Basis Of Presentation

6 Months Ended

Jun. 30, 2012

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Basis Of Presentation

1. BASIS OF PRESENTATION

The accompanying unaudited condensed consolidated financial statements of Citrix Systems, Inc. (the “Company”) have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States for complete financial statements. All adjustments, which, in the opinion of management, are considered necessary for a fair presentation of the results of operations for the periods shown, are of a normal recurring nature and have been reflected in the condensed consolidated financial statements and accompanying notes. The results of operations for the periods presented are not necessarily indicative of the results expected for the full year or for any future period partially because of the seasonality of the Company’s business. Historically, the Company’s revenue for the fourth quarter of any year is typically higher than the revenue for the first quarter of the subsequent year. The information included in these condensed consolidated financial statements should be read in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” contained in this report and the condensed consolidated financial statements and accompanying notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2011.

The condensed consolidated financial statements of the Company include the accounts of its wholly-owned subsidiaries in the Americas, Europe, the Middle East and Africa (“EMEA”), Asia-Pacific and the Online Services division. All significant transactions and balances between the Company and its subsidiaries have been eliminated in consolidation. In addition, the Company presents non-controlling interests of less-than-wholly-owned subsidiaries within the equity section of its condensed consolidated financial statements in accordance with the authoritative guidance for the presentation and disclosure of non-controlling interests of a consolidated subsidiary. See Note 4 for more information regarding the Company’s non-controlling interests.

Reclassifications

During the first quarter of 2012, the Company performed a review of the historical manner of presentation of certain of its revenue categories and adopted a revised presentation, which the Company believes is more comparable to those presented by other companies in the industry and better reflects the Company's evolving product and service offerings. As a result, technical support, hardware maintenance and software updates revenues, which were previously presented in Technical services and License updates are classified together as License updates and maintenance. A corresponding change was made to rename Cost of services revenues to Cost of services and maintenance revenues; however, there was no change in classification. Product training and certification and consulting services, which were previously presented in Technical services, are classified together as Professional services. Product licenses has been renamed to Product and licenses to more appropriately describe its composition of both software and hardware, however, there was no change in classification. The composition and classification of Software as a service remained unchanged. This change in manner of presentation will not affect the Company's total net revenues, total cost of net revenues or gross margin. Conforming changes have been made for all periods presented, as follows (in thousands):

			Three Months Ended June 30, 2011
As Previously Reported			Amount Reclassified			As Reported Herein
Revenues:						Revenues:
License updates	$	183,875	$	47,807		License updates and maintenance (2)	$	231,682
Technical services (1)	69,110		(47,807		)	Professional services (3)	21,303
Total	$	252,985	$	—		Total	$	252,985

			Six Months Ended June 30, 2011
As Previously Reported			Amount Reclassified			As Reported Herein
Revenues:						Revenues:
License updates	$	361,751	$	91,310		License updates and maintenance (2)	$	453,061
Technical services (1)	132,090		(91,310		)	Professional services (3)	40,780
Total	$	493,841	$	—		Total	$	493,841

(1) Technical services revenue was comprised of hardware maintenance, consulting services, product training and certification and technical support.

(2) License updates and maintenance is comprised of license updates, hardware and software maintenance and technical support.

(3) Professional services is comprised of consulting services and product training and certification.

Additionally, during the first quarter of 2012, the Company revised its methodology for allocating certain information technology ("IT") support costs to more closely align these costs to the employees directly utilizing the related assets and services and to reflect how management assesses the cost of headcount. As a result, certain IT support costs have been reclassified from General and administrative expenses to Cost of services and maintenance revenues, Research and development expenses and Sales, marketing and services expenses based on the headcount in each of these functional areas. This change in presentation will not affect the Company's income from operations or cash flows. Conforming changes have been made for all prior periods presented, as follows (in thousands):

			Three Months Ended June 30, 2011
As Previously Reported			Amount Reclassified			As Reported Herein
Cost of services revenues	$	37,906	$	2,937		Cost of services and maintenance revenues	$	40,843
Research and development	83,312		8,062			Research and development	91,374
Sales, marketing and services	199,359		12,037			Sales, marketing and services	211,396
General and administrative	79,696		(23,036		)	General and administrative	56,660
Total	$	400,273	$	—		Total	$	400,273

			Six Months Ended June 30, 2011
As Previously Reported			Amount Reclassified			As Reported Herein
Cost of services revenues	$	68,572	$	5,508		Cost of services and maintenance revenues	$	74,080
Research and development	166,030		15,892			Research and development	181,922
Sales, marketing and services	393,602		23,338			Sales, marketing and services	416,940
General and administrative	151,801		(44,738		)	General and administrative	107,063
Total	$	780,005	$	—		Total	$	780,005