First Data 2009 Annual Report Download - page 237

Chase Paymentech
NOTES TO COMBINED FINANCIAL STATEMENTS
For the years ended December 31, 2007 and 2006 and
the year ended December 31, 2005 (unaudited) (Continued)
Noncontrolling Interests
In December 2007, the FASB issued SFAS No. 160, Noncontrolling Interests in Consolidated Financial
Statements—An Amendment of ARB No. 51 (SFAS 160). SFAS 160 establishes accounting and reporting
standards for the noncontrolling interest in a subsidiary and for the deconsolidation of a subsidiary. This standard
requires the recognition of a noncontrolling interest (minority interest) as a component of equity in the
consolidated financial statements and separate from the parent’s equity. The amount of net income attributable to
the noncontrolling interest will be included in consolidated net income on the face of the income statement.
SFAS 160 is effective for the Company’s fiscal year beginning after December 15, 2008, and will be applied
prospectively except for the presentation and disclosure requirements, which must be applied retrospectively for
all periods presented. The Company is currently evaluating the impact that adopting SFAS 160 will have on its
combined financial statements.
NOTE 4—PROPERTY AND EQUIPMENT
A summary of property and equipment by major class as of December 31, 2007 and 2006 is as follows (in
thousands):
2007 2006
Furniture and equipment ......................................... $179,343 $ 153,266
Capitalized software ............................................ 103,765 92,809
Leasehold improvements ........................................ 14,364 12,005
297,472 258,080
Less accumulated depreciation and amortization ...................... (194,440) (173,788)
Property and equipment, net ...................................... $103,032 $ 84,292
Depreciation and amortization expense related to property and equipment was $47.4 million, $38.8 million,
and $34.4 million for the years ended December 31, 2007, 2006, and 2005, respectively. For the years ended
December 31, 2007 and 2006, software costs of $13.8 million and $11.4 million were capitalized, respectively.
NOTE 5—COMMITMENTS AND CONTINGENCIES
Operating Leases
The Company leases office space and certain equipment under operating leases with remaining terms
ranging up to eleven years. The office space leases contain renewal options and generally require the Company to
pay certain operating expenses.
Future minimum lease commitments under non-cancelable leases as of December 31, 2007 are as follows
(in thousands):
2008 ..................................................... $ 8,645
2009 ..................................................... 8,970
2010 ..................................................... 9,631
2011 ..................................................... 8,990
2012 ..................................................... 9,122
Thereafter ................................................. 33,169
$78,527
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