Citrix 2000 Annual Report Download - page 59

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CITRIX SYSTEMS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS −− (CONTINUED)
At December 31, 2000, the Company has approximately $35,793,000 of U.S. net
operating loss carryforwards remaining, a substantial portion of which begins to
expire in 2020. The Company will record the benefit of the net operating loss
carryforwards generated from the exercise of employee stock options, through
additional paid−in capital when the net operating loss carryforwards are
utilized. Approximately $5,242,000 of the U.S. net operating loss carryforwards
is limited under Internal Revenue Code section 382.
At December 31, 2000, the Company had research and development tax credit
carryforwards of approximately $8,224,000 that expire beginning in 2018.
Additionally, the Company had foreign tax credit carryforwards of approximately
$3,823,000 at December 31, 2000 that expire beginning in 2003.
Effective January 1, 2000, the Company does not expect to remit earnings
from its foreign subsidiaries. Accordingly, the Company has not provided for
deferred taxes on these earnings pursuant to FAS 109.
A reconciliation of the Company's income taxes to amounts calculated at the
statutory federal rate is as follows:
YEAR ENDED DECEMBER 31
−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−
2000 1999 1998
−−−−−−−− −−−−−−−− −−−−−−−
(IN THOUSANDS)
Federal statutory taxes............................. $ 47,256 $ 63,954 $33,415
State income taxes, net of federal tax benefit...... 5,134 5,378 3,476
Foreign sales corporation benefits.................. −− (2,556) (1,226)
Foreign operations.................................. (19,634) −− −−
Interest income..................................... (5,979) (4,555) −−
Intangible assets................................... 3,047 8,260 −−
Other permanent differences......................... 3,143 5,220 109
Tax credits......................................... 632 (10,981) (2,542)
Other............................................... 6,906 1,061 1,138
−−−−−−−− −−−−−−−− −−−−−−−
$ 40,505 $ 65,781 $34,370
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12. GEOGRAPHIC INFORMATION AND SIGNIFICANT CUSTOMERS
The Company operates in a single market consisting of the design,
development, marketing and support of application delivery and management
software and services for enterprise applications. Design, development,
marketing and support operations outside of the United States are conducted
through subsidiaries located primarily in Europe and the Asia Pacific region.
The Company tracks revenue by geography and product category but does not
track expenses or identifiable assets on a product category basis. The Company
does not engage in intercompany transfers between segments. The Company's
management evaluates performance based primarily on revenues in the geographic
locations that the Company operates. Segment profit for each segment includes
sales and marketing expenses directly attributable to the segment and excludes
certain expenses that are managed outside the reportable segments. Costs
excluded from segment profit primarily consist of cost of revenues, research and
development costs, interest, corporate expenses, including income taxes, as well
as non−recurring charges for purchased in−process technology and technology
write−downs, and overhead costs, including rent, utilities, depreciation and
amortization. Corporate expenses are comprised primarily of corporate marketing
costs, operations and other general and administrative expenses, which are
separately managed. Accounting policies of the segments are the same as the
Company's consolidated accounting policies.
During 1999 and 2000, wholly−owned subsidiaries were formed in various
locations within Europe, Middle East and Africa (EMEA) and Asia Pacific,
respectively. These subsidiaries are responsible for sales
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