(Mark One)
|
|
ü
|
Annual Report Pursuant To Section 13 or 15(d) of
the Securities Exchange Act of 1934
|
|
For the fiscal year ended March 31, 2016
|
|
OR
|
|
Transition Report Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
|
Delaware
|
|
13-2857434
|
(State or Other Jurisdiction of Incorporation or Organization)
|
|
(I.R.S. Employer Identification Number)
|
520 Madison Avenue,
New York, New York
|
|
10022
|
(Address of Principal Executive Offices)
|
|
(Zip Code)
|
(Title of each class)
|
|
(Name of each exchange on which registered)
|
Common Stock, par value $0.10 per share
Stock Purchase Rights Preferred Stock, Class A
|
|
The NASDAQ Stock Market LLC
The NASDAQ Stock Market LLC
|
Part I
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Part II
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Part III
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Part IV
|
|
|
|
|
|
•
|
Agile Management
enables customers to more effectively plan and manage the software development process and the business of IT service delivery. Our solutions enable customers to improve delivery time on large projects, reduce costs and optimize resources. This positions CA to partner with and guide customers early in the business transformation process.
|
▪
|
CA Agile Central.
The acquisition of Rally Software Development Corp. (Rally) during fiscal 2016 gives us the ability to help customers with their transition from the traditional waterfall methodology of software development (serial processes) to the Agile methodology (iterative work cadences that decrease time-to-market and increase product quality). It allows businesses to collaboratively plan, prioritize and track software development work at scale, across the enterprise.
|
▪
|
CA Project & Portfolio Management (PPM).
Our solutions enable customers to improve their decision processes and resource optimizations of technology investments and decrease project execution risk. This foundational piece of our Agile Management strategy is complementary to CA Agile Central.
|
▪
|
CA Service Management.
Our solutions empower corporate IT teams to speed up and streamline service desk operations while reducing complex and repetitive tasks with comprehensive automation capabilities and simple configuration.
|
•
|
DevOps
is adjacent to Agile Management and comprises a range of solutions that allow customers to efficiently deliver and manage applications and IT infrastructure. With our portfolio of solutions, customers can reduce the delivery time of new applications, increase the frequency of new releases and dramatically improve quality.
|
▪
|
Application Program Interface Management (API Management).
Our solutions help enterprises and organizations connect more directly to end-users via mobile apps, cloud platforms and the ‘Internet of Things’ through APIs, or application program interfaces, which are the building blocks of application and software development. Our API Management solutions simplify and secure application development, and facilitate the integration of legacy systems with modern applications - all of which enable the monetization of data. New solutions include
CA Live API Creator
which enables customers to rapidly create API connectors from data sources like MongoDB and Oracle SQL, supporting developers’ accelerating pace of innovation. Additionally,
CA Mobile App Services
provides common back-end services, like open software development kits and APIs to enable rapid development of enterprise-class mobile applications.
|
▪
|
Continuous Delivery.
Our solutions optimize application development processes by automating the deployment of applications across all stages of their lifecycles. Our three primary solutions are:
CA Service Virtualization
, which eliminates constraints in development and testing by modeling and simulating the behavior and performance characteristics of dependent systems and services enabling defects to be identified quickly and improving time-to-market;
CA Release Automation
, which automates and orchestrates the complex process of deploying and promoting new application capabilities from planning through development and production; and
CA Test Data Manager
, which automates the creation and management of the test data needed to test evolving applications.
|
▪
|
Application Performance Management (APM).
Application availability for the end user is dependent on a series of disparate systems performing in concert. Our APM
solutions provide deep application diagnostics, end-user experience monitoring, synthetic monitoring and analytics to proactively identify and fix issues before users are impacted. Our APM solutions scale and manage billions of transactions, across diverse enterprise applications and platforms, including Amazon Web Services™ (AWS).
|
▪
|
Infrastructure Management.
Our solutions offer a unified approach to monitoring and managing network, server and storage performance, whether they are contained within traditional data centers or diverse cloud environments. Our solutions provide operations teams in some of the largest IT organizations in the world with rapid access to the information needed to improve service quality, predictability and efficiency.
CA Unified Infrastructure Management (UIM)
enables monitoring and management of server, storage and network devices, including in public cloud environments such as AWS™ and Microsoft AZURE™.
|
•
|
Security
includes a comprehensive set of solutions to address the growing concern across all enterprises and organizations regarding external and internal threats to their environments and the critical data they contain. Security is often a top ranked spending priority among Chief Information Officers (CIOs) and Chief Information Security Officers (CISOs), with the majority projecting increasing spend year-over-year. Our identity-centric security portfolio allows customers to manage identities and regulate access from the device to the data center, providing a complete, end-to-end, and multi-channel security solution. This empowers customers to centrally manage and control access to applications and data in both on-premise and cloud deployments, and across web, mobile and API channels.
|
▪
|
Privileged Access Management (PAM).
Privileged users, or users who have elevated access or administrator rights, are commonly the targets of data breach attempts.
Our acquisition of Xceedium, Inc. (Xceedium) during fiscal 2016 expanded our PAM solutions that enable customers to control and monitor privileged user access and activity, detecting and preventing the threat of internal and external attacks.
|
▪
|
Identity Management.
We offer a unified solution with user provisioning, user management and governance for identities throughout their lifecycle, providing timely and compliant access to applications and data.
|
▪
|
Advanced Authentication.
We offer risk-based and credential-based authentication enabling customers to comply with regulatory mandates in authenticating employees, partners and consumers with a frictionless user experience.
|
▪
|
Single Sign-On (SSO).
Our solutions provide secure single sign-on and flexible access management to web applications on-premise or in the cloud.
|
▪
|
Payment Security.
We offer a SaaS-based payment card enrollment and authentication service to help banks protect against fraud and ensure a hassle-free online shopping experience for their customers.
|
•
|
Application Development
solutions help enable agile development processes, modernize applications and enable collaboration across the mobile to mainframe teams.
|
•
|
Databases and Database Management
solutions help customers manage the growth and increasing complexity of data and allow them to address their ever-evolving data management needs and enable web and mobile access of data.
|
•
|
Security & Compliance
solutions manage risk and ensure regulatory compliance across the enterprise with modern tools. Our solutions reduce risk from unauthorized access, secure mainframe assets, monitor instances that affect compliance and discover sensitive data. Our solutions secure data at rest and in motion, across the enterprise.
|
•
|
Systems and Operations Management
portfolio provides customers with a unified view of their z Systems performance, including their applications, middleware, networks, systems, storage and data.
|
•
|
Drive organic innovation.
Our product development strategy is built around key growth areas, where we are focused on innovating and delivering differentiated products and solutions across both distributed and mainframe. We are focused on developing solutions that are easy to use, easy to implement and have a low total cost of ownership. A key element of our organic innovation approach is the broad adoption of the Agile methodology to govern our software development process, which we believe will improve our product development time-to-market, quality and relevance, and support our customer success initiatives.
|
•
|
Incubate technology for next generation products.
We are researching and dedicating resources to the development of emerging technologies that are logical extensions of our core areas of focus. We are working on opportunities in areas such as containers, data analytics, big data and open source, some of which may become enhancements or extensions of our current product portfolio and others may evolve to new product categories.
|
•
|
Pursue new business models and expanded routes to market.
While our traditional on-premise software delivery remains core to many enterprise customers, we see cloud-based and try-and-buy models as increasingly attractive for our customers. These models simplify their decision-making and accelerate the value they can derive from new solution investments. New delivery models allow us to extend our market reach, speed adoption of our solutions, improve our efficiencies and compete more effectively for a larger number of customers globally. As such, our new product development is focused on our customers’ need for solutions that are simple and cost-effective to buy, install, deploy, manage and secure.
|
•
|
Expand relationships with our global customer base and address opportunities with new and underserved customers.
We are focused on maintaining and expanding the strong relationships with our established customer base, and will proactively target growth with other potential customers that we do not currently serve. In parallel, we are seeking to broaden our customer base to new buyers in geographic regions we have underserved. The emerging roles of CISOs and Chief Development Officers impacts who and where IT environment purchasing decisions are made within our customers. This shift aligns with the product portfolio decisions we are making across our solutions set to meet our customers' accelerating need for speed and agility. We are refining our sales, services, marketing and customer success resources to reach beyond the customers’ CIO and IT department to serve these new customer roles and respond to changes in customer buying behaviors.
|
•
|
Execute strategic and disciplined technology acquisitions.
We intend to supplement our organic innovation efforts with key technology acquisitions that are within or adjacent to our core areas of focus. We conduct a thorough acquisition process, which includes build vs. buy analysis and opportunity identification, detailed business case modeling, rigorous due diligence and extensive integration, to fully realize the value of our acquisitions.
|
•
|
In June 2015, Otto Berkes joined as Chief Technology Officer and is leading our targeted research and development efforts for next generation products and enhancements.
|
•
|
In July 2015, we completed our acquisition of Rally, a leading provider of Agile development software and services.
|
•
|
In August 2015, Ayman Sayed joined as Chief Product Officer and is driving increased agility, efficiency and discipline across the product organization, while focusing on the development of secure, easy to install, and easy to manage solutions to solve customer problems.
|
•
|
In August 2015, we completed our acquisition of Xceedium, a privately held provider of privileged identity management solutions that protect on-premise, cloud and hybrid IT environments.
|
•
|
In August 2015, we issued
$400 million
of
3.600%
Senior Notes due August 2020.
|
•
|
In October 2015, we entered into an agreement with Bank of America, N.A. for a $300 million term loan with a maturity date of April 20, 2022.
|
•
|
In November 2015, we repurchased 22 million shares from Careal Holding, AG for an aggregate price of $590 million, effectively completing our $1 billion share repurchase authorization.
|
•
|
In November 2015, we held our user conference, CA World ‘15. This event showcased our unique strength in serving customers in the Application Economy. The event highlighted our solutions as well as our vision of the future to thousands of customers and partners.
|
•
|
In November 2015, our Board of Directors approved a new stock repurchase program that authorized us to acquire up to $750 million of our common stock. At March 31, 2016, the new $750 million stock repurchase program remained fully outstanding.
|
•
|
In November 2015, we announced our intention to increase our dividend in fiscal 2017, subject to quarterly Board approval, to $1.02 per share for the year, or $0.255 per share on a quarterly basis. This would be an increase from the current $1.00 per share annual dividend, or $0.25 per share on a quarterly basis.
|
•
|
Resellers
derive a significant amount of revenue from the resale of third-party products. We are working with a number of key strategic national and regional reseller partners to expand our global reach.
|
•
|
Global service providers
provide a platform for application infrastructure or cloud-based services. We are working to establish long-term partnerships to support the development of innovative, differentiated services.
|
•
|
Global system integrators
offer our software within their business practices, leveraging their process design, planning, and vertical expertise to provide holistic solutions and implementation services to our joint customers.
|
•
|
Managed service providers
leverage our solutions to power their subscription-based IT services. We work together to deliver differentiated, high-value managed services.
|
•
|
Global technology partners
(
including Independent Software Vendors (ISVs) and Infrastructure and Cloud Vendors) offer an opportunity for joint solutions innovation and CA brand awareness.
|
•
|
A typical designated CPU (central processing unit) license, under which the customer may use the licensed product on a single, designated CPU.
|
•
|
A MIPS (millions of instructions per second)-based license, which allows the customer to use the licensed product on one or more CPUs, limited by the aggregate MIPS rating of the CPUs covered by the license.
|
•
|
A user-based license, under which the customer may use the licensed product by or for the agreed number of licensed users.
|
•
|
A designated server license, under which the customer may use a certain distributed product on a single, designated server. The licensed products must be licensed for use with a specific operating system.
|
•
|
Ensure that any new offerings address the needs of a rapidly changing market while not adversely affecting the demand for our traditional products or our profitability to an extent greater than anticipated;
|
•
|
Enable our sales force to accelerate growth of sales to new customers and expand sales with existing customers, including sales outside of our renewal cycle and to a broadening set of purchasers outside of traditional information technology operations. This growth needs to be at levels sufficient to offset any decline in revenue and/or sales in our Mainframe Solutions segment and in certain mature product lines in our Enterprise Solutions segment:
|
▪
|
in our Platinum customer accounts where we already have strong relationships;
|
▪
|
in our Named customer accounts where a competitor already has an established relationship; and
|
▪
|
in our Growth/Partners customer accounts where we currently do not have a strong presence and where we may have a dependence on unfamiliar distribution routes and offerings of a type not previously provided by us;
|
•
|
Effectively manage the strategic shift in our business model to develop more easily installed software, provide additional SaaS offerings and refocus our professional services and education engagements on those engagements that are connected to new product sales, without affecting our financial performance to an extent greater than anticipated; and
|
•
|
Effectively manage our pricing and other go-to-market strategies, as well as improve the CA Technologies brand, technology and innovation awareness in the marketplace.
|
•
|
Developing and executing an effective go-to-market strategy in various locations;
|
•
|
Foreign exchange rates;
|
•
|
Local economic conditions;
|
•
|
Restrictive local laws regarding the transfer of funds from, or the conversion of currencies in, certain countries;
|
•
|
Political stability and acts of terrorism;
|
•
|
Workforce reorganizations in various locations, including global reorganizations of sales, research and development, technical services, finance, human resources and facilities functions;
|
•
|
Effectively staffing key managerial and technical positions;
|
•
|
Successfully localizing software products for a significant number of international markets;
|
•
|
Restrictive employment regulation;
|
•
|
Trade restrictions such as tariffs, duties, taxes or other controls;
|
•
|
International intellectual property laws, which may be more restrictive or may offer lower levels of protection than U.S. law; and
|
•
|
Compliance by us and our partners (including unaffiliated third-party partners) with differing, changing and potentially inconsistent local laws, regulations and interpretations in multiple international jurisdictions, as well as compliance with U.S. laws and regulations where applicable in these international locations, such as anti-corruption, competition, anti-money laundering, export control and data privacy laws and regulations, including the U.S. Foreign Corrupt Practices Act of 1977, the UK Bribery Act of 2010, the potential impact of recent EU activity regarding data transfer restrictions as well as the impending General Data Protection Regulation (GDPR) and Network and Information Security (NIS) Directive in the EU, trade controls and sanctions administered by the U.S. Office of Foreign Assets Control and similar laws and regulations in other jurisdictions.
|
•
|
We may find that the acquired company or assets do not improve our financial and strategic position as planned;
|
•
|
We may have difficulty integrating the operations, facilities, personnel and commission plans of the acquired business;
|
•
|
We may have difficulty forecasting or reporting results subsequent to acquisitions;
|
•
|
We may have difficulty retaining the skills needed to further market, sell or provide services on the acquired products in a manner that will be accepted by the market;
|
•
|
We may have difficulty incorporating the acquired technologies or products into our existing product lines;
|
•
|
We may have product liability, customer liability or intellectual property liability associated with the sale of the acquired company’s products;
|
•
|
Our ongoing business may be disrupted by transition or integration issues and our management’s attention may be diverted from other business initiatives;
|
•
|
We may be unable to obtain timely approvals from governmental authorities under applicable competition and antitrust laws;
|
•
|
We may have difficulty maintaining uniform standards, controls, procedures and policies;
|
•
|
Our relationships with current and new employees, customers and distributors could be impaired;
|
•
|
An acquisition may result in increased litigation risk, including litigation from terminated employees or third parties;
|
•
|
Our due diligence process may fail to identify significant issues with the acquired company’s product quality, financial disclosures, accounting practices, internal control deficiencies including material weaknesses, product architecture, legal and tax contingencies, compliance with differing, changing and potentially inconsistent local laws, regulations and interpretations in multiple international jurisdictions, as well as compliance with U.S. laws and regulations where applicable in these international locations, and other matters; and
|
•
|
We may not be able to realize the benefits of recognized goodwill and intangible assets and this may result in the potential impairment of these assets.
|
•
|
Loss of or delay in revenue and loss of market share;
|
•
|
Loss of customers, including the inability to obtain repeat business with existing key customers;
|
•
|
Damage to our reputation;
|
•
|
Failure to achieve market acceptance;
|
•
|
Diversion of development resources;
|
•
|
Remediation efforts that may be required;
|
•
|
Increased service and warranty costs;
|
•
|
Legal actions by customers or government authorities against us that, whether or not successful, could be costly, distracting and time-consuming;
|
•
|
Increased insurance costs; and
|
•
|
Failure to successfully complete service or customer support engagements for product installations, implementations and integrations.
|
|
Fiscal 2016
|
|
Fiscal 2015
|
||||||||||||
|
High
|
|
Low
|
|
High
|
|
Low
|
||||||||
Fourth Quarter
|
$
|
31.11
|
|
|
$
|
25.83
|
|
|
$
|
33.11
|
|
|
$
|
29.89
|
|
Third Quarter
|
$
|
29.35
|
|
|
$
|
26.53
|
|
|
$
|
31.37
|
|
|
$
|
25.52
|
|
Second Quarter
|
$
|
30.71
|
|
|
$
|
25.57
|
|
|
$
|
29.64
|
|
|
$
|
27.64
|
|
First Quarter
|
$
|
32.39
|
|
|
$
|
29.07
|
|
|
$
|
31.84
|
|
|
$
|
28.29
|
|
Period
|
Total Number Of Shares Purchased
|
|
Average Price Paid Per Share
|
|
Total Number Of Shares Purchased As Part Of Publicly Announced Plans Or Programs
|
|
Approximate Dollar Value Of Shares That May Yet Be Purchased Under The Plans Or Programs
|
||||||
|
(in thousands, except average price paid per share)
|
||||||||||||
January 1, 2016 — January 31, 2016
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
750,000
|
|
February 1, 2016 — February 29, 2016
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
750,000
|
|
March 1, 2016 — March 31, 2016
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
750,000
|
|
Total
|
—
|
|
|
|
|
—
|
|
|
|
|
Year Ended March 31,
|
||||||||||||||||||
Statement Of Operations And Other Data
|
2016
|
|
2015
|
|
2014
|
|
2013
|
|
2012
|
||||||||||
|
(in millions, except per share amounts)
|
||||||||||||||||||
Revenue
(1)
|
$
|
4,025
|
|
|
$
|
4,262
|
|
|
$
|
4,412
|
|
|
$
|
4,504
|
|
|
$
|
4,658
|
|
Income from continuing operations
(1) (2)
|
$
|
769
|
|
|
$
|
810
|
|
|
$
|
887
|
|
|
$
|
921
|
|
|
$
|
901
|
|
Cash provided by operating activities — continuing operations
(1)
|
$
|
1,034
|
|
|
$
|
1,030
|
|
|
$
|
973
|
|
|
$
|
1,359
|
|
|
$
|
1,456
|
|
Basic income per common share from continuing operations
(1)
|
$
|
1.79
|
|
|
$
|
1.83
|
|
|
$
|
1.97
|
|
|
$
|
2.00
|
|
|
$
|
1.84
|
|
Diluted income per common share from continuing operations
(1)
|
$
|
1.78
|
|
|
$
|
1.82
|
|
|
$
|
1.96
|
|
|
$
|
1.99
|
|
|
$
|
1.83
|
|
Dividends declared per common share
(3)
|
$
|
1.00
|
|
|
$
|
1.00
|
|
|
$
|
1.00
|
|
|
$
|
1.00
|
|
|
$
|
0.40
|
|
|
At March 31,
|
||||||||||||||||||
Balance Sheet Data
|
2016
|
|
2015
|
|
2014
|
|
2013
|
|
2012
|
||||||||||
|
(in millions)
|
||||||||||||||||||
Working capital surplus
(4) (5) (6)
|
$
|
667
|
|
|
$
|
1,048
|
|
|
$
|
635
|
|
|
$
|
584
|
|
|
$
|
213
|
|
Working capital surplus, excluding current deferred revenue
(1) (5) (6) (7)
|
$
|
2,864
|
|
|
$
|
3,162
|
|
|
$
|
3,054
|
|
|
$
|
3,010
|
|
|
$
|
2,817
|
|
Total assets
(5)
|
$
|
11,204
|
|
|
$
|
10,973
|
|
|
$
|
12,008
|
|
|
$
|
11,810
|
|
|
$
|
11,991
|
|
Long-term debt (less current maturities)
(5)
|
$
|
1,947
|
|
|
$
|
1,247
|
|
|
$
|
1,244
|
|
|
$
|
1,269
|
|
|
$
|
1,281
|
|
Stockholders’ equity
|
$
|
5,378
|
|
|
$
|
5,625
|
|
|
$
|
5,570
|
|
|
$
|
5,450
|
|
|
$
|
5,397
|
|
(1)
|
Information presented excludes the results of our discontinued operations.
|
(2)
|
In fiscal 2014, we incurred after-tax charges of $114 million for costs associated with our fiscal 2014 rebalancing plan.
|
(3)
|
In fiscal 2016, 2015, 2014 and 2013, dividends declared per common share were $0.25 per quarter. Dividends declared per common share were $0.05 in each of the first three quarters of fiscal 2012 and $0.25 in the fourth quarter of fiscal 2012.
|
(4)
|
Working capital surplus is current assets less current liabilities.
|
(5)
|
Prior year amounts have been adjusted to reflect the adoption of Accounting Standards Update No. 2015-03,
Simplifying the Presentation of Debt Issuance Costs
(Topic 835). Refer to Note 1, “Significant Accounting Policies” in the Notes to the Consolidated Financial Statements for further details.
|
(6)
|
In fiscal 2016, we adopted Accounting Standards Update No. 2015-17,
Balance Sheet Classification of Deferred Taxes
(Topic 740) and applied the guidance prospectively to all deferred tax assets and liabilities. Refer to Note 1, “Significant Accounting Policies” in the Notes to the Consolidated Financial Statements for further details.
|
(7)
|
Deferred revenue includes amounts billed or collected in advance of revenue recognition, including subscription license agreements, maintenance and professional services. It does not include unearned revenue on future installments not yet billed at the respective balance sheet dates.
|
•
|
Agile Management
enables customers to more effectively plan and manage the software development process and the business of IT service delivery. Our solutions enable customers to improve delivery time on large projects, reduce costs and optimize resources.
|
•
|
DevOps
is adjacent to Agile Management and comprises a range of solutions that allow customers to efficiently deliver and manage applications and IT infrastructure. With our portfolio of solutions, customers can reduce the delivery time of new applications, increase the frequency of new releases and dramatically improve quality.
|
•
|
Security
includes a comprehensive set of solutions to address the growing concern across all enterprises and organizations regarding external and internal threats to their environments and the critical data they contain. Our identity-centric security portfolio allows customers to manage identities and regulate access from the device to the data center, providing a complete, end-to-end, and multi-channel security solution.
|
•
|
Application Development
solutions help enable agile development processes, modernize applications and enable collaboration across the mobile to mainframe teams.
|
•
|
Databases and Database Management
solutions help customers manage the growth and increasing complexity of data and allow them to address their ever-evolving data management needs and enable web and mobile access of data.
|
•
|
Security & Compliance
solutions manage risk and ensure regulatory compliance across the enterprise with modern tools. Our solutions reduce risk from unauthorized access, secure mainframe assets, monitor instances that affect compliance and discover sensitive data. Our solutions secure data at rest and in motion, across the enterprise.
|
•
|
Systems and Operations Management
portfolio provides customers with a unified view of their z Systems performance, including their applications, middleware, networks, systems, storage and data.
|
•
|
Drive organic innovation.
Our product development strategy is built around key growth areas, where we are focused on innovating and delivering differentiated products and solutions across both distributed and mainframe. A key element of our organic innovation approach is the broad adoption of the Agile methodology to govern our software development process, which we believe will improve our product development time-to-market, quality and relevance, and support our customer success initiatives.
|
•
|
Incubate technology for next generation products.
We are researching and dedicating resources to the development of emerging technologies that are logical extensions of our core areas of focus. We are working on opportunities in areas such as containers, data analytics, big data and open source, some of which may become enhancements or extensions of our current product portfolio and others may evolve to new product categories.
|
•
|
Pursue new business models and expanded routes to market.
While our traditional on-premise software delivery remains core to many enterprise customers, we see cloud-based and try-and-buy models as increasingly attractive for our customers.
|
•
|
Expand relationships with our global customer base and address opportunities with new and underserved customers.
We are focused on maintaining and expanding the strong relationships with our established customer base, and will proactively target growth with other potential customers that we do not currently serve. In parallel, we are seeking to broaden our customer base to new buyers in geographic regions we have underserved. The emerging roles of Chief Information Security Officers and Chief Development Officers align with the shifts we are driving across our portfolio to meet the needs of speed and agility.
|
•
|
Execute strategic and disciplined technology acquisitions.
We intend to supplement our organic innovation efforts with key technology acquisitions that are within or adjacent to our core areas of focus. We conduct a thorough acquisition process, which includes build vs. buy analysis and opportunity identification, detailed business case modeling, rigorous due diligence and extensive integration, to fully realize the value of our acquisitions.
|
•
|
Total revenue
decreased
$237 million
, or
6%
, primarily as a result of an
unfavorable
foreign exchange effect of
$212 million
during fiscal
2016
and, to a lesser extent, a decrease in subscription and maintenance revenue.
|
•
|
We expect revenue for fiscal 2017 to be generally consistent or increase slightly compared with fiscal 2016.
|
•
|
Total bookings
increased
18%
primarily due to an increase in renewal bookings, including the renewal with a large system integrator in excess of $500 million that occurred during the second quarter of fiscal 2016 and bookings relating to our second quarter fiscal 2016 acquisitions of Rally Software Development Corp. (Rally) and Xceedium, Inc. (Xceedium) (together, our second quarter fiscal 2016 acquisitions). This was partially offset by an unfavorable foreign exchange effect.
|
•
|
Renewal bookings increased by a percentage in the mid-twenties compared with the year-ago period primarily due to the aforementioned renewal with a large system integrator. Excluding the large system integrator renewal, renewal bookings increased by a percentage in the low single digits for fiscal 2016 compared with the year-ago period primarily due to the increase in renewal bookings relating to our second quarter fiscal 2016 acquisitions.
|
•
|
Total new product sales increased by a percentage in the mid-single digits for fiscal 2016 compared with the year-ago period. This increase was primarily due to the new sales in connection with our second quarter fiscal 2016 acquisitions and renewals, including the aforementioned renewal with a large system integrator.
|
•
|
Mainframe solutions new product sales, including capacity, increased by a percentage in the high-teens compared with the year-ago period primarily due to the aforementioned renewal with a large system integrator and new product sales in connection with other renewals.
|
•
|
Enterprise solutions new product sales increased by a percentage in the low-single digits compared with the year-ago period primarily as a result of Enterprise Solutions new product sales associated with our second quarter fiscal 2016 acquisitions. Excluding our second quarter fiscal 2016 acquisitions, Enterprise Solutions new product sales decreased by a percentage in the high single digits for fiscal 2016 compared with the year-ago period.
|
•
|
We expect fiscal 2017 renewals to increase by a percentage in the mid-single digits compared with fiscal 2016.
|
•
|
Total expenses before interest and income taxes
decreased
7%
compared with fiscal
2015
primarily as a result of a decrease in non-acquisition personnel costs and a favorable effect from foreign exchange during fiscal 2016. These decreases were partially offset by an increase in costs from our second quarter fiscal 2016 acquisitions.
|
•
|
Income tax expense for fiscal
2016
and fiscal
2015
was
$315 million
and
$305 million
, respectively.
|
•
|
Our fiscal
2016
and
2015
effective tax rate was
29.1%
and
27.4%
, respectively. This increase resulted primarily from the favorable resolutions of uncertain tax positions in fiscal 2015 relating to the completion of the examination of our U.S. federal income tax returns for the tax years ended March 31, 2011 and 2012.
|
•
|
Diluted income per common share from continuing operations
decreased
to
$1.78
from
$1.82
, primarily due to the decrease in revenue, partially offset by the decrease in operating expenses and the decrease in the weighted average common shares outstanding.
|
•
|
Mainframe Solutions revenue
decreased
primarily due to an unfavorable foreign exchange effect of $125 million and, to a lesser extent, insufficient revenue from new sales to offset the decline in revenue contribution from renewals. Mainframe Solutions operating margin for fiscal 2016 increased primarily due to a decrease in personnel-related costs.
|
•
|
Enterprise Solutions revenue
decreased
due to an unfavorable foreign exchange effect of $71 million. Excluding the unfavorable effect of foreign exchange, Enterprise Solutions revenue increased as a result of additional revenue associated with our second quarter fiscal 2016 acquisitions. Enterprise Solutions operating margin for fiscal 2016 decreased primarily due to costs from our second quarter fiscal 2016 acquisitions, partially offset by a decrease in non-acquisition personnel-related costs.
|
•
|
Services revenue
decreased
primarily due to an unfavorable foreign exchange effect of
$16 million
and, to a lesser extent, a decline in professional services engagements in the first half of fiscal 2016 and during fiscal 2015, partially offset by an increase in services revenue from our Rally acquisition. Operating margin for Services increased to 7% for fiscal 2016 compared with 3% for fiscal 2015 primarily due to a decrease in personnel-related costs as a result of our prior period severance actions and a decrease in external consulting costs.
|
•
|
Net cash provided by continuing operating activities increased slightly due to lower disbursements, lower payments associated with our Fiscal Year 2014 Rebalancing Plan (Fiscal 2014 Plan) and lower income tax payments, net, offset by a decrease in cash collections from billings, which included lower single installment payments. There was an overall unfavorable effect from foreign exchange on net cash provided by continuing operating activities.
|
|
|
Year Ended March 31,
|
|
Change
|
|
Percent Change
|
|||||||||
|
|
2016
(1)
|
|
2015
(1)
|
|
||||||||||
|
|
(dollars in millions)
|
|
|
|||||||||||
Total revenue
|
|
$
|
4,025
|
|
|
$
|
4,262
|
|
|
$
|
(237
|
)
|
|
(6
|
)%
|
Income from continuing operations
|
|
$
|
769
|
|
|
$
|
810
|
|
|
$
|
(41
|
)
|
|
(5
|
)%
|
Cash provided by operating activities — continuing operations
|
|
$
|
1,034
|
|
|
$
|
1,030
|
|
|
$
|
4
|
|
|
—
|
%
|
Total bookings
|
|
$
|
4,247
|
|
|
$
|
3,609
|
|
|
$
|
638
|
|
|
18
|
%
|
Subscription and maintenance bookings
|
|
$
|
3,489
|
|
|
$
|
2,942
|
|
|
$
|
547
|
|
|
19
|
%
|
Weighted average subscription and maintenance license agreement duration in years
|
|
3.71
|
|
|
3.24
|
|
|
0.47
|
|
|
15
|
%
|
|
|
At March 31,
|
|
Change
|
|
Percent Change
|
|||||||||
|
|
2016
|
|
2015
|
|
||||||||||
|
|
(dollars in millions)
|
|
|
|||||||||||
Cash and cash equivalents
|
|
$
|
2,812
|
|
|
$
|
2,804
|
|
|
$
|
8
|
|
|
—
|
%
|
Total debt
|
|
$
|
1,953
|
|
|
$
|
1,257
|
|
|
$
|
696
|
|
|
55
|
%
|
Total expected future cash collections from committed contracts
(1) (2)
|
|
$
|
4,520
|
|
|
$
|
4,205
|
|
|
$
|
315
|
|
|
7
|
%
|
Total revenue backlog
(1) (2)
|
|
$
|
6,829
|
|
|
$
|
6,530
|
|
|
$
|
299
|
|
|
5
|
%
|
Total current revenue backlog
(1) (2)
|
|
$
|
3,113
|
|
|
$
|
3,141
|
|
|
$
|
(28
|
)
|
|
(1
|
)%
|
(1)
|
Information presented excludes the results of our discontinued operations.
|
(2)
|
Refer to the discussion in the “Liquidity and Capital Resources” section of this MD&A for additional information about expected future cash collections from committed contracts, billing backlog and revenue backlog.
|
|
Year Ended March 31,
|
|
Dollar Change
2016/2015
|
|
Percent Change
2016/2015
|
|
Dollar Change
2015/2014
|
|
Percent Change
2015/2014
|
||||||||||||||||
|
2016
(1)
|
|
2015
(1)
|
|
2014
(1)
|
|
|||||||||||||||||||
|
(dollars in millions)
|
||||||||||||||||||||||||
Revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Subscription and maintenance
|
$
|
3,317
|
|
|
$
|
3,560
|
|
|
$
|
3,683
|
|
|
$
|
(243
|
)
|
|
(7
|
)%
|
|
$
|
(123
|
)
|
|
(3
|
)%
|
Professional services
|
326
|
|
|
351
|
|
|
379
|
|
|
(25
|
)
|
|
(7
|
)%
|
|
(28
|
)
|
|
(7
|
)%
|
|||||
Software fees and other
|
382
|
|
|
351
|
|
|
350
|
|
|
31
|
|
|
9
|
%
|
|
1
|
|
|
—
|
%
|
|||||
Total revenue
|
$
|
4,025
|
|
|
$
|
4,262
|
|
|
$
|
4,412
|
|
|
$
|
(237
|
)
|
|
(6
|
)%
|
|
$
|
(150
|
)
|
|
(3
|
)%
|
Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Costs of licensing and maintenance
|
$
|
283
|
|
|
$
|
297
|
|
|
$
|
296
|
|
|
$
|
(14
|
)
|
|
(5
|
)%
|
|
$
|
1
|
|
|
—
|
%
|
Cost of professional services
|
300
|
|
|
338
|
|
|
353
|
|
|
(38
|
)
|
|
(11
|
)%
|
|
(15
|
)
|
|
(4
|
)%
|
|||||
Amortization of capitalized software costs
|
256
|
|
|
273
|
|
|
271
|
|
|
(17
|
)
|
|
(6
|
)%
|
|
2
|
|
|
1
|
%
|
|||||
Selling and marketing
|
1,006
|
|
|
1,060
|
|
|
1,104
|
|
|
(54
|
)
|
|
(5
|
)%
|
|
(44
|
)
|
|
(4
|
)%
|
|||||
General and administrative
|
367
|
|
|
377
|
|
|
395
|
|
|
(10
|
)
|
|
(3
|
)%
|
|
(18
|
)
|
|
(5
|
)%
|
|||||
Product development and enhancements
|
560
|
|
|
603
|
|
|
574
|
|
|
(43
|
)
|
|
(7
|
)%
|
|
29
|
|
|
5
|
%
|
|||||
Depreciation and amortization of other intangible assets
|
106
|
|
|
129
|
|
|
144
|
|
|
(23
|
)
|
|
(18
|
)%
|
|
(15
|
)
|
|
(10
|
)%
|
|||||
Other expenses, net
|
12
|
|
|
23
|
|
|
205
|
|
|
(11
|
)
|
|
(48
|
)%
|
|
(182
|
)
|
|
(89
|
)%
|
|||||
Total expense before interest and income taxes
|
$
|
2,890
|
|
|
$
|
3,100
|
|
|
$
|
3,342
|
|
|
$
|
(210
|
)
|
|
(7
|
)%
|
|
$
|
(242
|
)
|
|
(7
|
)%
|
Income from continuing operations before interest and income taxes
|
$
|
1,135
|
|
|
$
|
1,162
|
|
|
$
|
1,070
|
|
|
$
|
(27
|
)
|
|
(2
|
)%
|
|
$
|
92
|
|
|
9
|
%
|
Interest expense, net
|
51
|
|
|
47
|
|
|
54
|
|
|
4
|
|
|
9
|
%
|
|
(7
|
)
|
|
(13
|
)%
|
|||||
Income from continuing operations before income taxes
|
$
|
1,084
|
|
|
$
|
1,115
|
|
|
$
|
1,016
|
|
|
$
|
(31
|
)
|
|
(3
|
)%
|
|
$
|
99
|
|
|
10
|
%
|
Income tax expense
|
315
|
|
|
305
|
|
|
129
|
|
|
10
|
|
|
3
|
%
|
|
176
|
|
|
136
|
%
|
|||||
Income from continuing operations
|
$
|
769
|
|
|
$
|
810
|
|
|
$
|
887
|
|
|
$
|
(41
|
)
|
|
(5
|
)%
|
|
$
|
(77
|
)
|
|
(9
|
)%
|
(1)
|
Information presented excludes the results of our discontinued operations.
|
|
|
Percentage of Total Revenue
for the Year Ended March 31,
|
|||||||
|
|
2016
|
|
2015
|
|
2014
|
|||
Revenue:
|
|
|
|
|
|
|
|||
Subscription and maintenance
|
|
82
|
%
|
|
84
|
%
|
|
83
|
%
|
Professional services
|
|
8
|
|
|
8
|
|
|
9
|
|
Software fees and other
|
|
10
|
|
|
8
|
|
|
8
|
|
Total revenue
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
Expenses:
|
|
|
|
|
|
|
|||
Costs of licensing and maintenance
|
|
7
|
%
|
|
7
|
%
|
|
7
|
%
|
Cost of professional services
|
|
7
|
|
|
8
|
|
|
8
|
|
Amortization of capitalized software costs
|
|
6
|
|
|
6
|
|
|
6
|
|
Selling and marketing
|
|
25
|
|
|
25
|
|
|
25
|
|
General and administrative
|
|
9
|
|
|
9
|
|
|
9
|
|
Product development and enhancements
|
|
14
|
|
|
14
|
|
|
13
|
|
Depreciation and amortization of other intangible assets
|
|
3
|
|
|
3
|
|
|
3
|
|
Other expenses, net
|
|
—
|
|
|
1
|
|
|
5
|
|
Total expenses before interest and income taxes
|
|
72
|
%
|
|
73
|
%
|
|
76
|
%
|
Income from continuing operations before interest and income taxes
|
|
28
|
%
|
|
27
|
%
|
|
24
|
%
|
Interest expense, net
|
|
1
|
|
|
1
|
|
|
1
|
|
Income from continuing operations before income taxes
|
|
27
|
%
|
|
26
|
%
|
|
23
|
%
|
Income tax expense
|
|
8
|
|
|
7
|
|
|
3
|
|
Income from continuing operations
|
|
19
|
%
|
|
19
|
%
|
|
20
|
%
|
|
|
Fiscal 2016
Compared With
Fiscal 2015
|
|
Fiscal 2015
Compared With Fiscal 2014 |
||||||||||||||||||||||||||||||
|
|
(dollars in millions)
|
||||||||||||||||||||||||||||||||
|
|
2016
(1)
|
|
% Of Total
|
|
2015
(1)
|
|
% Of Total
|
|
%
Change
|
|
2015
(1)
|
|
% Of Total
|
|
2014
(1)
|
|
% Of Total
|
|
%
Change
|
||||||||||||||
United States
|
|
$
|
2,585
|
|
|
64
|
%
|
|
$
|
2,615
|
|
|
61
|
%
|
|
(1
|
)%
|
|
$
|
2,615
|
|
|
61
|
%
|
|
$
|
2,645
|
|
|
60
|
%
|
|
(1
|
)%
|
International
|
|
1,440
|
|
|
36
|
%
|
|
1,647
|
|
|
39
|
%
|
|
(13
|
)%
|
|
1,647
|
|
|
39
|
%
|
|
1,767
|
|
|
40
|
%
|
|
(7
|
)%
|
||||
Total
|
|
$
|
4,025
|
|
|
100
|
%
|
|
$
|
4,262
|
|
|
100
|
%
|
|
(6
|
)%
|
|
$
|
4,262
|
|
|
100
|
%
|
|
$
|
4,412
|
|
|
100
|
%
|
|
(3
|
)%
|
(1)
|
Information presented excludes the results of our discontinued operations.
|
|
|
Year Ended March 31,
|
||||||||||
(in millions)
|
|
2016
|
|
2015
|
|
2014
|
||||||
Fiscal 2014 Plan
|
|
$
|
(1
|
)
|
|
$
|
17
|
|
|
$
|
168
|
|
Legal settlements
|
|
(13
|
)
|
|
15
|
|
|
29
|
|
|||
Losses (gains) from foreign exchange derivative contracts
|
|
6
|
|
|
(31
|
)
|
|
(20
|
)
|
|||
Losses from foreign exchange rate fluctuations
|
|
20
|
|
|
17
|
|
|
38
|
|
|||
Other miscellaneous items
|
|
—
|
|
|
5
|
|
|
(10
|
)
|
|||
Total
|
|
$
|
12
|
|
|
$
|
23
|
|
|
$
|
205
|
|
Mainframe Solutions
|
|
Fiscal 2016
(1)
|
|
Fiscal 2015
(1)
|
|
Fiscal 2014
(1)
|
||||||
Revenue
|
|
$
|
2,215
|
|
|
$
|
2,392
|
|
|
$
|
2,478
|
|
Expenses
|
|
854
|
|
|
970
|
|
|
996
|
|
|||
Segment profit
|
|
$
|
1,361
|
|
|
$
|
1,422
|
|
|
$
|
1,482
|
|
Segment operating margin
|
|
61
|
%
|
|
59
|
%
|
|
60
|
%
|
(1)
|
Information presented excludes the results of our discontinued operations.
|
Enterprise Solutions
|
|
Fiscal 2016
(1)
|
|
Fiscal 2015
(1)
|
|
Fiscal 2014
(1)
|
||||||
Revenue
|
|
$
|
1,484
|
|
|
$
|
1,519
|
|
|
$
|
1,555
|
|
Expenses
|
|
1,337
|
|
|
1,353
|
|
|
1,440
|
|
|||
Segment profit
|
|
$
|
147
|
|
|
$
|
166
|
|
|
$
|
115
|
|
Segment operating margin
|
|
10
|
%
|
|
11
|
%
|
|
7
|
%
|
(1)
|
Information presented excludes the results of our discontinued operations.
|
Services
|
|
Fiscal 2016
|
|
Fiscal 2015
|
|
Fiscal 2014
|
||||||
Revenue
|
|
$
|
326
|
|
|
$
|
351
|
|
|
$
|
379
|
|
Expenses
|
|
303
|
|
|
342
|
|
|
357
|
|
|||
Segment profit
|
|
$
|
23
|
|
|
$
|
9
|
|
|
$
|
22
|
|
Segment operating margin
|
|
7
|
%
|
|
3
|
%
|
|
6
|
%
|
•
|
Renewal Bookings:
|
•
|
License Agreements over $10 million:
During fiscal
2016
, we executed a total of
48
license agreements with incremental contract values in excess of $10 million each, for an aggregate contract value of
$1,965 million
. During fiscal
2015
, we executed a total of
51
license agreements with incremental contract values in excess of $10 million each, for an aggregate contract value of
$1,448 million
.
|
•
|
Annualized Subscription and Maintenance Bookings and Weighted Average Subscription and Maintenance License Agreement Duration in Years:
For fiscal
2016
, annualized subscription and maintenance bookings
increased
from
$908 million
in the prior year period to
$940 million
primarily a result of the aforementioned renewal with a large system integrator. The weighted average subscription and maintenance license agreement duration in years
increased
from
3.24
in fiscal
2015
to
3.71
in fiscal
2016
primarily due to the aforementioned renewal with a large system integrator which had a term greater than 5 years. Although each contract is subject to terms negotiated by the respective parties, we do not expect the weighted average subscription and maintenance agreement duration in years to change materially from historical levels for end-user contracts.
|
•
|
Full Year Fiscal 2017 Outlook:
We expect fiscal 2017 renewals to increase by a percentage in the mid-single digits compared with fiscal 2016.
|
•
|
Mainframe Solutions New Product Sales:
For fiscal
2016
, Mainframe Solutions new product sales, including capacity, increased by a percentage in the high-teens compared with the year-ago period primarily due to the aforementioned renewal with a large system integrator and new product sales in connection with other renewals. Excluding the unfavorable effect of foreign exchange, Mainframe Solutions new product sales increased by a percentage in the mid-twenties. Overall, we expect our mainframe revenue growth to decline in a low single digit range over the medium term, which we believe is in line with the mainframe market.
|
•
|
Enterprise Solutions New Product Sales:
For fiscal
2016
, Enterprise Solutions new product sales increased by a percentage in the low-single digits compared with the year-ago period primarily as a result of Enterprise Solutions new product sales associated with our second quarter fiscal 2016 acquisitions. Excluding the unfavorable effect of foreign exchange, Enterprise Solutions new product sales increased by a percentage in the high single digits. Excluding our second quarter fiscal 2016 acquisitions, Enterprise Solutions new product sales decreased by a percentage in the high single digits for fiscal 2016 compared with the year-ago period. Excluding both the unfavorable effect of foreign exchange and second quarter fiscal 2016 acquisitions, Enterprise Solutions new product sales decreased by a percentage in the low-single digits for fiscal 2016 compared with the year-ago period. Enterprise Solutions new product sales performance was negatively affected by certain products that are more mature and not growing. However, these products positively affect segment operating margin as well as cash flow from operations.
|
•
|
Renewal Bookings:
For fiscal 2015, renewal bookings decreased by a percentage in the low twenties compared with fiscal 2014. Excluding the unfavorable effect of foreign exchange, renewal bookings for fiscal 2015 decreased by a percentage in the high teens compared with fiscal 2014. This decrease was primarily due to two factors: (1) a four-year contract renewal with a large system integrator for more than $300 million executed during fiscal 2014; and (2) the value of contracts renewed prior to their scheduled expiration dates being lower in fiscal 2015 than we had historically experienced. For the fourth quarter of fiscal 2015, our percentage renewal yield was in the low 90% range. Our percentage renewal yield was at or above 90% for each quarter of fiscal 2015.
|
•
|
License Agreements over $10 million:
During fiscal 2015, we executed a total of 51 license agreements with incremental contract values in excess of $10 million each, for an aggregate contract value of $1,448 million. During fiscal 2014, we executed a total of 54 license agreements with incremental contract values in excess of $10 million each, for an aggregate contract value of $1,973 million, which includes the aforementioned contract renewal with a large system integrator. The decrease in aggregate contract value in fiscal 2015 compared with fiscal 2014 was primarily attributable to the aforementioned large system integrator deal executed in fiscal 2014.
|
•
|
Annualized Subscription and Maintenance Bookings and Weighted Average Subscription and Maintenance License Agreement Duration in Years:
For fiscal 2015, annualized subscription and maintenance bookings decreased from $1,093 million in the prior year period to $908 million. The decrease in annualized subscription and maintenance bookings was primarily a result of the lower level of renewal bookings executed during fiscal 2015 compared with fiscal 2014. The weighted average subscription and maintenance license agreement duration in years decreased from 3.35 in fiscal 2014 to 3.24 in fiscal 2015.
|
•
|
Mainframe Solutions New Product Sales:
For fiscal 2015, mainframe solutions new sales, including capacity, declined by approximately 10% compared with the year-ago period primarily due to lower mainframe renewals. Excluding the unfavorable effect of foreign exchange, mainframe solutions new sales decreased by a percentage in the high single digits.
|
•
|
Enterprise Solutions New Product Sales:
Enterprise solutions new product sales decreased by a percentage in the mid-single digits primarily as a result of the timing of our renewal portfolio providing fewer opportunities for new sales and weakness in selling outside the renewal opportunity. While fiscal 2015 new sales in our Named accounts increased by a percentage in the low teens, our combined Named and Growth new sales did not increase by a percentage sufficient to grow total revenue.
|
|
|
Fiscal 2016 Quarter Ended
|
|
Total
(1)
|
||||||||||||||||
|
|
June 30
(1)
|
|
September 30
(1)
|
|
December 31
(1)
|
|
March 31
(1)
|
|
|||||||||||
|
|
(dollars in millions, except per share amounts)
|
||||||||||||||||||
Revenue
|
|
$
|
977
|
|
|
$
|
1,005
|
|
|
$
|
1,034
|
|
|
$
|
1,009
|
|
|
$
|
4,025
|
|
Percentage of annual revenue
|
|
24
|
%
|
|
25
|
%
|
|
26
|
%
|
|
25
|
%
|
|
100
|
%
|
|||||
Costs of licensing and maintenance
|
|
$
|
66
|
|
|
$
|
70
|
|
|
$
|
73
|
|
|
$
|
74
|
|
|
$
|
283
|
|
Cost of professional services
|
|
$
|
71
|
|
|
$
|
78
|
|
|
$
|
75
|
|
|
$
|
76
|
|
|
$
|
300
|
|
Amortization of capitalized software costs
|
|
$
|
60
|
|
|
$
|
67
|
|
|
$
|
65
|
|
|
$
|
64
|
|
|
$
|
256
|
|
Income from continuing operations
|
|
$
|
207
|
|
|
$
|
172
|
|
|
$
|
219
|
|
|
$
|
171
|
|
|
$
|
769
|
|
Basic income per common share from continuing operations
|
|
$
|
0.47
|
|
|
$
|
0.39
|
|
|
$
|
0.52
|
|
|
$
|
0.41
|
|
|
$
|
1.79
|
|
Diluted income per common share from continuing operations
|
|
$
|
0.47
|
|
|
$
|
0.39
|
|
|
$
|
0.52
|
|
|
$
|
0.41
|
|
|
$
|
1.78
|
|
|
|
Fiscal 2015 Quarter Ended
|
|
Total
(1)
|
||||||||||||||||
|
|
June 30
(1)
|
|
September 30
(1)
|
|
December 31
(1)
|
|
March 31
(1)
|
|
|||||||||||
|
|
(dollars in millions, except per share amounts)
|
||||||||||||||||||
Revenue
|
|
$
|
1,069
|
|
|
$
|
1,079
|
|
|
$
|
1,091
|
|
|
$
|
1,023
|
|
|
$
|
4,262
|
|
Percentage of annual revenue
|
|
25
|
%
|
|
25
|
%
|
|
26
|
%
|
|
24
|
%
|
|
100
|
%
|
|||||
Costs of licensing and maintenance
|
|
$
|
72
|
|
|
$
|
71
|
|
|
$
|
74
|
|
|
$
|
80
|
|
|
$
|
297
|
|
Cost of professional services
|
|
$
|
81
|
|
|
$
|
88
|
|
|
$
|
84
|
|
|
$
|
85
|
|
|
$
|
338
|
|
Amortization of capitalized software costs
|
|
$
|
67
|
|
|
$
|
75
|
|
|
$
|
62
|
|
|
$
|
69
|
|
|
$
|
273
|
|
Income from continuing operations
|
|
$
|
212
|
|
|
$
|
235
|
|
|
$
|
218
|
|
|
$
|
145
|
|
|
$
|
810
|
|
Basic income per common share from continuing operations
|
|
$
|
0.48
|
|
|
$
|
0.53
|
|
|
$
|
0.49
|
|
|
$
|
0.33
|
|
|
$
|
1.83
|
|
Diluted income per common share from continuing operations
|
|
$
|
0.48
|
|
|
$
|
0.53
|
|
|
$
|
0.49
|
|
|
$
|
0.33
|
|
|
$
|
1.82
|
|
(1)
|
Information presented excludes the results of our discontinued operations.
|
|
|
March 31, 2016
(1)
|
|
March 31, 2015
(1)
|
||||
|
|
(in millions)
|
||||||
Billings backlog:
|
|
|
|
|
||||
Amounts to be billed — current
|
|
$
|
1,818
|
|
|
$
|
1,867
|
|
Amounts to be billed — noncurrent
|
|
2,077
|
|
|
1,686
|
|
||
Total billings backlog
|
|
$
|
3,895
|
|
|
$
|
3,553
|
|
Revenue backlog:
|
|
|
|
|
||||
Revenue to be recognized within the next 12 months — current
|
|
$
|
3,113
|
|
|
$
|
3,141
|
|
Revenue to be recognized beyond the next 12 months — noncurrent
|
|
3,716
|
|
|
3,389
|
|
||
Total revenue backlog
|
|
$
|
6,829
|
|
|
$
|
6,530
|
|
Deferred revenue (billed or collected)
|
|
$
|
2,934
|
|
|
$
|
2,977
|
|
Total billings backlog
|
|
3,895
|
|
|
3,553
|
|
||
Total revenue backlog
|
|
$
|
6,829
|
|
|
$
|
6,530
|
|
(1)
|
Information presented excludes the results of our discontinued operations.
|
|
|
March 31, 2016
(1)
|
|
March 31, 2015
(1)
|
||||
|
|
(in millions)
|
||||||
Expected future cash collections:
|
|
|
|
|
||||
Total billings backlog
|
|
$
|
3,895
|
|
|
$
|
3,553
|
|
Trade accounts receivable, net
|
|
625
|
|
|
652
|
|
||
Total expected future cash collections
|
|
$
|
4,520
|
|
|
$
|
4,205
|
|
(1)
|
Information presented excludes the results of our discontinued operations.
|
|
Year Ended March 31,
|
|
$ Change
|
||||||||||||||||
|
2016
(1)
|
|
2015
(1)
|
|
2014
(1)
|
|
2016 / 2015
|
|
2015 / 2014
|
||||||||||
|
(in millions)
|
||||||||||||||||||
Cash collections from billings
(2)
|
$
|
4,229
|
|
|
$
|
4,515
|
|
|
$
|
4,653
|
|
|
$
|
(286
|
)
|
|
$
|
(138
|
)
|
Vendor disbursements and payroll
(2)
|
(2,773
|
)
|
|
(2,960
|
)
|
|
(3,025
|
)
|
|
187
|
|
|
65
|
|
|||||
Income tax payments, net
|
(365
|
)
|
|
(411
|
)
|
|
(489
|
)
|
|
46
|
|
|
78
|
|
|||||
Other disbursements, net
(3)
|
(57
|
)
|
|
(114
|
)
|
|
(166
|
)
|
|
57
|
|
|
52
|
|
|||||
Net cash provided by continuing operating activities
|
$
|
1,034
|
|
|
$
|
1,030
|
|
|
$
|
973
|
|
|
$
|
4
|
|
|
$
|
57
|
|
(1)
|
Information presented excludes the results of our discontinued operations.
|
(2)
|
Amounts include value added taxes and sales taxes.
|
(3)
|
For fiscal 2016, amount includes $5 million of payments associated with the Fiscal 2014 Plan, interest, prior period restructuring plans and miscellaneous receipts and disbursements. For fiscal 2015, amount includes $66 million of payments associated with the Fiscal 2014 Plan, interest, prior period restructuring plans and miscellaneous receipts and disbursements. For fiscal 2014, amount includes $105 million of payments associated with the Fiscal 2014 Plan, interest, prior period restructuring plans and miscellaneous receipts and disbursements.
|
|
|
At March 31,
|
||||||
|
|
2016
|
|
2015
|
||||
|
|
(in millions)
|
||||||
Revolving credit facility
|
|
—
|
|
|
—
|
|
||
5.375% Senior Notes due December 2019
|
|
750
|
|
|
750
|
|
||
3.600% Senior Notes due August 2020
|
|
400
|
|
|
—
|
|
||
2.875% Senior Notes due August 2018
|
|
250
|
|
|
250
|
|
||
4.500% Senior Notes due August 2023
|
|
250
|
|
|
250
|
|
||
Term Loan due April 2022
|
|
300
|
|
|
—
|
|
||
Other indebtedness, primarily capital leases
|
|
15
|
|
|
17
|
|
||
Unamortized debt issuance costs
|
|
(8
|
)
|
|
(6
|
)
|
||
Unamortized discount for Senior Notes
|
|
(4
|
)
|
|
(4
|
)
|
||
Total debt outstanding
|
|
$
|
1,953
|
|
|
$
|
1,257
|
|
Less the current portion
|
|
(6
|
)
|
|
(10
|
)
|
||
Total long-term debt portion
|
|
$
|
1,947
|
|
|
$
|
1,247
|
|
|
|
Payments Due By Period
|
||||||||||||||||||
Contractual Obligations
|
|
Total
|
|
Less Than
1 Year
|
|
1–3
Years
|
|
3–5
Years
|
|
More Than
5 Years
|
||||||||||
|
|
(in millions)
|
||||||||||||||||||
Long-term debt obligations (inclusive of interest)
|
|
$
|
2,343
|
|
|
$
|
84
|
|
|
$
|
445
|
|
|
$
|
1,285
|
|
|
$
|
529
|
|
Operating lease obligations
(1)
|
|
419
|
|
|
83
|
|
|
140
|
|
|
111
|
|
|
85
|
|
|||||
Purchase obligations
|
|
173
|
|
|
91
|
|
|
79
|
|
|
3
|
|
|
—
|
|
|||||
Other obligations
(2)
|
|
94
|
|
|
19
|
|
|
32
|
|
|
20
|
|
|
23
|
|
|||||
Total
|
|
$
|
3,029
|
|
|
$
|
277
|
|
|
$
|
696
|
|
|
$
|
1,419
|
|
|
$
|
637
|
|
(1)
|
The contractual obligations for noncurrent operating leases exclude sublease income totaling $34 million expected to be received in the following periods: $6 million (less than 1 year); $13 million (1–3 years); $11 million (3–5 years); and $4 million (more than 5 years).
|
(2)
|
$162 million
of estimated liabilities related to unrecognized tax benefits are excluded from the contractual obligations table because we could not make a reasonable estimate of when those amounts will become payable.
|
•
|
Historical information, such as general collection history of multi-year software agreements;
|
•
|
Current customer information and events, such as extended delinquency, requests for restructuring and filings for bankruptcy;
|
•
|
Results of analyzing historical and current data; and
|
•
|
The overall macroeconomic environment.
|
•
|
future expected cash flows from sales, maintenance agreements and acquired developed technologies;
|
•
|
the acquired company’s trade name and customer relationships as well as assumptions about the period of time the acquired trade name and customer relationships will continue to be used in the combined company’s product portfolio; and
|
•
|
discount rates used to determine the present value of estimated future cash flows.
|
|
|
Incorporated by Reference
|
|
||
Exhibit Number
|
Exhibit Description
|
Form
|
Exhibit
|
Filing Date
|
Filed or Furnished Herewith
|
2.1
|
Acquisition Agreement, dated as of May 27, 2015, by and among CA, Inc., Grand Prix Acquisition Corp., and Rally Software Development Corp.
|
8-K
|
2.1
|
5/28/15
|
|
3.1
|
Restated Certificate of Incorporation.
|
8-K
|
3.3
|
03/09/06
|
|
3.2
|
By-Laws of the Company, as amended.
|
10-K
|
3.2
|
05/08/15
|
|
4.1
|
Stockholder Protection Rights Agreement, dated as of November 30, 2015 (the “Rights Agreement”), between CA, Inc. (the “Company”) and Computershare Trust Company, N.A., as Rights Agent, including as Exhibit A the forms of Rights Certificate and of Election to Exercise and as Exhibit B the form of Certificate of Designation and Terms of the Participating Preferred Stock, Class A of the Company.
|
8-K
|
4.1
|
12/01/15
|
|
4.2
|
Indenture dated June 1, 2008 between the Company and U.S. Bank National Association, as trustee, relating to the senior debt securities, the senior subordinated debt securities and the junior subordinated debt securities, as applicable.
|
S-3
|
4.1
|
06/12/08
|
|
4.3
|
Officers’ Certificates dated November 13, 2009 establishing the terms of the Company’s 5.375% Senior Notes due 2019 pursuant to the Indenture dated June 1, 2008 (including the form of the Senior Notes).
|
8-K
|
4.2
|
11/13/09
|
|
4.4
|
Officers’ Certificate dated August 16, 2013 establishing the terms of the Company’s 2.875% Senior Notes due 2018 and 4.500% Senior Notes due 2023 pursuant to the Indenture dated June 1, 2008 (including the forms of the Senior Notes).
|
8-K
|
4.2
|
08/16/13
|
|
4.5
|
Officers’ Certificate dated August 4, 2015 establishing the terms of the Company’s 3.600% Senior Notes due 2020 pursuant to the Indenture dated June 1, 2008 (including the form of the Senior Notes).
|
8-K
|
4.2
|
08/04/15
|
|
10.1*
|
CA, Inc. 2002 Incentive Plan (amended and restated effective as of April 27, 2007).
|
10-K
|
10.9
|
05/30/07
|
|
10.2*
|
CA, Inc. 2002 Compensation Plan for Non-Employee Directors.
|
DEF 14A
|
Exhibit C
|
07/26/02
|
|
10.3
|
Deferred Prosecution Agreement, including the related Information and Stipulation of Facts.
|
8-K
|
10.1
|
09/22/04
|
|
10.4
|
Final Consent Judgment of Permanent Injunction and Other Relief, including SEC complaint.
|
8-K
|
10.2
|
09/22/04
|
|
10.5*
|
Form of Restricted Stock Unit Certificate under the CA, Inc. 2002 Incentive Plan.
|
10-Q
|
10.1
|
02/09/05
|
|
10.6*
|
Form of Non-Qualified Stock Option Certificate under the CA, Inc. 2002 Incentive Plan.
|
10-Q
|
10.2
|
02/09/05
|
|
|
|
Incorporated by Reference
|
|
||
Exhibit Number
|
Exhibit Description
|
Form
|
Exhibit
|
Filing Date
|
Filed or Furnished Herewith
|
10.7*
|
Form of Non-Qualified Stock Option Award Certificate under the CA, Inc. 2002 Incentive Plan.
|
8-K
|
10.5
|
06/02/06
|
|
10.8*
|
Form of Non-Qualified Stock Option Award Certificate (Employment Agreement) under the CA, Inc. 2002 Incentive Plan.
|
8-K
|
10.6
|
06/02/06
|
|
10.9*
|
Form of Incentive Stock Option Award Certificate under the CA, Inc. 2002 Incentive Plan.
|
8-K
|
10.7
|
06/02/06
|
|
10.10*
|
Form of Incentive Stock Option Award Certificate (Employment Agreement) under the CA, Inc. 2002 Incentive Plan.
|
8-K
|
10.8
|
06/02/06
|
|
10.11*
|
Program whereby certain designated employees, including the Company’s Named Executive Officers, are provided with certain covered medical services, effective August 1, 2005.
|
8-K
|
10.1
|
08/02/05
|
|
10.12*
|
Amended and Restated CA, Inc. Executive Deferred Compensation Plan, effective November 20, 2006.
|
10-Q
|
10.1
|
02/06/07
|
|
10.13*
|
Form of Deferral Election.
|
10-K
|
10.52
|
07/31/06
|
|
10.14
|
Lease dated August 15, 2006 among the Company, Island Headquarters Operators LLC and Islandia Operators LLC.
|
8-K
|
10.2
|
08/21/06
|
|
10.15*
|
CA, Inc. 2007 Incentive Plan.
|
8-K
|
10.1
|
08/27/07
|
|
10.16*
|
Form of Award Agreement under the CA, Inc. 2007 Incentive Plan - Restricted Stock Units.
|
8-K
|
10.2
|
08/27/07
|
|
10.17*
|
Form of Award Agreement under the CA, Inc. 2007 Incentive Plan - Restricted Stock Awards.
|
8-K
|
10.3
|
08/27/07
|
|
10.18*
|
Form of Award Agreement under the CA, Inc. 2007 Incentive Plan - Non-Qualified Stock Awards.
|
8-K
|
10.4
|
08/27/07
|
|
10.19*
|
First Amendment to CA, Inc. Executive Deferred Compensation Plan, effective February 25, 2008.
|
10-K
|
10.68
|
05/23/08
|
|
10.20*
|
First Amendment to Adoption Agreement for CA, Inc. Executive Deferred Compensation Plan, effective February 25, 2008.
|
10-K
|
10.69
|
05/23/08
|
|
10.21*
|
Director Retirement Donation Policy.
|
10-Q
|
10.9
|
10/23/09
|
|
10.22*
|
Form of Restricted Stock Unit Award Agreement for certain Named Executive Officers.
|
10-Q
|
10.3
|
01/29/10
|
|
10.23*
|
Homeowners Relocation Policy for Senior Executives.
|
|
|
|
X
|
10.24*
|
Renters Relocation Policy for Senior Executives.
|
|
|
|
X
|
10.25*
|
CA, Inc. Special Retirement Vesting Benefit Policy.
|
10-Q
|
10.1
|
01/26/11
|
|
10.26*
|
CA, Inc. 2003 Compensation Plan for Non-Employee Directors (amended and restated dated December 31, 2010).
|
10-Q
|
10.2
|
01/26/11
|
|
10.27*
|
Letter dated May 18, 2011 from the Company to Richard J. Beckert regarding terms of employment.
|
10-Q
|
10.1
|
07/22/11
|
|
10.28*
|
CA, Inc. 2011 Incentive Plan.
|
DEF 14A
|
Exhibit B
|
06/10/11
|
|
10.29*
|
Form of Award Agreement under the CA, Inc. 2011 Incentive Plan - Restricted Stock Units.
|
10-Q
|
10.4
|
10/28/11
|
|
|
|
Incorporated by Reference
|
|
||
Exhibit Number
|
Exhibit Description
|
Form
|
Exhibit
|
Filing Date
|
Filed or Furnished Herewith
|
10.30*
|
Form of Award Agreement under the CA, Inc. 2011 Incentive Plan - Restricted Stock Awards.
|
10-Q
|
10.5
|
10/28/11
|
|
10.31*
|
Form of Award Agreement under the CA, Inc. 2011 Incentive Plan - Restricted Stock Awards (special retirement vesting).
|
10-Q
|
10.6
|
10/28/11
|
|
10.32*
|
Form of Award Agreement under the CA, Inc. 2011 Incentive Plan - Non-Qualified Stock Options.
|
10-Q
|
10.7
|
10/28/11
|
|
10.33*
|
CA, Inc. 2012 Employee Stock Purchase Plan.
|
DEF 14A
|
Exhibit C
|
06/10/11
|
|
10.34*
|
Form of Transitional Award Agreement under the CA, Inc. 2007 Incentive Plan - Restricted Stock Awards.
|
10-K
|
10.55
|
05/11/12
|
|
10.35*
|
Form of Transitional Award Agreement under the CA, Inc. 2011 Incentive Plan - Restricted Stock Awards.
|
10-K
|
10.56
|
05/11/12
|
|
10.36*
|
Amended Form of Award Agreement under the CA, Inc. 2011 Incentive Plan - Restricted Stock Units.
|
10-K
|
10.57
|
05/11/12
|
|
10.37*
|
Amended Form of Award Agreement under the CA, Inc. 2011 Incentive Plan - Restricted Stock Awards.
|
10-K
|
10.58
|
05/11/12
|
|
10.38*
|
Amended Form of Award Agreement under the CA, Inc. 2011 Incentive Plan - Restricted Stock Awards (special retirement vesting).
|
10-K
|
10.59
|
05/11/12
|
|
10.39*
|
Amended Form of Award Agreement under the CA, Inc. 2011 Incentive Plan - Non-Qualified Stock Options.
|
10-K
|
10.60
|
05/11/12
|
|
10.40*
|
Form of Award Agreement under the CA, Inc. 2011 Incentive Plan - Non-Qualified Stock Options (Canadian employees).
|
10-K
|
10.61
|
05/11/12
|
|
10.41*
|
CA, Inc. 2012 Compensation Plan for Non-Employee Directors.
|
DEF 14A
|
Exhibit B
|
06/11/12
|
|
10.42*
|
Summary description of amended financial planning benefit.
|
10-Q
|
10.1
|
10/26/12
|
|
10.43*
|
Employment Agreement dated December 10, 2012 between the Company and Michael P. Gregoire.
|
8-K
|
10.1
|
12/12/12
|
|
10.44*
|
CA, Inc. Change in Control Severance Policy (amended and restated effective August 5, 2015).
|
10-Q
|
10.1
|
10/22/15
|
|
10.45*
|
Amended Form of Award Agreement under the CA, Inc. 2011 Incentive Plan - Non-Qualified Stock Options (Canadian employees).
|
10-K
|
10.64
|
05/09/13
|
|
10.46
|
Amended and Restated Credit Agreement dated June 7, 2013.
|
8-K
|
10.1
|
06/10/13
|
|
10.47*
|
Form of Sign-On Award Agreement for Lauren P. Flaherty under the CA, Inc. 2011 Incentive Plan - Restricted Stock Units.
|
10-Q
|
10.2
|
10/25/13
|
|
10.48*
|
Form of Sign-On Award Agreement for Lauren P. Flaherty under the CA, Inc. 2011 Incentive Plan - Nonqualified Stock Options.
|
10-Q
|
10.3
|
10/25/13
|
|
|
|
Incorporated by Reference
|
|
||
Exhibit Number
|
Exhibit Description
|
Form
|
Exhibit
|
Filing Date
|
Filed or Furnished Herewith
|
10.49*
|
Letter dated January 21, 2014 from the Company to Adam Elster regarding terms of employment.
|
8-K
|
10.1
|
01/21/14
|
|
10.50*
|
Separation Agreement and General Claims Release dated June 23, 2015 between the Company and Amit Chatterjee.
|
10-Q
|
10.4
|
07/24/15
|
|
10.51*
|
CA, Inc. Executive Severance Policy effective May 13, 2014.
|
10-K
|
10.63
|
05/19/14
|
|
10.52*
|
Summary description of Director compensation.
|
10-K
|
10.64
|
05/19/14
|
|
10.53*
|
Letter dated June 14, 2013 from the Company to Lauren P. Flaherty regarding terms of employment.
|
10-Q
|
10.2
|
07/24/14
|
|
10.54*
|
Form of Award Agreement under the CA, Inc. 2011 Incentive Plan - Executive Officer Restricted Stock Awards.
|
10-Q
|
10.4
|
07/24/14
|
|
10.55*
|
Amended Form of Award Agreement under the CA, Inc. 2011 Incentive Plan - Restricted Stock Units.
|
10-Q
|
10.5
|
07/24/14
|
|
10.56*
|
Amended Form of Award Agreement under the CA, Inc. 2011 Incentive Plan - Restricted Stock Awards.
|
10-Q
|
10.6
|
07/24/14
|
|
10.57*
|
Amended Form of Award Agreement under the CA, Inc. 2011 Incentive Plan - Non-Qualified Stock Options.
|
10-Q
|
10.7
|
07/24/14
|
|
10.58*
|
Amended Form of Award Agreement under the CA, Inc. 2011 Incentive Plan - Non-Qualified Stock Options (Canadian employees).
|
10-Q
|
10.8
|
07/24/14
|
|
10.59*
|
Bring-down General Claims Release dated July 1, 2014 between the Company and George J. Fischer.
|
10-Q
|
10.1
|
10/23/14
|
|
10.60
|
Amendment No. 1 dated April 13, 2015 to Amended and Restated Credit Agreement dated June 7, 2013.
|
8-K
|
10.1
|
04/14/15
|
|
10.61*
|
Schedules A, B and C (as amended effective August 5, 2015) to CA, Inc. Change in Control Severance Policy.
|
10-Q
|
10. 2
|
10/22/15
|
|
10.62*
|
Amended Form of Award Agreement under the CA, Inc. 2011 Incentive Plan - Restricted Stock Awards (special retirement vesting).
|
10-K
|
10.63
|
05/08/15
|
|
10.63
|
Term Loan Agreement dated October 20, 2015.
|
10-Q
|
10.3
|
10/22/15
|
|
10.64
|
Share Repurchase Agreement, dated November 17, 2015 by and between CA, Inc. and Careal Holding AG.
|
8-K
|
10.1
|
11/18/15
|
|
12
|
Statement of Ratios of Earnings to Fixed Charges.
|
|
|
|
X
|
21
|
Subsidiaries of the Registrant.
|
|
|
|
X
|
23
|
Consent of Independent Registered Public Accounting Firm.
|
|
|
|
X
|
24
|
Power of Attorney
|
|
|
|
X
|
31.1
|
Certification of the CEO pursuant to §302 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
X
|
31.2
|
Certification of the CFO pursuant to §302 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
X
|
32†
|
Certification pursuant to §906 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
X
|
|
|
Incorporated by Reference
|
|
||
Exhibit Number
|
Exhibit Description
|
Form
|
Exhibit
|
Filing Date
|
Filed or Furnished Herewith
|
101
|
The following financial statements from CA, Inc.’s Annual Report on Form 10-K for the year ended March 31, 2016, formatted in XBRL (eXtensible Business Reporting Language):
|
|
|
|
X
|
|
(i) Consolidated Balance Sheets - March 31, 2016 and March 31, 2015.
|
|
|
|
|
|
(ii) Consolidated Statements of Operations - Years Ended March 31, 2016, 2015 and 2014.
|
|
|
|
|
|
(iii) Consolidated Statements of Comprehensive Income - Years Ended March 31, 2016, 2015 and 2014.
|
|
|
|
|
|
(iv) Consolidated Statements of Stockholders’ Equity - Years Ended March 31, 2016, 2015 and 2014.
|
|
|
|
|
|
(v) Consolidated Statements of Cash Flows - Years Ended March 31, 2016, 2015 and 2014.
|
|
|
|
|
|
(vi) Notes to Consolidated Financial Statements - March 31, 2016.
|
|
|
|
|
|
|
CA, INC.
|
|
|
|
|
|
|
|
By:
|
/s/ Michael P. Gregoire
|
|
|
|
|
|
|
Michael P. Gregoire
|
|
|
|
Chief Executive Officer
|
|
|
By:
|
/s/ Michael P. Gregoire
|
|
|
|
|
|
|
Michael P. Gregoire
|
|
|
|
Chief Executive Officer
|
|
|
|
(Principal Executive Officer)
|
|
|
|
|
|
|
|
By:
|
/s/ Richard J. Beckert
|
|
|
|
|
|
|
Richard J. Beckert
|
|
|
|
Executive Vice President and Chief Financial Officer
|
|
|
|
(Principal Financial Officer)
|
|
|
|
|
|
|
|
By:
|
/s/ Neil A. Manna
|
|
|
|
|
|
|
Neil A. Manna
|
|
|
|
Senior Vice President, Chief Accounting Officer
|
|
|
|
(Principal Accounting Officer)
|
*
|
|
Director
|
Jens Alder
|
|
|
|
|
|
*
|
|
Director
|
Raymond J. Bromark
|
|
|
|
|
|
*
|
|
Director
|
Gary J. Fernandes
|
|
|
|
|
|
*
|
|
Director
|
Michael P. Gregoire
|
|
|
|
|
|
*
|
|
Director
|
Rohit Kapoor
|
|
|
|
|
|
*
|
|
Director
|
Jeffrey G. Katz
|
|
|
|
|
|
*
|
|
Director
|
Kay Koplovitz
|
|
|
|
|
|
*
|
|
Director
|
Christopher B. Lofgren
|
|
|
|
|
|
*
|
|
Director
|
Richard Sulpizio
|
|
|
|
|
|
*
|
|
Director
|
Laura S. Unger
|
|
|
|
|
|
*
|
|
Director
|
Arthur F. Weinbach
|
|
|
|
|
|
*
|
|
Director
|
Renato (Ron) Zambonini
|
|
|
|
|
*By:
|
/s/ Michael Bisignano
|
|
Michael Bisignano
|
|
Attorney-in-fact
|
|
March 31,
|
||||||
(in millions, except share amounts)
|
2016
|
|
2015
|
||||
Assets
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
2,812
|
|
|
$
|
2,804
|
|
Trade accounts receivable, net
|
625
|
|
|
652
|
|
||
Deferred income taxes
|
—
|
|
|
318
|
|
||
Other current assets
|
124
|
|
|
212
|
|
||
Total current assets
|
$
|
3,561
|
|
|
$
|
3,986
|
|
Property and equipment, net of accumulated depreciation of $832 and $812, respectively
|
$
|
242
|
|
|
$
|
252
|
|
Goodwill
|
6,086
|
|
|
5,806
|
|
||
Capitalized software and other intangible assets, net
|
795
|
|
|
731
|
|
||
Deferred income taxes
|
407
|
|
|
92
|
|
||
Other noncurrent assets, net
|
113
|
|
|
106
|
|
||
Total assets
|
$
|
11,204
|
|
|
$
|
10,973
|
|
Liabilities and stockholders' equity
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Current portion of long-term debt
|
$
|
6
|
|
|
$
|
10
|
|
Accounts payable
|
77
|
|
|
105
|
|
||
Accrued salaries, wages and commissions
|
205
|
|
|
219
|
|
||
Accrued expenses and other current liabilities
|
352
|
|
|
428
|
|
||
Deferred revenue (billed or collected)
|
2,197
|
|
|
2,114
|
|
||
Taxes payable, other than income taxes payable
|
55
|
|
|
55
|
|
||
Federal, state and foreign income taxes payable
|
2
|
|
|
—
|
|
||
Deferred income taxes
|
—
|
|
|
7
|
|
||
Total current liabilities
|
$
|
2,894
|
|
|
$
|
2,938
|
|
Long-term debt, net of current portion
|
$
|
1,947
|
|
|
$
|
1,247
|
|
Federal, state and foreign income taxes payable
|
148
|
|
|
150
|
|
||
Deferred income taxes
|
3
|
|
|
45
|
|
||
Deferred revenue (billed or collected)
|
737
|
|
|
863
|
|
||
Other noncurrent liabilities
|
97
|
|
|
105
|
|
||
Total liabilities
|
$
|
5,826
|
|
|
$
|
5,348
|
|
Stockholders' equity:
|
|
|
|
||||
Preferred stock, no par value, 10,000,000 shares authorized; No shares issued and outstanding
|
$
|
—
|
|
|
$
|
—
|
|
Common stock, $0.10 par value, 1,100,000,000 shares authorized; 589,695,081 and 589,695,081 shares issued; 412,596,452 and 435,502,730 shares outstanding, respectively
|
59
|
|
|
59
|
|
||
Additional paid-in capital
|
3,664
|
|
|
3,631
|
|
||
Retained earnings
|
6,575
|
|
|
6,221
|
|
||
Accumulated other comprehensive loss
|
(416
|
)
|
|
(418
|
)
|
||
Treasury stock, at cost, 177,098,629 and 154,192,351 shares, respectively
|
(4,504
|
)
|
|
(3,868
|
)
|
||
Total stockholders' equity
|
$
|
5,378
|
|
|
$
|
5,625
|
|
Total liabilities and stockholders' equity
|
$
|
11,204
|
|
|
$
|
10,973
|
|
|
Year Ended March 31,
|
||||||||||
(in millions, except per share amounts)
|
2016
|
|
2015
|
|
2014
|
||||||
Revenue:
|
|
|
|
|
|
||||||
Subscription and maintenance
|
$
|
3,317
|
|
|
$
|
3,560
|
|
|
$
|
3,683
|
|
Professional services
|
326
|
|
|
351
|
|
|
379
|
|
|||
Software fees and other
|
382
|
|
|
351
|
|
|
350
|
|
|||
Total revenue
|
$
|
4,025
|
|
|
$
|
4,262
|
|
|
$
|
4,412
|
|
Expenses:
|
|
|
|
|
|
||||||
Costs of licensing and maintenance
|
$
|
283
|
|
|
$
|
297
|
|
|
$
|
296
|
|
Cost of professional services
|
300
|
|
|
338
|
|
|
353
|
|
|||
Amortization of capitalized software costs
|
256
|
|
|
273
|
|
|
271
|
|
|||
Selling and marketing
|
1,006
|
|
|
1,060
|
|
|
1,104
|
|
|||
General and administrative
|
367
|
|
|
377
|
|
|
395
|
|
|||
Product development and enhancements
|
560
|
|
|
603
|
|
|
574
|
|
|||
Depreciation and amortization of other intangible assets
|
106
|
|
|
129
|
|
|
144
|
|
|||
Other expenses, net
|
12
|
|
|
23
|
|
|
205
|
|
|||
Total expenses before interest and income taxes
|
$
|
2,890
|
|
|
$
|
3,100
|
|
|
$
|
3,342
|
|
Income from continuing operations before interest and income taxes
|
$
|
1,135
|
|
|
$
|
1,162
|
|
|
$
|
1,070
|
|
Interest expense, net
|
51
|
|
|
47
|
|
|
54
|
|
|||
Income from continuing operations before income taxes
|
$
|
1,084
|
|
|
$
|
1,115
|
|
|
$
|
1,016
|
|
Income tax expense
|
315
|
|
|
305
|
|
|
129
|
|
|||
Income from continuing operations
|
$
|
769
|
|
|
$
|
810
|
|
|
$
|
887
|
|
Income from discontinued operations, net of income taxes
|
14
|
|
|
36
|
|
|
27
|
|
|||
Net income
|
$
|
783
|
|
|
$
|
846
|
|
|
$
|
914
|
|
Basic income per common share:
|
|
|
|
|
|
||||||
Income from continuing operations
|
$
|
1.79
|
|
|
$
|
1.83
|
|
|
$
|
1.97
|
|
Income from discontinued operations
|
0.03
|
|
|
0.08
|
|
|
0.06
|
|
|||
Net income
|
$
|
1.82
|
|
|
$
|
1.91
|
|
|
$
|
2.03
|
|
Basic weighted average shares used in computation
|
426
|
|
|
439
|
|
|
446
|
|
|||
Diluted income per common share:
|
|
|
|
|
|
||||||
Income from continuing operations
|
$
|
1.78
|
|
|
$
|
1.82
|
|
|
$
|
1.96
|
|
Income from discontinued operations
|
0.03
|
|
|
0.08
|
|
|
0.06
|
|
|||
Net income
|
$
|
1.81
|
|
|
$
|
1.90
|
|
|
$
|
2.02
|
|
Diluted weighted average shares used in computation
|
427
|
|
|
441
|
|
|
448
|
|
|
Year Ended March 31,
|
||||||||||
(in millions)
|
2016
|
|
2015
|
|
2014
|
||||||
Net income
|
$
|
783
|
|
|
$
|
846
|
|
|
$
|
914
|
|
Other comprehensive income (loss):
|
|
|
|
|
|
||||||
Foreign currency translation adjustments
|
2
|
|
|
(247
|
)
|
|
(16
|
)
|
|||
Total other comprehensive income (loss)
|
$
|
2
|
|
|
$
|
(247
|
)
|
|
$
|
(16
|
)
|
Comprehensive income
|
$
|
785
|
|
|
$
|
599
|
|
|
$
|
898
|
|
(in millions, except per share amounts)
|
|
Common Stock
|
|
Additional Paid-in Capital
|
|
Retained Earnings
|
|
Accumulated Other Comprehensive Loss
|
|
Treasury Stock
|
|
Total Stockholders' Equity
|
||||||||||||
Balance at March 31, 2013
|
|
$
|
59
|
|
|
$
|
3,593
|
|
|
$
|
5,357
|
|
|
$
|
(155
|
)
|
|
$
|
(3,404
|
)
|
|
$
|
5,450
|
|
Net income
|
|
|
|
|
|
914
|
|
|
|
|
|
|
914
|
|
||||||||||
Other comprehensive loss
|
|
|
|
|
|
|
|
(16
|
)
|
|
|
|
(16
|
)
|
||||||||||
Comprehensive income
|
|
|
|
|
|
|
|
|
|
|
|
898
|
|
|||||||||||
Share-based compensation
|
|
|
|
82
|
|
|
|
|
|
|
|
|
82
|
|
||||||||||
Dividends declared
|
|
|
|
|
|
(453
|
)
|
|
|
|
|
|
(453
|
)
|
||||||||||
Release of restricted stock, exercise of common stock options, ESPP and other items
|
|
|
|
(65
|
)
|
|
|
|
|
|
163
|
|
|
98
|
|
|||||||||
Treasury stock purchased
|
|
|
|
|
|
|
|
|
|
(505
|
)
|
|
(505
|
)
|
||||||||||
Balance at March 31, 2014
|
|
$
|
59
|
|
|
$
|
3,610
|
|
|
$
|
5,818
|
|
|
$
|
(171
|
)
|
|
$
|
(3,746
|
)
|
|
$
|
5,570
|
|
Net income
|
|
|
|
|
|
846
|
|
|
|
|
|
|
846
|
|
||||||||||
Other comprehensive loss
|
|
|
|
|
|
|
|
(247
|
)
|
|
|
|
(247
|
)
|
||||||||||
Comprehensive income
|
|
|
|
|
|
|
|
|
|
|
|
599
|
|
|||||||||||
Share-based compensation
|
|
|
|
87
|
|
|
|
|
|
|
|
|
87
|
|
||||||||||
Dividends declared
|
|
|
|
|
|
(444
|
)
|
|
|
|
|
|
(444
|
)
|
||||||||||
Release of restricted stock, exercise of common stock options, ESPP and other items
|
|
|
|
(66
|
)
|
|
1
|
|
|
|
|
93
|
|
|
28
|
|
||||||||
Treasury stock purchased
|
|
|
|
|
|
|
|
|
|
(215
|
)
|
|
(215
|
)
|
||||||||||
Balance at March 31, 2015
|
|
$
|
59
|
|
|
$
|
3,631
|
|
|
$
|
6,221
|
|
|
$
|
(418
|
)
|
|
$
|
(3,868
|
)
|
|
$
|
5,625
|
|
Net income
|
|
|
|
|
|
783
|
|
|
|
|
|
|
783
|
|
||||||||||
Other comprehensive income
|
|
|
|
|
|
|
|
2
|
|
|
|
|
2
|
|
||||||||||
Comprehensive income
|
|
|
|
|
|
|
|
|
|
|
|
785
|
|
|||||||||||
Share-based compensation
|
|
|
|
97
|
|
|
|
|
|
|
|
|
97
|
|
||||||||||
Dividends declared
|
|
|
|
|
|
(429
|
)
|
|
|
|
|
|
(429
|
)
|
||||||||||
Release of restricted stock, exercise of common stock options, ESPP and other items
|
|
|
|
(64
|
)
|
|
|
|
|
|
71
|
|
|
7
|
|
|||||||||
Treasury stock purchased
|
|
|
|
|
|
|
|
|
|
(707
|
)
|
|
(707
|
)
|
||||||||||
Balance at March 31, 2016
|
|
$
|
59
|
|
|
$
|
3,664
|
|
|
$
|
6,575
|
|
|
$
|
(416
|
)
|
|
$
|
(4,504
|
)
|
|
$
|
5,378
|
|
|
Year Ended March 31,
|
||||||||||
(in millions)
|
2016
|
|
2015
|
|
2014
|
||||||
Operating activities from continuing operations:
|
|
|
|
|
|
||||||
Net income
|
$
|
783
|
|
|
$
|
846
|
|
|
$
|
914
|
|
Income from discontinued operations
|
(14
|
)
|
|
(36
|
)
|
|
(27
|
)
|
|||
Income from continuing operations
|
$
|
769
|
|
|
$
|
810
|
|
|
$
|
887
|
|
Adjustments to reconcile income from continuing operations to net cash provided by operating activities:
|
|
|
|
|
|
||||||
Depreciation and amortization
|
362
|
|
|
402
|
|
|
415
|
|
|||
Deferred income taxes
|
(115
|
)
|
|
(72
|
)
|
|
(69
|
)
|
|||
Provision for bad debts
|
—
|
|
|
3
|
|
|
7
|
|
|||
Share-based compensation expense
|
97
|
|
|
87
|
|
|
81
|
|
|||
Asset impairments and other non-cash items
|
—
|
|
|
5
|
|
|
10
|
|
|||
Foreign currency transaction losses (gains)
|
4
|
|
|
(2
|
)
|
|
10
|
|
|||
Changes in other operating assets and liabilities, net of effect of acquisitions:
|
|
|
|
|
|
||||||
Decrease in trade accounts receivable
|
54
|
|
|
79
|
|
|
42
|
|
|||
Decrease in deferred revenue
|
(105
|
)
|
|
(138
|
)
|
|
(103
|
)
|
|||
Increase (decrease) in taxes payable, net
|
28
|
|
|
(98
|
)
|
|
(331
|
)
|
|||
(Decrease) increase in accounts payable, accrued expenses and other
|
(62
|
)
|
|
(9
|
)
|
|
82
|
|
|||
Decrease in accrued salaries, wages and commissions
|
(18
|
)
|
|
(40
|
)
|
|
(28
|
)
|
|||
Changes in other operating assets and liabilities
|
20
|
|
|
3
|
|
|
(30
|
)
|
|||
Net cash provided by operating activities - continuing operations
|
$
|
1,034
|
|
|
$
|
1,030
|
|
|
$
|
973
|
|
Investing activities from continuing operations:
|
|
|
|
|
|
||||||
Acquisitions of businesses, net of cash acquired, and purchased software
|
$
|
(648
|
)
|
|
$
|
(38
|
)
|
|
$
|
(133
|
)
|
Purchases of property and equipment
|
(48
|
)
|
|
(53
|
)
|
|
(65
|
)
|
|||
Proceeds from sale of assets
|
—
|
|
|
—
|
|
|
12
|
|
|||
Capitalized software development costs
|
—
|
|
|
—
|
|
|
(40
|
)
|
|||
Purchases of investments
|
—
|
|
|
—
|
|
|
(9
|
)
|
|||
Maturities of investments
|
—
|
|
|
—
|
|
|
191
|
|
|||
Proceeds from sale of short-term investments
|
48
|
|
|
—
|
|
|
—
|
|
|||
Decrease in restricted cash
|
4
|
|
|
—
|
|
|
50
|
|
|||
Other investing activities
|
(1
|
)
|
|
—
|
|
|
(1
|
)
|
|||
Net cash (used in) provided by investing activities - continuing operations
|
$
|
(645
|
)
|
|
$
|
(91
|
)
|
|
$
|
5
|
|
Financing activities from continuing operations:
|
|
|
|
|
|
||||||
Dividends paid
|
$
|
(429
|
)
|
|
$
|
(444
|
)
|
|
$
|
(453
|
)
|
Purchases of common stock
|
(707
|
)
|
|
(215
|
)
|
|
(507
|
)
|
|||
Notional pooling borrowings
|
3,899
|
|
|
5,371
|
|
|
3,702
|
|
|||
Notional pooling repayments
|
(3,877
|
)
|
|
(5,207
|
)
|
|
(3,734
|
)
|
|||
Debt borrowings
|
1,100
|
|
|
—
|
|
|
498
|
|
|||
Debt repayments
|
(409
|
)
|
|
(508
|
)
|
|
(15
|
)
|
|||
Debt issuance costs
|
(4
|
)
|
|
—
|
|
|
(5
|
)
|
|||
Exercise of common stock options
|
8
|
|
|
26
|
|
|
93
|
|
|||
Other financing activities
|
(24
|
)
|
|
—
|
|
|
—
|
|
|||
Net cash used in financing activities - continuing operations
|
$
|
(443
|
)
|
|
$
|
(977
|
)
|
|
$
|
(421
|
)
|
Effect of exchange rate changes on cash
|
$
|
24
|
|
|
$
|
(532
|
)
|
|
$
|
62
|
|
Net change in cash and cash equivalents - continuing operations
|
$
|
(30
|
)
|
|
$
|
(570
|
)
|
|
$
|
619
|
|
Cash (used in) provided by operating activities - discontinued operations
|
$
|
(12
|
)
|
|
$
|
(48
|
)
|
|
$
|
40
|
|
Cash provided by investing activities - discontinued operations
|
50
|
|
|
170
|
|
|
—
|
|
|||
Net effect of discontinued operations on cash and cash equivalents
|
$
|
38
|
|
|
$
|
122
|
|
|
$
|
40
|
|
Increase (decrease) in cash and cash equivalents
|
$
|
8
|
|
|
$
|
(448
|
)
|
|
$
|
659
|
|
Cash and cash equivalents at beginning of period
|
$
|
2,804
|
|
|
$
|
3,252
|
|
|
$
|
2,593
|
|
Cash and cash equivalents at end of period
|
$
|
2,812
|
|
|
$
|
2,804
|
|
|
$
|
3,252
|
|
•
|
Level 1: Quoted prices in active markets that are unadjusted and accessible at the measurement date for identical, unrestricted assets or liabilities;
|
•
|
Level 2: Quoted prices for identical assets and liabilities in markets that are not active, or quoted prices for similar assets and liabilities in active markets or financial instruments for which significant inputs are observable, either directly or indirectly; and
|
•
|
Level 3: Prices or valuations that require inputs that are both significant to the fair value measurement and unobservable.
|
(dollars in millions)
|
Rally
|
|
Other Fiscal Year 2016 Acquisitions
|
|
Estimated
Useful Life
|
||||
Finite-lived intangible assets
(1)
|
$
|
78
|
|
|
$
|
14
|
|
|
1-15 years
|
Purchased software
|
178
|
|
|
96
|
|
|
5-7 years
|
||
Goodwill
|
257
|
|
|
59
|
|
|
Indefinite
|
||
Deferred tax liabilities, net
|
(45
|
)
|
|
(24
|
)
|
|
—
|
||
Other assets net of other liabilities assumed
(2)
|
51
|
|
|
2
|
|
|
—
|
||
Purchase price
|
$
|
519
|
|
|
$
|
147
|
|
|
|
(1)
|
Includes customer relationships and trade names.
|
(2)
|
Includes approximately
$13 million
of cash acquired and approximately
$48 million
of short-term investments acquired relating to Rally.
|
|
Year Ended March 31,
|
||||||||||
(in millions)
|
2016
|
|
2015
|
|
2014
|
||||||
Subscription and maintenance
|
$
|
20
|
|
|
$
|
43
|
|
|
$
|
88
|
|
Software fees and other
|
7
|
|
|
19
|
|
|
47
|
|
|||
Total revenue
|
$
|
27
|
|
|
$
|
62
|
|
|
$
|
135
|
|
Income from operations of discontinued components, net of tax expense of $7 million, $10 million and $19 million, respectively
|
$
|
12
|
|
|
$
|
16
|
|
|
$
|
27
|
|
Gain on disposal of discontinued components, net of tax
|
2
|
|
|
20
|
|
|
—
|
|
|||
Income from discontinued operations, net of tax
|
$
|
14
|
|
|
$
|
36
|
|
|
$
|
27
|
|
(in millions)
|
Accrued Balance at March 31, 2015
|
|
Expense
|
|
Change in
Estimate
|
|
Payments
|
|
Accretion
and Other
|
|
Accrued Balance at March 31, 2016
|
||||||||||||
Severance charges
|
$
|
28
|
|
|
$
|
—
|
|
|
$
|
(3
|
)
|
|
$
|
(22
|
)
|
|
$
|
—
|
|
|
$
|
3
|
|
Facility exit charges
|
21
|
|
|
—
|
|
|
—
|
|
|
(5
|
)
|
|
—
|
|
|
16
|
|
||||||
Total accrued liabilities
|
$
|
49
|
|
|
|
|
|
|
|
|
|
|
$
|
19
|
|
(in millions)
|
Accrued Balance at March 31, 2014
|
|
Expense
|
|
Change in
Estimate
|
|
Payments
|
|
Accretion
and Other
|
|
Accrued Balance at March 31, 2015
|
||||||||||||
Severance charges
|
$
|
55
|
|
|
$
|
60
|
|
|
$
|
(7
|
)
|
|
$
|
(77
|
)
|
|
$
|
(3
|
)
|
|
$
|
28
|
|
Facility exit charges
|
29
|
|
|
—
|
|
|
—
|
|
|
(9
|
)
|
|
1
|
|
|
21
|
|
||||||
Total accrued liabilities
|
$
|
84
|
|
|
|
|
|
|
|
|
|
|
$
|
49
|
|
(in millions)
|
Accrued Balance at March 31, 2013
|
|
Expense
|
|
Change in
Estimate
|
|
Payments
|
|
Accretion
and Other
|
|
Accrued Balance at March 31, 2014
|
||||||||||||
Severance charges
|
$
|
16
|
|
|
$
|
160
|
|
|
$
|
(12
|
)
|
|
$
|
(113
|
)
|
|
$
|
4
|
|
|
$
|
55
|
|
Facility exit charges
|
23
|
|
|
22
|
|
|
—
|
|
|
(13
|
)
|
|
(3
|
)
|
|
29
|
|
||||||
Total accrued liabilities
|
$
|
39
|
|
|
|
|
|
|
|
|
|
|
$
|
84
|
|
|
At March 31,
|
||||||
(in millions)
|
2016
|
|
2015
|
||||
Accounts receivable – billed
|
$
|
566
|
|
|
$
|
591
|
|
Accounts receivable – unbilled
|
55
|
|
|
63
|
|
||
Other receivables
|
13
|
|
|
15
|
|
||
Less: Allowances
|
(9
|
)
|
|
(17
|
)
|
||
Trade accounts receivable, net
|
$
|
625
|
|
|
$
|
652
|
|
|
At March 31.
|
||||||
(in millions)
|
2016
|
|
2015
|
||||
Land and buildings
|
$
|
188
|
|
|
$
|
190
|
|
Equipment, software developed for internal use, furniture and leasehold improvements
|
886
|
|
|
874
|
|
||
|
$
|
1,074
|
|
|
$
|
1,064
|
|
Accumulated depreciation and amortization
|
(832
|
)
|
|
(812
|
)
|
||
Property and equipment, net
|
$
|
242
|
|
|
$
|
252
|
|
|
At March 31, 2016
|
||||||||||||||||||
(in millions)
|
Gross
Amortizable
Assets
|
|
Less: Fully
Amortized
Assets
|
|
Remaining
Amortizable
Assets
|
|
Accumulated
Amortization
on Remaining
Amortizable
Assets
|
|
Net
Assets
|
||||||||||
Purchased software products
|
$
|
5,990
|
|
|
$
|
4,865
|
|
|
$
|
1,125
|
|
|
$
|
552
|
|
|
$
|
573
|
|
Internally developed software products
|
1,467
|
|
|
1,009
|
|
|
458
|
|
|
333
|
|
|
125
|
|
|||||
Other intangible assets
|
927
|
|
|
728
|
|
|
199
|
|
|
102
|
|
|
97
|
|
|||||
Total capitalized software and other intangible assets
|
$
|
8,384
|
|
|
$
|
6,602
|
|
|
$
|
1,782
|
|
|
$
|
987
|
|
|
$
|
795
|
|
|
At March 31, 2015
|
||||||||||||||||||
(in millions)
|
Gross
Amortizable
Assets
|
|
Less: Fully
Amortized
Assets
|
|
Remaining
Amortizable
Assets
|
|
Accumulated
Amortization
on Remaining
Amortizable
Assets
|
|
Net
Assets
|
||||||||||
Purchased software products
|
$
|
5,717
|
|
|
$
|
4,859
|
|
|
$
|
858
|
|
|
$
|
413
|
|
|
$
|
445
|
|
Internally developed software products
|
1,486
|
|
|
835
|
|
|
651
|
|
|
414
|
|
|
237
|
|
|||||
Other intangible assets
|
836
|
|
|
556
|
|
|
280
|
|
|
231
|
|
|
49
|
|
|||||
Total capitalized software and other intangible assets
|
$
|
8,039
|
|
|
$
|
6,250
|
|
|
$
|
1,789
|
|
|
$
|
1,058
|
|
|
$
|
731
|
|
|
Year Ended March 31,
|
||||||||||
(in millions)
|
2016
|
|
2015
|
|
2014
|
||||||
Depreciation
|
$
|
62
|
|
|
$
|
71
|
|
|
$
|
84
|
|
Amortization of purchased software products
|
146
|
|
|
124
|
|
|
116
|
|
|||
Amortization of internally developed software products
|
110
|
|
|
149
|
|
|
155
|
|
|||
Amortization of other intangible assets
|
44
|
|
|
58
|
|
|
60
|
|
|||
Total depreciation and amortization expense
|
$
|
362
|
|
|
$
|
402
|
|
|
$
|
415
|
|
|
Year Ended March 31,
|
||||||||||||||||||
(in millions)
|
2017
|
|
2018
|
|
2019
|
|
2020
|
|
2021
|
||||||||||
Purchased software products
|
$
|
153
|
|
|
$
|
145
|
|
|
$
|
105
|
|
|
$
|
85
|
|
|
$
|
43
|
|
Internally developed software products
|
79
|
|
|
36
|
|
|
9
|
|
|
1
|
|
|
—
|
|
|||||
Other intangible assets
|
16
|
|
|
8
|
|
|
7
|
|
|
6
|
|
|
6
|
|
|||||
Total
|
$
|
248
|
|
|
$
|
189
|
|
|
$
|
121
|
|
|
$
|
92
|
|
|
$
|
49
|
|
(in millions)
|
Mainframe Solutions
|
|
Enterprise Solutions
|
|
Services
|
|
Total
|
||||||||
Balance at March 31, 2014
|
$
|
4,178
|
|
|
$
|
1,663
|
|
|
$
|
81
|
|
|
$
|
5,922
|
|
Divestitures
|
—
|
|
|
(109
|
)
|
|
—
|
|
|
(109
|
)
|
||||
Foreign currency translation adjustment
|
—
|
|
|
(7
|
)
|
|
—
|
|
|
(7
|
)
|
||||
Balance at March 31, 2015
|
$
|
4,178
|
|
|
$
|
1,547
|
|
|
$
|
81
|
|
|
$
|
5,806
|
|
Acquisitions
|
—
|
|
|
316
|
|
|
—
|
|
|
316
|
|
||||
Divestitures
|
—
|
|
|
(36
|
)
|
|
—
|
|
|
(36
|
)
|
||||
Balance at March 31, 2016
|
$
|
4,178
|
|
|
$
|
1,827
|
|
|
$
|
81
|
|
|
$
|
6,086
|
|
|
At March 31,
|
||||||
(in millions)
|
2016
|
|
2015
|
||||
Current:
|
|
|
|
||||
Subscription and maintenance
|
$
|
1,990
|
|
|
$
|
1,966
|
|
Professional services
|
116
|
|
|
115
|
|
||
Software fees and other
|
91
|
|
|
33
|
|
||
Total deferred revenue (billed or collected) – current
|
$
|
2,197
|
|
|
$
|
2,114
|
|
Noncurrent:
|
|
|
|
||||
Subscription and maintenance
|
$
|
712
|
|
|
$
|
832
|
|
Professional services
|
21
|
|
|
28
|
|
||
Software fees and other
|
4
|
|
|
3
|
|
||
Total deferred revenue (billed or collected) – noncurrent
|
$
|
737
|
|
|
$
|
863
|
|
Total deferred revenue (billed or collected)
|
$
|
2,934
|
|
|
$
|
2,977
|
|
|
At March 31,
|
||||||
(in millions)
|
2016
|
|
2015
|
||||
Revolving credit facility
|
$
|
—
|
|
|
$
|
—
|
|
5.375% Senior Notes due December 2019
|
750
|
|
|
750
|
|
||
3.600% Senior Notes due August 2020
|
400
|
|
|
—
|
|
||
2.875% Senior Notes due August 2018
|
250
|
|
|
250
|
|
||
4.500% Senior Notes due August 2023
|
250
|
|
|
250
|
|
||
Term Loan due April 2022
|
300
|
|
|
—
|
|
||
Other indebtedness, primarily capital leases
|
15
|
|
|
17
|
|
||
Unamortized debt issuance costs
|
(8
|
)
|
|
(6
|
)
|
||
Unamortized discount for Senior Notes
|
(4
|
)
|
|
(4
|
)
|
||
Total debt outstanding
|
$
|
1,953
|
|
|
$
|
1,257
|
|
Less the current portion
|
(6
|
)
|
|
(10
|
)
|
||
Total long-term debt portion
|
$
|
1,947
|
|
|
$
|
1,247
|
|
|
Year Ended March 31,
|
||||||||||||||||||||||
(in millions)
|
2017
|
|
2018
|
|
2019
|
|
2020
|
|
2021
|
|
Thereafter
|
||||||||||||
Amount due
|
$
|
6
|
|
|
$
|
3
|
|
|
$
|
252
|
|
|
$
|
748
|
|
|
$
|
397
|
|
|
$
|
547
|
|
|
At March 31,
|
||||
|
2016
|
|
2015
|
||
Applicable margin on Base Rate borrowing
|
0.125
|
%
|
|
0.125
|
%
|
Weighted average interest rate on outstanding borrowings
|
—
|
%
|
|
—
|
%
|
Applicable margin on Eurocurrency Rate borrowing
|
1.000
|
%
|
|
1.000
|
%
|
Facility commitment fee
|
0.125
|
%
|
|
0.125
|
%
|
|
At March 31,
|
||||||
(in millions)
|
2016
|
|
2015
|
||||
Total borrowings outstanding at beginning of year
(1)
|
$
|
138
|
|
|
$
|
139
|
|
Borrowings
|
3,899
|
|
|
5,371
|
|
||
Repayments
|
(3,877
|
)
|
|
(5,207
|
)
|
||
Foreign exchange effect
|
(21
|
)
|
|
(165
|
)
|
||
Total borrowings outstanding at end of year
(1)
|
$
|
139
|
|
|
$
|
138
|
|
(1)
|
Included in “Accrued expenses and other current liabilities” in the Company’s Consolidated Balance Sheets.
|
|
Amount of Net (Gain)/Loss Recognized in the
Consolidated Statements of Operations
|
||||||||||
Location of Amounts Recognized
|
Year Ended March 31,
|
||||||||||
(in millions)
|
2016
|
|
2015
|
|
2014
|
||||||
Interest expense, net – interest rate swaps designated as fair value hedges
|
$
|
—
|
|
|
$
|
(8
|
)
|
|
$
|
(12
|
)
|
Other expenses, net – foreign currency contracts
|
$
|
6
|
|
|
$
|
(31
|
)
|
|
$
|
(20
|
)
|
|
At March 31, 2016
|
|
At March 31, 2015
|
||||||||||||||||||||
|
Fair Value
Measurement Using
Input Types
|
|
Estimated
Fair
Value
|
|
Fair Value
Measurement Using
Input Types
|
|
Estimated
Fair
Value
|
||||||||||||||||
(in millions)
|
Level 1
|
|
Level 2
|
|
Total
|
|
Level 1
|
|
Level 2
|
|
Total
|
||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Money market funds
(1)
|
$
|
617
|
|
|
$
|
—
|
|
|
$
|
617
|
|
|
$
|
749
|
|
|
$
|
—
|
|
|
$
|
749
|
|
Foreign exchange derivatives
(2)
|
—
|
|
|
2
|
|
|
2
|
|
|
—
|
|
|
5
|
|
|
5
|
|
||||||
Total assets
|
$
|
617
|
|
|
$
|
2
|
|
|
$
|
619
|
|
|
$
|
749
|
|
|
$
|
5
|
|
|
$
|
754
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Foreign exchange derivatives
(2)
|
$
|
—
|
|
|
$
|
3
|
|
|
$
|
3
|
|
|
$
|
—
|
|
|
$
|
3
|
|
|
$
|
3
|
|
Total liabilities
|
$
|
—
|
|
|
$
|
3
|
|
|
$
|
3
|
|
|
$
|
—
|
|
|
$
|
3
|
|
|
$
|
3
|
|
(1)
|
The Company's investments in money market funds are classified as “Cash and cash equivalents” in its Consolidated Balance Sheets.
|
(2)
|
Refer to Note 9, “Derivatives” for additional information.
|
|
At March 31, 2016
|
|
At March 31, 2015
|
||||||||||||
(in millions)
|
Carrying
Value
|
|
Estimated
Fair Value
|
|
Carrying
Value
|
|
Estimated
Fair Value
|
||||||||
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Total debt
(1)
|
$
|
1,953
|
|
|
$
|
2,058
|
|
|
$
|
1,257
|
|
|
$
|
1,370
|
|
Facility exit reserve
(2)
|
$
|
16
|
|
|
$
|
17
|
|
|
$
|
21
|
|
|
$
|
23
|
|
(1)
|
Estimated fair value of total debt is based on quoted prices for similar liabilities for which significant inputs are observable except for certain long-term lease obligations, for which fair value approximates carrying value (Level 2).
|
(2)
|
Estimated fair value for the facility exit reserve is determined using the Company’s incremental borrowing rate at
March 31, 2016
and
2015
. At
March 31, 2016
and
2015
, the facility exit reserve included approximately
$4 million
and
$4 million
, respectively, in “Accrued expenses and other current liabilities” and approximately
$12 million
and
$17 million
, respectively, in “Other noncurrent liabilities” in the Company’s Consolidated Balance Sheets (Level 3).
|
Fiscal Year
|
(in millions)
|
||
2017
|
$
|
83
|
|
2018
|
75
|
|
|
2019
|
65
|
|
|
2020
|
60
|
|
|
2021
|
51
|
|
|
Thereafter
|
85
|
|
|
Total
|
$
|
419
|
|
Less income from sublease
|
(34
|
)
|
|
Net minimum operating lease payments
|
$
|
385
|
|
Declaration Date
|
|
Dividend Per Share
|
|
Record Date
|
|
Total Amount
|
|
Payment Date
|
May 5, 2015
|
|
$0.25
|
|
May 28, 2015
|
|
$110
|
|
June 16, 2015
|
August 6, 2015
|
|
$0.25
|
|
August 27, 2015
|
|
$110
|
|
September 15, 2015
|
November 5, 2015
|
|
$0.25
|
|
November 19, 2015
|
|
$105
|
|
December 8, 2015
|
February 3, 2016
|
|
$0.25
|
|
February 18, 2016
|
|
$104
|
|
March 15, 2016
|
Declaration Date
|
|
Dividend Per Share
|
|
Record Date
|
|
Total Amount
|
|
Payment Date
|
May 15, 2014
|
|
$0.25
|
|
May 29, 2014
|
|
$111
|
|
June 17, 2014
|
July 31, 2014
|
|
$0.25
|
|
August 21, 2014
|
|
$111
|
|
September 9, 2014
|
November 6, 2014
|
|
$0.25
|
|
November 20, 2014
|
|
$111
|
|
December 9, 2014
|
February 5, 2015
|
|
$0.25
|
|
February 19, 2015
|
|
$111
|
|
March 17, 2015
|
|
Year Ended March 31,
|
||||||||||
(in millions, except per share amounts)
|
2016
|
|
2015
|
|
2014
|
||||||
Basic income from continuing operations per common share:
|
|
|
|
|
|
||||||
Income from continuing operations
|
$
|
769
|
|
|
$
|
810
|
|
|
$
|
887
|
|
Less: Income from continuing operations allocable to participating securities
|
(8
|
)
|
|
(8
|
)
|
|
(9
|
)
|
|||
Income from continuing operations allocable to common shares
|
$
|
761
|
|
|
$
|
802
|
|
|
$
|
878
|
|
Weighted average common shares outstanding
|
426
|
|
|
439
|
|
|
446
|
|
|||
Basic income from continuing operations per common share
|
$
|
1.79
|
|
|
$
|
1.83
|
|
|
$
|
1.97
|
|
Diluted income from continuing operations per common share:
|
|
|
|
|
|
||||||
Income from continuing operations
|
$
|
769
|
|
|
$
|
810
|
|
|
$
|
887
|
|
Less: Income from continuing operations allocable to participating securities
|
(8
|
)
|
|
(8
|
)
|
|
(9
|
)
|
|||
Income from continuing operations allocable to common shares
|
$
|
761
|
|
|
$
|
802
|
|
|
$
|
878
|
|
Weighted average shares outstanding and common share equivalents:
|
|
|
|
|
|
||||||
Weighted average common shares outstanding
|
426
|
|
|
439
|
|
|
446
|
|
|||
Weighted average effect of share-based payment awards
|
1
|
|
|
2
|
|
|
2
|
|
|||
Denominator in calculation of diluted income per share
|
427
|
|
|
441
|
|
|
448
|
|
|||
Diluted income from continuing operations per common share
|
$
|
1.78
|
|
|
$
|
1.82
|
|
|
$
|
1.96
|
|
|
Year Ended March 31,
|
||||||||||
(in millions)
|
2016
|
|
2015
|
|
2014
|
||||||
Costs of licensing and maintenance
|
$
|
7
|
|
|
$
|
5
|
|
|
$
|
4
|
|
Cost of professional services
|
4
|
|
|
4
|
|
|
4
|
|
|||
Selling and marketing
|
34
|
|
|
30
|
|
|
28
|
|
|||
General and administrative
|
35
|
|
|
29
|
|
|
26
|
|
|||
Product development and enhancements
|
17
|
|
|
19
|
|
|
19
|
|
|||
Share-based compensation expense before tax
|
$
|
97
|
|
|
$
|
87
|
|
|
$
|
81
|
|
Income tax benefit
|
(31
|
)
|
|
(28
|
)
|
|
(26
|
)
|
|||
Net share-based compensation expense
|
$
|
66
|
|
|
$
|
59
|
|
|
$
|
55
|
|
|
Unrecognized Share-Based Compensation Costs
|
|
Weighted Average Period Expected to be Recognized
|
||
|
(in millions)
|
|
(in years)
|
||
Stock option awards
|
$
|
4
|
|
|
1.8
|
Restricted stock units
|
16
|
|
|
1.9
|
|
Restricted stock awards
|
56
|
|
|
1.8
|
|
Performance share units
|
25
|
|
|
2.2
|
|
Total unrecognized share-based compensation costs
|
$
|
101
|
|
|
1.9
|
|
Number of Shares
(in millions)
|
|
Weighted Average Exercise Price
|
|
Weighted Average Remaining Contractual Life
(in years)
|
|
Aggregate Intrinsic Value
(1)
(in millions)
|
|||||
Vested
|
2.0
|
|
|
$
|
26.16
|
|
|
6.5
|
|
$
|
9.4
|
|
Expected to vest
(2)
|
1.6
|
|
|
29.52
|
|
|
8.5
|
|
2.0
|
|
||
Total
|
3.6
|
|
|
$
|
27.60
|
|
|
7.4
|
|
$
|
11.4
|
|
(1)
|
These amounts represent the difference between the exercise price and
$30.79
, the closing price of the Company’s common stock on
March 31, 2016
, the last trading day of the Company’s fiscal year as reported on the NASDAQ Stock Market for all in-the-money options.
|
(2)
|
Outstanding options expected to vest are net of estimated future forfeitures.
|
|
Number of Shares
|
|
Weighted Average Exercise Price
|
|||
|
(in millions)
|
|
||||
Outstanding at March 31, 2013
|
6.0
|
|
|
$
|
25.17
|
|
Granted
|
1.7
|
|
|
27.86
|
|
|
Exercised
|
(3.5
|
)
|
|
25.06
|
|
|
Expired or terminated
|
(0.5
|
)
|
|
25.95
|
|
|
Outstanding at March 31, 2014
|
3.7
|
|
|
$
|
26.13
|
|
Granted
|
0.9
|
|
|
29.13
|
|
|
Exercised
|
(0.9
|
)
|
|
25.46
|
|
|
Expired or terminated
|
(0.5
|
)
|
|
26.81
|
|
|
Outstanding at March 31, 2015
|
3.2
|
|
|
$
|
27.02
|
|
Granted
|
0.8
|
|
|
30.39
|
|
|
Exercised
|
(0.2
|
)
|
|
25.58
|
|
|
Expired or terminated
|
(0.1
|
)
|
|
31.08
|
|
|
Outstanding at March 31, 2016
|
3.7
|
|
|
$
|
27.72
|
|
|
Options Outstanding
|
|
Options Exercisable
|
||||||||||||||||||||||
Range of Exercise Prices
|
Shares
|
|
Aggregate Intrinsic Value
|
|
Weighted Average Remaining Contractual Life
|
|
Weighted Average Exercise Price
|
|
Shares
|
|
Aggregate Intrinsic Value
|
|
Weighted Average Remaining Contractual Life
|
|
Weighted Average Exercise Price
|
||||||||||
(in millions)
|
|
(in millions)
|
|
(in years)
|
|
|
(in millions)
|
|
(in millions)
|
|
(in years)
|
|
|||||||||||||
$21.78 — $25.00
|
0.8
|
|
|
$
|
6.0
|
|
|
6.1
|
|
$
|
23.53
|
|
|
0.8
|
|
|
$
|
6.0
|
|
|
6.1
|
|
$
|
23.53
|
|
$25.01 — $30.00
|
1.4
|
|
|
4.8
|
|
|
7.1
|
|
27.43
|
|
|
0.8
|
|
|
3.2
|
|
|
6.5
|
|
26.96
|
|
||||
$30.01 — over
|
1.5
|
|
|
0.7
|
|
|
8.6
|
|
30.37
|
|
|
0.4
|
|
|
0.2
|
|
|
7.6
|
|
30.23
|
|
||||
|
3.7
|
|
|
$
|
11.5
|
|
|
7.4
|
|
$
|
27.72
|
|
|
2.0
|
|
|
$
|
9.4
|
|
|
6.5
|
|
$
|
26.16
|
|
|
Year Ended March 31,
|
||||||||||
|
2016
|
|
2015
|
|
2014
|
||||||
Weighted average fair value
|
$
|
4.68
|
|
|
$
|
5.61
|
|
|
$
|
5.20
|
|
Dividend yield
|
3.37
|
%
|
|
3.32
|
%
|
|
4.05
|
%
|
|||
Expected volatility factor
(1)
|
23
|
%
|
|
27
|
%
|
|
30
|
%
|
|||
Risk-free interest rate
(2)
|
1.9
|
%
|
|
2.0
|
%
|
|
1.5
|
%
|
|||
Expected life (in years)
(3)
|
6.0
|
|
|
6.0
|
|
|
6.0
|
|
(1)
|
Expected volatility is measured using historical daily price changes of the Company’s stock over the respective expected term of the options and the implied volatility derived from the market prices of the Company’s traded options.
|
(2)
|
The risk-free rate for periods within the contractual term of the stock options is based on the U.S. Treasury yield curve in effect at the time of grant.
|
(3)
|
The expected life is the number of years the Company estimates that options will be outstanding prior to exercise.
The Company’s computation of expected life was determined based on the simplified method (the average of the vesting period and option term).
|
|
Year Ended March 31,
|
||||||||||
(in millions)
|
2016
|
|
2015
|
|
2014
|
||||||
Cash received from options exercised
|
$
|
4
|
|
|
$
|
22
|
|
|
$
|
88
|
|
Intrinsic value of options exercised
|
$
|
1
|
|
|
$
|
3
|
|
|
$
|
19
|
|
|
RSAs
|
|
RSUs
|
||||||||||
|
Shares
|
|
Weighted Average Grant Date Fair Value
|
|
Shares
|
|
Weighted Average Grant Date Fair Value
|
||||||
|
(in millions)
|
|
|
(in millions)
|
|
||||||||
Outstanding at March 31, 2013
|
5.0
|
|
|
$
|
24.98
|
|
|
1.4
|
|
|
$
|
23.28
|
|
Granted
|
2.7
|
|
|
27.06
|
|
|
0.7
|
|
|
25.45
|
|
||
Released
|
(2.6
|
)
|
|
24.49
|
|
|
(0.6
|
)
|
|
23.01
|
|
||
Forfeitures
|
(0.8
|
)
|
|
26.14
|
|
|
(0.1
|
)
|
|
24.41
|
|
||
Outstanding at March 31, 2014
|
4.3
|
|
|
$
|
26.38
|
|
|
1.4
|
|
|
$
|
24.47
|
|
Granted
|
3.1
|
|
|
28.97
|
|
|
0.8
|
|
|
26.99
|
|
||
Released
|
(2.2
|
)
|
|
26.36
|
|
|
(0.6
|
)
|
|
24.64
|
|
||
Forfeitures
|
(0.9
|
)
|
|
27.79
|
|
|
(0.2
|
)
|
|
25.59
|
|
||
Outstanding at March 31, 2015
|
4.3
|
|
|
$
|
27.99
|
|
|
1.4
|
|
|
$
|
25.74
|
|
Granted
|
2.8
|
|
|
30.59
|
|
|
0.9
|
|
|
28.72
|
|
||
Released
|
(2.1
|
)
|
|
27.95
|
|
|
(0.8
|
)
|
|
26.17
|
|
||
Forfeitures
|
(0.8
|
)
|
|
29.44
|
|
|
(0.2
|
)
|
|
26.88
|
|
||
Outstanding at March 31, 2016
|
4.2
|
|
|
$
|
29.51
|
|
|
1.3
|
|
|
$
|
27.35
|
|
|
|
|
RSAs
|
|
RSUs
|
||||||||||
Incentive Plans for Fiscal Years
|
Performance Period
|
|
Shares
(in millions)
|
|
Weighted Average Grant Date Fair Value
|
|
Shares
(in millions)
|
|
Weighted Average Grant Date Fair Value
|
||||||
2015
|
1 year
|
|
0.5
|
|
|
$
|
31.41
|
|
|
0.1
|
|
|
$
|
30.42
|
|
2014
|
1 year
|
|
0.7
|
|
|
$
|
29.91
|
|
|
0.1
|
|
|
$
|
28.92
|
|
2013
|
1 year
|
|
0.4
|
|
|
$
|
27.11
|
|
|
0.1
|
|
|
$
|
26.12
|
|
Incentive Plans for Fiscal Years
|
Performance Period
|
|
Shares of Common Stock
(in millions)
|
|
Weighted Average Grant Date Fair Value
|
|||
2013
|
3 years
|
|
0.1
|
|
|
$
|
31.41
|
|
|
|
|
RSAs
|
|
RSUs
|
||||||||||
Incentive Plans for Fiscal Years
|
Performance Period
|
|
Shares
(in millions)
|
|
Weighted Average Grant Date Fair Value
|
|
Shares
(in millions)
|
|
Weighted Average Grant Date Fair Value
|
||||||
2015
|
1 year
|
|
0.2
|
|
|
$
|
30.45
|
|
|
0.1
|
|
|
$
|
27.50
|
|
2014
|
1 year
|
|
0.2
|
|
|
$
|
28.69
|
|
|
0.1
|
|
|
$
|
25.73
|
|
2013
|
1 year
|
|
0.2
|
|
|
$
|
27.11
|
|
|
0.1
|
|
|
$
|
24.13
|
|
|
Year Ended March 31,
|
||||||||||
(in millions)
|
2016
|
|
2015
|
|
2014
|
||||||
Domestic
|
$
|
729
|
|
|
$
|
737
|
|
|
$
|
683
|
|
Foreign
|
355
|
|
|
378
|
|
|
333
|
|
|||
Income from continuing operations before income taxes
|
$
|
1,084
|
|
|
$
|
1,115
|
|
|
$
|
1,016
|
|
|
Year Ended March 31,
|
||||||||||
(in millions)
|
2016
|
|
2015
|
|
2014
|
||||||
Current:
|
|
|
|
|
|
||||||
Federal
|
$
|
285
|
|
|
$
|
284
|
|
|
$
|
184
|
|
State
|
50
|
|
|
37
|
|
|
33
|
|
|||
Foreign
|
95
|
|
|
56
|
|
|
(19
|
)
|
|||
Total current
|
$
|
430
|
|
|
$
|
377
|
|
|
$
|
198
|
|
Deferred:
|
|
|
|
|
|
||||||
Federal
|
$
|
(86
|
)
|
|
$
|
(74
|
)
|
|
$
|
(82
|
)
|
State
|
(20
|
)
|
|
(12
|
)
|
|
(12
|
)
|
|||
Foreign
|
(9
|
)
|
|
14
|
|
|
25
|
|
|||
Total deferred
|
$
|
(115
|
)
|
|
$
|
(72
|
)
|
|
$
|
(69
|
)
|
Total:
|
|
|
|
|
|
||||||
Federal
|
$
|
199
|
|
|
$
|
210
|
|
|
$
|
102
|
|
State
|
30
|
|
|
25
|
|
|
21
|
|
|||
Foreign
|
86
|
|
|
70
|
|
|
6
|
|
|||
Total income tax expense from continuing operations
|
$
|
315
|
|
|
$
|
305
|
|
|
$
|
129
|
|
|
Year Ended March 31,
|
||||||||||
(in millions)
|
2016
|
|
2015
|
|
2014
|
||||||
Tax expense at U.S. federal statutory tax rate
|
$
|
379
|
|
|
$
|
390
|
|
|
$
|
356
|
|
Effect of international operations
|
(77
|
)
|
|
(91
|
)
|
|
(147
|
)
|
|||
U.S. federal and state tax contingencies
|
8
|
|
|
1
|
|
|
(123
|
)
|
|||
Domestic manufacturing deduction
|
(27
|
)
|
|
(23
|
)
|
|
(24
|
)
|
|||
State taxes, net of U.S. federal tax benefit
|
16
|
|
|
15
|
|
|
19
|
|
|||
Valuation allowance
|
3
|
|
|
8
|
|
|
23
|
|
|||
Other, net
|
13
|
|
|
5
|
|
|
25
|
|
|||
Income tax expense from continuing operations
|
$
|
315
|
|
|
$
|
305
|
|
|
$
|
129
|
|
|
At March 31,
|
||||||
(in millions)
|
2016
|
|
2015
|
||||
Deferred tax assets:
|
|
|
|
||||
Modified accrual basis accounting for revenue
|
$
|
391
|
|
|
$
|
349
|
|
Share-based compensation
|
36
|
|
|
31
|
|
||
Accrued expenses
|
42
|
|
|
36
|
|
||
Net operating losses
|
135
|
|
|
96
|
|
||
Intangible assets amortizable for tax purposes
|
2
|
|
|
3
|
|
||
Deductible state tax and interest benefits
|
17
|
|
|
20
|
|
||
Other
|
73
|
|
|
69
|
|
||
Total deferred tax assets
|
$
|
696
|
|
|
$
|
604
|
|
Valuation allowances
|
(96
|
)
|
|
(85
|
)
|
||
Total deferred tax assets, net of valuation allowance
|
$
|
600
|
|
|
$
|
519
|
|
Deferred tax liabilities:
|
|
|
|
||||
Purchased software
|
$
|
100
|
|
|
$
|
48
|
|
Depreciation
|
4
|
|
|
3
|
|
||
Other intangible assets
|
39
|
|
|
17
|
|
||
Internally developed software
|
53
|
|
|
93
|
|
||
Total deferred tax liabilities
|
$
|
196
|
|
|
$
|
161
|
|
Net deferred tax asset
|
$
|
404
|
|
|
$
|
358
|
|
|
At March 31,
|
||||||
(in millions)
|
2016
|
|
2015
|
||||
Balance at beginning of year
|
$
|
134
|
|
|
$
|
170
|
|
Additions for tax positions related to the current year
|
22
|
|
|
16
|
|
||
Additions for tax positions from prior years
|
20
|
|
|
23
|
|
||
Reductions for tax positions from prior years
|
(14
|
)
|
|
(43
|
)
|
||
Settlement payments
|
(16
|
)
|
|
(5
|
)
|
||
Statute of limitations expiration
|
(5
|
)
|
|
(13
|
)
|
||
Translation and other
|
2
|
|
|
(14
|
)
|
||
Balance at end of year
|
$
|
143
|
|
|
$
|
134
|
|
•
|
United States — federal tax years are open for years 2013 and forward;
|
•
|
Brazil — tax years are open for years 2008 and forward;
|
•
|
Canada — tax years are open for years 2008 and forward; and
|
•
|
Italy — tax years are open for years 2012 and forward.
|
Year Ended March 31, 2016
|
|
Mainframe
Solutions
|
|
Enterprise
Solutions
|
|
Services
|
|
Total
|
||||||||
(dollars in millions)
|
||||||||||||||||
Revenue
|
|
$
|
2,215
|
|
|
$
|
1,484
|
|
|
$
|
326
|
|
|
$
|
4,025
|
|
Expenses
|
|
854
|
|
|
1,337
|
|
|
303
|
|
|
2,494
|
|
||||
Segment profit
|
|
$
|
1,361
|
|
|
$
|
147
|
|
|
$
|
23
|
|
|
$
|
1,531
|
|
Segment operating margin
|
|
61
|
%
|
|
10
|
%
|
|
7
|
%
|
|
38
|
%
|
||||
Depreciation
|
|
$
|
36
|
|
|
$
|
26
|
|
|
$
|
—
|
|
|
$
|
62
|
|
Segment profit
|
$
|
1,531
|
|
Less:
|
|
||
Purchased software amortization
|
146
|
|
|
Other intangibles amortization
|
44
|
|
|
Software development costs capitalized
|
—
|
|
|
Internally developed software products amortization
|
110
|
|
|
Share-based compensation expense
|
97
|
|
|
Other gains, net
(1)
|
(1
|
)
|
|
Interest expense, net
|
51
|
|
|
Income from continuing operations before income taxes
|
$
|
1,084
|
|
(1)
|
Other gains, net consists of costs associated with the Fiscal 2014 Plan and other miscellaneous items.
|
Year Ended March 31, 2015
|
|
Mainframe
Solutions
|
|
Enterprise
Solutions
|
|
Services
|
|
Total
|
||||||||
(dollars in millions)
|
||||||||||||||||
Revenue
|
|
$
|
2,392
|
|
|
$
|
1,519
|
|
|
$
|
351
|
|
|
$
|
4,262
|
|
Expenses
|
|
970
|
|
|
1,353
|
|
|
342
|
|
|
2,665
|
|
||||
Segment profit
|
|
$
|
1,422
|
|
|
$
|
166
|
|
|
$
|
9
|
|
|
$
|
1,597
|
|
Segment operating margin
|
|
59
|
%
|
|
11
|
%
|
|
3
|
%
|
|
37
|
%
|
||||
Depreciation
|
|
$
|
43
|
|
|
$
|
28
|
|
|
$
|
—
|
|
|
$
|
71
|
|
Segment profit
|
$
|
1,597
|
|
Less:
|
|
||
Purchased software amortization
|
124
|
|
|
Other intangibles amortization
|
58
|
|
|
Software development costs capitalized
|
—
|
|
|
Internally developed software products amortization
|
149
|
|
|
Share-based compensation expense
|
87
|
|
|
Other expenses, net
(1)
|
17
|
|
|
Interest expense, net
|
47
|
|
|
Income from continuing operations before income taxes
|
$
|
1,115
|
|
(1)
|
Other expenses, net consists of costs associated with the Fiscal 2014 Plan and other miscellaneous items.
|
Year Ended March 31, 2014
|
|
Mainframe
Solutions
|
|
Enterprise
Solutions
|
|
Services
|
|
Total
|
||||||||
(dollars in millions)
|
||||||||||||||||
Revenue
|
|
$
|
2,478
|
|
|
$
|
1,555
|
|
|
$
|
379
|
|
|
$
|
4,412
|
|
Expenses
|
|
996
|
|
|
1,440
|
|
|
357
|
|
|
2,793
|
|
||||
Segment profit
|
|
$
|
1,482
|
|
|
$
|
115
|
|
|
$
|
22
|
|
|
$
|
1,619
|
|
Segment operating margin
|
|
60
|
%
|
|
7
|
%
|
|
6
|
%
|
|
37
|
%
|
||||
Depreciation
|
|
$
|
52
|
|
|
$
|
32
|
|
|
$
|
—
|
|
|
$
|
84
|
|
Segment profit
|
$
|
1,619
|
|
Less:
|
|
||
Purchased software amortization
|
116
|
|
|
Other intangibles amortization
|
60
|
|
|
Software development costs capitalized
|
(33
|
)
|
|
Internally developed software products amortization
|
155
|
|
|
Share-based compensation expense
|
81
|
|
|
Other expenses, net
(1)
|
170
|
|
|
Interest expense, net
|
54
|
|
|
Income from continuing operations before income taxes
|
$
|
1,016
|
|
(1)
|
Other expenses, net consists of approximately
$168 million
of costs associated with the Fiscal 2014 Plan and other miscellaneous items.
|
(in millions)
|
United States
|
|
EMEA
(1)
|
|
Other
|
|
Eliminations
|
|
Total
|
||||||||||
Year Ended March 31, 2016
|
|
|
|
|
|
|
|
|
|
||||||||||
Revenue:
|
|
|
|
|
|
|
|
|
|
||||||||||
From unaffiliated customers
|
$
|
2,585
|
|
|
$
|
903
|
|
|
$
|
537
|
|
|
$
|
—
|
|
|
$
|
4,025
|
|
Between geographic areas
(2)
|
400
|
|
|
—
|
|
|
—
|
|
|
(400
|
)
|
|
—
|
|
|||||
Total revenue
|
$
|
2,985
|
|
|
$
|
903
|
|
|
$
|
537
|
|
|
$
|
(400
|
)
|
|
$
|
4,025
|
|
Property and equipment, net
|
$
|
109
|
|
|
$
|
96
|
|
|
$
|
37
|
|
|
$
|
—
|
|
|
$
|
242
|
|
Total assets
|
$
|
8,185
|
|
|
$
|
2,170
|
|
|
$
|
849
|
|
|
$
|
—
|
|
|
$
|
11,204
|
|
Total liabilities
|
$
|
4,646
|
|
|
$
|
728
|
|
|
$
|
452
|
|
|
$
|
—
|
|
|
$
|
5,826
|
|
Year Ended March 31, 2015
|
|
|
|
|
|
|
|
|
|
||||||||||
Revenue:
|
|
|
|
|
|
|
|
|
|
||||||||||
From unaffiliated customers
|
$
|
2,615
|
|
|
$
|
1,008
|
|
|
$
|
639
|
|
|
$
|
—
|
|
|
$
|
4,262
|
|
Between geographic areas
(2)
|
438
|
|
|
—
|
|
|
—
|
|
|
(438
|
)
|
|
—
|
|
|||||
Total revenue
|
$
|
3,053
|
|
|
$
|
1,008
|
|
|
$
|
639
|
|
|
$
|
(438
|
)
|
|
$
|
4,262
|
|
Property and equipment, net
|
$
|
112
|
|
|
$
|
97
|
|
|
$
|
43
|
|
|
$
|
—
|
|
|
$
|
252
|
|
Total assets
(3)
|
$
|
8,122
|
|
|
$
|
1,874
|
|
|
$
|
977
|
|
|
$
|
—
|
|
|
$
|
10,973
|
|
Total liabilities
(3)
|
$
|
4,041
|
|
|
$
|
809
|
|
|
$
|
498
|
|
|
$
|
—
|
|
|
$
|
5,348
|
|
Year Ended March 31, 2014
|
|
|
|
|
|
|
|
|
|
||||||||||
Revenue:
|
|
|
|
|
|
|
|
|
|
||||||||||
From unaffiliated customers
|
$
|
2,645
|
|
|
$
|
1,093
|
|
|
$
|
674
|
|
|
$
|
—
|
|
|
$
|
4,412
|
|
Between geographic areas
(2)
|
446
|
|
|
—
|
|
|
—
|
|
|
(446
|
)
|
|
—
|
|
|||||
Total revenue
|
$
|
3,091
|
|
|
$
|
1,093
|
|
|
$
|
674
|
|
|
$
|
(446
|
)
|
|
$
|
4,412
|
|
Property and equipment, net
|
$
|
125
|
|
|
$
|
116
|
|
|
$
|
54
|
|
|
$
|
—
|
|
|
$
|
295
|
|
Total assets
(3)
|
$
|
8,900
|
|
|
$
|
2,076
|
|
|
$
|
1,032
|
|
|
$
|
—
|
|
|
$
|
12,008
|
|
Total liabilities
(3)
|
$
|
4,911
|
|
|
$
|
890
|
|
|
$
|
637
|
|
|
$
|
—
|
|
|
$
|
6,438
|
|
(1)
|
Consists of Europe, the Middle East and Africa.
|
(2)
|
Represents royalties from foreign subsidiaries determined as a percentage of certain amounts invoiced to customer.
|
(3)
|
Prior year amounts have been adjusted to reflect the adoption of Accounting Standards Update No. 2015-03,
Simplifying the Presentation of Debt Issuance Costs
(Topic 835). Refer to Note 1, “Significant Accounting Policies” in the Notes to the Consolidated Financial Statements for further details.
|
Description
|
|
Balance at Beginning of Period
|
|
Additions/(Deductions) Charged/(Credited) to Costs and Expenses
|
|
Deductions
(1)
|
|
Balance at End of Period
|
||||||||
Allowance for doubtful accounts
(in millions)
|
|
|
|
|
|
|
|
|
||||||||
Year ended March 31, 2016
|
|
$
|
17
|
|
|
$
|
(2
|
)
|
|
$
|
(6
|
)
|
|
$
|
9
|
|
Year ended March 31, 2015
|
|
$
|
19
|
|
|
$
|
1
|
|
|
$
|
(3
|
)
|
|
$
|
17
|
|
Year ended March 31, 2014
|
|
$
|
24
|
|
|
$
|
4
|
|
|
$
|
(9
|
)
|
|
$
|
19
|
|
(1)
|
Write-off of amounts against allowance provided
|
•
|
You must not contact any brokers directly until you have spoken with your Counselor. Instead, you will be referred to approved brokers at both the departure and destination locations.
|
•
|
You should retain certain receipts and other documents to verify relocation expenses and support payments made to you by CA under this policy.
|
•
|
You are expected to comply with the time frames established for the various steps of your relocation, as described in this policy.
|
•
|
You must secure necessary approvals.
|
•
|
You must prepare and submit all necessary expense reports in a timely manner.
|
•
|
You must sign your Moving & Relocation Expense Repayment Agreement in the form provided by CA's preferred relocation partner.
|
•
|
Lodging for a total of nine nights
|
•
|
Per diem for meals
|
•
|
Mid-size rental car
|
•
|
Two round-trip airline tickets for you and your spouse/partner based upon a 14-day advance purchase or personal auto mileage. (The distance between your old location and new location must be greater than 250 miles to qualify for air transportation.)
|
•
|
Lodging in corporate housing (or equivalent) for 90 days
|
•
|
If customary corporate lodging in the area does not include kitchen facilities, a per diem for meals will be factored into the lump sum calculation
|
•
|
Mid-size rental car for 2 weeks
|
•
|
Five (5) return trips home for the employee only including coach-class airline ticket based on a 14-day advance purchase.
|
•
|
Selecting a qualified real estate broker
|
•
|
Establishing a competitive list price based on competitive market analysis
|
•
|
Developing marketing strategies to increase the likelihood of a rapid sale
|
1.
|
Your Brookfield GRS Counselor will provide you with the names of two approved real estate agents who will prepare individual market analyses on your home. If for some reason, you’d like to request a different agent, just notify your Brookfield GRS Counselor and request a change. Remember, the agent must be an approved network agent.
|
2.
|
Once the market analyses have been completed and reviewed, you will need to select one agent to list and market your home.
|
3.
|
Be sure your listing agreement includes a commission rate that is standard for the area (normally not more than 6% or 7%).
|
4.
|
You will need to list your home at no more than
103%
of the average of the most likely sales price found on the two broker market analyses (BMAs). By listing within a reasonable range of the recommended sales price, you are more likely to receive a sale within the first 30 days of marketing. The faster you sell your home, the faster you will be able to get settled in your new location.
|
•
|
Which locations and price ranges do you have the most experience with?
|
•
|
How many similar homes have you sold in the last six months?
|
•
|
How do you intend to market my home? (How many open houses will be scheduled? What is your advertising strategy?)
|
•
|
Extensions of temporary living due to construction delays
|
•
|
Builder’s costs relative to construction loans; only one set of eligible purchase closing costs will be considered for reimbursement
|
•
|
Located in a residential community
|
•
|
Located within an incorporated area
|
•
|
Architecturally consistent with the neighborhood
|
•
|
A resort or recreational property
|
•
|
Consistent in property acreage within the neighborhood
|
▪
|
Loan Origination Fees, subject to a maximum of one point
|
▪
|
Title Insurance or fees for examination of title, as required by the lender
|
▪
|
Normal and customary escrow or closing fees charged by the title company and/or the lender to close the sale (Not including items such as taxes and insurance that must be paid in advance into escrow accounts.)
|
▪
|
Normal and customary attorneys’ fees
|
▪
|
Normal and customary recording fees
|
▪
|
Assumption or transfer fees
|
▪
|
Appraisal and/or survey of the new home, if required by the lender
|
▪
|
Credit report charges
|
▪
|
Inspections (general home inspection, radon, termite)
|
▪
|
Discount Points
|
▪
|
In addition, you will be reimbursed discount points according to a sliding scale that correlates with the published interest rate index: if the published FNMA 30-year 60-day yield rate is:
|
▪
|
Application fee,
|
▪
|
Document prep fee
|
▪
|
Underwriting fee,
|
▪
|
Commitment fee
|
▪
|
Processing fee.
|
•
|
Normal packing and necessary materials
|
•
|
Transportation of household goods to the new destination
|
•
|
Normal appliance services, including wiring and plumbing modifications required within the house for disconnection and reconnection of appliances
|
•
|
Delivery to the new home. Weekend or holiday delivery should be avoided (will not be covered)
|
•
|
Normal unpacking and removal of packing materials
|
•
|
Storage for up to 60 days
|
•
|
Exclusive use of the van, expedited service or extra drop off/pick up stops
|
•
|
Housecleaning, maid, or debris removal service at either the old or new home
|
•
|
Removal or installation of wall-to-wall carpeting, draperies and/or rods, electrical fixtures, water softeners, or similar items
|
•
|
Packing or transportation of boats, trailers, airplanes, household pets, plants, building materials, wood, or any perishable item
|
•
|
Disassembly or reassembly of children's playhouses or swing sets, portable swimming pools, waterbeds, utility sheds, fencing, or items of a similar nature
|
•
|
Your household goods are protected with full replacement insurance coverage, based on the value of the items covered by the insurance policy that you are moving.
|
•
|
Items not be covered under the policy include the following: accounts, deeds, bills, evidence of debt, currency, letters of credit, passports, railroad or other tickets, animals, jewelry, securities, coin & stamp collection, notes, bullion or precious stones, boats and trailers over 25 feet in length, merchandise for sale or exhibition, personal and sentimental value, and the unused portion of any warranty.
|
•
|
Prior to the move, you will asked to complete the “Declaration of Insurance” form to identify the value of the move, collections, and high value items.
|
•
|
High value items are defined as a single item, pair, set or collection with a market value of $5,000 or more (collections $2,000 or more.) These items must be specifically valued & declared prior to the move taking place. Current third party written appraisals of these high value items is also recommended. If these items are not declared, the recovery amount will be limited to a maximum of $5,000 per article, pair, set or $2,000 per collection.
|
•
|
Mileage (based on the current reimbursement rate) will be paid for the most direct route for up to two vehicles unless you choose to fly and/or ship your vehicles.
|
•
|
If you are shipping your automobile(s), you will be reimbursed for airfare for all family members at the coach class rate for one-way tickets purchased at least seven days in advance.
|
•
|
Per diem for meals and one night’s lodging for each 500 miles driven.
|
•
|
Travel must be booked through Carlson Wagonlit (via your CA,Inc’s on-line profile, following the site’s link:
https://one.ca.com/admin/gas/travel/Pages/default.aspx
)
|
•
|
The expenses associated with shipment of your household goods.
|
•
|
The travel and lodging (not meals) for you and your family during the final move.
|
•
|
How many dependents you claim and your tax filing status (single, joint, etc.).
|
•
|
Company compensation is only defined to include the annualized base salary and relocation expenses. Any commission, bonus and stock options, etc. are excluded. We will not include any spousal income (unless your spouse is also employed with Computer Associates), even if you are filing jointly.
|
•
|
The higher of the standard deduction or estimated itemized deduction of the respective taxing authorities.
|
•
|
Your destination state.
|
Relocation Expense
|
Gross-Up
|
Tax Calculation
|
Lump Sum Payment
|
Yes
|
At individual's tax rate
|
Final Move Meals
|
Yes
|
At individual's tax rate
|
Mileage Reimbursement
|
Yes
|
At individual's tax rate
|
Miscellaneous Allowance
|
No
|
Withhold federal, state and local taxes
|
Final Move
Lodging/Transportation
|
No
|
None -not included in employee income
|
Household
Goods Shipment & Storage up
To 30 days
|
No
|
None -not included in employee income
|
30 days additional storage
|
Yes
|
At individual's tax rate
|
New Home Closing Costs
|
Yes
|
At individual's tax rate (excl. origination
fee & points)
|
Old Homesale Through
CA’S PREFERRED RELOCATION
PARTNER
|
No
|
Most costs are not taxable to the
employee. Certain Seller costs are
deminimus and are included in employee's
income. No gross-up is provided for
these amounts.
|
Direct Reimbursement of Old
Home Selling Costs
|
No
|
Employee responsible for tax liability
|
•
|
You should retain certain receipts and other documents to verify relocation expenses and support payments made to you by CA under this policy.
|
•
|
You are expected to comply with the time frames established for the various steps of your relocation, as described in this policy.
|
•
|
You must secure necessary approvals.
|
•
|
You must prepare and submit all necessary expense reports in a timely manner.
|
•
|
You must sign your Moving & Relocation Expense Repayment Agreement in the form provided by CA's preferred relocation partner.
|
•
|
Per diem for meals
|
•
|
Lodging for four nights
|
•
|
Mid-size rental car
|
•
|
Round trip airline tickets for you and your spouse /partner based upon a 14-day advance purchase or personal auto mileage. (The distance between your old location and new location must be greater than 250 miles to qualify for air transportation.)
|
•
|
Lodging in corporate housing (or equivalent) for 30 days
|
•
|
If lodging does not have kitchen facilities, a per diem for meals will be factored into the lump sum calculation
|
•
|
Mid-size rental car for 2 weeks
|
•
|
One (1) return trips home for the employee only via coach-class airline ticket based on a 14-day advance purchase.
|
•
|
Normal packing and necessary materials
|
•
|
Transportation of household goods to the new destination
|
•
|
Normal appliance services, including wiring and plumbing modifications required within the house for disconnection and reconnection of appliances
|
•
|
Delivery to the new home. Weekend or holiday delivery should be avoided and will not be covered
|
•
|
Normal unpacking and removal of packing materials
|
•
|
Storage for up to 30 days
|
•
|
Exclusive use of the van, expedited service or extra drop off/pick up stops
|
•
|
Housecleaning, maid, or debris removal service at either the old or new home
|
•
|
Removal or installation of wall-to-wall carpeting, draperies and/or rods, electrical fixtures, water softeners, or similar items
|
•
|
Packing or transportation of boats, trailers, airplanes, household pets, plants, building materials, wood, or any perishable item
|
•
|
Disassembly or reassembly of children's playhouses or swing sets, portable swimming pools, waterbeds, utility sheds, fencing, or items of a similar nature
|
•
|
Your household goods are protected with full replacement insurance coverage, based on the value of the items covered by the insurance policy that you are moving.
|
•
|
Items not be covered under the policy include the following: accounts, deeds, bills, evidence of debt, currency, letters of credit, passports, railroad or other tickets, animals, jewelry, securities, coin & stamp collection, notes, bullion or precious stones, boats and trailers over 25 feet in length, merchandise for sale or exhibition, personal and sentimental value, and the unused portion of any warranty.
|
•
|
Prior to the move, you will asked to complete the “Declaration of Insurance” form to identify the value of the move, collections, and high value items.
|
•
|
High value items are defined as a single item, pair, set or collection with a market value of $5,000 or more (collections $2,000 or more.) These items must be specifically valued & declared prior to the move taking place. Current third party written appraisals of these high value items is also recommended. If these items are not declared, the recovery amount will be limited to a maximum of $5,000 per article, pair, set or $2,000 per collection.
|
•
|
Mileage (based on the current reimbursement rate) will be paid for the most direct route for one vehicle unless you choose to fly or ship your vehicle.
|
•
|
If you are shipping your automobile, you will be reimbursed for airfare for all family members at the coach class rate for one-way tickets purchased at least fourteen days in advance.
|
•
|
Per diem for meals and one night’s lodging for each 500 miles driven.
|
•
|
The expenses associated with shipment of your household goods.
|
•
|
The travel and lodging (not meals) for you and your family during the final move.
|
•
|
How many dependents you claim and your tax filing status (single, joint, etc.).
|
•
|
Company compensation is only defined to include the annualized base salary and relocation expenses. Any commission, bonus and stock options, etc. are excluded. We will not include any spousal income (unless your spouse is also employed with CA), even if you are filing jointly.
|
•
|
The higher of the standard deduction or estimated itemized deduction of the respective taxing authorities.
|
•
|
Your destination state.
|
|
2012
|
|
2013
|
|
2014
|
|
2015
|
|
2016
|
||||||||||
Earnings available for fixed charges:
|
|
|
|
|
|
|
|
|
|
||||||||||
Earnings from continuing operations before income taxes, minority interest and discontinued operations
|
$
|
1,291
|
|
|
$
|
1,260
|
|
|
$
|
1,016
|
|
|
$
|
1,115
|
|
|
$
|
1,084
|
|
Add: Fixed charges
|
115
|
|
|
113
|
|
|
123
|
|
|
125
|
|
|
128
|
|
|||||
Total earnings available for fixed charges
|
$
|
1,406
|
|
|
$
|
1,373
|
|
|
$
|
1,139
|
|
|
$
|
1,240
|
|
|
$
|
1,212
|
|
Fixed charges:
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest expense
(1)
|
$
|
64
|
|
|
$
|
64
|
|
|
$
|
75
|
|
|
$
|
77
|
|
|
$
|
81
|
|
Interest portion of rental expense
|
51
|
|
|
49
|
|
|
48
|
|
|
48
|
|
|
47
|
|
|||||
Total fixed charges
|
$
|
115
|
|
|
$
|
113
|
|
|
$
|
123
|
|
|
$
|
125
|
|
|
$
|
128
|
|
RATIOS OF EARNINGS TO FIXED CHARGES
|
12.23
|
|
|
12.15
|
|
|
9.26
|
|
|
9.92
|
|
|
9.47
|
|
|||||
Deficiency of earnings to fixed charges
|
n/a
|
|
|
n/a
|
|
|
n/a
|
|
|
n/a
|
|
|
n/a
|
|
(1)
|
Includes amortization of discount related to indebtedness
|
Name of Subsidiary
|
Jurisdiction of Incorporation or Organization
|
CA Canada Company
|
Canada
|
CA Computer Associates European Holding GmbH
|
Germany
|
CA Europe Sàrl
|
Switzerland
|
CA Foreign, Inc.
|
Delaware
|
CA Global Holdings
|
Bermuda
|
CA Japan, Ltd.
|
Japan
|
CA Management, Inc.
|
Delaware
|
CA Marketing Corporation
|
Delaware
|
CA (Pacific) Pty Ltd
|
Australia
|
CA Programas de Computador, Participações e Serviços Ltda.
|
Brazil
|
CA Software de Mexico, S.A. de C.V.
|
Mexico
|
CA Software Holding B.V.
|
Netherlands
|
Computer Associates Holding Limited
|
United Kingdom
|
Rally Software Development Corp.
|
Delaware
|
Signature
|
|
|
/s/ Michael P. Gregoire
|
Michael P. Gregoire
Director and Chief Executive Officer
(Principal Executive Officer)
|
|
|
/s/ Richard J. Beckert
|
Richard J. Beckert
Executive Vice President and Chief Financial Officer
(Principal Financial Officer)
|
|
|
/s/ Neil A. Manna
|
Neil A. Manna
Senior Vice President, Chief Accounting Officer
(Principal Accounting Officer)
|
|
Signature
|
|
|
/s/ Jens Alder
|
Jens Alder
|
|
|
/s/ Raymond J. Bromark
|
Raymond J. Bromark
|
|
|
/s/ Gary J. Fernandes
|
Gary J. Fernandes
|
|
|
/s/ Rohit Kapoor
|
Rohit Kapoor
|
|
|
/s/ Jeffrey G. Katz
|
Jeffrey G. Katz
|
|
|
/s/ Kay Koplovitz
|
Kay Koplovitz
|
|
|
/s/ Christopher B. Lofgren
|
Christopher B. Lofgren
|
|
|
/s/ Richard Sulpizio
|
Richard Sulpizio
|
|
|
/s/ Laura S. Unger
|
Laura S. Unger
|
|
|
/s/ Arthur F. Weinbach
|
Arthur F. Weinbach
|
|
|
/s/ Renato (Ron) Zambonini
|
Renato (Ron) Zambonini
|
1.
|
I have reviewed this Annual Report on Form 10-K of CA, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
|
|
|
|
|
|
|
|
Date:
|
May 12, 2016
|
|
|
|
|
|
/s/ Michael P. Gregoire
|
|
|
|
|
|
|
|
Michael P. Gregoire
|
|
|
|
|
|
|
|
Chief Executive Officer
|
|
|
|
|
|
|
|
|
1.
|
I have reviewed this Annual Report on Form 10-K of CA, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
|
|
|
|
|
|
|
|
Date:
|
May 12, 2016
|
|
|
|
|
|
/s/ Richard J. Beckert
|
|
|
|
|
|
|
|
Richard J. Beckert
|
|
|
|
|
|
|
|
Executive Vice President and Chief Financial Officer
|
|
|
|
|
|
|
|
|
|
/s/ Michael P. Gregoire
|
Michael P. Gregoire
|
Chief Executive Officer
|
May 12, 2016
|
|
/s/ Richard J. Beckert
|
Richard J. Beckert
|
Executive Vice President and Chief Financial Officer
|
May 12, 2016
|