TripAdvisor 2013 Annual Report Download - page 59

Download and view the complete annual report

Please find page 59 of the 2013 TripAdvisor annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 184

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132
  • 133
  • 134
  • 135
  • 136
  • 137
  • 138
  • 139
  • 140
  • 141
  • 142
  • 143
  • 144
  • 145
  • 146
  • 147
  • 148
  • 149
  • 150
  • 151
  • 152
  • 153
  • 154
  • 155
  • 156
  • 157
  • 158
  • 159
  • 160
  • 161
  • 162
  • 163
  • 164
  • 165
  • 166
  • 167
  • 168
  • 169
  • 170
  • 171
  • 172
  • 173
  • 174
  • 175
  • 176
  • 177
  • 178
  • 179
  • 180
  • 181
  • 182
  • 183
  • 184

General and Administrative
General and administrative expense consists primarily of personnel and related overhead costs, including
executive leadership, finance, legal and human resource functions and stock-based compensation as well as
professional service fees and other fees including audit, legal, tax and accounting, and other costs including bad
debt expense and our charitable foundation costs.
Year ended December 31, % Change
2013 2012 2011 2013 vs. 2012 2012 vs. 2011
($ in millions)
Personnel and overhead ............................ $ 66 $51 $37 30% 39%
Professional service fees and other .................... 32 25 8 28% 203%
Total general and administrative ................. $ 98 $76 $45 30% 69%
% of revenue ................................. 10.4% 9.9% 7.0%
2013 vs. 2012
General and administrative costs increased $22 million during the year ended December 31, 2013, when
compared to the same period in 2012, primarily due to increased personnel costs related to an increase in stock-
based compensation, as well as increased headcount to support business growth and additional professional
service fees in order to support our operations and an increase in our bad debt provision.
2012 vs. 2011
General and administrative costs increased $31 million during the year ended December 31, 2012, when
compared to the same period in 2011, due to increased personnel and overhead costs related to an increase in
stock based compensation, as well as increased headcount to support business growth, and a full year of costs
related to additional headcount and professional service fees to support our operations as a standalone public
company in 2012. We also incurred increased professional service fees primarily related to legal and tax
initiatives. In addition, in connection with the Spin-Off, we assumed Expedia’s obligation to fund a charitable
foundation (see “Note 12—Commitments and Contingencies” in the notes to the consolidated and combined
financial statements). Our expense related to the funding of this charitable foundation was $7 million for the year
ended December 31, 2012.
Shared Services Fee with Expedia
Prior to the Spin-Off, our shared services fee was comprised of allocations from Expedia for accounting,
legal, tax, corporate development, treasury, financial reporting, real estate management and included an
allocation of employee compensation within these functions. These allocations were determined based on what
we and Expedia considered to be reasonable reflections of the utilization of services provided or the benefit
received by us.
Year ended December 31, % Change
2013 2012 2011 2013 vs. 2012 2012 vs. 2011
($ in millions)
Shared services fee with Expedia .................... $— $— $ 9 0% (100)%
% of revenue .................................... 0% 0% 1.4%
Shared services fee costs incurred for the use of Expedia shared services ceased in connection with the Spin-
Off. Refer to “Note 15—Related Party Transactions” in the notes to our consolidated and combined financial
statements for further information on our relationship with Expedia.
49