Computer Associates 2015 Annual Report Download - page 46

customer to the third-party financial institution. Whether the future committed installments have been financed directly by
the customer with our assistance or by the transfer of our rights to future committed installments to a third party, these
financing agreements may contain limited recourse provisions with respect to our continued performance under the license
agreements. Based on our historical experience, we believe that any liability that we may incur as a result of these limited
recourse provisions will be immaterial.
Amounts billed or collected as a result of a single installment for the entire contract value, or a substantial portion of the
contract value, rather than being invoiced and collected over the life of the license agreement, are reflected in the liability
section of our Consolidated Balance Sheets as ‘‘Deferred revenue (billed or collected).’’ Amounts received from either a
customer or a third-party financial institution that are attributable to later years of a license agreement have a positive
impact on billings and cash provided by operating activities in the current period. Accordingly, to the extent these
collections are attributable to the later years of a license agreement, billings and cash provided by operating activities during
the license’s later years will be lower than if the payments were received over the license term. We are unable to predict
with certainty the amount of cash to be collected from single installments for the entire contract value, or a substantial
portion of the contract value, under new or renewed license agreements to be executed in future periods.
For fiscal 2015, gross receipts related to single installments for the entire contract value, or a substantial portion of the
contract value, were $514 million compared with $502 million in fiscal 2014.
In any quarter, we may receive payments in advance of the contractually committed date on which the payments were
otherwise due. In limited circumstances, we may offer discounts to customers to ensure payment in the current period of
invoices that have been billed, but might not otherwise be paid until a subsequent period because of payment terms.
Historically, any such discounts have not been material.
Amounts due from customers from our subscription licenses are offset by deferred revenue related to these license
agreements, leaving no or minimal net carrying value on our Consolidated Balance Sheets for those amounts. The fair value
of these amounts may exceed or be less than this carrying value but cannot be practically assessed since there is no existing
market for a pool of customer receivables with contractual commitments similar to those owned by us. The actual fair value
may not be known until these amounts are sold, securitized or collected. Although these customer license agreements
commit the customer to payment under a fixed schedule, to the extent amounts are not yet due and payable by the
customer, the agreements are considered executory in nature due to our ongoing commitment to provide maintenance and
unspecified future software products as part of the agreement terms.
We can estimate the total amounts to be billed from committed contracts, referred to as our ‘‘billings backlog,’’ and the
total amount to be recognized as revenue from committed contracts, referred to as our ‘‘revenue backlog.’’ The aggregate
amounts of our billings backlog and trade receivables already reflected in our Consolidated Balance Sheets represent the
amounts we expect to collect in the future from committed contracts.
MARCH 31, 2015(1) MARCH 31, 2014(1)
(in millions)
Billings backlog:
Amounts to be billed — current $ 1,867 $ 1,983
Amounts to be billed — noncurrent 1,686 2,365
Total billings backlog $ 3,553 $ 4,348
Revenue backlog:
Revenue to be recognized within the next 12 months — current $ 3,141 $ 3,500
Revenue to be recognized beyond the next 12 months — noncurrent 3,389 4,139
Total revenue backlog $ 6,530 $ 7,639
Deferred revenue (billed or collected) $ 2,977 $ 3,291
Total billings backlog 3,553 4,348
Total revenue backlog $ 6,530 $ 7,639
(1) Information presented excludes the results of our discontinued operations.
Note: Revenue backlog includes deferred subscription and maintenance, professional services and software fees and other revenue.
43