Autodesk 2009 Annual Report Download - page 137

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AUTODESK, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Costs incurred for computer software developed or obtained for internal use are capitalized for application
development activities, if material, and immediately expensed for preliminary project activities and post-
implementation activities. These capitalized costs are amortized over the expected useful life of the software,
which is generally three years.
Software Development Costs
Software development costs incurred prior to the establishment of technological feasibility are included in
research and development expenses. Autodesk defines establishment of technological feasibility as the
completion of a working model. Software development costs incurred subsequent to the establishment of
technological feasibility through the period of general market availability of the products are capitalized and
generally amortized over a one year period, if material. Autodesk had no capitalized software development costs
at January 31, 2009 and January 31, 2008.
Purchased Technologies, Net
Purchased technologies are amortized over the estimated economic life of the product, which ranges from
one to seven years. Amortization expense, which is included as a component of cost of revenue, was
$26.3 million in fiscal 2009, $15.9 million in fiscal 2008 and $12.9 million in fiscal 2007.
Purchased technologies and related accumulated amortization at January 31 were as follows:
2009 2008
Purchased technologies ........................................ $302.4 $ 227.5
Less: Accumulated amortization ................................ (189.1) (163.1)
Purchased technologies, net .................................... $113.3 $ 64.4
The weighted average amortization period for purchased technologies acquired during fiscal 2009 was 5.3
years.
Expected future amortization expense for purchased technologies for each of the fiscal years ended
thereafter is as follows:
Year ending
January 31,
2010 .................................................................... $ 33.1
2011 .................................................................... 30.3
2012 .................................................................... 23.3
2013 .................................................................... 13.6
2014 .................................................................... 9.1
Thereafter ................................................................ 3.9
Total .................................................................... $113.3
Goodwill
Goodwill consists of the excess of cost over the fair value of net assets acquired in business combinations.
Autodesk assigns goodwill to the reportable segment associated with each business combination, and tests
goodwill for impairment annually in the fourth quarter or more often if and when circumstances indicate potential
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