Computer Associates 2005 Annual Report Download - page 32

Table of Contents
addition, we converted employee stock options to acquire the common stock of Netegrity to employee stock options to acquire our
shares at a cost of approximately $11 million and incurred acquisition costs of approximately $5 million, for an aggregate purchase price
of approximately $455 million. Netegrity was a provider of business security software, principally in the areas of identity and access
management, and we have made Netegrity’ s identity and access management solutions available both as independent products and as
integrated components of our eTrust Identity and Access Management Suite.
In August 2004, we acquired Pest Patrol, Inc. (Pest Patrol), a privately held provider of anti-spyware and security solutions for
approximately $40 million. The products acquired in this transaction were integrated into our eTrust Threat Management software
product portfolio. This portfolio protects organizations from diverse Internet dangers such as viruses, spam, and inappropriate use of the
Web by employees.
In March 2004, we sold our approximate 90% interest in ACCPAC International, Inc. (ACCPAC) to The Sage Group, plc. (Sage). Our
net proceeds totaled $104 million for all of our outstanding equity interests of ACCPAC, including options and change of control
payments for certain ACCPAC officers and managers. We received approximately $90 million of the net proceeds in fiscal year 2004
and the remainder in fiscal year 2005. ACCPAC specializes in accounting, customer relationship management, human resources,
warehouse management, manufacturing, electronic data interchange, and point-of-sale software for small and medium-sized businesses.
As a result of the sale, we realized a gain, net of taxes, of approximately $60 million in fiscal year 2004. In the second quarter of fiscal
year 2005, we recorded an adjustment to the gain of $2 million, net of tax, that reduced the net gain to $58 million. Approximately 600 of
our employees were transferred to Sage. The sale completed our multi-year effort to exit the business applications market. Pursuant to
Statement of Financial Accounting Standards (SFAS) No. 144, “Accounting for the Impairment or Disposal of Long-Lived Assets,” the
assets, liabilities, results of operations, and cash flow of ACCPAC have been classified as a discontinued operation for all periods
presented prior to the sale of ACCPAC in March 2004.
(b) Financial Information About Segments
Our global business is principally in a single industry segment — the design, development, marketing, licensing, and support of software
products that can operate on a wide range of hardware platforms and operating systems.
Refer to Note 4, “Segment and Geographic Information” of the Consolidated Financial Statements for financial data pertaining to our
segment and geographic operations.
(c) Narrative Description of Business
Products
In many cases, customers work with several vendors that provide different hardware platforms and operating systems. Our software
products are designed to work with almost every commercially available computer hardware platform and with almost every common
software operating system. Our software products address our customers’ IT requirements in the following areas: infrastructure
management, security management, storage management, application life cycle management, data management and application
development, and portal and business intelligence. Our products are supported by a software layer we call CA Common Services so that
they can work alone or together with other vendors’ software products.
CA Common Services is the common infrastructure that allows many of our software products to work together with those from other
companies. CA Common Services also help enable integration of user interface, processes, and management information across our
product lines, which we believe improves efficiency.
Our Product Areas:
Unicenter for Infrastructure Management — Our Unicenter products are designed to improve the efficiency and responsiveness of our
customers’ computing operations. These products identify and help resolve problems within a customer’ s IT infrastructure. These
products also automate time-consuming tasks such as software installation, tracking computing assets, and managing customers’
databases. We offer Unicenter products across the following three major solution areas:
• Operations Management — These products focus on the availability, health, and performance of the entire computing system,
from mainframe computers to handheld devices. Products include Unicenter Network and Systems Management, Unicenter
NetMaster, Unicenter AutoSys Job Management, Unicenter CA-7 Job Management, and Unicenter Database Management.
• Service Management — These products manage and measure service levels to help ensure that the IT infrastructure
continuously meets business demands. Products include Unicenter ServicePlus Service Desk, and Unicenter Service Level
Management.
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