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46
The following table shows the Company’s pro forma results reconciled to the GAAP Consolidated Statement of
Income for the fiscal years ended November 29, 2002, November 30, 2001, and December 1, 2000. Our pro forma
information, including the information presented below, is a non-GAAP measure and may not be comparable to
similarly titled measures reported by other companies. Our pro forma results for fiscal year 2002, 2001, and 2000
exclude restructuring and other charges, acquired in-process research and development, amortization and
impairment of goodwill and purchased intangibles, investment gains and losses, and gain on the sale of a building.
Years Ended
November 29,
2002
November 30,
2001
December 1,
2000
(in thousands)
GAAP income before income taxes $ 284,689 $ 306,931 $ 443,739
Restructuring and other charges 12,148 12,063 5,629
Acquired in-process research and development 5,769
—
47
0
Amortization and impairment of goodwill and
purchased intangibles 20,973 14,281 7,013
Investment (gain) loss 17,185 93,414 (14,345)
Gain on the sale of a building
—
—
(2,718)
Pro forma income before income taxes 340,764 426,689 439,788
Income tax provision 109,044 140,807 154,542
Pro forma net income $ 231,720 $ 285,882 $ 285,24
6
Pro Forma Fair Value Disclosures on Employee Stock Plans
We account for our fixed stock option plans and our employee stock purchase plan using the intrinsic value
method. Please see our Note 11 of the Notes to Consolidated Financial Statements for the pro forma amounts of net
income and net income per share that would have resulted if we accounted for our employee stock plans under the
fair value recognition provisions of SFAS No. 123.
Recent Accounting Pronouncements
In July 2001, the Financial Accounting Standards Board (“FASB”) issued Statement of Financial Accounting
Standards No. 142 (“SFAS No. 142”), “Goodwill and Other Intangible Assets.” This Statement requires that
goodwill and other intangibles with an indefinite useful life not be amortized, but be tested for impairment at least
annually. SFAS No. 142 is effective for fiscal years beginning after December 15, 2001; however, for new business
combinations that occur after June 30, 2001, SFAS No. 142 is effective. In accordance with SFAS No. 142,
goodwill resulting from our recent acquisition of Accelio in April 2002 is not amortized. We will fully adopt SFAS
No. 142 beginning in our fiscal year 2003. We do not expect the adoption of SFAS No. 142 to have a material
impact on our financial position or results of operations. Amortization and impairment of goodwill in fiscal 2002,
2001, and 2000 was $21.0 million, $14.3 million, and $7.0 million, respectively.
In June 2001, the FASB issued Statement of Financial Accounting Standards No. 143 (“SFAS No. 143”),
“Accounting for Asset Retirement Obligations.” This Statement addresses financial accounting and reporting for
obligations associated with the retirement of tangible long-lived assets and the associated asset retirement costs. This
Statement applies to legal obligations associated with the retirement of long-lived assets that result from the
acquisition, construction, development, or normal use of the asset. As used in this Statement, a legal obligation
results from existing law, statute, ordinance, written or oral contract, or by legal construction of a contract under the
doctrine of promissory estoppel. SFAS No. 143 is effective for fiscal years beginning after June 15, 2002. We will
adopt SFAS No. 143 beginning in our fiscal year 2003. We do not expect the adoption of SFAS No. 143 to have a
material impact on our financial position or results of operations.
In August 2001, the FASB issued Statement of Financial Accounting Standards No. 144 (“SFAS No. 144”),
“Accounting for the Impairment or Disposal of Long-Lived Assets.” This Statement addresses financial accounting
and reporting for the impairment or disposal of long-lived assets and supersedes SFAS No. 121, "Accounting for the
Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed Of," and the accounting and reporting
provisions of Accounting Principles Board Opinion No. 30 (“APB No. 30”), "Reporting the Results of Operations