Note 1 Description of Business and Summary of Significant Accounting Policies Recent Development On May 22, 2012, the Company, SAP America, Inc., a Delaware corporation ( Parent ) and Angel Expansion Corporation, a Delaware corporation and a wholly-owned subsidiary of Parent ( Purchaser ), entered into an Agreement and Plan of Merger ( Merger Agreement ). Pursuant to the terms of the Merger Agreement, and subject to the conditions thereof, Purchaser will merge with and into the Company and the Company will become a wholly-owned subsidiary of Parent (the  Merger ). If the Merger is completed, the Company s stockholders will be entitled to receive $45.00 in cash (the  Merger Consideration ) for each share of the Company s common stock owned by them as of the date of the Merger. The consummation of the Merger is subject to certain conditions, including (i) adoption of the Merger Agreement by the Company s stockholders, (ii) the continuing accuracy of the Company s and Parent and Merger Sub s respective representations and warranties, (iii) the expiration or termination of any waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, as well as any similar filings that need to be made in foreign jurisdictions, (iv) approval by the Committee on Foreign Investment in the United States under the Exon-Florio Act, and approval under certain foreign antitrust laws, and (v) other customary conditions. The Company s stockholder meeting to vote on adoption of the Merger Agreement will be held on August 29, 2012. The date for closing the Merger has not yet been determined. Description of Business Ariba, Inc., along with its subsidiaries (collectively referred to herein as the  Company  or  Ariba ), is the leading provider of collaborative business commerce solutions for buying and selling goods and services. Ariba combines industry-leading software as a service ( SaaS ) technology to optimize the complete commerce lifecycle and enables companies to discover, connect and collaborate with a globa