Blizzard 2008 Annual Report Download - page 57

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43
For the year ended December 31, 2007
As
reported As
adjusted Effect of
change
As adjusted
and
reclassified*
Consolidated Statement of Cash Flows:
Net income (loss)............................................................
.
$251 $227 $(24) $227
Adjustments to reconcile net income to net cash
provided by operating activities:
Deferred income taxes ................................................
.
(61) (77) (16) (77)
Amortization and write-off of capitalized software
development costs and intellectual property
licenses....................................................................
.
10 10 — 54
Changes in operating assets and liabilities:
Deferred revenues.......................................................
.
20 73 53 79
Accrued expenses and other liabilities........................
.
160 148 (12) 34
* As adjusted and reclassified reflects certain reclassification adjustments made to prior
periods to be consistent with the current period presentation. These reclassification
adjustments are not presented in the above tables. There is no change to accumulated
deficit at January 1, 2007 or 2006 as a result of the change in accounting principle.
Stock Split—In July 2008, the Board of Directors approved a two-for-one split of our
outstanding common stock effected in the form of a stock dividend (“the split”). The split was
paid September 5, 2008 to shareholders of record at August 25, 2008. The par value of our
common stock was maintained at the pre-split amount of $.000001 per share. The Consolidated
Financial Statements and Notes thereto, including all share and per share data, have been restated
as if the split had occurred at the earliest period presented.
Reclassifications—Certain reclassifications have been made to prior year financial
statements to conform to the current year presentation.
3. Summary of significant accounting policies
Basis of Consolidation and Presentation
The accompanying Consolidated Financial Statements include the accounts and
operations of the Company. All intercompany accounts and transactions have been eliminated.
The Consolidated Financial Statements have been prepared in conformity with accounting
principles generally accepted in the United States of America (“U.S. GAAP”). The preparation of
the Consolidated Financial Statements in conformity with U.S. GAAP requires management to
make estimates and assumptions that affect the amounts reported in the consolidated financial
statements. Actual results could differ from these estimates and assumptions.
Cash, Cash Equivalents, and Investments
Cash and cash equivalents include cash, time deposits, and money market funds with
original maturities of three months or less at the date of purchase. Cash and time deposits totaled