Symantec 2014 Annual Report Download - page 146

Property and equipment
Property, equipment, and leasehold improvements are stated at cost, net of accumulated depreciation. We
capitalize costs incurred during the application development stage related to the development of internal use
software and enterprise cloud computing services. We expense costs incurred related to the planning and post-
implementation phases of development as incurred. Depreciation is provided on a straight-line basis over the
estimated useful lives. Estimated useful lives for financial reporting purposes are as follows: buildings, 20 to
30 years; leasehold improvements, the lesser of the life of the improvement or the initial lease term; computer
hardware and software, and office furniture and equipment, 3 to 5 years.
The following table summarizes property and equipment, net of accumulated depreciation by categories for
the periods presented:
March 28,
2014
March 29,
2013
(Dollars in millions)
Computer hardware and software $ 1,797 $ 1,820
Office furniture and equipment 140 172
Buildings 539 530
Leasehold improvements 356 310
2,832 2,832
Accumulated depreciation (1,823) (1,853)
1,009 979
Construction in progress 28 64
Land 79 79
Total $ 1,116 $ 1,122
Depreciation expense was $281 million, $283 million, and $273 million in fiscal 2014, 2013, and 2012,
respectively.
Business combinations
We use the acquisition method of accounting under the authoritative guidance on business combinations.
Each acquired company’s operating results are included in our Consolidated Financial Statements starting on the
date of acquisition. The purchase price is equivalent to the fair value of consideration transferred. Tangible and
identifiable intangible assets acquired and liabilities assumed as of the date of acquisition are recorded at the
acquisition date fair value. Goodwill is recognized for the excess of purchase price over the net fair value of
assets acquired and liabilities assumed.
Amounts allocated to assets and liabilities are based upon fair values. Such valuations require management
to make significant estimates and assumptions, especially with respect to the identifiable intangible assets.
Management makes estimates of fair value based upon assumptions believed to be reasonable and that of a
market participant. These estimates are based on historical experience and information obtained from the
management of the acquired companies and the estimates are inherently uncertain. The separately identifiable
intangible assets generally include developed technology, customer relationships and trade names. We estimate
the fair value of deferred revenue related to product support assumed in connection with acquisitions. The
estimated fair value of deferred revenue is determined by estimating the costs related to fulfilling the obligations
plus a normal profit margin. The estimated costs to fulfill the support contracts are based on the historical direct
costs related to providing the support.
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