Adobe 2002 Annual Report Download - page 79

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should include in its financial statements the assets, liabilities and activities of another entity. A variable interest
entity is a corporation, partnership, trust, or any other legal structure used for business purposes that either (a) does
not have equity investors with voting rights or (b) has equity investors that do not provide sufficient financial
resources for the entity to support its activities. FIN No. 46 requires a variable interest entity to be consolidated by a
company if that company is subject to a majority of the risk of loss from the variable interest entity’s activities or is
entitled to receive a majority of the entity's residual returns or both. The consolidation requirements of FIN No. 46
apply immediately to variable interest entities created after January 31, 2003. The consolidation requirements apply
to older entities in the first fiscal year or interim period beginning after June 15, 2003. Disclosure requirements
apply to any financial statements issued after January 31, 2003. The Company has considered the provisions of FIN
No. 46 and believes it will not be necessary to include in the Company's financial statements any assets, liabilities,
or activities of the entities holding the Company's corporate headquarters leases. The Company has provided certain
disclosures in other areas of this filing (see Note 6 and Note 14 of our Notes to Consolidated Financial Statements)
and will continue to evaluate the impact of FIN No. 46 on our financial statements and related disclosures.
LIQUIDITY AND CAPITAL RESOURCES
2002 Change 2001 Change 2000
Cash, cash equivalents, and short-term investments.... $ 617.
7
6 % $ 581.
6
(14 )% $ 679.
9
Working capital ........................................................... $ 436.
9
(4 )% $ 453.
7
(19 )% $ 563.3
Stockholders’ equity.................................................... $ 674.3 9 % $ 617.
0
(18 )% $ 752.5
Our cash, cash equivalents, and short-term investments consist principally of money market funds, U.S.
Treasuries, corporate notes, municipal bonds, and marketable equity securities. All of our short-term investments are
classified as available-for-sale under the provisions of Statement of Financial Accounting Standards No. 115,
“Accounting for Certain Investments in Debt and Equity Securities.” The securities are carried at fair market value
with the unrealized gains and losses, net of tax, included in accumulated other comprehensive income, which is
reflected as a separate component of stockholders’ equity. Realized gains and losses are recognized when realized in
our consolidated statements of income.
Cash provided by operating activities was $329.3 million, $418.7 million, and $444.6 million in fiscal 2002,
2001, and 2000, respectively. The $329.3 million of cash provided by operating activities for the year ended
November 29, 2002, was primarily due to net income of $191.4 million, net non-cash related expenses of $118.9
million, and a net increase in operating assets and liabilities of $19.0 million. The $418.7 million of cash provided
by operating activities for the year ended November 30, 2001, was primarily due to net income of $205.6 million,
net non-cash related expenses of $197.1 million, and a net increase in operating assets and liabilities of $16.0
million. The $444.6 million of cash provided by operating activities for the year ended December 1, 2000, was
primarily due to net income of $287.8 million and net non-cash related expenses of $173.6 million, partially offset
by a net decrease in operating assets and liabilities of $16.8 million. Our cash provided by operating activities
decreased in fiscal 2002 compared to fiscal 2001 and in fiscal 2001 compared to fiscal 2000 as a result of decreases
in revenue and operating income that occurred primarily as a result of weak economic conditions.
Cash used for investing activities was $142.3 million, $26.4 million, and $228.1 million in fiscal 2002, 2001,
and 2000, respectively. The $142.3 million of cash used for investing activities for the year ended November 29,
2002, was primarily due to net purchases of short-term investments of $91.8 million, purchases of long-term
investments and other assets of $38.0 million, and acquisitions of property and equipment of $31.6 million. The cash
used for investing activities was partially offset by proceeds from the sale of equity securities of $11.7 million and
proceeds of $7.3 million related to our Accelio acquisition. The $26.4 million of cash used for investing activities
for the year ended November 30, 2001, was primarily due to acquisitions of property and equipment of $43.2
million and purchases of long-term investments and other assets of $35.3 million. The cash used for investing
activities was partially offset by net cash provided by short-term investments of $20.6 million and proceeds from the
sale of equity securities of $31.5 million. The $228.1 million of cash used for investing activities for the year ended
December 1, 2000, was primarily due to net purchases of short-term investments of $137.9 million, purchases of
long-term investments and other assets of $59.1 million, and acquisitions of property and equipment of $29.8
million. The cash used for investing activities was partially offset by proceeds from the sales of equity securities and
a building of $17.8 million and $5.4 million, respectively. We expect to continue to invest in short-term investments
and purchase additional property and equipment to support our growth.