TripAdvisor 2012 Annual Report Download - page 99

these instruments as reported on the consolidated balance sheets as of December 31, 2012 and December 31,
2011. The carrying value of the long-term borrowings outstanding on our Credit Agreement bear interest at a
variable rate and therefore is also considered to approximate fair value.
In addition during 2012 we had a redeemable noncontrolling interest which was considered a Level 3
liability. The total liability balance at December 31, 2012 and December 31, 2011 is $0 and $3.9 million
respectively, and is included in redeemable noncontrolling interests in the mezzanine section of the consolidated
balance sheets. Refer to “Note 14—Redeemable Noncontrolling Interest’ below for additional information.
We did not have any Level 3 assets for the periods ended December 31, 2012 or 2011.
NOTE 6: PROPERTY AND EQUIPMENT, NET
Property and equipment consists of the following:
December 31,
2012 2011
(In thousands)
Capitalized software and website development ......... $48,527 $ 46,878
Leasehold improvements .......................... 14,244 12,924
Computer equipment ............................. 13,174 11,638
Furniture and other equipment ...................... 5,276 5,267
81,221 76,707
Less: accumulated depreciation ..................... (37,626) (43,391)
Projects in progress ............................... 207 1,438
Property and equipment, net ........................ $43,802 $ 34,754
As of December 31, 2012 and 2011, our recorded capitalized software and website development costs, net of
accumulated amortization, were $28.4 million and $21.0 million, respectively. For the years ended December 31,
2012 and 2011, we capitalized $20.2 million and $16.3 million, respectively, related to software and website
development costs. For the years ended December 31, 2012, 2011 and 2010, we recorded amortization of
capitalized software and website development costs of $12.8 million, $12.4 million and $8.1 million, respectively,
which is included in depreciation expense on our consolidated and combined statement of operations.
During the year ended December 31, 2012, we retired property and equipment, primarily capitalized
software and website development, which were no longer in use with a total cost of $25.4 million and associated
accumulated depreciation of $25.2 million, resulting in a loss of $0.2 million included in Other, net on the
consolidated and combined statement of operations.
NOTE 7: GOODWILL AND INTANGIBLE ASSETS, NET
The following table presents the changes in goodwill for the years ended December 31:
2012 2011
(In thousands)
Beginning balance as of January 1 .................. $466,892 $460,610
Additions .................................. 3,043 6,390
Foreign exchange translation adjustment ......... 1,749 (108)
Ending balance as of December 31 .................. $471,684 $466,892
In 2012 and 2011, the additions to goodwill relate to our acquisitions. See “Note 3—Acquisitions,” above
for further information. Refer to “Note 2—Significant Accounting Policies,” above for a discussion of our annual
goodwill impairment assessment.
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