Autodesk 2010 Annual Report Download - page 157

AUTODESK, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Autodesk measures all stock-based payments to employees and directors, including grants of stock options,
employee stock purchases related to the employee stock purchase plan (“ESP Plan”), and restricted stock, using a
fair-value based method, and records the expense in Autodesk’s Consolidated Statements of Operations. The
estimated fair value of stock-based awards is amortized to expense on a straight-line basis over the awards’
vesting period. The following table summarizes stock-based compensation expense for fiscal 2010, 2009 and
2008, respectively, as follows:
Fiscal Year Ended January 31,
2010 2009 2008
Cost of license and other revenue ....................................... $ 3.1 $ 3.6 $ 5.0
Marketing and sales ................................................. 41.1 39.2 43.1
Research and development ............................................ 30.0 29.3 32.4
General and administrative ............................................ 19.4 17.4 18.8
Stock-based compensation expense related to stock awards and ESP Plan
purchases ........................................................ 93.6 89.5 99.3
Tax benefit ........................................................ (22.2) (21.6) (21.0)
Stock-based compensation expense related to stock awards and ESP Plan
purchases ........................................................ $71.4 $ 67.9 $ 78.3
As discussed above, Autodesk determined that the cumulative error from the understatement of stock-based
compensation expense related to the periods prior to fiscal 2010 totaled $6.8 million, net of tax effects.
Accordingly, additional expenses of $0.4 million for Cost of license and other revenue, $4.4 million for
Marketing and sales, $2.9 million for Research and development, $2.1 million for General and Administrative
and $3.0 million for additional Tax benefit are included in the stock-based compensation expenses in the table
above for the fiscal year ended January 31, 2010.
Autodesk uses the Black-Scholes-Merton option-pricing model to estimate the fair value of stock-based
awards and the fair value of awards under the ESP Plan based on the following assumptions:
Fiscal Year Ended
January 31, 2010
Fiscal Year Ended
January 31, 2009
Fiscal Year Ended
January 31, 2008
Stock Option
Plans ESP Plan
Stock Option
Plans ESP Plan
Stock Option
Plans ESP Plan
Range of expected
volatilities ............ 0.43 – 0.55 0.43 – 0.73 0.37 – 0.55 0.36 – 0.41 0.33 – 0.36 0.29 – 0.34
Range of expected
lives (in years) ........ 2.7–4.0 0.5–2.0 2.6–4.0 0.5–2.0 2.6–4.2 0.3–2.0
Expected dividends ....... 0% 0% 0% 0% 0% 0%
Range of risk-free
interest rates .......... 1.02 – 2.42% 0.20 – 0.98% 1.01 – 3.40% 1.29 – 1.85% 3.07 – 5.11% 3.98 – 5.06%
Expected forfeitures ...... 13.5% 13.5% 13.6% 13.6% 13.0% 13.0%
Autodesk estimates expected volatility for options granted under the Company’s stock option plans and ESP
Plan awards based on two measures. The first is a measure of historical volatility in the trading market for the
Company’s common stock, and the second is the implied volatility of traded forward call options to purchase
shares of the Company’s common stock.
Autodesk estimates the expected life of stock-based awards granted under the Company’s stock plans using
both exercise behavior and post-vesting termination behavior, as well as consideration of outstanding options.
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