Discontinued Operations

12 Months Ended

Jul. 31, 2012

Discontinued Operations and Disposal Groups [Abstract]

Discontinued Operations

Discontinued Operations

Intuit Websites

In July 2012 management having the authority to do so formally approved a plan to sell our Intuit Websites business, which was a component of our Financial Management Solutions reporting segment. The decision was the result of a shift in our strategy for helping small businesses to establish an online presence. On August 10, 2012 we signed a definitive agreement to sell our Intuit Websites business, subject to closing conditions. We expect the sale to be completed in the first quarter of fiscal 2013 and we do not expect to record a loss on the transaction.

We determined that our Intuit Websites business became a long-lived asset held for sale in the fourth quarter of fiscal 2012. A long-lived asset classified as held for sale is measured at the lower of its carrying amount or fair value less cost to sell. Since the carrying value of Intuit Websites at July 31, 2012 was less than the estimated fair value less cost to sell, no adjustment to the carrying value of this long-lived asset was necessary at that date.

We also classified our Intuit Websites business as discontinued operations in the fourth quarter of fiscal 2012 and have segregated its operating results in our statements of operations for all periods presented. Net revenue from Intuit Websites was $76 million for the twelve months ended July 31, 2012; $79 million for the twelve months ended July 31, 2011; and $52 million for the twelve months ended July 31, 2010. Net income from discontinued operations for the twelve months ended July 31, 2012 included a net loss from Intuit Websites discontinued operations of $11 million and $36 million in tax benefits from the anticipated sale of this business. We recorded net losses from Intuit Websites discontinued operations of $18 million for the twelve months ended July 31, 2011 and $25 million for the twelve months ended July 31, 2010.

Net assets held for sale at July 31, 2012 and July 31, 2011 consisted primarily of operating assets and liabilities that were not material, so we have not segregated them on our balance sheets. Because operating cash flows from the Intuit Websites business were also not material for any period presented, we have not segregated them from continuing operations on our statements of cash flows.

Intuit Real Estate Solutions

On January 15, 2010 we sold our Intuit Real Estate Solutions (IRES) business for approximately $128 million in cash and recorded a net gain on disposal of $35 million, which included $72 million for goodwill and $23 million for income taxes. The decision to sell IRES was a result of management’s desire to focus resources on Intuit’s core products and services. IRES was part of our Other Businesses segment.

We accounted for IRES as discontinued operations and have therefore segregated the operating results of IRES from continuing operations in our statements of operations for all periods prior to the sale. Net revenue from IRES was $33 million and net income excluding the net gain on disposal was less than $1 million for the twelve months ended July 31, 2010. Because IRES operating cash flows were not material for any period presented, we have not segregated them from continuing operations on our statements of cash flows. We have presented the effect of the net gain on disposal of IRES in net income from discontinued operations on our statements of cash flows for the twelve months ended July 31, 2010.