Blizzard 2005 Annual Report Download - page 50
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Please find page 50 of the 2005 Blizzard 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.Related Parties
InAugust2001,weelectedtoourBoardofDirectorsanindividualwhoisapartnerinalawfirmthathasprovidedlegalservicestoActivisionformorethantenyearsand
whoremainsadirectoroftheCompany.FortheyearsendedMarch31,2005,2004and2003,thefeeswepaidtothelawfirmwereaninsignificantportionofthelaw
firm’stotalrevenues.Webelievethatthefeeschargedtousbythelawfirmarecompetitivewiththefeeschargedbyotherlawfirms.
Financial Disclosure
Wemaintaininternalcontrols over financialreporting,whichgenerallyincludethose controlsrelatingtothepreparationof ourfinancialstatementsinconformitywith
accountingprinciplesgenerallyacceptedintheUnitedStatesofAmerica.Wealsoarefocusedonour“disclosurecontrolsandprocedures,”whichasdefinedbythe
Securities andExchange Commissionaregenerally thosecontrolsandprocedures designed toensure that financialandnon-financial information requiredto be
disclosedinourreportsfiledwiththeSecuritiesandExchangeCommissionisreportedwithinthetimeperiodsspecifiedintheSecuritiesandExchangeCommission’s
rulesandforms,andthatsuchinformationiscommunicatedtomanagement,includingourChiefExecutiveOfficersandourChiefFinancialOfficer,asappropriate,to
allowtimelydecisionsregardingrequireddisclosure.
Our Disclosure Committee,which operates underthe Board approved Disclosure Committee Charter and Disclosure Controls & ProceduresPolicy,includes senior
managementrepresentativesandassistsexecutivemanagementinitsoversightoftheaccuracyandtimelinessofourdisclosures,aswellasinimplementingandevaluating
ouroveralldisclosureprocess.Aspartofourdisclosureprocess,seniorfinanceandoperationalrepresentativesfromallofourcorporatedivisionsandbusinessunits
preparequarterlyreportsregardingtheircurrentquarteroperationalperformance,futuretrends,subsequentevents,internalcontrols,changesininternalcontrolsand
otheraccountinganddisclosure-relevantinformation.Thesequarterlyreportsarereviewedbycertainkeycorporatefinancerepresentatives.Thesecorporatefinance
representativesalsoconductquarterly interviewsonarotatingbasiswith thepreparers ofselectedquarterlyreports.Theresultsofthequarterlyreportsand related
interviewsarereviewedbytheDisclosureCommittee.Financerepresentativesalsoconductreviewswithourseniormanagementteam,ourinternalandexternalcounseland
otherappropriatepersonnelinvolvedinthedisclosureprocess,asappropriate.Additionally,seniorfinanceandoperationalrepresentativesprovideinternalcertifications
regardingtheaccuracyofinformationtheyprovidethatisutilizedinthepreparationofourperiodicpublicreportsfiledwiththeSecuritiesandExchangeCommission.
Financialresultsand otherfinancialinformationalsoare reviewedwiththeAuditCommitteeof theBoardofDirectorsonaquarterlybasis.Asrequiredbyapplicable
regulatoryrequirements,theChiefExecutiveOfficersandtheChiefFinancialOfficerreviewandmakevariouscertificationsregardingtheaccuracyofourperiodicpublic
reportsfiledwiththeSecuritiesandExchangeCommission,ourdisclosurecontrolsandprocedures,andourinternalcontroloverfinancialreporting.Withtheassistance
oftheDisclosureCommittee,wewillcontinuetoassessandmonitorourdisclosurecontrolsandprocedures,andourinternalcontrolsoverfinancialreporting,andwill
makerefinementsasnecessary.
RECENTLY ISSUED ACCOUNTING STANDARDS AND LAWS
OnDecember16,2004,theFinancialAccountingStandardsBoard(“FASB”)issuedFASBStatementNo.123(revised2004),“Share-BasedPayment”(“SFASNo.123R”),
whichisarevisionofFASBStatementNo.123,“AccountingforStock-BasedCompensation”(“SFAS123”).SFASNo.123RsupersedesAPBOpinionNo.25,“Accounting
forStockIssuedtoEmployees,”andamendsFASBStatementNo.95,“StatementofCashFlows.”Generally,theapproachinSFASNo.123Rissimilartotheapproach
describedinSFAS123.However,SFASNo.123Rrequiresallshare-basedpaymentstoemployees,includinggrantsofemployeestockoptions,toberecognizedinthe
incomestatementbasedontheirfairvalues.Proformadisclosureisnolongeranalternative.
SFASNo.123RmustbeadoptedbytheCompanynolaterthanApril1,2006.Earlyadoptionwillbepermittedinperiodsinwhichfinancialstatementshavenotyetbeen
issued.TheCompanyexpectstoadoptSFASNo.123RonApril1,2006.
page 48
Activision, Inc. — 2005 Annual Report
Management’s Discussion and Analysis of Financial Condition and Results of Operations