Visa 2007 Annual Report Download - page 130
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Table of Contents
VISA U.S.A. INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Future amortization of internally developed software is shown in the following table:
For the Years Ending September 30 (in thousands)
2008 $ 15,130
2009 10,497
2010 3,897
2011 1,805
2012 242
Total $ 31,571
Note 10—Intangible Assets
On January 31, 2003 the Company entered into an exclusive ten-year licensing agreement with a member financial institution. The agreement granted
Visa patent and know-how rights, which allowed the Company to market and distribute Mini Cards within the United States. The license granted was sub-
licensable.
In June 2006 the Company assessed a low probability of future incremental cash flows from the Mini Card, given the Company's strategic focus on
developing next-generation payment platforms and services and minimal Mini Card issuance by Visa members at that time. If the sum of expected future cash
flows (undiscounted and without interest charges) is less than the carrying amount of an asset, an impairment loss is recognized. The loss is measured as the
amount by which the carrying amount of the asset exceeds its fair value calculated using the present value of estimated net future cash flows.
As a result, the Company recognized an impairment charge of $13.2 million in June 2006 for the net carrying value of the asset. The expense was
reflected in administrative and other on the Company's consolidated statements of operations. Related amortization, also included in Administrative and
Other, for the years ended September 30, 2007, 2006 and 2005 was $0.0 million, $1.5 million and $2.0 million, respectively.
At September 30, 2007 and 2006 the Company has no intangible assets (other than capitalized software) on its consolidated balance sheets.
Note 11—Accrued Liabilities
Accrued liabilities is comprised of the following:
As of September 30,
2007 2006
(in thousands)
Accrued operating expenses $ 188,863 $ 178,372
Accrued taxes 148,551 9,576
Member collateral 67,885 51,042
Deferred revenues 8,560 50,780
Accrued discounts 773 36,105
Restricted issuer liability — 76,803
Accrued other 6,107 4,802
Total $ 420,739 $ 407,480
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