Symantec 2008 Annual Report Download - page 127

Research and development expense as a percentage of total revenues has remained relatively constant in fiscal
2008, fiscal 2007 and fiscal 2006. The increase in absolute dollars in fiscal 2008 as compared to fiscal 2007 is
attributable to a higher employee compensation expense primarily related to the Altiris and Vontu acquisitions. The
increase in fiscal 2007 as compared to fiscal 2006 was due primarily to higher employee compensation expense of
approximately $108 million resulting from an increase in employee headcount. Higher employee compensation
expense includes the effect of adopting of SFAS No. 123R, which added $57 million of stock-based compensation
expense in fiscal 2007 for which there is no comparable expense in fiscal 2006. In addition, approximately
$96 million of the increase is due to an additional three months of research and development expenses related to the
Veritas acquisition, which is included for the full year of fiscal 2007 as compared to nine months in fiscal 2006.
General and administrative expense
2008 2007 2006
Fiscal
($ in thousands)
General and administrative ............................ $347,642 $316,783 $228,563
Percentage of total net revenues ........................ 6% 6% 6%
Period over period change ............................ $ 30,859 $ 88,220
10% 39%
General and administrative expense as a percentage of total revenues has remained relatively constant in fiscal
2008, fiscal 2007, and fiscal 2006. The increase in general and administrative expenses in fiscal 2008 as compared
with fiscal 2007 is primarily due to higher salaries and wages resulting from the Altiris and Vontu acquisitions offset
by a gradual reduction in headcount during fiscal 2008. The increase in absolute dollars in general and admin-
istrative 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 compen-
sation expense in fiscal 2007 for which there is no comparable expense in fiscal 2006. In addition, approximately
$20 million of the increase is due to an additional three months of general and administrative expenses related to the
Veritas acquisition, which are included for the full year in fiscal 2007 as compared to nine months in fiscal 2006.
Amortization of other purchased intangible assets
2008 2007 2006
Fiscal
($ in thousands)
Amortization of other purchased intangible assets . . ......... $225,131 $201,502 $148,822
Percentage of total net revenues ........................ 4% 4% 4%
Period over period change ............................ $ 23,629 $ 52,680
12% 35%
Other purchased intangible assets are comprised of customer base, tradenames, partnership agreements, and
marketing-related assets. The increased amortization in fiscal 2008 is primarily associated with a full year of
amortization of intangible assets associated with the Altiris purchase which occurred in April 2007. 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. For further discussion of other intangible assets from acquisitions and related
amortization, see Note 7 of the Notes to Consolidated Financial Statements in this annual report.
Acquired in-process research and development (IPR&D)
During fiscal 2006, we wrote off IPR&D totaling $285 million, of which $284 million was in connection with
our acquisition of Veritas. The IPR&D was written off because the acquired technologies had not reached
technological feasibility and had no alternative uses. Technological feasibility is defined as being equivalent to
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