Autodesk 2009 Annual Report Download - page 120

During fiscal 2008, we incurred a total of approximately $38.3 million for consulting services and
in-process technology purchases from Hanna Strategies compared to $26.7 million in fiscal 2007. The cost of the
in-process technology acquired from Hanna Strategies was immediately recognized as an expense because the
technology had not yet reached technological feasibility and had no alternative future use. During the fourth
quarter of fiscal 2008 we acquired the remaining 72% ownership interest in Hanna Strategies for net
consideration of $13.5 million. See Note 13, “Business Combinations,” in Notes to Consolidated Financial
Statements for further discussion of this acquisition.
General and Administrative
Fiscal year
Ended
January 31,
2009
Increase
compared to
prior fiscal year
Fiscal year
Ended
January 31,
2008
Increase
compared to
prior fiscal year
Fiscal year
Ended
January 31,
2007$ % $ %
(in millions)
General and administrative .......... $205.7 $25.3 14% $180.4 $19.0 12% $161.4
As a percentage of net revenue . . . . . . . 9% 8% 9%
General and administrative expenses include salaries, benefits, bonuses and stock-based compensation
expense for our finance, human resources and legal personnel, as well as, professional fees for legal and
accounting services and amortization expense of customer relationships and trademarks acquired.
General and administrative expenses increased 14% from fiscal 2008 to fiscal 2009 primarily due to a $12.7
million increase in employee-related costs, due to an increase in general and administrative headcount, and a
$14.1 million increase in amortization of acquired intangible assets during fiscal 2009. General and
administrative expenses increased 12% from fiscal 2007 to fiscal 2008 primarily due to a $19.6 million increase
in employee related costs, due to an increase in general and administrative headcount. We expect general and
administrative expense to decrease in absolute dollars during fiscal 2010 as compared to fiscal 2009, as we
continue to find ways to reduce our operating expenses to align with our financial condition, and increase as a
percentage of net revenue during fiscal 2010, as compared to fiscal 2009.
Impairment of Goodwill and Intangibles
Fiscal year
Ended
January 31,
2009
Increase
compared to
prior fiscal year
Fiscal year
Ended
January 31,
2008
Increase
compared to
prior fiscal year
Fiscal year
Ended
January 31,
2007$ % $ %
(in millions)
Impairment of goodwill and intangibles .... $128.9 $128.9 * $— $— * $—
As a percentage of net revenue . . . . . . . . . . . 6% 0% 0%
* Percentage is not meaningful
We recorded a $128.9 million impairment charge affecting the fourth quarter of fiscal 2009, primarily
related to impairment of goodwill associated with our M&E segment. During the three months ended January 31,
2009, revenue and cash flow projections for all segments decreased substantially as the economy worsened. The
M&E segment was the only segment which had a current fair value that fell below the carrying value of its
assets. Should our revenue and cash flow projections decline significantly in the future, additional impairment
charges may be recorded on goodwill. See Note 1, “Business and Summary of Significant Accounting Policies,”
in Notes to Consolidated Financial Statements for further discussion.
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