Symantec 2014 Annual Report Download - page 151

of our assessment. As additional information becomes available, we reassess the potential liability related to our
pending claims, litigation and government investigations, and may revise our estimates. Any revisions in the
estimates of potential liabilities could have a material impact on our operating results and financial position.
Sales Commissions
Effective March 30, 2013, we changed our accounting policy for sales commissions that are incremental and
directly related to customer sales contracts in which revenue is deferred. These commission costs are accrued and
capitalized upon execution of a non-cancelable customer contract, and subsequently expensed over the term of
such contract in proportion to the related future revenue streams. For commission costs where revenue is
recognized, the related commission costs are recorded in the period of revenue recognition. Prior to this change
in accounting policy, commission costs were expensed in the period in which they were incurred. The adoption
of this accounting policy change has been applied retrospectively to all periods presented in this Annual Report
on Form 10-K, in which the cumulative effect of the change has been reflected as of the beginning of the first
period presented. Deferred commissions as of March 28, 2014 and March 29, 2013 were $136 million and $159
million, respectively. During the year ended March 28, 2014, we capitalized $172 million of commission costs
and amortized $195 million to sales expense, respectively. During the years ended March 29, 2013, and
March 30, 2012, we deferred $190 million and $210 million of commission costs and amortized $208 million and
$186 million to sales expense, respectively.
We believe this change in accounting policy is preferable as the direct and incremental commission costs are
closely related to the revenue, and therefore they should be recorded as an asset and recognized as an expense
over the same period that the related revenue is recognized.
The cumulative effect of the change on accumulated deficit was $98 million as of April 1, 2011. The
cumulative effect of the change on accumulated deficit and accumulated other comprehensive income was $109
million and $3 million, respectively, as of March 30, 2012. The following tables present the changes to financial
statement line items as a result of the accounting change for the periods presented in the accompanying
Condensed Consolidated Financial Statements:
Condensed Consolidated Balance Sheet
March 29, 2013
As Reported Adjustment As Adjusted
(Dollars in millions)
Deferred income taxes $ 198 $ (29) $ 169
Deferred commissions $ - $ 130 $ 130
Long-term deferred commissions $ - $ 29 $ 29
Other long-term assets $ 124 $ (1) $ 123
Other current liabilities $ 313 $ 5 $ 318
Long-term deferred tax liabilities (1) $ 403 $ 6 $ 409
Accumulated other comprehensive income (1) $ 197 $ 5 $ 202
Accumulated deficit (1) $ (2,096) $ 50 $ (2,046)
(1) Adjustment includes a decrease of $17 million in long-term deferred tax liability, an increase of $3 million in
accumulated other comprehensive income, and an increase of $49 million in accumulated deficit, related to the
correction of the deferred revenue error. See discussion of immaterial correction of previously provided financial
information above.
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