounting Standards Update No. 2010-06, Improving Disclosures about
Fair Value Measurements (Topic 820)—Fair Value Measurements and
Disclosures (ASU 2010-06), to add additional disclosures about the different classes of
assets and liabilities measured at fair value, the valuation techniques and inputs used, and
the activity in Level 3 fair value measurements. Certain provisions of this update will be
effective for us in fiscal 2012 and we and do not believe these provisions will have a
material impact on our consolidated financial statements.
Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document Research℠