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Borland Software Corporation Case Study

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A) Intangible assets are operational assets that lack physical substance. However, the future economic benefits that are derived from intangible assets are usually less certain than tangible operational assets. Due to this uncertainty, the valuation of these assets rely upon multiple estimations, therefore the reliability of the information may not be as accurate. Additionally, the relevance of the data in the decision making process comes into question since the future benefits are unknown. Copyrights, franchises, goodwill, patents, and trademarks are just a few examples of intangible assets.
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When taken in proportion to total revenues and general expenses, the percentage that composes advertising expense decreases each year. Since advertising costs are expensed the first time the advertising takes place, this may not represent an actual decrease in advertising, just a decrease in new advertising campaigns.

iii) Looking at the assets of the company may help to show fluctuations in the current value at least in terms of book value. Even more so, the company’s stock price will help to see where investors see the current value of the company and its brands.

G) i) For the purchase of Segue Software, Inc, the purchase price was allocated to the acquired assets and liabilities based on their estimated fair values on the date of acquisition with the remaining classified as goodwill. The developed technology, customer relationships, agreements, and trademarks are all amortized over their respective periods. These amortizable intangible assets were calculated using the income approach by estimated the expected cash flows from once the projects become viable and discounting them to the present value.

ii) 131,663/141,456 = 86.93%

iii) In process research and development is research and development acquired from Segue Software, Inc that had not reached technological feasibility and

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