Adobe 2004 Annual Report Download - page 40

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40
Acquired In-Process Research and Development
Fiscal
2004
% Change
2004 to 2003
Fiscal
2003
% Change
2003 to 2002 Fiscal
2002
Expenses ................................... $ — — $ — *% $ 5.8
Percentage of total revenues.. — — *%
* Percentage is not meaningful.
We did not allocate any expenses to acquired in-process research and development in fiscal 2004 and 2003. In
April 2002, we acquired 100% of the outstanding common stock of Accelio, a provider of Web-enabled solutions
that helped customers manage business processes driven by electronic forms. Based on a valuation analysis, $0.4
million was allocated to in-process research and development, which was expensed as of the date of the acquisition
due to the state of the development of certain products and the uncertainty of the technology.
In December 2001, we acquired Fotiva, a development stage software company that created solutions to help
consumers manage, store, enrich, and share digital photographs and other related personal media. Substantially all of
Fotiva’s assets were intellectual property. In connection with the acquisition, substantially all of the purchase price
of $5.4 million cash was allocated to in-process research and development and expensed at the time of acquisition
due to the in-process state of the technology.
Amortization and Impairment of Goodwill and Purchased and Other Intangibles
Fiscal
2004
% Change
2004 to 2003
Fiscal
2003
% Change
2003 to 2002 Fiscal
2002
Expenses ................................... $ — — $ — *% $ 21.0
Percentage of total revenues.. — — 2%
* Percentage is not meaningful.
In accordance with Statement of Financial Accounting Standards No. 142 (“SFAS 142”), “Goodwill and Other
Intangible Assets,” goodwill and intangible assets with indefinite lives are no longer amortized after fiscal 2002.
Instead, the goodwill associated with past and any future acquisitions is reviewed annually for impairment. For
further information, see Notes 1 and 5 in our Notes to Consolidated Financial Statements.
During the second quarter of fiscal 2004, we assessed our goodwill for impairment. This assessment did not
result in an impairment of goodwill.
Amortization and impairment of goodwill and purchased and other intangibles in fiscal 2002 included a
goodwill impairment charge for the remaining book value of the Glassbook acquisition.