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Description of Business and Basis of Presentation
12 Months Ended
Jan. 31, 2013
Description of Business and Basis of Presentation [Abstract]  
Description of Business and Basis of Presentation

1.    Description of Business and Basis of Presentation

Description of Business

Serena Software, Inc. (“Serena” or the “Company”) designs, develops, and sells application lifecycle management, application release management, and information technology management software and solutions, which the Company refers to collectively as its “Orchestrated IT” management solutions. Our primary goal is to provide Orchestrated IT solutions that advance the business value of IT. Our Orchestrated IT solutions simplify and automate the transition of new versions of applications into production by managing request, development, release, change and support processes across heterogeneous environments, including mainframe and non-mainframe environments.

On March 2006, Spyglass Merger Corp., an affiliate of Silver Lake, a private equity firm, merged with and into the Company, a transaction referred to in this report as the “merger.” As a result of the merger, the Company’s common stock ceased to be traded on the NASDAQ National Market and it became a privately-held company, with approximately 56.5% of the common stock at the time of the merger on a fully diluted basis owned by investment funds affiliated with Silver Lake.

Silver Lake also owns the only authorized, issued and outstanding share of series A preferred stock, which ranks senior to the Company’s common stock as to rights of payment upon liquidation. The series A preferred stock is not entitled to receive or participate in any dividends.

Basis of Presentation

The consolidated financial statements, which include the Company and its wholly owned subsidiaries, are prepared in conformity with generally accepted accounting principles in the United States of America (“U.S. GAAP”). All intercompany balances and transactions have been eliminated. Certain amounts in the prior year consolidated financial statements have been reclassified to conform to the current year presentation.

Correction of Immaterial Errors

During the second quarter of fiscal year 2013, the Company concluded that previously reported interest expense and accrued interest on long-term debt were overstated. The Company assessed the materiality of these errors, using relevant quantitative and qualitative factors, and determined these errors, both individually and in the aggregate, were not material to any previously reported period, but could have been material if recorded in the second quarter of fiscal 2013. Accordingly, the Company revised the consolidated balance sheet as of January 31, 2012 and 2011 by reducing the accrued interest by approximately $1.8 million with a corresponding decrease in accumulated deficit. In addition, accumulated deficit as of the beginning of the year ended January 31, 2011 was decreased by approximately $1.5 million. The Company revised the consolidated statements of comprehensive income (loss) for the years ended January 31, 2011by reducing interest expense of approximately $0.3 million.