Priceline 2011 Annual Report Download - page 52

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51
General and Administrative
General and Administrative
% of Total Gross Profit
Year Ended
December 31,
($000)
2010
$ 81,185
4.3%
2009
$ 68,555
5.4%
Change
18.4%
General and administrative expenses consist primarily of: (1) fees for outside professionals, including litigation
expenses; (2) occupancy expenses; and (3) personnel-related expenses such as recruiting, training and travel expenses. General
and administrative expenses for the year ended December 31, 2010 included a favorable adjustment of approximately $2.7
million in connection with the resolution of certain franchise tax and sales and use tax issues related to our corporate
headquarters location and a charge of $1.7 million related to a court ruling in South Carolina (see Note 16 to the Consolidated
Financial Statements for further details). General and administrative expenses for the same period in 2009 included a charge of
$3.7 million related to a judgment in a lawsuit involving hotel occupancy taxes. Excluding these items, general and
administrative expenses increased during the year ended December 31, 2010, over the same period in 2009, due to professional
fees incurred in the second quarter 2010 related to the acquisition of TravelJigsaw, increased personnel-related expenses and
occupancy expenses to support the growth in our Booking.com and Agoda operations, and the inclusion of TravelJigsaw since
its acquisition in May 2010, partially offset by a decrease in litigation expenses primarily related to hotel occupancy tax and
other tax proceedings.
Information Technology
Information Technology
% of Total Gross Profit
Year Ended
December 31,
($000)
2010
$ 20,998
1.1%
2009
$ 19,139
1.5%
Change
9.7%
Information technology expenses consist primarily of: (1) system maintenance and software license fees;
(2) outsourced data center costs relating to our domestic and international data centers; (3) data communications and other
expenses associated with operating our Internet sites; and (4) payments to outside consultants. For the year ended
December 31, 2010, information technology expenses increased compared to the same period in 2009, primarily due to growth
in our worldwide operations.
Depreciation and Amortization
Depreciation and Amortization
% of Total Gross Profit
Year Ended
December 31,
($000)
2010
$ 45,763
2.4%
2009
$ 39,193
3.1%
Change
16.8%
Depreciation and amortization expenses consist of: (1) amortization of intangible assets with determinable lives;
(2) amortization of internally developed and purchased software, (3) depreciation of computer equipment; and (4) depreciation
of leasehold improvements, office equipment and furniture and fixtures. For the year ended December 31, 2010, depreciation
and amortization expense increased from the same period in 2009, primarily due to acquisition-related amortization in
connection with our acquisition of TravelJigsaw.