Electronic Arts 2013 Annual Report Download - page 150

ELECTRONIC ARTS INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(1) DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
We develop, market, publish and distribute game software content and services that can be played by consumers
on a variety of platforms, including video game consoles (such as the Sony PLAYSTATION 3, Microsoft Xbox
360, and Nintendo WiiU), personal computers, mobile devices (such as the Apple iPhone and Google Android
compatible phones), tablets and electronic readers (such as the Apple iPad and Amazon Kindle), and the Internet.
Our ability to publish games across multiple platforms, through multiple distribution channels, and directly to
consumers (online and wirelessly) has been, and will continue to be, a cornerstone of our product strategy. We
have generated substantial growth in new business models and alternative revenue streams (such as subscription,
micro-transactions, and advertising) based on the continued expansion of our online and wireless product and
service offerings. Some of our games are based on our wholly-owned intellectual property (e.g., Battlefield, Mass
Effect, Need for Speed, The Sims, Bejeweled, and Plants v. Zombies), and some of our games are based on
content that we license from others (e.g., FIFA and Madden NFL). Our goal is to turn our core intellectual
properties into year-round businesses available on a range of platforms. Our products and services may be
purchased through physical and online retailers, platform providers such as console manufacturers and mobile
carriers via digital downloads, as well as directly through our own online distribution platform Origin.
A summary of our significant accounting policies applied in the preparation of our Consolidated Financial
Statements follows:
Consolidation
The accompanying Consolidated Financial Statements include the accounts of Electronic Arts Inc. and its
wholly-owned subsidiaries. Intercompany balances and transactions have been eliminated in consolidation.
Fiscal Year
Our fiscal year is reported on a 52- or 53-week period that ends on the Saturday nearest March 31. Our results of
operations for the fiscal years ended March 31, 2013, 2012 and 2011 each contained 52 weeks and ended on
March 30, 2013, March 31, 2012, and April 2, 2011, respectively. For simplicity of disclosure, all fiscal periods
are referred to as ending on a calendar month-end.
Reclassifications
During the fourth quarter of fiscal year 2013, we reviewed our operating expenses and reclassified certain
amounts, primarily headcount and facilities costs, to align with our current operating structure. As a result, we
also reclassified the related prior year amounts within our Consolidated Statements of Operations for
comparability purposes. These reclassifications did not affect the Company’s consolidated net revenue, gross
profit, operating income (loss), or net income (loss). The effect of the reclassifications on the previously-reported
Consolidated Statement of Operations is reflected in the tables below:
Year Ended March 31, 2012 Year Ended March 31, 2011
As Previously
Reported Change
Reclassified
Balance
As Previously
Reported Change
Reclassified
Balance
Operating expenses:
Research and development .......... $1,212 $(32) $1,180 $1,153 $(29) $1,124
Marketing and sales ............... 853 30 883 747 34 781
General and administrative .......... 375 2 377 301 (5) 296
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