Acquisitions

6 Months Ended

Sep. 30, 2011

Acquisitions [Abstract]

ACQUISITIONS

NOTE B — ACQUISITIONS

Acquisitions of businesses are accounted for as purchases and, accordingly, their results of operations have been included in the Company’s Condensed Consolidated Financial Statements since the respective dates of the acquisitions. The purchase price for each of the Company’s acquisitions is allocated to the assets acquired and liabilities assumed from the acquired entity.

In August 2011, the Company acquired 100% of the voting equity interest of Interactive TKO, Inc. (ITKO), a privately held provider of service simulation solutions for developing applications in composite and cloud environments. The acquisition expands solutions the Company offers enterprises and service providers for using and providing cloud computing to deliver business services. The total purchase price of the acquisition was approximately $317 million.

The pro forma effects of the Company’s fiscal year 2012 acquisitions to the Company’s revenues and results of operations during fiscal year 2011 and 2012 were considered immaterial. The purchase price allocation of the Company’s fiscal year 2012 acquisitions is as follows:

	ITKO						Estimated
(dollars in millions)	Acquisition(2)			Other Acquisitions			Useful Life
Finite-lived intangible assets(1)	$	6		$	11		3-15 years
Purchased software		148			8		5-7 years
Goodwill		192			20		Indefinite
Deferred tax assets/(liabilities)		(50	)		(3	)		—
Other assets net of other liabilities assumed(3)		21			3			—
Purchase Price	$	317		$	39

(1)	Includes customer relationships and trade names.
(2)	Purchase price allocation is preliminary due to ongoing analysis to determine the fair value of acquired intangibles and the tax basis of acquired assets and liabilities.
(3)	Includes approximately $20 million of cash acquired relating to ITKO.

Transaction costs for acquisitions were immaterial. The excess purchase price over the estimated value of the net tangible and identifiable intangible assets was recorded to goodwill. The preliminary allocation of a significant portion of the purchase price to goodwill was predominantly due to the intangible assets that are not separable, such as assembled workforce and going concern. The goodwill relating to the ITKO acquisition is not expected to be deductible for tax purposes. Goodwill relating to the other fiscal year 2012 acquisitions is expected to be deductible for tax purposes.

The Company’s acquisitions during the first half of fiscal year 2011 were considered immaterial, both individually and in the aggregate, compared with the results of the Company’s operations. Therefore, purchase accounting information and pro forma disclosure are not presented.

During the third quarter of fiscal year 2011, the Company acquired 100% of the voting equity interests of Arcot Systems, Inc. (Arcot), a privately held provider of authentication and fraud prevention solutions through on-premises software or cloud services. The purchase price allocation was finalized in the second quarter of fiscal 2012 and no material adjustments were made to amounts previously reported. The following represents the allocation of the purchase price and estimated useful lives to the acquired net assets of Arcot:

				Estimated
(dollars in millions)	Arcot			Useful Life
Finite-lived intangible assets(1)	$	39		2-5 years
Purchased software		86		10 years
Goodwill		60		Indefinite
Deferred tax assets/(liabilities)		(1	)		—
Other assets net of other liabilities assumed		13			—
Purchase Price	$	197

⁽¹⁾ Includes customer relationships and trade names.

The Company had approximately $44 million and $77 million of accrued acquisition-related costs at September 30, 2011 and March 31, 2011, respectively, all of which related to purchase price amounts withheld subject to indemnification protections.