Salesforce.com 2009 Annual Report Download - page 64

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Table of Contents
salesforce.com, inc.
Notes to Consolidated Financial Statements
1. Summary of Business and Significant Accounting Policies
Description of Business
salesforce.com, inc. (the "Company") is a leading provider of enterprise cloud computing applications. The Company provides a comprehensive
customer and collaboration relationship management ("CRM") service to businesses of all sizes and industries worldwide and provides a technology platform
for customers and developers to build and run applications. The Company offers its services on a subscription basis.
Fiscal Year
The Company's fiscal year ends on January 31. References to fiscal 2010, for example, refer to the fiscal year ending January 31, 2010.
Use of Estimates
The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions in the Company's
consolidated financial statements and notes thereto.
Significant estimates and assumptions made by management include the determination of the provision for income taxes, whether an other-than-
temporary decline has occurred in the fair value of certain investments in marketable securities, the fair value of stock awards issued, the non-convertible
borrowing rate used to calculate the fair value of the liability component of the convertible senior notes and the allocation of the purchase price paid for
acquisitions. Actual results could differ from those estimates.
Principles of Consolidation
The consolidated financial statements include the accounts of the Company and its wholly and majority owned subsidiaries. All significant
intercompany balances and transactions have been eliminated in consolidation.
The Company holds a controlling interest in Kabushiki Kaisha salesforce.com ("Salesforce Japan"), a Japanese joint venture. As of January 31, 2010,
the Company owned a 72 percent interest in the joint venture. Given the Company's controlling interest in the joint venture, the accounts of the joint venture
have been consolidated with the accounts of the Company, and a noncontrolling interest has been recorded for the noncontrolling investors' interests in the net
assets and operations of the joint venture to the extent of the noncontrolling investors' individual investments. Noncontrolling interest of $12.9 million and
$10.7 million as of January 31, 2010 and January 31, 2009, respectively, have been reflected in stockholders' equity.
The Company now reports the noncontrolling interest in a subsidiary as a component of equity in the consolidated balance sheets and discloses on the
face of the consolidated statements of operations the amounts of the consolidated net income attributable to the parent and to the noncontrolling interests.
Prior period amounts have been reclassified to reflect the effect of the retrospective adoption in fiscal 2010 of new accounting and presentation guidance for
noncontrolling interest, the effect of which is not material to any period presented.
Segments
The Company operates in one segment.
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