Symantec 2007 Annual Report Download - page 53

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2007 for which there is no comparable expense in fiscal 2006. In addition, approximately $96 million of the increase
is due to an additional three months of research and development expenses related to the Veritas acquisition, which
is included for the full year of fiscal 2007 as compared to nine months in fiscal 2006.
Research and development expense as a percentage of total revenues increased to 16% in fiscal 2006 as
compared to 13% in fiscal 2005. The percentage increase and increase in absolute dollars in research and
development expenses in fiscal 2006 as compared to fiscal 2005 was due primarily to the Veritas acquisition, which
contributed $320 million in additional research and development expenses for which there were no comparable
expenses in fiscal 2005.
General and administrative expense
2007 2006 2005
Year Ended March 31,
($ in thousands)
General and administrative ............................ $316,783 $228,563 $116,865
Percentage of total net revenues ........................ 6% 6% 5%
Period over period increase............................ $ 88,220 $111,698
39% 96%
General and administrative expense as a percentage of total revenues was relatively constant in fiscal 2007 and
fiscal 2006. The increase in absolute dollars in general and administrative expenses in fiscal 2007 as compared to
fiscal 2006 was due primarily to higher employee compensation expense of approximately $73 million resulting
from an increase in employee headcount. Higher employee compensation includes the effect of adopting
SFAS No. 123R, which added $24 million of stock-based compensation expense in fiscal 2007 for which there
is no comparable expense in fiscal 2006. In addition, approximately $20 million of the increase is due to an
additional three months of general and administrative expenses related to the Veritas acquisition, which are included
for the full year in fiscal 2007 as compared to nine months in fiscal 2006.
General and administrative expense as a percentage of total revenues increased slightly in fiscal 2006 as
compared to fiscal 2005. The increase in absolute dollars in general and administrative expenses in fiscal 2006 as
compared to fiscal 2005 was due primarily to the Veritas acquisition, which contributed $81 million in additional
general and administrative expenses for which there were no comparable expenses in fiscal 2005. The remaining
increase in general and administrative expenses was due primarily to an increase in employee headcount, resulting
in additional employee compensation expense.
Amortization of other intangible assets
2007 2006 2005
Year Ended March 31,
($ in thousands)
Amortization of other intangible assets ..................... $201,502 $148,822 $5,416
Percentage of total net revenues .......................... 4% 4%
*
Period over period increase ............................. $ 52,680 $143,406
35%
*
*
Percentage not meaningful
Other intangible assets are comprised of customer base, trade names, partnership agreements, and marketing-
related assets. The increased amortization in fiscal 2007 is primarily associated with a full year of amortization
associated with the Veritas acquisition which occurred in July 2005 and the acquisitions of Company-i Limited and
4FrontSecurity, Inc. that occurred during fiscal 2007. We recorded $9 million of other intangible assets associated
with the Company-i and 4FrontSecurity, acquisitions which will be amortized over their useful lives of one to eight
years.
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