Autodesk 2001 Annual Report Download - page 25

22 FY 01 Autodesk, Inc.
45 percent complete as of the acquisition date, with total
estimated costs of $1.5 million to reach technological fea-
sibility at the time. The in-process projects were
completed in fiscal 2000, at an aggregate amount approx-
imately equal to the original estimated costs to complete.
In valuing the developed and in-process technologies, we
used a discounted cash flow analysis based on projected
net revenues, cost of revenues, operating expenses and
income taxes resulting from such technologies over a
5-year period. The projected financial results were dis-
counted using a 15 percent rate for the developed
technology and a 20 percent rate for the in-process tech-
nology.
The revenue projections for the developed technology,
which considered historical product life cycles and antici-
pated product release dates, assumed a gradual decline
over the 5-year period. The revenue projections for the
IPR&D assumed higher than historical average sales due to
the integration and expansion of Genius products into our
worldwide sales channels, particularly in North America
and Asia Pacific, which historically had not contributed sig-
nificant revenues to Genius.
Actual results in fiscal 2001 were consistent with the major
assumptions used in the original valuation made at the
time of the acquisition, such as the revenue growth rate
between years.
Recently Issued Accounting Standards
Effective November 1, 2000 we adopted Staff Accounting
Bulletin No. 101, “Revenue Recognition in Financial
Statements”(”SAB 101”). The adoption of SAB 101 did not
have a material impact on our financial statements.
Effective February 1, 2001 we adopted the provisions of
Statement of Financial Accounting Standards No. 133,
”Accounting for Derivative Instruments and Hedging
Activities” (”SFAS 133”). This Statement requires Autodesk
to recognize all derivatives on the balance sheet at fair
value. Had we adopted SFAS 133 during fiscal 2001, the
impact would not have been material. The adoption of
SFAS 133 on February 1, 2001 did not have a material
impact on our financial position.
Liquidity and Capital Resources
Cash, cash equivalents, and marketable securities totaled
$422.5 million at January 31, 2001 compared to
$540.9 million at January 31, 2000. The primary uses of
cash during fiscal 2001 were: the repurchase of 9.2 million
shares of our common stock for $359.3 million,capital and
other expenditures of $32.4 million, dividend pay-
ments totaling $13.6 million and an additional invest-
ment in Buzzsaw.com of $17.5 million.The primary sources
of cash were cash provided by operating activities of
$196.1 million, stock issuances resulting from our
employee stock plans of $114.0 million, and $14.0 million
of third party venture funding for RedSpark.
Between November 1999 and March 2001, the Board of
Directors approved plans to repurchase up to 22.0 million
shares of our common stock. Of these 22.0 million shares,
12.1 million have been repurchased as of January 31,2001.
The primary purpose of the stock repurchase programs is
to help offset the dilution to earnings per share caused by
the issuance of stock under our employee stock plans.
We have a U.S. line of credit permitting short-term, unse-
cured borrowings of up to $75.0 million, which may be
used from time to time for working capital or other busi-
ness needs. At January 31, 2001, there were no borrowings
outstanding under this agreement, which expires in
January 2002.
Principal commitments at January 31, 2001, consisted of
obligations under operating leases for facilities and some
computer equipment.
We believe that our existing cash, cash equivalents, mar-
ketable securities, available line of credit and cash
generated from operations will be sufficient to satisfy our
currently anticipated short-term and long-term cash
requirements. Long-term cash requirements, other than
normal operating expenses, are anticipated for the devel-
opment of new software products and incremental
product offerings resulting from the enhancement of
existing products; financing anticipated growth; dividend
payments; the share repurchase programs; investments in
related entities;and the acquisition of businesses, software
products,or technologies complementary to our business.
Our international operations are subject to currency fluc-
tuations. To minimize the impact of these fluctuations, we
use foreign currency option contracts to hedge our expo-
sure on anticipated transactions and forward contracts to
hedge our exposure on firm commitments, primarily cer-
tain payables and receivables denominated in foreign
currencies. Our foreign currency instruments generally
have maturities of less than three months, and the option
contracts settle before the end of each quarterly period.
The principal currencies hedged during fiscal 2001 were
the Euro, British pound and Japanese yen. We monitor our
foreign exchange exposures to ensure the overall effec-
tiveness of our foreign currency hedge positions.