Oracle 2011 Annual Report Download - page 67

increases were partially offset by a reduction in amortization associated with certain of our intangible assets that
became fully amortized in fiscal 2011. Amortization of intangible assets increased in fiscal 2010 in comparison
to fiscal 2009 due to additional amortization from acquired intangible assets that we acquired since the beginning
of fiscal 2009, including from our acquisition of Sun. See Note 7 of Notes to Consolidated Financial Statements
included elsewhere in this Annual Report for additional information regarding our intangible assets (including
weighted average useful lives) and related amortization.
Acquisition Related and Other Expenses: Acquisition related and other expenses consist of personnel related
costs for transitional and certain other employees, stock-based compensation expenses, integration related
professional services, certain business combination adjustments after the measurement periods or purchase price
allocation periods have ended, and certain other operating expenses, net. Stock-based compensation expenses
included in acquisition related and other expenses resulted from unvested stock options and restricted stock-
based awards assumed from acquisitions whereby vesting was accelerated upon termination of the employees
pursuant to the original terms of those stock options and restricted stock-based awards. As a result of our
adoption of the FASB’s revised accounting standard for business combinations as of the beginning of fiscal 2010,
certain acquisition related and other expenses were recorded as expenses in our fiscal 2011 and 2010 statements
of operations that had been historically included as a part of the consideration transferred and capitalized as a part
of our accounting for acquisitions pursuant to previous accounting rules, primarily direct transaction costs such
as professional services fees.
Year Ended May 31,
Percent Change Percent Change
(Dollars in millions) 2011 Actual Constant 2010 Actual Constant 2009
Transitional and other employee related costs ..... $ 129 94% 86% $ 66 46% 54% $ 45
Stock-based compensation .................... 10 -37% -37% 15 -1% -1% 15
Professional fees and other, net ................. 66 -2% -4% 68 99% 96% 35
Business combination adjustments, net ........... 3 -28% -78% 5 -79% -76% 22
Total acquisition related and other expenses . . . $ 208 35% 27% $ 154 32% 36% $ 117
Fiscal 2011 Compared to Fiscal 2010: On a constant currency basis, acquisition related and other expenses
increased primarily due to the full fiscal year impact of Sun’s expense contributions, including higher transitional
employee related expenses.
Fiscal 2010 Compared to Fiscal 2009: On a constant currency basis, acquisition related and other expenses
increased in fiscal 2010 primarily due to higher employee related and professional services expenses resulting
from our acquisition of Sun.
Restructuring expenses: Restructuring expenses consist of employee severance costs and may also include
charges for duplicate facilities and other contract termination costs to improve our cost structure prospectively.
Beginning in fiscal 2010, our adoption of the FASB’s revised accounting standard for business combinations
required that, in connection with any prospective acquisition, we record involuntary employee termination and
other exit costs associated with such acquisition to restructuring expenses in our consolidated financial
statements. For additional information regarding our Oracle-based and acquired company restructuring plans, see
Note 9 of Notes to Consolidated Financial Statements included elsewhere in this Annual Report.
Year Ended May 31,
Percent Change Percent Change
(Dollars in millions) 2011 Actual Constant 2010 Actual Constant 2009
Restructuring expenses ................ $ 487 -22% -23% $ 622 432% 423% $ 117
Fiscal 2011 Compared to Fiscal 2010: Restructuring expenses in fiscal 2011 primarily related to our Sun
Restructuring Plan, which our management approved, committed to and initiated in order to better align our cost
structure as a result of our acquisition of Sun. To a lesser extent, we also incurred expenses associated with other
Oracle-based plans, which our management approved, committed to and initiated in order to restructure and
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