Adobe 2006 Annual Report Download - page 73

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73
ADOBE SYSTEMS INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(In thousands, except share and per share data)
Note 1. Significant Accounting Policies
Operations
Founded in 1982, Adobe Systems Incorporated offers a line of creative, business and mobile software
and services used by high-end consumers, creative professionals, designers, knowledge workers, OEM
partners, developers and enterprises for creating, managing, delivering and engaging with compelling
content and experiences across multiple operating systems, devices and media. We distribute our products
through a network of distributors and dealers, VARs, systems integrators, ISVs and OEMs; direct to end
users; and through our own Web site at www.adobe.com. We also license our technology to major
hardware manufacturers, software developers and service providers and we offer integrated software
solutions to businesses of all sizes. We have operations in the Americas, EMEA and Asia. Our software
runs on Microsoft Windows, Apple Macintosh, Linux, UNIX and various non-personal computer
platforms, depending on the product.
Basis of Presentation
The accompanying consolidated financial statements include those of Adobe and our subsidiaries, after
elimination of all intercompany accounts and transactions. Adobe has prepared the accompanying
consolidated financial statements in conformity with accounting principles generally accepted in the United
States of America.
Use of Estimates
In the preparation of financial statements in conformity with accounting principles generally accepted
in the United States of America, we must make estimates and assumptions that affect the reported amounts
of assets and liabilities and disclosure of contingent assets and liabilities, at the date of the balance sheet,
and reported amounts of revenues and expenses during the reporting period. Actual results could differ
from those estimates.
Fiscal Year
Our fiscal year is a 52/53-week year ending on the Friday closest to November 30.
Stock Dividend
On March 16, 2005, our Board of Directors approved a two-for-one stock split, in the form of a stock
dividend, of our common stock payable on May 23, 2005 to stockholders of record as of May 2, 2005.
Share and per share data, for all periods presented, have been adjusted to give effect to this stock split.
Reclassification
Certain amounts in fiscal 2005 and 2004 as reported in the Consolidated Statements of Cash Flows
have been revised. Specifically in fiscal 2005, approximately $9.6 million of prepaid expenses related to
the Macromedia acquisition and $18.4 million of expense related to the amortization of premium on
available for sale securities have been reclassified from Net Cash Provided by Operating Activities to Net
Cash Provided By (Used For) Investing Activities. In fiscal 2004, $21.0 million of expense related to the
amortization of premium on available for sale securities has been reclassified from Net Cash Provided By
Operating Activities to Net Cash Provided By (Used For) Investing Activities.