Plantronics 2015 Annual Report Download - page 66

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Included in Software are unamortized capitalized software costs relating to both purchased and internally developed software of
$19.2 million and $5.1 million at March 31, 2015 and 2014, respectively. Amortization expense related to capitalized software
costs in fiscal years 2015, 2014, and 2013 was $3.8 million, $2.3 million, and $2.9 million, respectively.
Accrued liabilities:
March 31,
(in thousands) 2015 2014
Employee compensation and benefits $ 31,888 $ 32,280
Warranty obligation 7,717 7,965
VAT/Sales Tax Payable 4,749 3,802
Income taxes payable — 3,092
Accrued other 17,687 19,712
Accrued liabilities $ 62,041 $ 66,851
Changes in the warranty obligation, which are included as a component of accrued liabilities in the consolidated balance sheets,
are as follows:
Year ended March 31,
(in thousands) 2015 2014
Warranty obligation at beginning of year $ 7,965 $ 13,410
Warranty provision related to products shipped 9,955 9,861
Deductions for warranty claims processed (8,856)(9,715)
Adjustments related to preexisting warranties (1,347)(5,591)(1)
Warranty obligation at end of year $ 7,717 $ 7,965
(1) During the third quarter of fiscal year 2014, the Company identified immaterial out of period errors related to its estimated warranty obligation and return
material authorization ("RMA") reserves, the correction of which decreased its cost of revenues by approximately $2.4 million and increased net income by
approximately $2.1 million. The Company recorded these corrections in the quarter ended December 31, 2013 because the errors were not material, either
individually or in the aggregate, to any of the prior reporting periods. In addition, these adjustments are not material for the fiscal year ending March 31, 2014,
either individually or in the aggregate.
7. GOODWILL
Goodwill as of March 31, 2015 and March 31, 2014 was $15.5 million and $15.5 million, net of accumulated impairment of $54.6
million. In fiscal years 2015 and 2014, for purposes of the annual goodwill impairment test, the Company determined there to be
no reporting units below its operating segment; therefore, the annual goodwill impairment analysis was performed at the segment
level in both of these years. In the fourth quarter of fiscal years 2015 and 2014, the Company evaluated qualitative factors that
may affect the fair value of the reporting unit and concluded there to be no indication of goodwill impairment.
8. COMMITMENTS AND CONTINGENCIES
Minimum Future Rental Payments
Minimum future rental payments under non-cancelable operating leases having remaining terms in excess of one year as of
March 31, 2015 are as follows:
Fiscal Year Ending March 31, (in thousands)
2016 $ 2,236
2017 1,174
2018 977
2019 751
2020 736
Thereafter 2,135
Total minimum future rental payments $ 8,009
Total rent expense for operating leases was approximately $3.4 million, $4.3 million, and $5.6 million in fiscal years 2015, 2014,
and 2013, respectively.
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