Electronic Arts 2008 Annual Report Download - page 174
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The following weighted-average assumptions were used for grants made under our stock-based compensation
plans in fiscal 2006:
Year Ended
March 31, 2006
Risk-free interest rate ....................................................... 4.3%
Expected volatility ......................................................... 33%
Expected term of stock options (in years) ........................................ 3.2
Expected term of employee stock purchase plan (in months) .......................... 6
Expected dividends ......................................................... None
Our calculations were based on a multiple-award valuation method and forfeitures were recognized when they
occurred.
(In millions, except per share data)
Year Ended
March 31, 2006
Net income:
As reported ............................................................. $236
Deduct: Total stock-based employee compensation expense determined under fair-value-
based method for all awards, net of related tax effects ........................... (85)
Add: Stock-based employee compensation expense included in reported net income, net of
relatedtaxeffects ...................................................... 2
Proforma.............................................................. $153
Net income per share:
As reported — basic ...................................................... $0.78
Pro forma — basic ....................................................... $0.50
As reported — diluted ..................................................... $0.75
Proforma—diluted...................................................... $0.49
401(k) Plan and Registered Retirement Savings Plan
We have a 401(k) plan covering substantially all of our U.S. employees, and a Registered Retirement Savings
Plan covering substantially all of our Canadian employees. These plans permit us to make discretionary
contributions to employees’ accounts based on our financial performance. We contributed an aggregate of
$13 million, $3 million and $2 million to these plans in fiscal 2008, 2007 and 2006, respectively.
(13) COMPREHENSIVE INCOME
We are required to classify items of other comprehensive income (loss) by their nature in a financial statement
and display the accumulated balance of other comprehensive income separately from retained earnings and
additional paid-in capital in the equity section of a balance sheet. Accumulated other comprehensive income
primarily includes foreign currency translation adjustments, and the net-of-tax amounts for unrealized gains
(losses) on investments and unrealized gains (losses) on derivatives designated as cash flow hedges. Foreign
currency translation adjustments are not adjusted for income taxes as they relate to indefinite investments in
non-U.S. subsidiaries.
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