Basis of Presentation and Summary of Significant Accounting Policies New Accounting Standards (Tables)

3 Months Ended

Mar. 31, 2018

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Summary of the effects of the adoption of Topic 606

The following table summarizes the effects of adopting Topic 606 on Cadence’s condensed consolidated balance sheet as of March 31, 2018:

	As reported under Topic 606		Adjustments			Balances under Prior GAAP
	(In thousands)
Receivables, net	$	225,822	$	(18,538	)	$	207,284
Prepaid expenses and other	61,597		(5,255		)	56,342
Long-term receivables	9,380		569			9,949
Other assets	226,998		(11,947		)	215,051
Accounts payable and accrued liabilities*	210,784		(40,357		)	170,427
Current portion of deferred revenue	310,639		78,462			389,101
Long-term portion of deferred revenue	56,276		4,275			60,551
Retained earnings	499,817		(79,876		)	419,941
Accumulated other comprehensive income	5,940		2,325			8,265

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* Cadence has certain arrangements under which consideration is received from customers prior to identifying the specific goods or services to be delivered under the contract. Cadence records an accrued liability on a contract-by-contract basis at the end of each reporting period for cash consideration received.

The following table summarizes the effects of adopting Topic 606 on Cadence’s condensed consolidated income statement for the three months ended March 31, 2018:

	As reported under Topic 606		Adjustments			Balances under Prior GAAP
	(In thousands, except per share amounts)
Product and maintenance revenue	$	480,609	$	6,180		$	486,789
Services revenue	36,704		1,964			38,668
Cost of product and maintenance	41,730		(251		)	41,479
Marketing and sales expense	109,148		(2,810		)	106,338
Provision for income taxes	5,284		557			5,841
Net income	72,885		10,648			83,533
Net income per share - basic	0.27		0.04			0.31
Net income per share - diluted	0.26		0.04			0.30

Cadence’s net cash provided by operating activities for the three months ended March 31, 2018 did not change due to the adoption of Topic 606. The following table summarizes the effects of adopting Topic 606 on the financial statement line items of Cadence’s condensed consolidated statement of cash flows for the three months ended March 31, 2018:

	As reported under Topic 606			Adjustments			Balances under Prior GAAP
	(In thousands)
Net income	$	72,885		$	10,648		$	83,533
Changes in operating assets and liabilities:
Receivables	(10,988		)	(25,638		)	(36,626		)
Prepaid expenses and other	8,392			2,026			10,418
Other assets	8,152			(1,742		)	6,410
Accounts payable and accrued liabilities	(46,956		)	(11,641		)	(58,597		)
Deferred revenue	59,854			26,347			86,201

Schedule of the cumulative effect of the change on retained earnings

The following table presents the cumulative effect adjustments, net of income tax effects, to beginning retained earnings for new accounting standards adopted by Cadence on the first day of fiscal 2018:

	Retained Earnings
	(In thousands)
Balance, December 30, 2017, as previously reported	$	341,003
Cumulative effect adjustment from the adoption of new accounting standards:
Revenue from Contracts with Customers (Topic 606)	91,640
Financial Instruments—Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities	2,638
Income taxes (Topic 740): Intra-entity Transfers of Assets Other Than Inventory	(8,349		)
Balance, December 30, 2017, as adjusted	426,932
Net Income	72,885
Balance, March 31, 2018	$	499,817