Activision, Inc. — 2004 Annual Report Consolidated Balance Sheets (In thousands, except share data) March 31, 2004 2003 Assets Current assets: Cash and cash equivalents $ 466,552 $ 285,554 Short-term investments 121,097 121,400 Accounts receivable, net of allowances of $47,028 and  $57,356 at March 31, 2004 and 2003, respectively 62,577 15,822 Inventories 26,427 19,577 Software development 58,320 26,791 Intellectual property licenses 32,115 8,906 Deferred income taxes 26,127 38,290 Other current assets 18,660 10,565 Total current assets 811,875 526,905 Software development 28,386 35,281 Intellectual property licenses 16,380 36,943 Property and equipment, net 25,539 22,265 Deferred income taxes 9,064 10,322 Other assets 1,080 5,081 Goodwill 76,493 68,019 Total assets $ 968,817 $ 704,816 Liabilities and Shareholders’ Equity Current liabilities: Current portion of long-term debt $ — $ 147 Accounts payable 72,874 45,602 Accrued expenses 63,205 58,656 Total current liabilities 136,079 104,405 Long-term debt, less current portion — 2,671 Total liabilities 136,079 107,076 Commitments and contingencies (Note 14) Shareholders’ equity: Preferred stock, $.000001 par value, 3,750,000 shares authorized,  no shares issued at March 31, 2004 and 2003 — — Series A Junior Preferred stock, $.000001 par value, 1,250,000 shares  authorized, no shares issued at March 31, 2004 and 2003 — — Common stock, $.000001 par value, 225,000,000 and 125,000,000  shares authorized, 166,876,567 and 161,059,091 shares issued and  137,331,242 and 135,126,368 shares outstanding at March 31,  2004 and 2003, respectively — — Additional paid-in capital 758,626 592,295 Retained earnings 208,279 130,564 Less: Treasury stock, at cost, 29,545,325 and 25,932,723 shares as of  March 31, 2004 and 2003, respectively (144,128) (121,685) Accumulated other comprehensive income (loss) 9,961 (3,434) Total shareholders’ equity 832,738 597,740 Total liabilities and shareholders’ equity $ 968,817 $ 704,816 The accompanying notes are an integral part of these consolidated financial statements. page 42