Adobe 2004 Annual Report Download - page 39

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39
General and Administrative
Fiscal
2004
% Change
2004 to 2003
Fiscal
2003
% Change
2003 to 2002 Fiscal
2002
Expenses ................................... $ 138.0 13% $ 122.4 13% $ 108.1
Percentage of total revenues.. 8% 9% 9%
General and administrative expenses consist of compensation and benefit expenses, travel expenses, and related
facilities costs for our finance, facilities, human resources, legal, information services and executive personnel.
General and administrative expenses also include outside legal and accounting fees, provision for bad debts, and
expenses associated with computer equipment and software used in the administration of the business.
General and administrative expenses increased 10% due to compensation and related benefits associated with
headcount growth and higher incentive compensation. General and administrative expenses also increased 3% due to
higher professional fees.
General and administrative expenses increased 12% in fiscal 2003 as compared to fiscal 2002 due to
compensation and related benefits associated with headcount growth and higher incentive compensation and 4% due
to increased insurance costs. These increases were slightly offset by various individually insignificant items.
Restructuring and Other Charges
Fiscal
2004
% Change
2004 to 2003
Fiscal
2003
% Change
2003 to 2002 Fiscal
2002
Expenses ................................... $ — *% $ (0.5) *% $ 12.1
Percentage of total revenues.. — *% 1%
* Percentage is not meaningful.
We did not incur any restructuring and other charges in fiscal 2004. During fiscal 2003, we revised our
estimates of certain costs associated with our restructuring program that was implemented in the fourth quarter of
fiscal 2002. As a result, we revised the accrual related to severance and other charges and facilities.
In the fourth quarter of fiscal 2002, we incurred a restructuring charge of $11.1 million, which included
severance and related charges and the closure of a facility. The related restructuring program eliminated 239
engineering, sales and marketing, and general and administrative positions worldwide in order to realign our
resources for our future business plans. This restructuring plan was completed during the fourth quarter of fiscal
2003.
In the second quarter of fiscal 2002, we implemented a restructuring plan to eliminate 39 redundant sales and
marketing positions, held by Adobe employees worldwide, as a result of the acquisition of Accelio. The total
restructuring charges, of $1.6 million, included severance and related charges associated with the reduction in force
and the cost of vacating a leased facility. This restructuring plan was completed during the second quarter of fiscal
2003. Additionally, during the second quarter of fiscal 2002, we revised our estimates of certain costs associated
with our restructuring program that was implemented in fiscal 2001. As a result, we revised the accrual by $0.6
million related to relocation, severance and other charges.