Autodesk 2005 Annual Report Download - page 43

Download and view the complete annual report

Please find page 43 of the 2005 Autodesk annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 102

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102

2002 restructuring plan and reversals of the accrual for changes in estimates of $1.7 million related to underlying
liabilities originally established under the fiscal 2002 and fiscal 2003 restructuring plans. Of the $3.8 million
related to the fiscal 2004 plan, $3.6 million related to employee termination costs for 86 employees worldwide
(71 in the United States and 15 outside the United States) and $0.2 million related to office closure costs. Office
closure costs included losses on operating leases and the write-off of leasehold improvements and equipment.
Employee termination costs consisted of one-time termination benefits including severance benefits, medical
benefits and outplacement costs. With respect to the $1.7 million of reversals, the underlying liabilities,
primarily related to employee termination costs outside the United States, were ultimately settled for less than
originally estimated.
During the third quarter of fiscal 2003 the Board of Directors approved the fiscal 2003 restructuring plan
which resulted in the termination of 394 employees worldwide (184 in the United States and 210 outside the
United States) and the closure of several additional international and domestic offices. This plan was designed
to help further reduce operating expense levels as well as redirect resources to product development and other
critical areas.
During fiscal 2003, Autodesk recognized net restructuring charges of $25.9 million, of which $18.3 million
related to the fiscal 2003 restructuring plan, and $10.7 million related to additional costs associated with the fiscal
2002 restructuring plan, offset by a credit of $2.1 millionresulting from accrual reversals and a credit of $1.0 million
related to the reversal of the remaining restructuring charges related to the fiscal 2000 restructuring program.
Of the $18.3 million related to the fiscal 2003 restructuring plan, $16.5 million related to employee termination
costs and $1.8 million related to office closures. Of the $10.7 million associated with the fiscal 2002 restructuring
plan, $1.2 million related to the further consolidation of certain European offices and the remaining $9.5 million
resulted from changes to estimated accrued liabilities related to vacated facilities. During fiscal year 2003, we
also reversed $2.1 million of accruals related to restructuring reserves established in fiscal 2002. The facility-
related accruals were settled for less than originally estimated.
For additional information regarding the restructuring and other charges recorded over the past three fiscal
years, see Note 9, “Restructuring Reserves”, in the Notes to Consolidated Financial Statements.
Interest and Other Income
The following table sets forth the components of interest and other income, net (in millions):
2005 2004 2003
Interest and investment income, net ...................... $ 7.2 $10.4 $ 9.4
Foreign-based stamp taxes ................................ (2.8) — —
Gains on foreign currency transactions .................... 0.8 3.3 1.7
Write-downs of cost method investments ................. — (0.6) (3.4)
Legal proceeding settlement .............................. 2.4 — —
Net realized gains on sales of marketable securities ...... 0.5 1.6 2.1
Other income ............................................. 3.4 2.3 3.7
$ 11.5 $ 17.0 $ 13.5
The investment income portion of the Interest and investment income, net line item fluctuates based on
average cash and marketable securities balances, average maturities and interest rates.
During the second quarter of fiscal 2005, we determined that certain money market fund investments
were subject to $2.8 million of Swiss Transfer Stamp Taxes from the third quarter of fiscal 2001 through the
second quarter of fiscal 2005. We determined that the impact of this adjustment was not material to previously
reported periods.
Legal proceedings settlement includes $2.4 million received during the second quarter of fiscal 2005 as part
of a court settlement related to legal proceedings with Spatial Corp. During October 2003, Spatial was ordered
to reimburse Autodesk for attorneys’ fees and trial costs.
Interest income for fiscal 2004 includes $4.2 million related to a one time tax benefit realized during the
second quarter of fiscal 2004 resulting from the favorable resolution with the IRS of an industry-wide issue
regarding Foreign Sales Corporations.
31