Electronic Arts 2000 Annual Report Download - page 60

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(G) OTHER BUSINESS COMBINATIONS Additionally, during the year ended March 31, 2000, the Company acquired two soft-
ware development companies. In connection with these acquisitions, the Company incurred a charge of $2,670,000 for
acquired in-process technology. The charge was made after the Company concluded that the in-process technology had not
reached technological feasibility and had no alternative future use after taking into consideration the potential for usage of the
software in different products and resale of the software.
During the quarter ended June 30, 1998, the Company acquired two software development companies. In connection with
these acquisitions, the Company incurred a charge of $2,279,000 for acquired in-process technology. The charge was made after
the Company concluded that the in-process technology had not reached technological feasibility and had no alternative future
use after taking into consideration the potential for usage of the software in different products and resale of the software.
(14) INCOME TAXES
The Company’s pretax income from operations for the fiscal years ended March 31, 2000, 1999 and 1998 consisted of the fol-
lowing components:
2000 1999 1998
(in thousands)
Domestic $ 104,096 $ 79,789 $ 51,620
Foreign 65,718 38,669 56,640
Total pretax income $ 169,814 $ 118,458 $ 108,260
Income tax expense (benefit) for the fiscal years ended March 31, 2000, 1999 and 1998 consisted of:
Current Deferred Total
(in thousands)
2000:
Federal $ 2,766 $ 3,231 $ 5,997
State 299 859 1,158
Foreign 15,573 (2,649) 12,924
Charge in lieu of taxes from employee stock plans 32,563 – 32,563
$51,201 $ 1,441 $ 52,642
1999:
Federal $ 31,204 $ (10,340) $ 20,864
State 4,401 (2,590) 1,811
Foreign 15,715 1,410 17,125
Charge in lieu of taxes from employee stock plans 5,614 – 5,614
$56,934 $ (11,520) $ 45,414
1998:
Federal $ 14,751 $ (7,585) $ 7,166
State 1,361 (727) 634
Foreign 18,561 1,434 19,995
Charge in lieu of taxes from employee stock plans 7,931 – 7,931
$42,604 $ (6,878) $ 35,726
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
58