Autodesk 2010 Annual Report Download - page 149

AUTODESK, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
January 31, 2010
(Tables in millions of dollars, except share and per share data, unless otherwise indicated)
Note 1. Business and Summary of Significant Accounting Policies
Business
Autodesk, Inc. (“Autodesk” or the “Company”) is a world leading design software and services companies,
offering customers progressive business solutions through powerful technology products and services. The
Company serves customers in the architectural, engineering and construction, manufacturing, geospatial
mapping, digital media and entertainment markets. The Company’s sophisticated software products enable its
customers to experience their ideas before they are real by allowing them to create and document their designs
and to visualize, simulate and analyze real-world performance early in the design process by creating digital
prototypes. These capabilities give Autodesk’s customers the flexibility to optimize and improve their designs
before they actually begin the building process, helping save time and money, improving quality and fostering
innovation. Autodesk software products are sold globally, both directly to customers and through a network of
resellers and distributors.
Principles of Consolidation
The accompanying consolidated financial statements include the accounts of Autodesk and its wholly-
owned and majority-owned subsidiaries. All significant intercompany accounts and transactions have been
eliminated.
Use of Estimates
The preparation of financial statements in conformity with generally accepted accounting principles requires
management to make estimates and assumptions that affect the amounts reported in Autodesk’s consolidated
financial statements and notes thereto. These estimates are based on information available as of the date of the
consolidated financial statements. On a regular basis, management evaluates these estimates and assumptions.
Actual results may differ materially from these estimates.
Examples of significant estimates and assumptions made by management involve the determination of the
fair value of goodwill, financial instruments, long-lived assets and other intangible assets the realizability of
deferred tax assets and the fair value of stock awards(see “Stock-Based Compensation Expense” within this Note
1 and Note 4, “Employee and Director Stock Plans,” for further discussion). We also make assumptions,
judgments and estimates in determining the accruals for uncertain tax positions, partner incentive programs,
product returns reserves, allowances for doubtful accounts, asset retirement obligations and legal contingencies.
Foreign Currency Translation
The assets and liabilities of Autodesk’s foreign subsidiaries are translated from their respective functional
currencies into U.S. dollars at the rates in effect at the balance sheet date, and revenue and expense amounts are
translated at weighted average rates during the period. Foreign currency translation adjustments are recorded as
other comprehensive income.
Gains and losses realized from foreign currency transactions, those transactions denominated in currencies
other than the foreign subsidiary’s functional currency, are included in interest and other income, net.
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