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Document and Entity Information - USD ($) $ in Thousands	12 Months Ended
Document and Entity Information - USD ($) $ in Thousands	Jan. 31, 2012	Mar. 15, 2012	Jul. 31, 2011
Document and Entity Information
Entity Registrant Name	VERINT SYSTEMS INC
Entity Central Index Key	0001166388
Document Type	10-K
Document Period End Date	Jan. 31, 2012
Amendment Flag	false
Current Fiscal Year End Date	--01-31
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Public Float			$ 762,054
Entity Common Stock, Shares Outstanding		38,989,555
Document Fiscal Year Focus	2012
Document Fiscal Period Focus	FY

Consolidated Balance Sheets - USD ($) $ in Thousands	Jan. 31, 2012	Jan. 31, 2011
Current Assets:
Cash and cash equivalents	$ 150,662	$ 169,906
Restricted cash and bank time deposits	12,863	13,639
Accounts receivable, net of allowance for doubtful accounts of $2.9 million and $5.4 million, respectively	154,753	150,769
Inventories	14,414	16,987
Deferred cost of revenue	11,951	6,269
Deferred income taxes	13,060	13,179
Prepaid expenses and other current assets	42,987	31,195
Total current assets	400,690	401,944
Property and equipment, net	28,289	23,176
Goodwill	831,687	738,674
Intangible assets, net	184,873	157,071
Capitalized software development costs, net	5,846	6,787
Long-term deferred cost of revenue	13,285	21,715
Long-term deferred income taxes	9,237	6,700
Other assets	28,961	20,060
Total assets	1,502,868	1,376,127
Current Liabilities:
Accounts payable	49,411	36,861
Accrued expenses and other current liabilities	168,125	162,650
Current maturities of long-term debt	6,228
Deferred revenue	156,772	142,465
Deferred income taxes	1,056	379
Liabilities to affiliates	1,760	1,847
Total current liabilities	383,352	344,202
Long-term debt	591,151	583,234
Long-term deferred revenue	25,987	40,424
Long-term deferred income taxes	13,353	13,226
Other liabilities	59,188	31,812
Total liabilities	1,073,031	1,012,898
Preferred Stock - $0.001 par value; authorized 2,500,000 shares. Series A convertible preferred stock; 293,000 shares issued and outstanding; aggregate liquidation preference and redemption value of $352,034 at January 31, 2012.	285,542	285,542
Commitments and Contingencies
Stockholders' Equity:
Common stock - $0.001 par value; authorized 120,000,000 shares. Issued 39,265,000 and 37,349,000 shares, respectively; outstanding 38,982,000 and 37,089,000 shares as of January 31, 2012 and 2011, respectively.	40	38
Additional paid-in capital	554,351	519,834
Treasury stock, at cost - 283,000 and 260,000 shares as of January 31, 2012 and 2011, respectively.	(7,466)	(6,639)
Accumulated deficit	(357,764)	(394,757)
Accumulated other comprehensive loss	(47,736)	(42,069)
Total Verint Systems Inc. stockholders' equity	141,425	76,407
Noncontrolling interest	2,870	1,280
Total stockholders' equity	144,295	77,687
Total liabilities, preferred stock, and stockholders' equity	$ 1,502,868	$ 1,376,127

Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Jan. 31, 2012	Jan. 31, 2011
Consolidated Balance Sheets
Accounts receivable, allowance for doubtful accounts (in dollars)	$ 2,900	$ 5,400
Preferred Stock, par value (in dollars per share)	$ 0.001	$ 0.001
Preferred Stock, authorized shares	2,500,000	2,500,000
Series A convertible preferred stock, shares issued	293,000	293,000
Series A convertible preferred stock, shares outstanding	293,000	293,000
Series A convertible preferred stock, aggregate liquidation preference value (in dollars)	$ 352,034
Series A convertible preferred stock, redemption value (in dollars)	$ 352,034
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, authorized shares	120,000,000	120,000,000
Common stock, Issued shares	39,265,000	37,349,000
Common stock, outstanding shares	38,982,000	37,089,000
Treasury stock, shares	283,000	260,000

Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands	12 Months Ended
	Jan. 31, 2012	Jan. 31, 2011	Jan. 31, 2010
Revenue:
Product	$ 390,392	$ 375,164	$ 374,272
Service and support	392,256	351,635	329,361
Total revenue	782,648	726,799	703,633
Cost of revenue:
Product	126,050	111,989	122,961
Service and support	129,911	117,261	108,953
Amortization of acquired technology	12,400	9,094	8,021
Total cost of revenue	268,361	238,344	239,935
Gross profit	514,287	488,455	463,698
Operating expenses:
Research and development, net	111,001	96,525	83,797
Selling, general and administrative	293,906	297,365	291,954
Amortization of other acquired intangible assets	22,902	21,460	22,268
Total operating expenses	427,809	415,350	398,019
Operating income	86,478	73,105	65,679
Other income (expense), net:
Interest income	661	454	616
Interest expense	(32,358)	(29,896)	(24,964)
Loss on extinguishment of debt	(8,136)
Other income (expense), net	(488)	(5,138)	(17,123)
Total other expense, net	(40,321)	(34,580)	(41,471)
Income before provision for income taxes	46,157	38,525	24,208
Provision for income taxes	5,532	9,940	7,108
Net income	40,625	28,585	17,100
Net income attributable to noncontrolling interest	3,632	3,004	1,483
Net income attributable to Verint Systems Inc.	36,993	25,581	15,617
Dividends on preferred stock	(14,790)	(14,178)	(13,591)
Net income attributable to Verint Systems Inc. common shares	$ 22,203	$ 11,403	$ 2,026
Net income per common share attributable to Verint Systems Inc.
Basic (in dollars per share)	$ 0.58	$ 0.33	$ 0.06
Diluted (in dollars per share)	$ 0.56	$ 0.31	$ 0.06
Weighted-average common shares outstanding
Basic (in shares)	38,419	34,544	32,478
Diluted (in shares)	39,499	37,179	33,127

Consolidated Statements of Stockholders' Equity (Deficit) - USD ($) shares in Thousands, $ in Thousands	Total	Total Verint Systems Inc. Stockholders' Equity (Deficit)	Common Stock	Additional Paid-in Capital	Treasury Stock	Accumulated Deficit	Accumulated Other Comprehensive Loss	Noncontrolling Interest	Comprehensive Income
Balances at Jan. 31, 2009	$ (76,070)	$ (76,743)	$ 32	$ 419,937	$ (2,353)	$ (435,955)	$ (58,404)	$ 673
Balances (in shares) at Jan. 31, 2009			32,535
Comprehensive income (loss):
Net income	17,100	15,617				15,617		1,483	$ 17,100
Unrealized gains (losses) on derivative financial instruments and other, net	5	5					5		5
Unrealized gains on available-for-sale securities, net	34	34					34		34
Foreign currency translation adjustments	15,277	15,231					15,231	46	15,277
Total comprehensive income (loss)	32,416	30,887				15,617	15,270	1,529	32,416
Stock-based compensation - equity portion	31,195	31,195		31,195
Common stock issued for stock awards	1	1	$ 1
Common stock issued for stock awards (in shares)			64
Forfeitures of restricted stock awards				34	(34)
Forfeitures of restricted stock awards (in shares)			(4)
Purchases of treasury stock	(106)	(106)			(106)
Purchases of treasury stock (in shares)			(11)
Dividends to noncontrolling interest	(2,003)							(2,003)
Balances at Jan. 31, 2010	(14,567)	(14,766)	$ 33	451,166	(2,493)	(420,338)	(43,134)	199
Balances (in shares) at Jan. 31, 2010			32,584
Comprehensive income (loss):
Net income	28,585	25,581				25,581		3,004	28,585
Unrealized gains (losses) on derivative financial instruments and other, net	(351)	(351)					(351)		(351)
Foreign currency translation adjustments	1,684	1,416					1,416	268	1,684
Total comprehensive income (loss)	29,918	26,646				25,581	1,065	3,272	29,918
Stock-based compensation - equity portion	28,784	28,784		28,784
Common stock issued for stock awards			$ 3	(3)
Common stock issued for stock awards (in shares)			2,498
Exercises of stock options	40,835	40,835	$ 2	40,833
Exercises of stock options (in shares)			2,164
Purchases of treasury stock	$ (4,146)	(4,146)			(4,146)
Purchases of treasury stock (in shares)	(157)		(157)
Dividends to noncontrolling interest	$ (2,191)							(2,191)
Tax effects from stock award plans	(946)	(946)		(946)
Balances at Jan. 31, 2011	77,687	76,407	$ 38	519,834	(6,639)	(394,757)	(42,069)	1,280
Balances (in shares) at Jan. 31, 2011			37,089
Comprehensive income (loss):
Net income	40,625	36,993				36,993		3,632	40,625
Unrealized gains (losses) on derivative financial instruments and other, net	906	906					906		906
Foreign currency translation adjustments	(6,685)	(6,573)					(6,573)	(112)	(6,685)
Total comprehensive income (loss)	34,846	31,326				36,993	(5,667)	3,520	$ 34,846
Stock-based compensation - equity portion	21,781	21,781		21,781
Common stock issued for stock awards			$ 1	(52)	51
Common stock issued for stock awards (in shares)			1,323
Exercises of stock options	12,844	12,844	$ 1	12,843
Exercises of stock options (in shares)			623
Purchases of treasury stock	$ (1,655)	(1,655)			(1,655)
Purchases of treasury stock (in shares)	(53)		(53)
Treasury stock retired				(777)	777
Stock options issued in business combination	$ 60	60		60
Dividends to noncontrolling interest	(1,930)							(1,930)
Tax effects from stock award plans	662	662		662
Balances at Jan. 31, 2012	$ 144,295	$ 141,425	$ 40	$ 554,351	$ (7,466)	$ (357,764)	$ (47,736)	$ 2,870
Balances (in shares) at Jan. 31, 2012			38,982

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	12 Months Ended
	Jan. 31, 2012	Jan. 31, 2011	Jan. 31, 2010
Cash flows from operating activities:
Net income	$ 40,625	$ 28,585	$ 17,100
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	53,040	48,951	49,290
Provision for doubtful accounts	1,055	1,863	849
Stock-based compensation - equity portion	21,781	28,784	31,195
Provision (benefit) for deferred income taxes	(11,101)	(1,092)	(62)
Excess tax benefits from stock award plans	(847)	(815)
Non-cash losses on derivative financial instruments, net	896	5,863	14,709
Loss on extinguishment of debt	8,136
Other non-cash items, net	(802)	1,139	1,443
Changes in operating assets and liabilities, net of effects of business combinations:
Accounts receivable	(2,942)	(24,574)	(13,910)
Inventories	1,080	(3,471)	5,686
Deferred cost of revenue	3,199	16,616	14,082
Prepaid expenses and other assets	6,339	9,924	(11,542)
Accounts payable and accrued expenses	(7,192)	15,839	12,912
Deferred revenue	(3,424)	(51,226)	(21,143)
Other liabilities	(3,326)	(5,933)	471
Other, net	(19)	67	(243)
Net cash provided by operating activities	106,498	70,520	100,837
Cash flows from investing activities:
Cash paid for business combinations, net of cash acquired	(109,780)	(23,485)	(96)
Purchases of property and equipment	(13,080)	(8,536)	(4,965)
Sales and maturities of investments	245
Settlements of derivative financial instruments not designated as hedges	(1,313)	(34,783)	(19,414)
Cash paid for capitalized software development costs	(3,399)	(2,527)	(2,715)
Change in restricted cash and bank time deposits	479	(8,502)	2,591
Net cash used in investing activities	(126,848)	(77,833)	(24,599)
Cash flows from financing activities:
Proceeds from borrowings, net of original issuance discount	597,136
Repayments of borrowings and other financing obligations	(587,549)	(38,163)	(6,088)
Proceeds from exercises of stock options	12,474	40,787
Payment of debt issuance and other debt-related costs	(15,276)	(4,039)	(152)
Dividends paid to noncontrolling interest	(1,930)	(2,191)	(4,145)
Purchases of treasury stock	(1,655)	(4,146)
Excess tax benefits from stock award plans	847	815
Other financing activities	(1,969)		(106)
Net cash provided by (used in) financing activities	2,078	(6,937)	(10,491)
Effect of exchange rate changes on cash and cash equivalents	(972)	(179)	2,660
Net increase (decrease) in cash and cash equivalents	(19,244)	(14,429)	68,407
Cash and cash equivalents, beginning of year	169,906	184,335	115,928
Cash and cash equivalents, end of year	$ 150,662	$ 169,906	$ 184,335

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

12 Months Ended

Jan. 31, 2012

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Description of Business

Unless the context otherwise requires, the terms “Verint”, “we”, “us”, and “our” in these notes to consolidated financial statements refer to Verint® Systems Inc. and its consolidated subsidiaries.

Verint is a global leader in Actionable Intelligence® solutions and value-added services. Our solutions enable organizations of all sizes to make more timely and effective decisions to improve enterprise performance and make the world a safer place. Our solutions are used to capture, distill, and analyze complex and underused information sources, such as voice, video, and unstructured text. In the enterprise intelligence market, our workforce optimization and voice of the customer solutions help organizations enhance customer service operations in contact centers, branches, and back-office environments to increase customer satisfaction, reduce operating costs, identify revenue opportunities, and improve profitability. In the security intelligence market, our communications and cyber intelligence, video and situation intelligence, and public safety solutions help government and commercial organizations in their efforts to protect people and property and neutralize terrorism and crime.

Significant Ownership

Comverse Technology, Inc. (“Comverse”), beneficially owns a majority of our common stock (assuming the conversion of Comverse’s preferred stock holdings into common stock) and holds a majority of the voting power of our common stock. During the three years ended January 31, 2012, Comverse did not provide us with material levels of corporate or administrative services.

Basis of Presentation

The accompanying consolidated financial statements include the accounts of Verint Systems Inc., our wholly owned subsidiaries, and a joint venture in which we hold a 50% equity interest. This joint venture functions as a systems integrator for Asian markets and is a variable interest entity in which we are the primary beneficiary and is therefore included within our consolidated financial statements. Investments in companies in which we have less than a 20% ownership interest and do not exercise significant influence are accounted for at cost. We have included the results of operations of acquired companies from the date of acquisition. All significant intercompany transactions and balances have been eliminated.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires our management to make estimates and assumptions, which may affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.

Cash and Cash Equivalents

Cash primarily consists of cash on hand and bank deposits. Cash equivalents primarily consist of interest-bearing money market accounts and other highly liquid investments with an original maturity of three months or less when purchased.

Restricted Cash and Bank Time Deposits

Restricted cash and restricted bank time deposits are pledged as collateral or otherwise restricted as to use for vendor payables, general liability insurance, workers’ compensation insurance, warranty programs, and other obligations. Restricted bank time deposits generally consist of certificates of deposit with original maturities of between 30 and 360 days.

Investments

As of January 31, 2012 and 2011, all of our excess funds are cash, cash equivalents, restricted cash, or restricted time deposits. Historically, investments generally consist of marketable debt securities of corporations, the U.S. government, and agencies of the U.S. government. We do not invest in auction rate securities as a matter of policy.

Our investments in marketable securities are classified as available-for-sale, and are stated at fair value based on market quotes. Investments with stated maturities beyond one year are classified as short-term if the securities are highly marketable and readily convertible into cash for current operations. Unrealized gains and losses, net of deferred taxes, are recorded as a component of accumulated other comprehensive income (loss) in stockholders’ equity (deficit). We recognize realized gains and losses upon sale of short-term investments and declines in value deemed to be other than temporary using the specific identification method. Interest on short-term investments is recognized within income when earned.

We periodically review our investments for indications of possible impairment in value. Factors considered in determining whether a loss is other than temporary include the length of time and extent to which fair value has been below the cost basis, the financial condition and near-term prospects of the investee, and our intent and ability to hold the investment for a period of time sufficient to allow for any anticipated recovery in market value. Upon sale, the cumulative unrealized gain or loss associated with the sold security that was previously recorded in accumulated other comprehensive income (loss) is reclassified into the consolidated statement of operations as a realized gain (loss), which is included in other income (expense), net.

Concentrations of Credit Risk

Financial instruments that potentially subject us to concentrations of credit risk consist principally of cash and cash equivalents, bank time deposits, short-term investments, and trade accounts receivable. We invest our cash in bank accounts, certificates of deposit, and money market accounts with major financial institutions, in U.S. Treasury and agency obligations, and in debt securities of corporations. By policy, we seek to limit credit exposure on investments through diversification and by restricting our investments to highly rated securities.

We grant credit terms to our customers in the ordinary course of business. Concentrations of credit risk with respect to trade accounts receivable are limited due to the large number of customers comprising our customer base and their dispersion across different industries and geographic areas.

Accounts Receivable, Net

Trade accounts receivable are recorded at the invoiced amount and are not interest-bearing.

Accounts receivable, net, includes costs in excess of billings and estimated earnings on arrangements recognized under contract accounting methods, representing revenue recognized on contracts for which billing will occur in subsequent periods, in accordance with the terms of the contracts. Costs in excess of billings and estimated earnings on such contracts was $11.2 million and $4.4 million as of January 31, 2012 and 2011, respectively.

The application of our revenue recognition policies sometimes results in circumstances for which we are unable to recognize revenue relating to sales transactions that have been billed, but the related account receivable has not been collected. For consolidated balance sheet presentation purposes, we do not recognize the deferred revenue or the related account receivable and no amounts appear in our consolidated balance sheets for such transactions. Only to the extent that we have received cash for a given deferred revenue transaction is the amount included in deferred revenue on the consolidated balance sheets.

Allowance for Doubtful Accounts

We estimate the collectability of our accounts receivable balances each accounting period and adjust our allowance for doubtful accounts accordingly. We exercise a considerable amount of judgment in assessing the collectability of accounts receivable, including consideration of the creditworthiness of each customer, their collection history, and the related aging of past due receivables balances. We evaluate specific accounts when we learn that a customer may be experiencing a deterioration of its financial condition due to lower credit ratings, bankruptcy, or other factors that may affect its ability to render payment.

The following table summarizes the activity in our allowance for doubtful accounts for the years ended January 31, 2012, 2011, and 2010:

	Year Ended January 31,
(in thousands)	2012			2011			2010
Balance at beginning of year	$	5,395		$	4,706		$	5,989
Provisions charged to expense	399			1,832			801
Amounts written off	(2,912		)	(1,126		)	(2,210		)
Other (1)	47			(17		)	126
Balance at end of year	$	2,929		$	5,395		$	4,706

(1) Includes balances from acquisitions and changes in balances due to foreign currency exchange rates.

Inventories

Inventories are stated at the lower of cost or market. Cost is determined using the weighted-average method of inventory accounting. The valuation of our inventories requires us to make estimates regarding excess or obsolete inventories, including making estimates of the future demand for our products. Although we make every effort to ensure the accuracy of our forecasts of future product demand, any significant unanticipated changes in demand, price, or technological developments could have a significant impact on the value of our inventory and reported operating results. Charges for excess and obsolete inventories are included within cost of revenue.

Property and Equipment, net

Property and equipment are stated at cost, net of accumulated depreciation and amortization. Depreciation is computed using the straight-line method based over the estimated useful lives of the assets. We depreciate buildings over periods ranging from twenty-five to thirty years. Leasehold improvements are amortized over the shorter of their estimated useful lives or the related lease term. Software is depreciated over periods ranging from three to four years. Equipment, furniture and other are depreciated over periods ranging from three to ten years.

The cost of maintenance and repairs of property and equipment is charged to operations as incurred. When assets are retired or disposed of, the cost and accumulated depreciation or amortization thereon are removed from the consolidated balance sheet and any resulting gain or loss is recognized in the consolidated statement of operations.

Goodwill, Other Acquired Intangible Assets, and Long-lived Assets

We record goodwill when the purchase price of net tangible and intangible assets we acquire exceeds their fair value. Other acquired intangible assets include identifiable acquired technologies, in-process research and development (“IPR&D”), trade names, customer relationships, distribution networks, non-competition agreements, and sales backlog. We amortize the cost of finite-lived identifiable intangible assets on a straight-line basis, which approximates the pattern in which the economic benefits of the assets are expected to be realized, over their estimated useful lives, which are periods of ten years or less.

We regularly perform reviews to determine if the carrying values of our goodwill and other intangible assets are impaired. We review goodwill for impairment at least annually on November 1, or more frequently if an event occurs indicating the potential for impairment. We review goodwill for impairment utilizing either a qualitative assessment or a two-step process. If we decide that it is appropriate to perform a qualitative assessment and conclude that the fair value of a reporting unit more likely than not exceeds its carrying value, no further evaluation is necessary. For reporting units where we perform the two-step process, the first step requires us to estimate the fair value of each reporting unit and compare that fair value to the respective carrying value, which includes goodwill. If the fair value of the reporting unit exceeds its carrying value, the goodwill is not considered impaired and no further evaluation is necessary. If the carrying value is higher than the estimated fair value, there is an indication that impairment may exist and the second step is required. In the second step, the implied fair value of goodwill is calculated as the excess of the fair value of a reporting unit over the fair values assigned to its assets and liabilities. If the implied fair value of goodwill is less than the carrying value of the reporting unit’s goodwill, the difference is recognized as an impairment charge.

For reporting units where we decide to perform a qualitative assessment, our management assesses and makes judgments regarding a variety of factors which potentially impact the fair value of a reporting unit, including general economic conditions, industry and market-specific conditions, customer behavior, cost factors, our financial performance and trends, our strategies and business plans, capital requirements, management and personnel issues, and our stock price, among others. Management then considers the totality of these and other factors, placing more weight on the events and circumstances that are judged to most affect a reporting unit’s fair value or the carrying amount of its net assets, to reach a qualitative conclusion regarding whether it is more likely than not that the fair value of a reporting unit exceeds its carrying amount.

For reporting units where we perform the two-step process, we utilize three primary approaches to assess fair value: (a) an income based approach, using projected discounted cash flows, (b) a market based approach, using multiples of comparable companies, and (c) a transaction based approach, using multiples for recent acquisitions of similar businesses made in the marketplace.

Our estimate of fair value of each reporting unit is based on a number of subjective factors, including: (a) appropriate consideration of valuation approaches (income approach, comparable public company approach, and comparable transaction approach), (b) estimates of our future cost structure, (c) discount rates for our estimated cash flows, (d) selection of peer group companies for the public company and the market transaction approaches, (e) required levels of working capital, (f) assumed terminal value, and (g) time horizon of cash flow forecasts.

We did not record any impairment of goodwill for the years ended January 31, 2012, 2011, and 2010.

Acquired IPR&D projects which have not reached technological feasibility at the date of acquisition are considered indefinite-lived intangible assets and are not subject to amortization until the completion or abandonment of the associated research and development efforts. Upon completion of the development process, the IPR&D assets are amortized over their estimated useful lives. If a project is abandoned rather than completed, the IPR&D asset is written-off. IPR&D assets are tested for impairment annually or more frequently if events or changes in circumstances indicate that the assets might be impaired. The impairment test compares the fair value of the IPR&D asset with its carrying amount. If the carrying amount of the IPR&D asset exceeds its fair value, an impairment loss is recognized in an amount equal to that excess.

Our IPR&D assets were acquired during the fourth quarter of the year ended January 31, 2012, and we did not record any impairment of these IPR&D assets for the year ended January 31, 2012.

We review intangible assets that have finite useful lives and other long-lived assets when an event occurs indicating the potential for impairment. If any indicators are present, we perform a recoverability test by comparing the sum of the estimated undiscounted future cash flows attributable to the assets in question to their carrying amounts. If the undiscounted cash flows used in the test for recoverability are less than the long-lived assets carrying amount, we determine the fair value of the long-lived asset and recognize an impairment loss if the carrying amount of the long-lived asset exceeds its fair value. The impairment loss recognized is the amount by which the carrying amount of the long-lived asset exceeds its fair value.

No impairments of long-lived assets were recorded during the years ended January 31, 2012, 2011, and 2010.

Fair Values of Financial Instruments

Our recorded amounts of cash and cash equivalents, accounts receivable, investments, and accounts payable approximate fair value, due to the short-term nature of these instruments. We measure certain financial assets and liabilities at fair value based on the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants. Fair value disclosures regarding our money market funds, derivative financial instruments, and long-term debt are included in Note 12, “Fair Value Measurements”.

Derivative Financial Instruments

As part of our risk management strategy, when considered appropriate, we use derivative financial instruments including forward contracts and interest rate swap agreements to hedge against certain foreign currency and interest rate exposures. Our intent is to mitigate gains and losses caused by the underlying exposures with offsetting gains and losses on the derivative contracts. By policy, we do not enter into speculative positions with derivative instruments. The criteria we use for designating a derivative as a hedge include contemporaneous and ongoing documentation of the instrument’s effectiveness in risk reduction and direct matching of the financial instrument to the underlying transaction. We record all derivatives in other assets or other liabilities on our consolidated balance sheets at their fair values. Gains and losses from the changes in values of these derivatives are accounted for based on the use of the derivative and whether it qualifies for hedge accounting.

For the years ended January 31, 2012, 2011, and 2010, certain foreign currency forward contracts qualified for accounting as hedges and accordingly, the effective portions of the changes in fair value of these instruments were recorded in accumulated other comprehensive income (loss) in our consolidated balance sheets, net of applicable income taxes. The ineffective portion, if any, of these contracts is reported in other income (expense), net. For derivative financial instruments not accounted for as hedges, gains and losses from changes in their fair values are reported in other income (expense), net. See Note 13, “Derivative Financial Instruments”, for further details regarding our hedging activities and related accounting policies.

Long-term Debt

We capitalize debt issuance costs, as well as costs incurred for subsequent modification of debt, incurred in connection with our long-term borrowings and credit facilities. We amortize these costs as an adjustment to interest expense over the remaining contractual life of the associated long-term borrowing or credit facility using the effective interest method for long-term borrowings and the straight-line method for revolving credit facilities. When unscheduled principal payments are made, we adjust the amortization of our deferred debt-related costs to reflect the expected remaining terms of the borrowing.

Segment Reporting

We have three operating segments, which are also our reportable segments, Enterprise Intelligence Solutions (“Enterprise Intelligence”), Video and Situation Intelligence Solutions (“Video Intelligence”), and Communications and Cyber Intelligence Solutions (“Communications Intelligence”). Our Enterprise Intelligence segment was previously referred to as our Workforce Optimization segment. We determine our reportable segments based on a number of factors our management uses to evaluate and run our business operations, including similarities of customers, products and technology. Our Chief Executive Officer is our chief operating decision maker, who utilizes segment revenue and segment operating contribution as the primary basis for assessing financial results of segments and for the allocation of resources. See Note 17, “Segment, Geographic, and Significant Customer Information”, for a full description of our segments and related accounting policies.

Revenue Recognition

In October 2009, the Financial Accounting Standards Board (“FASB”) issued amended revenue recognition accounting standards that removed tangible products containing software components and non-software components that function together to deliver the product’s essential functionality from the scope of industry-specific software revenue recognition guidance. Also in October 2009, the FASB amended the accounting standards for many multiple-deliverable revenue arrangements to:

(i)

provide updated guidance on when and how the deliverables in a multiple-deliverable arrangement should be separated, and how the consideration should be allocated;

	(ii)	require an entity to allocate revenue in an arrangement that has separate units of accounting, using estimated selling prices (“ESP”) of deliverables if a vendor does not have vendor-specific objective evidence (“VSOE”) of selling price, or third-party evidence of selling price (“TPE”); and

	(iii)	eliminate the use of the residual method and require an entity to allocate revenue using the relative selling price method to the separate units of accounting.

This guidance was effective for fiscal years beginning on or after June 15, 2010, although early adoption was permitted. We elected to prospectively adopt the provisions of this new guidance as of February 1, 2011, for new and materially modified transactions entered into on or after that date. Since we have been able to establish VSOE for a significant amount of our service and support offerings included in multiple-element arrangements, we do not consider the impact of implementing the guidance to be significant for the year ended January 31, 2012. For the year ended January 31, 2012, we recognized $12.4 million and $6.3 million of additional revenue and income before provision for income taxes, respectively, as a result of adopting the new guidance.

Our revenue recognition policies, reflecting the impact of the new guidance, are described below.

We derive and report our revenue in two categories: (a) product revenue, including sale of hardware products (which include software that works together with the hardware to deliver the product’s essential functionality) and licensing of software products, and (b) service and support revenue, including revenue from installation services, post-contract customer support (“PCS”), project management, hosting services, software-as-a-service (“SaaS”), product warranties, and training services.

Our revenue recognition policy is a critical component of determining our operating results and is based on a complex set of accounting rules that require us to make significant judgments and estimates. Our customer arrangements typically include several elements, including products, services, and support. Revenue recognition for a particular arrangement is dependent upon such factors as the level of customization within the solution and the contractual delivery, acceptance, payment, and support terms with the customer. Significant judgment is required to conclude whether collectability of fees is reasonably assured and whether fees are fixed and determinable.

For arrangements that do not require significant modification or customization of the underlying products, we recognize revenue when we have persuasive evidence of an arrangement, the product has been delivered or the services have been provided to the customer, the sales price is fixed or determinable and collectability is reasonably assured. In addition, our multiple-element arrangements must be carefully reviewed to determine the selling price of each element.

Our multiple-element arrangements consist of a combination of our product and service offerings that may be delivered at various points in time. For arrangements within the scope of the new revenue accounting guidance, a deliverable constitutes a separate unit of accounting when it has stand-alone value and there are no customer-negotiated refunds or return rights for the delivered elements. For multiple-element arrangements comprised only of hardware products and related services, we allocate revenue to each element in an arrangement based on a selling price hierarchy. The selling price for a deliverable is based on its VSOE, if available, TPE, if VSOE is not available, or ESP, if neither VSOE nor TPE is available. The total transaction revenue is allocated to the multiple elements based on each element’s relative selling price compared to the total selling price.

Our policy for establishing VSOE for installation, consulting, and training is based upon an analysis of separate sales of services. We utilize either the substantive renewal rate approach or the bell-shaped curve approach to establish VSOE for our PCS offerings, depending upon the business segment, geographical region, or product line.

TPE of selling price is established by evaluating largely similar and interchangeable competitor products or services in stand-alone sales to similarly situated customers.

If we are unable to determine the selling price because VSOE or TPE does not exist, we determine ESP for the purposes of allocating the arrangement by considering several external and internal factors including, but not limited to, pricing practices, similar product offerings, margin objectives, geographies in which we offer our products and services, internal costs, competition, and product lifecycle. The determination of ESP is made through consultation with and approval by our management, taking into consideration our go-to-market strategies. ESP for each element is updated, when appropriate, to ensure that it reflects recent pricing experience.

For multiple-element arrangements comprised only of software products and related services, a portion of the total purchase price is allocated to the undelivered elements, primarily installation services, PCS, and training, using VSOE of fair value of the undelivered elements. The remaining portion of the total transaction value is allocated to the delivered software, referred to as the residual method. If we are unable to establish VSOE for the undelivered elements of the arrangement, revenue recognition is deferred for the entire arrangement until all elements of the arrangement are delivered. However, if the only undelivered element is PCS, we recognize the arrangement fee ratably over the PCS period.

For multiple-element arrangements that contain software and software related elements for which we are unable to establish VSOE of one or more elements, we use various available indicators of fair value and apply our best judgment to reasonably classify the arrangement’s revenue into product revenue and service revenue for financial reporting purposes. Installation services associated with our Communications Intelligence arrangements are included within product revenue as such amounts are not considered material.

For new or materially modified multiple-element arrangements entered into on or after February 1, 2011 that are comprised of a combination of hardware and software elements, the total transaction value is bifurcated between the hardware elements and the software elements that are not essential to the functionality of the hardware, based on the relative selling prices of the hardware elements and the software elements as a group. Revenue is then recognized for the hardware and hardware-related services following the hardware revenue recognition methodology outlined above and revenue for the software and software-related services is recognized following the residual method or ratably over the PCS period if VSOE for PCS does not exist.

PCS revenue is derived from providing technical software support services and unspecified software updates and upgrades to customers on a when-and-if-available basis. PCS revenue is recognized ratably over the term of the maintenance period, which in most cases is one year.

Under the substantive renewal rate approach, we believe it is necessary to evaluate whether both the support renewal rate and term are substantive and whether the renewal rate is being consistently applied to subsequent renewals for a particular customer. We establish VSOE under this approach through analyzing the renewal rate stated in the customer agreement and determining whether that rate is above the minimum substantive VSOE renewal rate established for that particular PCS offering. The minimum substantive VSOE rate is determined based upon an analysis of renewal rates associated with historical PCS contracts. For multiple-element software arrangements that do not contain a stated renewal rate, revenue associated with the entire bundled arrangement is recognized ratably over the PCS term. Multiple-element software arrangements that have a renewal rate below the minimum substantive VSOE rate are deemed to contain a more than insignificant discount element, for which VSOE cannot be established. We recognize aggregate contractual revenue for these arrangements over the period that the customer is entitled to renew its PCS at the discounted rate, but not to exceed the estimated economic life of the product. We evaluate many factors in determining the estimated economic life of our products, including the support period of the product, technological obsolescence, and customer expectations. We have concluded that our software products have estimated economic lives ranging from five to seven years.

Under the bell-shaped curve approach of establishing VSOE, we perform VSOE compliance tests to ensure that a substantial majority of our actual PCS renewals are within a narrow range of pricing.

For certain of our products, we do not have an explicit obligation to provide PCS but as a matter of business practice have provided implied PCS. The implied PCS is accounted for as a separate element for which VSOE does not exist. Arrangements comprised of software only elements that contain implied PCS are recognized over the period the implied PCS is provided, but not to exceed the estimated economic life of the product.

Some of our arrangements require significant customization of the product to meet the particular requirements of the customer. For these arrangements, revenue is recognized under contract accounting methods, typically using the percentage-of-completion (“POC”) method. Under the POC method, revenue recognition is generally based upon the ratio of hours incurred to date to the total estimated hours required to complete the contract. Profit estimates on long-term contracts are revised periodically based on changes in circumstances, and any losses on contracts are recognized in the period that such losses become evident. If the range of profitability cannot be estimated, but some level of profit is assured, revenue is recognized to the extent of costs incurred, until such time that the project’s profitability can be estimated or the services have been completed. In the event some level of profitability on a contract cannot be assured, the completed-contract method of revenue recognition is applied.

If an arrangement includes customer acceptance criteria, revenue is not recognized until we can objectively demonstrate that the software or services meet the acceptance criteria, or the acceptance period lapses, whichever occurs earlier. If an arrangement containing software elements obligates us to deliver specified future software products or upgrades, revenue related to the software elements under the arrangement is initially deferred and is recognized only when the specified future software products or upgrades are delivered, or when the obligation to deliver specified future software products expires, whichever occurs earlier.

We record provisions for estimated product returns in the same period in which the associated revenue is recognized. We base these estimates of product returns upon historical levels of sales returns and other known factors. Actual product returns could be different from our estimates, and current or future provisions for product returns may differ from historical provisions. Concessions granted to customers are recorded as reductions to revenue in the period in which they were granted. The vast majority of our contracts are successfully completed, and concessions granted to customers are minimal in both dollar value and frequency.

Product revenue derived from shipments to resellers and original equipment manufacturers (“OEMs”) who purchase our products for resale are generally recognized when such products are shipped (on a “sell-in” basis). We have historically experienced insignificant product returns from resellers and OEMs, and our payment terms for these customers are similar to those granted to our end-users. If a reseller or OEM develops a pattern of payment delinquency, or seeks payment terms longer than generally accepted, we defer the recognition of revenue until the receipt of cash. Our arrangements with resellers and OEMs are periodically reviewed as our business and products change.

In instances where revenue is derived from sale of third-party vendor services and we are a principal in the transaction, we generally record revenue on a gross basis and record costs related to a sale within cost of revenue. In those cases where we are acting as an agent between the customer and the vendor, revenue is recorded net of costs.

We record reimbursements from customers for out-of-pocket expenses as revenue. Shipping and handling fees and expenses that are billed to customers are recognized in revenue and the costs associated with such fees and expenses are recorded in cost of revenue. Historically, these fees and expenses have not been material. Taxes collected from customers and remitted to government authorities are excluded from revenue.

Cost of Revenue

Our cost of revenue includes costs of materials, compensation and benefit costs for operations and service personnel, subcontractor costs, royalties and license fees, depreciation of equipment used in operations and service, amortization of capitalized software development costs and certain purchased intangible assets, and related overhead costs.

Where revenue is recognized over multiple periods in accordance with our revenue recognition policies, we have made an accounting policy election whereby cost of product revenue, including hardware and third-party software license fees, are capitalized and recognized in the same period that product revenue is recognized, while installation and other service costs are generally expensed as incurred, except for certain contracts that are accounted for using contract accounting principles. Deferred cost of revenue is classified in its entirety as current or long-term assets based on whether the related revenue will be recognized within twelve months of the origination date of the arrangement.

For certain contracts accounted for using contract accounting principles, revisions in estimates of costs and profits are reflected in the accounting period in which the facts that require the revision become known, if such facts become known subsequent to the issuance of the consolidated financial statements. If such facts become known before the issuance of the consolidated financial statements, the requisite revisions in estimates of costs and profits are reflected in the consolidated financial statements. At the time a loss on a contract becomes evident, the entire amount of the estimated loss is accrued. Related contract costs include all direct material and labor costs and those indirect costs related to contract performance.

Customer acquisition and origination costs, including sales commissions, are recorded in selling, general and administrative expenses. These costs are expensed as incurred, with the exception of certain sales referral fees in our Communication Intelligence segment which are capitalized and amortized ratably over the revenue recognition period.

Research and Development, net

With the exception of certain software development costs, all research and development costs are expensed as incurred, and consist primarily of personnel and consulting costs, travel, depreciation of research and development equipment, and related overhead and other costs associated with research and development activities.

We receive non-refundable grants from the Israel Office of the Chief Scientist (“OCS”) that fund a portion of our research and development expenditures. We currently only enter into non-royalty-bearing arrangements with the OCS which do not require us to pay royalties. Funds received from the OCS are recorded as a reduction to research and development expense. Royalties, to the extent paid, are recorded as part of our cost of revenue.

Software Development Costs

Costs incurred to acquire or develop software to be sold, leased or otherwise marketed are capitalized after technological feasibility is established, and continue to be capitalized through the general release of the related software product. Amortization of capitalized costs begins in the period in which the related product is available for general release to customers and is recorded on a straight-line basis, which approximates the pattern in which the economic benefits of the capitalized costs are expected to be realized, over the estimated economic lives of the related software products, generally four years.

Internal-Use Software

We capitalize costs associated with internal-use software systems that have reached the application development stage. These capitalized costs include external direct costs utilized in developing or obtaining the applications and expenses for employees who are directly associated with the development of the applications. Capitalization of such costs begins when the preliminary project stage is complete and continues until the project is substantially complete and is ready for its intended purpose. The costs are amortized over a period of four years.

Capitalization of such costs was not material during the years ended January 31, 2012, 2011, and 2010.

Income Taxes

We account for income taxes under the asset and liability method which includes the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in our consolidated financial statements. Under this approach, deferred taxes are recorded for the future tax consequences expected to occur when the reported amounts of assets and liabilities are recovered or paid. The provision for income taxes represents income taxes paid or payable for the current year plus deferred taxes. Deferred taxes result from differences between the financial statement and tax bases of our assets and liabilities, and are adjusted for changes in tax rates and tax laws when changes are enacted. The effects of future changes in income tax laws or rates are not anticipated.

We are subject to income taxes in the United States and numerous foreign jurisdictions. The calculation of our tax provision involves the application of complex tax laws and requires significant judgment and estimates.

We evaluate the realizability of our deferred tax assets for each jurisdiction in which we operate at each reporting date, and establish valuation allowances when it is more likely than not that all or a portion of our deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income of the same character and in the same jurisdiction. We consider all available positive and negative evidence in making this assessment, including, but not limited to, the scheduled reversal of deferred tax liabilities, projected future taxable income, and tax planning strategies. In circumstances where there is sufficient negative evidence indicating that our deferred tax assets are not more-likely-than-not realizable, we establish a valuation allowance.

We use a two-step approach to recognizing and measuring uncertain tax positions. The first step is to evaluate tax positions taken or expected to be taken in a tax return by assessing whether they are more-likely-than-not sustainable, based solely on their technical merits, upon examination and including resolution of any related appeals or litigation process. The second step is to measure the associated tax benefit of each position as the largest amount that we believe is more-likely-than-not realizable. Differences between the amount of tax benefits taken or expected to be taken in our income tax returns and the amount of tax benefits recognized in our financial statements represent our unrecognized income tax benefits, which we either record as a liability or as a reduction of deferred tax assets. Our policy is to include interest and penalties related to unrecognized income tax benefits as a component of income tax expense.

Functional Currency and Foreign Currency Transaction Gains and Losses

The functional currency for most of our foreign subsidiaries is the respective local currency, of which the notable exceptions are our subsidiaries in Israel and Canada, whose functional currencies are the U.S. dollar. Most of our revenue and materials purchased from suppliers are denominated in or linked to the U.S. dollar. Transactions denominated in currencies other than a functional currency (primarily compensation and benefits costs of foreign operations) are converted to the functional currency on the transaction date, and any resulting assets or liabilities are further translated at each reporting date and at settlement. Gains and losses recognized upon such translations are included within other income (expense), net in the consolidated statements of operations. We recorded $1.4 million and $0.9 million of net foreign currency gains for the years ended January 31, 2012 and 2011, respectively, and $1.9 million of net foreign currency losses for the year ended January 31, 2010.

In those instances where a foreign subsidiary has a functional currency other than the U.S. dollar, revenue and expenses are translated into U.S. dollars using average exchange rates for the reporting period, while assets and liabilities are translated into U.S. dollars using period-end rates. The effects of foreign currency translation adjustments are included in stockholders’ equity (deficit) as a component of accumulated other comprehensive income (loss) in the accompanying consolidated balance sheets.

Stock-Based Compensation

We recognize the cost of employee services received in exchange for awards of equity instruments based on the grant-date fair value of the award. We use the Black-Scholes option-pricing model to estimate the fair value of certain of our stock-based awards. We recognize the fair value of the award over the period during which an employee is required to provide service in exchange for the award.

Net Income Per Common Share Attributable to Verint Systems Inc.

Shares used in the calculation of basic net income per common share are based on the weighted-average number of shares outstanding during the accounting period. Shares used in the calculation of basic net income per common share exclude unvested shares of restricted stock because they are contingent upon future service conditions. Shares used in the calculation of diluted net income per common share are based on the weighted-average number of shares outstanding, adjusted for the assumed exercise of all potentially dilutive stock options and other stock-based awards outstanding using the treasury stock method. Shares used in the calculation of diluted net income per common share also include the assumed conversion of our convertible preferred stock, if dilutive. In periods for which we report a net loss, basic net loss per common share and diluted net loss per common share are identical since the effect of potential common shares is anti-dilutive and therefore excluded.

Recent Accounting Pronouncements

Other Accounting Pronouncements Implemented:

In January 2010, the FASB issued amended standards that require additional fair value disclosures. These disclosure requirements were effective in two phases. The initial phase, which was effective for us as of February 1, 2010, requires enhanced disclosures about inputs and valuation techniques used to measure fair value as well as disclosures about significant transfers. The second phase, which was effective for us as of February 1, 2011, requires presentation of disaggregated activity within the reconciliation for fair value measurements using significant unobservable inputs (Level 3). The adoption of these standards did not have a material impact on our consolidated financial statements.

In December 2010, the FASB issued updated accounting guidance to clarify that pro forma disclosures should be presented as if a business combination occurred at the beginning of the prior annual period for purposes of preparing both the current reporting period and the prior reporting period pro forma financial information. These disclosures should be accompanied by a narrative description about the nature and amount of material, nonrecurring pro forma adjustments. This new accounting guidance is effective for business combinations consummated in periods beginning after December 15, 2010 and should be applied prospectively as of the date of adoption, although early adoption is permitted. We adopted this new guidance effective February 1, 2011. The adoption of this guidance did not have a material impact on our consolidated financial statements.

In December 2010, the FASB issued updated accounting guidance related to the calculation of the carrying amount of a reporting unit when performing the first step of a goodwill impairment test. This update modifies Step 1 of the goodwill impairment test for reporting units with zero or negative carrying amounts. For those reporting units, an entity is required to perform Step 2 of the goodwill impairment test if it is more likely than not that a goodwill impairment exists. In determining whether it is more likely than not that a goodwill impairment exists, an entity should consider and assess whether there are any adverse qualitative factors indicating that impairment may exist. For public companies, this new accounting guidance is effective for impairment tests performed during fiscal years (and interim periods within those years) that began after December 15, 2010. We adopted this new guidance effective February 1, 2011. The adoption of this new guidance did not have a material impact on our November 1, 2011 tests for goodwill impairment, and we do not believe that it will materially impact future tests for goodwill impairment.

In September 2011, the FASB issued amended standards intended to simplify how tests for potential goodwill impairment are performed. These amended standards permit an assessment of qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit in which goodwill resides is less than its carrying value. For reporting units in which this assessment concludes it is more likely than not that the fair value is more than its carrying value, these amended standards eliminate the requirement to perform further goodwill impairment testing as required under the previous standards. We adopted these standards on November 1, 2011 and they did not materially impact our consolidated financial statements. We do not expect these new standards to materially impact our future consolidated financial statements.

New Accounting Pronouncements to be Implemented:

In May 2011, the FASB issued updated accounting guidance to amend existing requirements for fair value measurements and disclosures. The guidance expands the disclosure requirements around fair value measurements categorized in Level 3 of the fair value hierarchy and requires disclosure of the level in the fair value hierarchy of items that are not measured at fair value but whose fair value must be disclosed. It also clarifies and expands upon existing requirements for fair value measurements of financial assets and liabilities as well as instruments classified in stockholders’ equity. The guidance is effective for us beginning with our three-month period ending April 30, 2012. We are assessing the impact that the application of this guidance may have on our consolidated financial statements.

In June 2011, the FASB issued amended standards regarding the presentation of comprehensive income. These amendments eliminate the option to present components of other comprehensive income as part of the statement of stockholders’ equity and require the presentation of comprehensive income, the components of net income, and the components of other comprehensive income in either a single continuous statement of comprehensive income or in two separate but consecutive statements. In December 2011, the FASB updated this guidance to indefinitely defer the requirement to present items that are reclassified from accumulated other comprehensive income to net income separately with their respective components of net income and other comprehensive income. This guidance does not change the items that must be reported within other comprehensive income and the criteria for determining when an item of other comprehensive income must be reclassified to net income. These amended standards are effective for us beginning with our three-month period ending April 30, 2012 and must be applied retrospectively. Other than the change in presentation, these changes will not have an impact on our consolidated financial statements.

- Definition

The entire disclosure for the organization, consolidation and basis of presentation of financial statements disclosure, and significant accounting policies of the reporting entity. May be provided in more than one note to the financial statements, as long as users are provided with an understanding of (1) the significant judgments and assumptions made by an enterprise in determining whether it must consolidate a VIE and/or disclose information about its involvement with a VIE, (2) the nature of restrictions on a consolidated VIE's assets reported by an enterprise in its statement of financial position, including the carrying amounts of such assets, (3) the nature of, and changes in, the risks associated with an enterprise's involvement with the VIE, and (4) how an enterprise's involvement with the VIE affects the enterprise's financial position, financial performance, and cash flows. Describes procedure if disclosures are provided in more than one note to the financial statements.

+ References + Details

NET INCOME PER COMMON SHARE ATTRIBUTABLE TO VERINT SYSTEMS INC.

12 Months Ended

Jan. 31, 2012

NET INCOME PER COMMON SHARE ATTRIBUTABLE TO VERINT SYSTEMS INC.

NET INCOME PER COMMON SHARE ATTRIBUTABLE TO VERINT SYSTEMS INC.

2. NET INCOME PER COMMON SHARE ATTRIBUTABLE TO VERINT SYSTEMS INC.

The following table summarizes the calculation of basic and diluted net income per common share attributable to Verint Systems Inc. for the years ended January 31, 2012, 2011, and 2010:

	Year Ended January 31,
(in thousands, except per share amounts)	2012			2011			2010
Net income	$	40,625		$	28,585		$	17,100
Net income attributable to noncontrolling interest	3,632			3,004			1,483
Net income attributable to Verint Systems Inc.	36,993			25,581			15,617
Dividends on preferred stock	(14,790		)	(14,178		)	(13,591		)
Net income attributable to Verint Systems Inc. for basic net income per common share	22,203			11,403			2,026
Dilutive effect of dividends on preferred stock	—			—			—
Net income attributable to Verint Systems Inc. for diluted net income per common share	$	22,203		$	11,403		$	2,026
Weighted-average shares outstanding:
Basic	38,419			34,544			32,478
Dilutive effect of employee equity award plans	1,080			2,635			649
Dilutive effect of assumed conversion of preferred stock	—			—			—
Diluted	39,499			37,179			33,127
Net income per common share attributable to Verint Systems Inc.
Basic	$	0.58		$	0.33		$	0.06
Diluted	$	0.56		$	0.31		$	0.06

We excluded the following weighted-average shares underlying stock-based awards and convertible preferred stock from the calculations of diluted net income per common share because their inclusion would have been anti-dilutive:

	Year Ended January 31,
(in thousands)	2012	2011	2010
Shares excluded from calculation:
Stock options and restricted stock-based awards	813	1,158	4,714
Convertible preferred stock	10,625	10,223	9,836

INVESTMENTS

12 Months Ended

Jan. 31, 2012

INVESTMENTS

INVESTMENTS

3. INVESTMENTS

As of January 31, 2012 and 2011, all of our excess funds are in cash, cash equivalents, restricted cash, or restricted time deposits. We have not invested in marketable debt or equity securities during the three-year period ended January 31, 2012, but may do so in the future as permitted under our investment guidelines. We have historically invested in a variety of securities, including U.S. Government, corporation, agency bonds, and auction rate securities, which typically provide higher yields than money market and other cash equivalent investments. As a matter of policy, we no longer invest in auction rate securities.

We received no proceeds from sales of available for sale securities during the years ended January 31, 2012, 2011 and 2010, because all of our available operating funds and our restricted cash were held in the form of cash and cash equivalents during those entire years.

- Definition

Tabular disclosure of investments in certain debt and equity securities (and certain other trading assets) which include all debt and equity securities (other than those equity securities accounted for under the equity or cost methods of accounting) with readily determinable fair values. Other trading assets include assets that are carried on the balance sheet at fair value and held for trading purposes. A debt security represents a creditor relationship with an enterprise that is in the form of a security. Debt securities include, among other items, US Treasury securities, US government securities, municipal securities, corporate bonds, convertible debt, commercial paper, and all securitized debt instruments. An equity security represents an ownership interest in an enterprise or the right to acquire or dispose of an ownership interest in an enterprise at fixed or determinable prices. Equity securities include, among other things, common stock, certain preferred stock, warrant rights, call options, and put options, but do not include convertible debt. An entity may opt to provide the reader with additional narrative text to better understand the nature of investments in debt and equity securities (and other trading assets).

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
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-Name Statement of Financial Accounting Standard (FAS)
-Number 115
-Paragraph 3, 19, 20, 21, 22, 137
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

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+ Details

BUSINESS COMBINATIONS

12 Months Ended

Jan. 31, 2012

BUSINESS COMBINATIONS

BUSINESS COMBINATIONS

4. BUSINESS COMBINATIONS

Year Ended January 31, 2012

Vovici Corporation

On August 4, 2011, we acquired all of the outstanding shares of Vovici Corporation (“Vovici”), a U.S.-based, privately held provider of online survey management and enterprise feedback solutions. This acquisition enhances our Enterprise Intelligence product suite to include comprehensive voice of the customer software and services offerings, designed to help organizations implement a single-vendor solution set for collecting, analyzing, and acting on customer insights. We have included the financial results of Vovici in our consolidated financial statements since August 4, 2011.

We acquired Vovici for approximately $56.1 million in cash at closing, including $0.4 million to repay Vovici’s bank debt. In addition, the consideration also included the exchange of certain unvested Vovici stock options for options to acquire approximately 42,000 shares of Verint common stock with fair values totaling $1.0 million, of which $0.1 million represents compensation for pre-acquisition services and is included in the consideration transferred and $0.9 million is being recognized as stock-based compensation expense over the remaining future vesting periods of the awards. We also agreed to make potential additional cash payments to the former Vovici shareholders of up to approximately $19.1 million, contingent upon the achievement of certain performance targets over the period ending January 31, 2013. The fair value of this contingent obligation was estimated to be $9.9 million at August 4, 2011.

The $9.9 million acquisition date fair value of the contingent consideration obligation was estimated based on the probability adjusted present value of the consideration expected to be transferred using significant inputs that are not observable in the market. Key assumptions used in this estimate include probability assessments with respect to the likelihood of achieving the performance targets and discount rates consistent with the level of risk of achievement. At each reporting date, we revalue the contingent consideration obligation to its fair value and record increases and decreases in fair value within selling, general and administrative expenses in our consolidated statements of operations. Increases or decreases in the fair value of the contingent consideration obligation may result from changes in discount periods and rates, and changes in probability assumptions with respect to the likelihood of achieving the performance targets.

For the year ended January 31, 2012, we recorded a benefit of approximately $2.7 million for the change in the fair value of the contingent consideration obligation between the acquisition date and January 31, 2012, which primarily reflected the impact of revised assessments of the probabilities of payment. As of January 31, 2012, the fair value of this contingent consideration obligation was approximately $7.2 million.

The purchase price was allocated to the tangible assets and intangible assets acquired and liabilities assumed based on their estimated fair values on the acquisition date, with the remaining unallocated purchase price recorded as goodwill. The fair values assigned to identifiable intangible assets acquired were determined primarily by using the income approach, which discounts expected future cash flows to present value using estimates and assumptions determined by management. The acquired identifiable intangible assets are being amortized on a straight-line basis, which we believe approximates the pattern in which the assets are utilized, over their estimated useful lives.

Among the factors contributing to the recognition of goodwill in this transaction were synergies in products and technologies, and the addition of a skilled, assembled workforce. This goodwill has been assigned to our Enterprise Intelligence segment and is not deductible for income tax purposes.

In connection with the purchase price allocation, the estimated fair value of support obligations assumed from Vovici was determined utilizing a cost build-up approach. The cost build-up approach calculates fair value by estimating the costs relating to fulfilling these obligations plus a normal profit margin, which approximates the amount that we believe would be required to pay a third party to assume the support obligations. The estimated costs to fulfill the support obligation were based on the historical direct costs related to providing support services. These estimated costs did not include any costs associated with selling efforts or research and development or the related margins on these costs. Profit associated with selling efforts is excluded because the selling effort on the support contracts concluded prior to the August 4, 2011 acquisition date. The estimated profit margin was 15%, which we believe best approximates our operating profit margin to fulfill these support obligations. As a result, in allocating the purchase price, we recorded an adjustment to reduce the $5.3 million carrying value of Vovici’s deferred revenue to $2.3 million, representing the estimated fair value of the support obligations assumed. As former Vovici customers renew their support contracts, we will recognize revenue at the full contract value over the remaining term of the contracts.

Revenue attributable to Vovici from August 4, 2011 through January 31, 2012 was $5.0 million. The impact of Vovici on net income for this period was not significant.

Transaction and related costs, consisting primarily professional fees and integration expenses, directly related to the acquisition of Vovici, totaled $3.4 million for the year ended January 31, 2012, and were expensed as incurred.

Global Management Technologies

On October 7, 2011, we acquired all of the outstanding shares of Global Management Technologies (“GMT”), a U.S.-based, privately held provider of workforce management solutions whose software and services are widely used by organizations, particularly in retail branch banking environments. This acquisition adds key functionality to our Enterprise Intelligence product suite. We have included the financial results of GMT in our consolidated financial statements since October 7, 2011.

We acquired GMT for approximately $24.6 million in cash at closing. We also agreed to make potential additional cash payments to the former GMT shareholders of up to approximately $17.4 million, contingent upon the achievement of certain performance targets over the period ending January 31, 2014. The fair value of this contingent obligation was estimated to be $12.0 million at October 7, 2011.

The $12.0 million acquisition date fair value of the contingent consideration obligation was estimated based on the probability adjusted present value of the consideration expected to be transferred using significant inputs that are not observable in the market. Key assumptions used in this estimate include probability assessments with respect to the likelihood of achieving the performance targets and discount rates consistent with the level of risk of achievement. At each reporting date, we revalue the contingent consideration obligation to its fair value and record increases and decreases in fair value within selling, general and administrative expenses in our consolidated statements of operations. Increases or decreases in the fair value of the contingent consideration obligation may result from changes in discount periods and rates, and changes in probability assumptions with respect to the likelihood of achieving the performance targets.

For the year ended January 31, 2012, we recorded a benefit of approximately $2.4 million for the change in the fair value of the contingent consideration obligation between the acquisition date and January 31, 2012, which primarily reflected the impact of revised assessments of the probabilities of payment. As of January 31, 2012, the fair value of this contingent consideration obligation was approximately $9.6 million.

In connection with the purchase price allocation, the estimated fair value of support obligations assumed from GMT was determined utilizing a cost build-up approach. The cost build-up approach calculates fair value by estimating the costs relating to fulfilling the obligations plus a normal profit margin, which approximates the amount that we believe would be required to pay a third party to assume the support obligations. The estimated costs to fulfill the support obligation were based on the historical direct costs related to providing support services. These estimated costs did not include any costs associated with selling efforts or research and development or the related margins on these costs. Profit associated with selling efforts is excluded because the selling effort on the support contracts was concluded prior to October 7, 2011. The estimated profit margin was 20%, which we believe best approximates our operating profit margin to fulfill these support obligations. As a result, in allocating the purchase price, we recorded an adjustment to reduce the $4.3 million carrying value of GMT’s deferred revenue to $1.2 million, representing the estimated fair value of the support obligations assumed. As former GMT customers renew their support contracts, we will recognize revenue at the full contract value over the remaining term of the contracts.

Revenue and the impact on net income attributable to GMT from October 7, 2011 through January 31, 2012 were not significant.

Transaction and related costs, primarily professional fees and integration expenses, directly related to the acquisition of GMT, totaled $1.6 million for the year ended January 31, 2012, and were expensed as incurred.

Other Business Combinations

During the year ended January 31, 2012, we executed the following additional business combinations:

· On March 30, 2011, we acquired all of the outstanding shares of a privately held company, based in Israel, that has been integrated into our Video Intelligence operating segment. This acquisition broadened our Video Intelligence product line.

· On August 2, 2011, we acquired all of the outstanding shares of a privately held provider of communications intelligence solutions, data retention services, and network performance management, based in the Americas region. This acquisition expands our Communications Intelligence product portfolio and increases our presence in this region.

· On November 1, 2011, we acquired certain technology and other assets for use in our Communications Intelligence operating segment in a transaction that qualified as a business combination.

· On November 10, 2011, we acquired certain technology and other assets for use in our Enterprise Intelligence operating segment in a transaction that qualified as a business combination.

· On January 5, 2012, we acquired all of the outstanding shares of a privately held provider of web intelligence technology, based in the EMEA region, that is being integrated into our Communications Intelligence operating segment.

The combined consideration for these business combinations was approximately $55.1 million, including $33.8 million of combined cash paid at the closings. We also agreed to make potential additional cash payments to the respective former shareholders aggregating up to approximately $41.0 million contingent upon the achievement of certain performance targets over periods ending through January 31, 2015. The combined fair values of these contingent consideration obligations were estimated to be $20.5 million as of the respective acquisition dates.

We recorded net benefits of $0.4 million within selling, general and administrative expenses for the year ended January 31, 2012 for changes in the fair values of the contingent consideration obligations associated with these acquisitions, reflecting the impacts of revised assessments of the probability of payment, as well as decreases in the discount periods since the acquisition dates. As of January 31, 2012, the combined fair values of these contingent consideration obligations were $20.1 million.

The fair values assigned to identifiable intangible assets acquired in these business combinations were determined primarily by using the income approach, which discounts expected future cash flows to present value using estimates and assumptions determined by management. The acquired identifiable finite-lived intangible assets are being amortized on a straight-line basis, which we believe approximates the pattern in which the assets are utilized, over their estimated useful lives.

Intangible assets acquired in these business combinations included several IPR&D assets with estimated fair values totaling $2.5 million. IPR&D assets are considered indefinite-lived intangible assets until the completion or abandonment of the associated research and development efforts. The fair values of the IPR&D assets were estimated by projecting the costs required to develop the IPR&D assets into commercially viable products, estimating the resulting net cash flows from the projects when completed and discounting the net cash flows to their present values. We will amortize these intangible assets once the projects are complete. Currently, we expect to complete these projects within the next two years. IPR&D assets are subject to impairment testing at least annually, or more frequently if circumstances are identified indicating the potential for impairment.

Among the factors contributing to the recognition of goodwill in these transactions were synergies in products and technologies, and the additions of skilled, assembled workforces. Of the $33.5 million of goodwill associated with these business combinations, $10.1 million was assigned to our Video Intelligence segment and is not deductible for income tax purposes, $2.0 million was assigned to our Enterprise Intelligence segment and is not deductible for income tax purposes, and $21.4 million was assigned to our Communications Intelligence segment, the tax deductibility of which is still being assessed.

In connection with the foregoing August 2, 2011 Communications Intelligence acquisition, we have evaluated and continue to evaluate the impact of certain liabilities associated with pre-acquisition business activities of the acquired company. Based upon our initial evaluation of these matters, we originally recorded liabilities of approximately $10.7 million, of which $5.5 million was classified as current and $5.2 million was classified as long-term, along with corresponding indemnification assets of the same amounts and classified in the same manner, as components of the purchase price for this acquisition, representing our then best estimates of these amounts at the acquisition date. The indemnification assets recognized the selling shareholders’ contractual obligation to indemnify us for these pre-acquisition liabilities and were measured on the same basis as the corresponding liabilities. These amounts, as adjusted for currency exchange rate fluctuations, were reflected on our October 31, 2011 consolidated balance sheet. Subsequently, based upon an assessment of additional information obtained during the three months ended January 31, 2012 about facts and circumstances that existed as of the acquisition date regarding these matters, we reduced the estimated acquisition-date liabilities by $0.8 million, and recorded a corresponding acquisition-date reduction in the associated indemnification assets.

As of January 31, 2012, the current and long-term liabilities for these matters are $4.3 million and $4.7 million, respectively, with corresponding indemnification assets reflected within current and long-term assets. We are continuing to gather and assess information in this regard, and changes to the amounts recorded, if any, during the remainder of the measurement period, will be included in the purchase price allocation during the measurement period and, subsequently, in our results of operations.

Revenue and the impact on net income attributable to these acquisitions for the year ended January 31, 2012 were not significant.

Transaction and related costs, primarily professional fees and integration expenses, directly related to these acquisitions totaled $5.0 million for the year ended January 31, 2012, and were expensed as incurred.

Components and Allocations of Purchase Prices

The following table sets forth the components and the allocations of the purchase prices, some of which are preliminary, for business combinations completed during the year ended January 31, 2012:

(in thousands)	Vovici			GMT			Other
Components of Purchase Price:
Cash	$	55,708		$	24,596		$	33,835
Fair value of contingent consideration	9,900			12,000			20,504
Fair value of stock options	60			—			—
Bank debt, repaid at closing	435			—			—
Other purchase price adjustments	—			—			786
Total purchase price	$	66,103		$	36,596		$	55,125

Allocation of Purchase Price:
Net tangible assets (liabilities):
Accounts receivable	$	1,106		$	512		$	842
Other current assets	5,398			1,717			15,650
Other assets	913			483			5,579
Current and other liabilities	(3,165		)	(1,915		)	(15,419		)
Deferred revenue	(2,264		)	(1,234		)	(944		)
Bank debt	—			—			(3,330		)
Deferred income taxes - current and long-term	(6,021		)	(108		)	(3,587		)
Net tangible assets (liabilities)	(4,033		)	(545		)	(1,209		)
Identifiable intangible assets:
Developed technology	11,300			7,400			10,043
Customer relationships	15,400			6,200			7,460
Trademarks and trade names	1,700			400			1,350
In-process research and development assets	—			—			2,500
Other identifiable intangible assets	—			—			1,421
Total identifiable intangible assets (1)	28,400			14,000			22,774
Goodwill	41,736			23,141			33,560
Total purchase price	$	66,103		$	36,596		$	55,125

(1) The weighted-average estimated useful life of all finite-lived identifiable intangible assets is 7.5 years.

The purchase price allocations for acquisitions completed during the year ended January 31, 2012 are provisional and are based on the information that was available as of the acquisition dates to estimate the fair values of assets acquired and liabilities assumed. The purchase price allocations for these acquisitions as reported at January 31, 2012 represent our best estimates of the fair values and were based upon the information available to us.

We are gathering and reviewing additional information necessary to finalize the values assigned to the acquired identified intangible assets, goodwill and income tax assets and liabilities for these acquisitions. Therefore, the provisional measurements of fair values reported at January 31, 2012 are subject to change. We expect to finalize the purchase price allocations as soon as practicable but no later than one year from the respective acquisition dates.

Based upon additional information obtained during the three months ended January 31, 2012 about facts and circumstances that existed as of the respective acquisition dates, we adjusted the purchase price allocations for several acquisitions completed during the year ended January 31, 2012, as described below:

· For the Vovici purchase price allocation, we increased certain liabilities by $1.1 million, recorded an associated $1.0 million asset reflecting the selling shareholders’ indemnification obligations related to these liabilities, and increased goodwill by $0.1 million. We also adjusted certain income tax assets and liabilities of Vovici which resulted in a $4.0 million increase in goodwill. These adjustments did not materially impact our consolidated statement of operations.

· For the GMT purchase price allocation, we refined certain assumptions in the discounted cash flow models used to estimate the fair values of certain identified intangible assets, which reduced the estimated acquisition-date fair values of the developed technology and customer relationship intangible assets identified in the acquisition of GMT by $0.1 million and $1.0 million, respectively, compared to the original estimated amounts, which resulted in a corresponding $1.1 million increase in acquisition-date goodwill. We also adjusted certain income tax assets and liabilities of GMT which resulted in a $0.4 million increase in goodwill. These adjustments did not materially impact our consolidated statement of operations.

· For the purchase price allocation associated with our August 2, 2011, Communications Intelligence acquisition, we refined certain assumptions in the discounted cash flow models used to estimate the fair values of certain identified intangible assets, which increased the estimated acquisition-date fair values of the developed technology and customer relationship intangible assets identified in this acquisition by $0.2 million each, compared to the original estimated amounts, which resulted in a corresponding $0.4 million decrease in acquisition-date goodwill. We also increased the fair value of our contingent consideration obligation in this acquisition by $0.5 million and recorded a corresponding $0.5 million increase in acquisition-date goodwill. Additionally, we adjusted the acquisition-date fair value of our performance obligations under customer contracts assumed in this acquisition, which resulted in a $1.7 million decrease in acquisition-date goodwill. Finally, we adjusted certain acquisition-date deferred income taxes and unrecognized tax benefits, which resulted in a $3.1 million increase in acquisition-date goodwill. These adjustments combined to increase acquisition-date goodwill for this acquisition by $1.5 million.

For the acquisition of Vovici, the acquired developed technology, customer relationships, and trademarks and trade names were assigned estimated useful lives of six years, ten years, and five years, respectively, the weighted average of which is approximately 8.1 years.

For the acquisition of GMT, the acquired developed technology, customer relationships, and trademarks and trade names were assigned estimated useful lives of five years, ten years, and three years, respectively, the weighted average of which is approximately 7.2 years.

For the other acquisitions, the acquired developed technology, customer relationships, trademarks and trade names, and other identifiable intangible assets were assigned estimated useful lives of from six years to seven years, from four years to ten years, from four years to five years, and from three years to four years, respectively, the weighted average of which is approximately 6.8 years.

Year Ended January 31, 2011

Iontas Limited

On February 4, 2010, we acquired all of the outstanding shares of Iontas Limited (“Iontas”), a privately held provider of desktop analytics solutions which measure application usage and analyze workflows to help improve staff performance in contact center, branch, and back-office operations environments. We acquired Iontas to, among other objectives, expand the desktop analytical capabilities of our Enterprise Intelligence solutions. We have included the financial results of Iontas in our consolidated financial statements since February 4, 2010.

We acquired Iontas for total consideration valued at $21.7 million, including cash consideration of $17.7 million, and additional milestone-based contingent payments of up to $3.8 million tied to certain performance targets being achieved over the two-year period following the acquisition date. The acquisition-date fair value of the contingent consideration was estimated to be $3.2 million. The purchase price also included $1.5 million of prepayments for product licenses and support services procured from Iontas prior to the acquisition date, partially offset by $0.7 million of trade accounts payable to Iontas as of the acquisition date.

The consideration paid to acquire Iontas was allocated to the assets acquired and liabilities assumed based on their estimated fair values as of the acquisition date, which included $6.9 million for developed technology, $0.3 million for non-competition agreements, $1.7 million for tangible net assets, and $12.8 million of goodwill. The developed technology and non-competition agreements were assigned estimated useful lives of six years and three years, respectively, the weighted average of which is 5.9 years, and are being amortized on a straight-line basis, which we believe approximates the pattern in which the assets are utilized, over these estimated useful lives.

Among the factors that contributed to the recognition of goodwill in this transaction were the expansion of our desktop analytical capabilities, the expansion of our suite of products and services, and the addition of an assembled workforce. This goodwill was assigned to our Enterprise Intelligence segment and is not deductible for income tax purposes.

We recorded the $3.2 million acquisition-date estimated fair value of the contingent consideration as a component of the purchase price of Iontas. During the year ended January 31, 2012, $2.0 million of the previously recorded contingent consideration was paid to the former shareholders of Iontas. The estimated fair value of the remaining contingent consideration was $1.7 million as of January 31, 2012. Expenses of $0.2 million and $0.3 million for the years ended January 31, 2012 and 2011, respectively, reflecting increases in the fair value of this contingent consideration obligation, were recorded within selling, general and administrative expenses for those periods.

Transaction costs, primarily professional fees, directly related to the acquisition of Iontas, totaled $1.3 million and were expensed as incurred.

The integration of Iontas into our business subsequent to the acquisition has made it impractical to quantify revenue and the impact on net income from Iontas for the years ended January 31, 2012 and 2011.

Communications Intelligence Business Combination

In December 2010, we acquired certain technology and other assets for use in our Communications Intelligence operating segment in a transaction that qualified as a business combination. Total consideration for this acquisition was less than $15.0 million. The impact of this acquisition was not material to our consolidated financial statements. The fair value of our liability for contingent consideration related to this acquisition increased by $1.9 million during the year ended January 31, 2012, resulting in a corresponding charge recorded within selling, general and administrative expenses for that period. The earned contingent consideration related to this acquisition was paid to the sellers during the year ended January 31, 2012, and we have no further contingent consideration obligations for this acquisition.

Pro Forma Information

The following table provides unaudited pro forma revenue and net income (loss) attributable to Verint Systems Inc. for the years ended January 31, 2012 and 2011, as if Vovici and GMT had been acquired on February 1, 2010. These unaudited pro forma results reflect certain adjustments related to these acquisitions, such as amortization expense on finite-lived intangible assets acquired from Vovici and GMT. The unaudited pro forma results do not include any operating efficiencies or potential cost savings which may result from these business combinations. Accordingly, such unaudited pro forma amounts are not necessarily indicative of the results that actually would have occurred had the acquisitions been completed on February 1, 2010, nor are they indicative of future operating results. The pro forma impact of the other business combinations discussed in this note were not material to our historical consolidated operating results and is therefore not presented.

	Year Ended January 31,
(in thousands)	2012		2011
Revenue	$	804,006	$	746,097
Net income attributable to Verint Systems Inc.	$	43,652	$	6,331

- Definition

The entire disclosure for a business combination (or series of individually immaterial business combinations) completed during the period, including background, timing, and recognized assets and liabilities. The disclosure may include leverage buyout transactions (as applicable).

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Emerging Issues Task Force (EITF)
-Number 88-16
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
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+ Details

INTANGIBLE ASSETS AND GOODWILL

12 Months Ended

Jan. 31, 2012

INTANGIBLE ASSETS AND GOODWILL

INTANGIBLE ASSETS AND GOODWILL

5. INTANGIBLE ASSETS AND GOODWILL

Acquisition-related intangible assets consisted of the following as of January 31, 2012 and 2011:

	January 31, 2012
(in thousands)	Cost		Accumulated Amortization			Net
Intangible assets with finite lives:
Customer relationships	$	225,929	$	(95,173	)	$	130,756
Acquired technology	94,295		(49,732		)	44,563
Trade names	12,824		(9,805		)	3,019
Non-competition agreements	5,779		(3,656		)	2,123
Distribution network	2,440		(1,352		)	1,088
Backlog	843		(19		)	824
Total intangible assets with finite lives:	342,110		(159,737		)	182,373
In-process research and development, with indefinite lives	2,500		—			2,500
Total	$	344,610	$	(159,737	)	$	184,873

	January 31, 2011
(in thousands)	Cost		Accumulated Amortization			Net
Intangible assets, all with finite lives:
Customer relationships	$	198,106	$	(74,412	)	$	123,694
Acquired technology	66,794		(37,579		)	29,215
Trade names	9,552		(9,177		)	375
Non-competition agreements	5,215		(2,760		)	2,455
Distribution network	2,440		(1,108		)	1,332
Total	$	282,107	$	(125,036	)	$	157,071

The following table presents net acquisition-related intangible assets by reportable segment as of January 31, 2012 and 2011.

	January 31,
(in thousands)	2012		2011
Enterprise Intelligence	$	160,258	$	148,471
Video Intelligence	5,059		934
Communications Intelligence	19,556		7,666
Total	$	184,873	$	157,071

All acquired, finite-lived intangible assets are amortized on a straight-line basis, which approximates the pattern in which the estimated economic benefits of the assets are realized, over their estimated useful lives, which are periods of ten years or less.

Total amortization expense recorded for acquisition-related intangible assets was $35.3 million, $30.6 million, and $30.3 million for the years ended January 31, 2012, 2011, and 2010, respectively. The reported amount of net acquisition-related intangible assets can fluctuate from the impact of changes in foreign exchange rates on intangible assets not denominated in U.S. dollars.

Estimated future amortization expense on finite-lived acquisition-related intangible assets is as follows:

(in thousands)
Years Ending January 31,	Amount
2013	$	39,664
2014	34,499
2015	31,069
2016	29,731
2017	26,969
2018 and thereafter	20,441
Total	$	182,373

In conjunction with the goodwill impairment reviews described below, we conducted reviews for impairment of our other long-lived assets, including finite-lived intangible assets, because any impairment of these assets must be considered prior to the conclusion of the goodwill impairment review in accordance with applicable accounting guidance. We did not identify any impairments of finite-lived intangible assets during the years ended January 31, 2012, 2011, and 2010.

Our IPR&D assets were acquired during the fourth quarter of the year ended January 31, 2012, and no impairment indicators were identified for these assets between their acquisition dates and January 31, 2012.

Goodwill represents the excess of the purchase price in a business combination over the fair value of net tangible and identifiable intangible assets acquired. Goodwill activity for the years ended January 31, 2012 and 2011, in total and by reportable segment, was as follows:

				Reportable Segment
(in thousands)	Total			Enterprise Intelligence			Video Intelligence			Communications Intelligence
Year Ended January 31, 2011
Goodwill, gross, at January 31, 2010	$	791,535		$	694,465		$	66,998		$	30,072
Accumulated impairment losses at January 31, 2010	(66,865		)	(30,791		)	(36,074		)	—
Goodwill, net, at January 31, 2010	724,670			663,674			30,924			30,072
Business acquisition	12,776			12,776			—			—
Foreign currency translation and other	1,228			(39		)	(209		)	1,476
Goodwill, net, at January 31, 2011	$	738,674		$	676,411		$	30,715		$	31,548

Year Ended January 31, 2012
Goodwill, gross, at January 31, 2011	$	805,539		$	707,202		$	66,789		$	31,548
Accumulated impairment losses at January 31, 2011	(66,865		)	(30,791		)	(36,074		)	—
Goodwill, net, at January 31, 2011	738,674			676,411			30,715			31,548
Business acquisitions	98,437			66,877			10,141			21,419
Foreign currency translation and other	(5,424		)	(3,547		)	(716		)	(1,161		)
Goodwill, net, at January 31, 2012	$	831,687		$	739,741		$	40,140		$	51,806

Balance at January 31, 2012
Goodwill, gross, at January 31, 2012	$	898,552		$	770,532		$	76,214		$	51,806
Accumulated impairment losses at January 31, 2012	(66,865		)	(30,791		)	(36,074		)	—
Goodwill, net, at January 31, 2012	$	831,687		$	739,741		$	40,140		$	51,806

At the acquisition date, goodwill resulting from a business combination is assigned to those reporting units expected to benefit from the synergies of the combination. Reporting units may either be at, or one level below, our operating segment level.

We test our goodwill for impairment annually as of November 1, or more frequently, if events or circumstances indicate the potential for an impairment. We performed goodwill impairment tests for each of our reporting units as of November 1, 2011, 2010, and 2009.

The results of our testing as of November 1, 2011, 2010 and 2009 indicated that the fair values of all of our reporting units significantly exceeded their net carrying values, and no indicators of potential impairment were identified between November 1 and January 31 in each of the years ended January 31, 2012, 2011, and 2010. Therefore, no goodwill impairment was identified for the years ended January 31, 2012, 2011, and 2010.

- Definition

The entire disclosure for the aggregate amount of goodwill and a description of intangible assets, which may include (a) for amortizable intangible assets (also referred to as finite-lived intangible assets), the carrying amount, the amount of any significant residual value, and the weighted-average amortization period, (b) for intangible assets not subject to amortization (also referred to as indefinite-lived intangible assets), the carrying amount, and (c) the amount of research and development assets acquired and written off in the period, including the line item in the income statement in which the amounts written off are aggregated, if not readily apparent from the income statement. Also discloses (a) for amortizable intangibles assets in total and by major class, the gross carrying amount and accumulated amortization, the total amortization expense for the period, and the estimated aggregate amortization expense for each of the five succeeding fiscal years, (b) for intangible assets not subject to amortization the carrying amount in total and by major class, and (c) for goodwill, in total and for each reportable segment, the changes in the carrying amount of goodwill during the period (including the aggregate amount of goodwill acquired, the aggregate amount of impairment losses recognized, and the amount of goodwill included in the gain (loss) on disposal of a reporting unit). If any part of goodwill has not been allocated to a reportable segment, discloses the unallocated amount and the reasons for not allocating. For each impairment loss recognized related to an intangible asset (excluding goodwill), discloses: (a) a description of the impaired intangible asset and the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method for determining fair value, (c) the caption in the income statement or the statement of activities in which the impairment loss is aggregated, and (d) the segment in which the impaired intangible asset is reported. For each goodwill impairment loss recognized, discloses: (a) a description of the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method of determining the fair value of the associated reporting unit, and (c) if a recognized impairment loss is an estimate not finalized and the reasons why the estimate is not final. May also disclose the nature and amount of any significant adjustments made to a previous estimate of an impairment loss.

+ References + Details

LONG-TERM DEBT

12 Months Ended

Jan. 31, 2012

LONG-TERM DEBT

LONG-TERM DEBT

6. LONG-TERM DEBT

The following table summarizes our long-term debt at January 31, 2012 and 2011:

	January 31,
(in thousands)	2012			2011
Term loan facility - new credit agreement:
Gross loan	$	597,000		$	—
Unamortized debt discount	(2,685		)	—
Other debt	3,064			—
Term loan facility - prior credit agreement	—			583,234
Total debt	597,379			583,234
Less: current maturities	6,228			—
Long-term debt	$	591,151		$	583,234

In May 2007, we entered into a $675.0 million secured credit agreement (“Prior Credit Agreement”) comprised of a $650.0 million seven-year term loan facility and a $25.0 million six-year revolving line of credit. The borrowing capacity under the revolving line of credit was increased to $75.0 million in July 2010.

In April 2011, we entered into a new credit agreement (“Credit Agreement”) and concurrently terminated the Prior Credit Agreement. The Credit Agreement provides for $770.0 million of secured credit facilities, comprised of a $600.0 million term loan maturing in October 2017 and a $170.0 million revolving credit facility maturing in April 2016, subject to increase (up to a maximum increase of $300.0 million) and reduction from time to time according to the terms of the Credit Agreement.

The majority of the new term loan proceeds were used to repay all $583.2 million of outstanding term loan borrowings under the Prior Credit Agreement at the closing date of the Credit Agreement. There were no outstanding borrowings under the prior revolving credit facility at the closing date.

The Credit Agreement included an original issuance term loan discount of 0.50%, or $3.0 million, resulting in net term loan proceeds of $597.0 million. This discount is being amortized as interest expense over the term of the term loan using the effective interest method.

Loans under the Credit Agreement bear interest, payable quarterly or, in the case of Eurodollar loans with an interest period of three months or shorter, at the end of any interest period, at a per annum rate of, at our election:

(a) in the case of Eurodollar loans, the Adjusted LIBO Rate plus 3.25% (or if our corporate ratings are at least BB- and Ba3 or better, 3.00%). The “Adjusted LIBO Rate” is the greater of (i) 1.25% per annum and (ii) the product of the LIBO Rate and Statutory Reserves (both as defined in the Credit Agreement), and

(b) in the case of Base Rate loans, the Base Rate plus 2.25% (or if our corporate ratings are at least BB- and Ba3 or better, 2.00%). The “Base Rate” is the greatest of (i) the administrative agent’s prime rate, (ii) the Federal Funds Effective Rate (as defined in the Credit Agreement) plus 0.50% and (iii) the Adjusted LIBO Rate for a one-month interest period plus 1.00%.

We incurred debt issuance costs of $14.8 million associated with the Credit Agreement, which we have deferred and are classified within other assets. We are amortizing these deferred costs as interest expense over the term of the Credit Agreement. Of these deferred costs, $10.2 million were associated with the term loan and are being amortized using the effective interest rate method. Deferred costs associated with the revolving credit facility were $4.6 million and are being amortized on a straight-line basis.

At the closing date of the Credit Agreement, there were $9.0 million of unamortized deferred costs associated with the Prior Credit Agreement. Upon termination of the Prior Credit Agreement and repayment of the prior term loan, $8.1 million of these fees were expensed as a loss on extinguishment of debt. The remaining $0.9 million of these fees were associated with lenders that provided commitments under both the new and the prior revolving credit facilities, which remained deferred and are being amortized over the term of the Credit Agreement.

During the three months ended October 31, 2011, we incurred $0.5 million of fees to secure waivers of certain provisions of the Credit Agreement which allowed us to structure the financing for one of our business combinations in a favorable manner, $0.2 million of which were deferred and will be amortized over the remaining term of the Credit Agreement and $0.3 million of which were expensed as incurred.

As of January 31, 2012, the interest rate on the term loan was 4.50%. Including the impact of the 0.50% original issuance term loan discount and the deferred debt issuance costs, the effective interest rate on our term loan was approximately 4.91% as of January 31, 2012.

During the years ended January 31, 2012, 2011, and 2010, we incurred $28.1 million, $26.2 million, and $22.6 million of interest expense, respectively, on borrowings under our credit facility. We also recorded $2.8 million, $2.8 million, and $1.9 million during the years ended January 31, 2012, 2011, and 2010, respectively, for amortization of our deferred debt issuance costs, which is reported within interest expense. Included in the deferred debt-related cost amortization for the years ended January 31, 2011 and 2010 were $0.3 million and $0.1 million, respectively, of additional amortization associated with unscheduled principal repayments in those years. During the year ended January 31, 2012, we also recorded $0.3 million for amortization of the original issuance term loan discount, which is reported within interest expense.

We are required to pay a commitment fee equal to 0.50% per annum on the undrawn portion of the revolving credit facility, payable quarterly, and customary administrative agent and letter of credit fees.

The Credit Agreement requires us to make term loan principal payments of $1.5 million per quarter through August 2017, beginning in August 2011, with the remaining balance due in October 2017. Optional prepayments of the loans are permitted without premium or penalty, other than customary breakage costs associated with the prepayment of loans bearing interest based on LIBO Rates and a 1.0% premium applicable in the event of a Repricing Transaction (as defined in the Credit Agreement) prior to April 30, 2012. The loans are also subject to mandatory prepayment requirements with respect to certain asset sales, excess cash flow (as defined in the Credit Agreement), and certain other events. Prepayments are applied first to the eight immediately following scheduled term loan principal payments, then pro rata to other remaining scheduled term loan principal payments, if any, and thereafter as otherwise provided in the Credit Agreement.

Obligations under the Credit Agreement are guaranteed by substantially all of our domestic subsidiaries and certain foreign subsidiaries that have elected to be disregarded for U.S. tax purposes and are secured by security interests in substantially all of our and their assets, subject to certain exceptions detailed in the Credit Agreement and related ancillary documentation.

The Credit Agreement contains customary affirmative and negative covenants for credit facilities of this type, and also contains a financial covenant that requires us to maintain a Consolidated Total Debt to Consolidated EBITDA (each as defined in the Credit Agreement) leverage ratio until July 31, 2013 of no greater than 5.00 to 1 and thereafter of no greater than 4.50 to 1.

The Credit Agreement provides for customary events of default with corresponding grace periods. Upon an event of default, all of our indebtedness under the Credit Agreement may be declared immediately due and payable, and the lenders’ commitments to provide loans under the Credit Agreement may be terminated.

The following table summarizes future scheduled principal payments on our term loan as of January 31, 2012:

(in thousands)
Years Ending January 31,	Amount
2013	$	6,000
2014	6,000
2015	6,000
2016	6,000
2017	6,000
2018 and thereafter	567,000
Total	$	597,000

In connection with our August 2, 2011 Communications Intelligence business combination, we assumed approximately $3.3 million of development bank and government debt in the Americas region. This debt is payable in periods through February 2017 and bears interest at varying rates. As of January 31, 2012, the majority of this debt bears interest at an annual rate of 7.00%. The carrying value of this debt was approximately $3.1 million at January 31, 2012.

SUPPLEMENTAL CONSOLIDATED FINANCIAL STATEMENT INFORMATION

12 Months Ended

Jan. 31, 2012

SUPPLEMENTAL CONSOLIDATED FINANCIAL STATEMENT INFORMATION

SUPPLEMENTAL CONSOLIDATED FINANCIAL STATEMENT INFORMATION

7. SUPPLEMENTAL CONSOLIDATED FINANCIAL STATEMENT INFORMATION

Consolidated Balance Sheets

Inventories consisted of the following as of January 31, 2012 and 2011:

	January 31,
(in thousands)	2012		2011
Raw materials	$	4,959	$	7,112
Work-in-process	5,777		5,112
Finished goods	3,678		4,763
Total inventories	$	14,414	$	16,987

Property and equipment, net consisted of the following as of January 31, 2012 and 2011:

	January 31,
(in thousands)	2012			2011
Land	$	3,741		$	3,861
Buildings	2,204			2,204
Leasehold improvements	11,554			10,097
Software	27,694			23,973
Equipment, furniture, and other	49,298			45,874
	94,491			86,009
Less: accumulated depreciation and amortization	(66,202		)	(62,833		)
Total property and equipment, net	$	28,289		$	23,176

Depreciation expense on property and equipment was $10.8 million, $11.4 million, and $12.4 million for the years ended January 31, 2012, 2011, and 2010, respectively.

Other assets consisted of the following as of January 31, 2012 and 2011:

	January 31,
(in thousands)	2012		2011
Deferred debt issuance costs, net	$	14,060	$	9,725
Other	14,901		10,335
Total other assets	$	28,961	$	20,060

Accrued expenses and other liabilities consisted of the following as of January 31, 2012 and 2011:

	January 31,
(in thousands)	2012		2011
Compensation and benefits	$	56,873	$	57,863
Billings in excess of costs and estimated earnings on uncompleted contracts	38,960		47,692
Professional and consulting fees	8,140		6,962
Derivative financial instruments - current portion	530		1,886
Distributor and agent commissions	4,954		7,511
Taxes other than income taxes	11,530		8,357
Interest on indebtedness	4,701		5,699
Contingent consideration - current portion	10,152		2,194
Other	32,285		24,486
Total accrued expenses and other liabilities	$	168,125	$	162,650

Other liabilities consisted of the following as of January 31, 2012 and 2011:

	January 31,
(in thousands)	2012		2011
Unrecognized tax benefits, including interest and penalties	$	23,883	$	21,032
Obligation for severance compensation	3,027		3,279
Contingent consideration - non current portion	28,494		1,492
Other	3,784		6,009
Total other liabilities	$	59,188	$	31,812

Consolidated Statements of Operations

Other income (expense), net consisted of the following for the years ended January 31, 2012, 2011, and 2010:

	Year Ended January 31,
(in thousands)	2012			2011			2010
Foreign currency gains (losses), net	$	1,382		$	857		$	(1,898	)
Losses on derivative financial instruments, net	(896		)	(5,864		)	(14,709		)
Other, net	(974		)	(131		)	(516		)
Total other income (expense), net	$	(488	)	$	(5,138	)	$	(17,123	)

Consolidated Statements of Cash Flows

The following table provides supplemental information regarding our consolidated cash flows for the years ended January 31, 2012, 2011, and 2010:

	Year Ended January 31,
(in thousands)	2012		2011		2010
Cash paid for interest	$	29,227	$	21,053	$	24,705
Cash paid for income taxes, net of refunds received	$	16,629	$	8,528	$	11,661
Non-cash investing and financing transactions:
Accrued but unpaid purchases of property and equipment	$	832	$	1,047	$	642
Inventory transfers to property and equipment	$	637	$	874	$	621
Liabilities for contingent consideration in business combinations	$	42,404	$	3,424	$	—
Stock options exercised, proceeds received subsequent to year end	$	383	$	65	$	—
Purchases under supplier financing arrangements, including capital leases	$	1,090	$	1,859	$	—

CONVERTIBLE PREFERRED STOCK

12 Months Ended

Jan. 31, 2012

CONVERTIBLE PREFERRED STOCK

CONVERTIBLE PREFERRED STOCK

8. CONVERTIBLE PREFERRED STOCK

On May 25, 2007, we entered into a Securities Purchase Agreement with Comverse, (the “Securities Purchase Agreement”) whereby Comverse purchased, for cash, an aggregate of 293,000 shares of our Series A Convertible Preferred Stock (“preferred stock”), for an aggregate purchase price of $293.0 million. Proceeds from the issuance of the preferred stock were used to partially finance our acquisition of Witness Systems Inc. (“Witness”). We incurred $0.2 million of direct issuance costs associated with the issuance of the preferred stock, which were charged against the carrying value of the preferred stock.

The preferred stock was issued at a purchase price of $1,000 per share and ranks senior to our common stock. The preferred stock had an initial liquidation preference equal to its $1,000 per share purchase price. In the event of any voluntary or involuntary liquidation, dissolution, or winding-up of our company, the holders of the preferred stock will be entitled to receive, out of assets available for distribution to our stockholders and before any distribution of assets to our common stockholders, an amount equal to the then-current liquidation preference, which includes accrued and unpaid dividends.

The terms of the preferred stock provide that upon a fundamental change, as defined, the holders of the preferred stock would have the right to require us to repurchase the preferred stock for 100% of the liquidation preference then in effect. Therefore, the preferred stock has been classified as mezzanine equity on our consolidated balance sheets as of January 31, 2012 and January 31, 2011, separate from permanent equity, because the occurrence of these fundamental changes, and thus potential redemption of the preferred stock, however remote in likelihood, is not solely under our control. Fundamental change events include the sale of substantially all of our assets, and certain changes in beneficial ownership, board of directors’ representation, and business reorganizations. In the event of a fundamental change, the conversion rate (as described in the section entitled “Voting and Conversion”, below) will be increased to provide for additional shares of common stock issuable to the holders of preferred stock, based on a sliding scale (depending on the acquisition price, as defined) ranging from zero to 3.7 additional shares of common stock for every share of preferred stock converted into shares of common stock.

We have concluded that, as of January 31, 2012, the occurrence of a fundamental change and the associated redemption of the preferred stock were not probable. We therefore did not adjust the carrying amount of the preferred stock to its redemption amount, which is its liquidation preference, at January 31, 2012. Through January 31, 2012, cumulative, undeclared dividends on the preferred stock were $59.0 million and as a result, the liquidation preference of the preferred stock was $352.0 million at that date.

We determined that the variable dividend feature of the preferred stock, details of which are further described below, was not clearly and closely related to the characteristics of the preferred stock host contract and, therefore, was an embedded derivative financial instrument, subject to bifurcation from the preferred stock. This feature was determined to be an asset, and was assigned an initial fair value of $0.9 million at the May 25, 2007 issue date of the preferred stock. Therefore, the preferred stock was assigned an initial fair value of $293.9 million, and the $0.9 million bifurcated derivative financial instrument was reflected within other assets. The fair value of the embedded derivative financial instrument was based on the potential future savings implicit in paying dividends at a reduced rate of 3.875% instead of the original stated preferred dividend rate of 4.25%. On February 1, 2008, as further described below, the preferred stock dividend rate was reset to 3.875% per annum and upon the occurrence of this dividend rate reset, the embedded derivative was settled in the form of reduced future dividend obligations. Accordingly, we reclassified the $8.1 million fair value of the derivative asset at that date against the carrying value of the preferred stock as of February 1, 2008, reducing the carrying value of the preferred stock to $285.5 million.

The holders of the preferred stock have various rights and preferences, as follows:

Dividends

Cash dividends on the preferred stock are cumulative and are calculated quarterly at a specified dividend rate on the liquidation preference in effect at such time. Dividends are paid only if declared by our board of directors. Initially, the specified annual dividend rate was 4.25% per share. However, beginning in the first quarter after the initial interest rate on our variable term loan was reduced by 50 basis points or more, the dividend rate was reset to 3.875% per annum and then fixed at that level. This variable dividend feature was accounted for as an embedded derivative financial instrument, as described above.

During the quarter ended January 31, 2008, the interest rate on our term loan was reduced by more than 50 basis points below the initial interest rate. Accordingly, the dividend rate on the preferred stock was reset to 3.875%, effective February 1, 2008. This rate is no longer subject to future change.

We are prohibited from paying cash dividends on the preferred stock under the terms of a covenant in our credit agreement. We may elect to make dividend payments in shares of our common stock. The common stock used for dividends, when and if declared, would be valued at 95% of the volume weighted-average price of our common stock for each of the five consecutive trading days ending on the second trading day immediately prior to the record date for the dividend.

The preferred stock does not participate in our earnings other than as described above.

Through January 31, 2012, no dividends had been declared or paid on the preferred stock.

Voting and Conversion

Effective with the approval of the issuance of common shares underlying the preferred stock’s conversion feature at a special meeting of our stockholders in October 2010, each share of preferred stock entitles its holder to votes equal to the number of shares of common stock into which it is convertible using the conversion rate that was in effect upon the issuance of the preferred stock in May 2007, on all matters voted upon by common stockholders. The initial conversion rate was set at 30.6185 shares of common stock for each share of preferred stock. In addition, each share of preferred stock is convertible, at the option of the holder, into a number of shares of our common stock equal to the liquidation preference then in effect, divided by the conversion price then in effect, which was initially set at $32.66, and remained unchanged through January 31, 2012. The conversion price is subject to periodic adjustment upon the occurrence of certain dilutive events. As of January 31, 2012, the preferred stock is convertible into approximately 10.8 million shares of our common stock.

Since the second anniversary of the preferred stock’s issue date, we have had the right to cause the preferred stock, in whole but not in part, to be automatically converted into common stock at the conversion price then in effect. However, we may exercise this right only if the closing sale price of our common stock immediately prior to conversion equals or exceeds the conversion price then in effect by a specified percentage, which is now fixed at 135%.

Transfer and Registration Rights

Comverse has had the right to sell the preferred stock since November 25, 2007 in either private or public transactions. Pursuant to a registration rights agreement we entered into concurrently with the Securities Purchase Agreement (“New Registration Rights Agreement”), subject to certain conditions which have now been satisfied, Comverse has been entitled to two demands to require us to register the preferred stock and/or the shares of common stock underlying the preferred stock for resale under the Securities Act of 1933, as amended (the “Securities Act”).

The New Registration Rights Agreement also gives Comverse unlimited piggyback registration rights on certain Securities Act registrations filed by us on our own behalf or on behalf of other stockholders.

Comverse may transfer its rights under the New Registration Rights Agreement to any transferee of the registrable securities that is an affiliate of Comverse or any other subsequent transferee, provided that in each case such affiliate or transferee becomes a party to the New Registration Rights Agreement, agreeing to be bound by all of its terms and conditions.

Comverse’s rights under the New Registration Rights Agreement are in addition to its rights under a previous registration rights agreement we entered into with Comverse shortly before our initial public offering (“IPO”) in 2002. This registration rights agreement (“Original Registration Rights Agreement”) covers all shares of common stock then held by Comverse and any additional shares of common stock acquired by Comverse at later dates. Under the Original Registration Rights Agreement, Comverse is entitled to unlimited demand registrations of its shares on Form S-3, and if we were not eligible to use Form S-3, Comverse was also entitled to one demand registration on Form S-1, which demand was exercised by Comverse to consummate a sale of a portion of its holdings of our common stock in January 2011.

Like the New Registration Rights Agreement, the Original Registration Rights Agreement also provides Comverse with unlimited piggyback registration rights. Comverse may transfer its rights under this agreement to an affiliate or other subsequent transferee, subject to the transferee agreeing to be bound by all of its terms and conditions.

STOCKHOLDERS' EQUITY (DEFICIT)

12 Months Ended

Jan. 31, 2012

STOCKHOLDERS' EQUITY (DEFICIT)

STOCKHOLDERS' EQUITY (DEFICIT)

9. STOCKHOLDERS’ EQUITY (DEFICIT)

Dividends on Common Stock

We did not declare or pay any dividends on our common stock during the years ended January 31, 2012, 2011, and 2010. Commencing with our issuance of preferred stock, and our entry into term loan and revolving credit facilities in May 2007, we are subject to certain restrictions on declaring and paying dividends on our common stock.

Treasury Stock

Repurchased shares of common stock are recorded as treasury stock, at cost. At January 31, 2012, we held 283,000 shares of treasury stock with a cost of $7.5 million, and at January 31, 2011, we held 260,000 shares of treasury stock with a cost of $6.6 million.

Shares of restricted stock awards that are forfeited when recipients separate from their employment prior to the lapsing of the award’s restrictions are recorded as treasury stock.

From time to time, our board of directors has approved limited programs to repurchase shares of our common stock from directors or officers in connection with the vesting of restricted stock or restricted stock units to facilitate required income tax withholding by us or the payment of required income taxes by such holders. In addition, the terms of some of our equity award agreements with all grantees provide for automatic repurchases by us for the same purpose if a vesting-related tax event occurs at a time when the holder is not permitted to sell shares in the market. Any such repurchases of common stock occur at prevailing market prices and are recorded as treasury stock. We repurchased approximately 23,000 and 157,000 shares of common stock during the years ended January 31, 2012 and 2011, respectively, under these arrangements.

As previously disclosed, in connection with the resumption of option exercises following the conclusion of our previous extended filing delay period and the vesting of restricted stock units after the relisting of our common stock on the NASDAQ Global Market, during the summer of 2010, we issued up to an aggregate of approximately 135,000 shares of common stock to certain current and former employees and a former director in transactions that did not involve public offerings and that were made in reliance on available exemptions from registration under the Securities Act of 1933. In January 2012, we repurchased approximately 30,000 of these shares of common stock at a cost of $0.8 million. Approximately 2,000 of those shares were reissued under stock-based employee benefit plans and the remaining 28,000 shares were retired. The cost of the retired shares was deducted from common stock at par value, which was negligible, and from additional paid-in capital for the excess over par value.

Accumulated Other Comprehensive Income (Loss)

In addition to net income, accumulated other comprehensive income (loss) includes items such as foreign currency translation adjustments and unrealized gains and losses on certain marketable securities and derivative financial instruments designated as hedges. Accumulated other comprehensive income (loss) is presented as a separate line item in the stockholders’ equity (deficit) section of our consolidated balance sheets, the components of which are detailed in our consolidated statements of stockholders’ equity (deficit). Accumulated other comprehensive income (loss) items have no impact on our net income as presented in our consolidated statements of operations.

The following table summarizes, as of each balance sheet date, the components of our accumulated other comprehensive loss.

	January 31,
(in thousands)	2012			2011
Foreign currency translation losses, net	$	(48,402	)	$	(41,829	)
Unrealized gains (losses) on derivative financial instruments, net	666			(245		)
Unrealized gains on available-for-sale marketable securities	—			5
Total accumulated other comprehensive loss	$	(47,736	)	$	(42,069	)

Income tax effects on unrealized gains (losses) on derivative financial instruments were not significant. Foreign currency translation losses, net, primarily reflect the strengthening of the U.S. dollar against the British pound sterling since our acquisition of Witness in May 2007, which has resulted in lower U.S. dollar-translated balances of British pound sterling-denominated goodwill and intangible assets associated with that acquisition.

Total other comprehensive income was $34.8 million, $29.9 million, and $32.4 million, for the years ended January 31, 2012, 2011, and 2010, respectively. Total other comprehensive income attributable to Verint Systems Inc. was $31.3 million, $26.6 million, and $30.9 million, and total other comprehensive income attributable to the noncontrolling interest was $3.5 million, $3.3 million, and $1.5 million for the years ended January 31, 2012, 2011, and 2010, respectively.

Noncontrolling Interest

The noncontrolling interest presented in our consolidated financial statements reflects a 50% noncontrolling equity interest in a joint venture which functions as a systems integrator for Asian markets. Net income attributable to noncontrolling interest, as reported on our consolidated statements of operations, represents the net income of this joint venture attributable to the noncontrolling equity interest. The noncontrolling interest is reflected within stockholders’ equity on the consolidated balance sheet but is presented separately from our equity.

- Definition

The entire disclosure for shareholders' equity, comprised of portions attributable to the parent entity and noncontrolling interest, if any, including other comprehensive income (as applicable). Including, but not limited to: (1) balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings; (2) accumulated balance for each classification of other comprehensive income and total amount of comprehensive income; (3) amount and nature of changes in separate accounts, including the number of shares authorized and outstanding, number of shares issued upon exercise and conversion, and for other comprehensive income, the adjustments for reclassifications to net income; (4) rights and privileges of each class of stock authorized; (5) basis of treasury stock, if other than cost, and amounts paid and accounting treatment for treasury stock purchased significantly in excess of market; (6) dividends paid or payable per share and in the aggregate for each class of stock for each period presented; (7) dividend restrictions and accumulated preferred dividends in arrears (in aggregate and per share amount); (8) retained earnings appropriations or restrictions, such as dividend restrictions; (9) impact of change in accounting principle, initial adoption of new accounting principle and correction of an error in previously issued financial statements; (10) shares held in trust for Employee Stock Ownership Plan (ESOP); (11) deferred compensation related to issuance of capital stock; (12) note received for issuance of stock; (13) unamortized discount on shares; (14) description, terms, and number of warrants or rights outstanding; (15) shares under subscription and subscription receivables, effective date of new retained earnings after quasi-reorganization and deficit eliminated by quasi-reorganization and, for a period of at least ten years after the effective date, the point in time from which the new retained dates; and (16) retroactive effective of subsequent change in capital structure.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher AICPA
-Name Accounting Principles Board Opinion (APB)
-Number 12
-Paragraph 10
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Regulation S-X (SX)
-Number 210
-Section 04
-Article 3

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Regulation S-X (SX)
-Number 210
-Article 4
-Section 08
-Paragraph d

Reference 4: http://www.xbrl.org/2003/role/presentationRef
-Publisher AICPA
-Name Accounting Research Bulletin (ARB)
-Number 43
-Chapter 1
-Section B
-Paragraph 7, 11A
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 5: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 129
-Paragraph 2, 3, 4, 5, 6, 7, 8
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 6: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Regulation S-X (SX)
-Number 210
-Section 08
-Article 4

Reference 7: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 5
-Paragraph 15
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 8: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Regulation S-X (SX)
-Number 210
-Section 02
-Paragraph 29, 30, 31
-Article 5

Reference 9: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Staff Accounting Bulletin (SAB)
-Number Topic 4
-Section E

Reference 10: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Staff Accounting Bulletin (SAB)
-Number Topic 4
-Section C

Reference 11: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.3-04)
-URI http://asc.fasb.org/extlink&oid=6959260&loc=d3e187085-122770

Reference 12: http://www.xbrl.org/2003/role/presentationRef
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-Name Accounting Standards Codification
-Topic 505
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-Section 50
-Paragraph 2
-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21463-112644

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Reference 14: http://www.xbrl.org/2003/role/presentationRef
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-Paragraph 4
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Reference 15: http://www.xbrl.org/2003/role/presentationRef
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-Name Accounting Standards Codification
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-Name Accounting Standards Codification
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-Paragraph 1
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-Name Accounting Standards Codification
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-Paragraph 2
-Subparagraph (SAB TOPIC 4.E)
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Reference 21: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Glossary Preferred Stock
-URI http://asc.fasb.org/extlink&oid=6521494

Reference 22: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 210
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-Subparagraph (SX 210.5-02.29-31)
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Reference 23: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
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-Section S99
-Paragraph 4
-Subparagraph (SAB TOPIC 4.C)
-URI http://asc.fasb.org/extlink&oid=6959260&loc=d3e187143-122770

+ Details

RESEARCH AND DEVELOPMENT, NET

12 Months Ended

Jan. 31, 2012

RESEARCH AND DEVELOPMENT, NET

RESEARCH AND DEVELOPMENT, NET

10. RESEARCH AND DEVELOPMENT, NET

Our gross research and development expenses for the years ended January 31, 2012, 2011, and 2010, were approximately $115.7 million, $100.8 million, and $86.7 million, respectively. OCS grants amounted to approximately $3.2 million, $3.0 million, and $2.1 million for the years ended January 31, 2012, 2011, and 2010, respectively, which were recorded as reductions of gross research and development expenses. We recorded other reimbursements of research and development expenses amounting to approximately $1.5 million, $1.3 million, and $0.8 million for the years ended January 31, 2012, 2011, and 2010, respectively.

We capitalize certain costs incurred to develop our commercial software products, and we then recognize those costs within product cost of revenue as the products are sold. Activity for our capitalized software development costs for the years ended January 31, 2012, 2011, and 2010 was as follows:

	Year Ended January 31,
(in thousands)	2012			2011			2010
Capitalized software development costs, net, beginning of year	$	6,787		$	8,530		$	10,489
Software development costs capitalized during the year	3,399			2,527			2,715
Amortization of capitalized software development costs	(4,135		)	(4,236		)	(4,717		)
Foreign currency translation and other	(205		)	(34		)	43
Capitalized software development costs, net, end of year	$	5,846		$	6,787		$	8,530

- Definition

The entire disclosure for research, development, and computer software activities, including contracts and arrangements to be performed for others and with federal government. Includes costs incurred (1) in a planned search or critical investigation aimed at discovery of new knowledge with the hope that such knowledge will be useful in developing a new product or service, a new process or technique, or in bringing about a significant improvement to an existing product or process; or (2) to translate research findings or other knowledge into a plan or design for a new product or process or for a significant improvement to an existing product or process whether intended for sale or the entity's use, during the reporting period charged to research and development projects, including the costs of developing computer software up to the point in time of achieving technological feasibility and in-process research and development acquired in a business combination consummated during the period.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 2
-Paragraph 12, 13
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 86
-Paragraph 11, 12
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher AICPA
-Name Audit and Accounting Guide (AAG)
-Number AAG-FGC
-Chapter 3
-Paragraph 56, 57
-IssueDate 2006-05-01
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 4: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 68
-Paragraph 14
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 5: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 730
-SubTopic 20
-Section 50
-Paragraph 1
-URI http://asc.fasb.org/extlink&oid=6420387&loc=d3e23199-108380

Reference 6: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
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-SubTopic 20
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Reference 7: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 985
-SubTopic 20
-Section 50
-Paragraph 1
-URI http://asc.fasb.org/extlink&oid=6501960&loc=d3e128462-111756

Reference 8: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 730
-SubTopic 10
-Section 50
-Paragraph 1
-URI http://asc.fasb.org/extlink&oid=6420194&loc=d3e21568-108373

Reference 9: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 730
-SubTopic 20
-Section 50
-Paragraph 2
-URI http://asc.fasb.org/extlink&oid=6420387&loc=d3e23218-108380

+ Details

INCOME TAXES

12 Months Ended

Jan. 31, 2012

INCOME TAXES

INCOME TAXES

11. INCOME TAXES

The components of income before income taxes for the years ended January 31, 2012, 2011, and 2010 were as follows:

	Year Ended January 31,
(in thousands)	2012			2011		2010
Domestic	$	(40,272	)	$	13,746	$	(47,139	)
Foreign	86,429			24,779		71,347
Total income before income taxes	$	46,157		$	38,525	$	24,208

The provision for income taxes for the years ended January 31, 2012, 2011, and 2010 consisted of the following:

	Year Ended January 31,
(in thousands)	2012			2011			2010
Current income tax provision (benefit):
Federal	$	145		$	24		$	(835	)
State	1,387			1,140			415
Foreign	15,101			9,868			7,590
Total current income tax provision	16,633			11,032			7,170
Deferred income tax provision (benefit):
Federal	(4,865		)	(16		)	500
State	(1,040		)	459			777
Foreign	(5,196		)	(1,535		)	(1,339		)
Total deferred income tax benefit	(11,101		)	(1,092		)	(62		)
Total provision for income taxes	$	5,532		$	9,940		$	7,108

The reconciliation of the U.S. federal statutory rate to our effective tax rate on income before income taxes for the years ended January 31, 2012, 2011, and 2010 was as follows:

	Year Ended January 31,
(in thousands)	2012			2011			2010
U.S. federal statutory income tax rate	35.0		%	35.0		%	35.0		%

Income tax provision at the U.S. federal statutory rate	$	16,155		$	13,484		$	8,471
State tax provision	2,443			3,720			756
Foreign rate differential	(7,408		)	(2,204		)	(8,869		)
Tax incentive	(8,846		)	(2,114		)	(9,762		)
Valuation allowance	(5,575		)	(13,042		)	7,737
Stock-based and other compensation	1,480			1,823			3,262
Non-deductible expenses	2,392			787			882
Tax credits	(2,034		)	(1,880		)	(2,019		)
Tax contingencies	(223		)	(4,233		)	1,102
Changes in tax rates	(486		)	(516		)	1,227
U.S. tax effects of foreign operations	7,864			13,774			4,750
Other, net	(230		)	341			(429		)
Total provision for income taxes	$	5,532		$	9,940		$	7,108
Effective income tax rate	12.0		%	25.8		%	29.4		%

Our operations in Israel have been granted “Approved Enterprise” status by the Investment Center of the Israeli Ministry of Industry, Trade and Labor, which makes us eligible for tax benefits under the Israeli Law for Encouragement of Capital Investments, 1959. Under the terms of the program, income attributable to an approved enterprise is exempt from income tax for a period of two years and is subject to a reduced income tax rate for the subsequent five to eight years (generally 10-25%, depending on the percentage of foreign investment in the company). These tax incentives decreased our effective tax rates by 19.2%, 5.5%, and 40.3% for the years ended January 31, 2012, 2011, and 2010, respectively.

Deferred tax assets and liabilities consisted of the following at January 31, 2012 and 2011:

	January 31,
(in thousands)	2012			2011
Deferred tax assets:
Accrued expenses	$	5,203		$	5,040
Allowance for doubtful accounts	2,257			1,246
Deferred revenue	22,611			24,954
Depreciation of property and equipment	2,386			3,804
Loss carryforwards	103,263			98,938
Tax credits	7,815			6,566
Stock-based and other compensation	14,616			16,567
Capitalized research and development expenses	3,732			4,395
Other long-term liabilities	1,796			1,938
Other, net	3,073			3,088
Total deferred tax assets	166,752			166,536
Deferred tax liabilities:
Deferred cost of revenue	(3,842		)	(6,270		)
Goodwill and other intangible assets	(53,276		)	(47,655		)
Other, net	(904		)	(617		)
Total deferred tax liabilities	(58,022		)	(54,542		)
Valuation allowance	(100,842		)	(105,720		)
Net deferred tax assets	$	7,888		$	6,274

Recorded as:
Current deferred tax assets	$	13,060		$	13,179
Long-term deferred tax assets	9,237			6,700
Current deferred tax liabilities	(1,056		)	(379		)
Long-term deferred tax liabilities	(13,353		)	(13,226		)
Net deferred tax assets	$	7,888		$	6,274

At January 31, 2012 and 2011, we had U.S. federal net operating loss (“NOL”) carryforwards of approximately $287.8 million and $282.4 million, respectively. These loss carryforwards expire in various years ending from January 31, 2016 to 2031. We had state NOL carryforwards of approximately $205.0 million and $179.7 million in the same respective years, expiring in years ending from January 31, 2012 to 2031. We had foreign NOL carryforwards of approximately $39.7 million and $28.3 million in the same respective years. At January 31, 2012, all but $1.6 million of these foreign loss carryforwards have indefinite carryforward periods. Certain of these federal, state, and foreign loss carryforwards and credits are subject to Internal Revenue Code Section 382 or similar provisions, which impose limitations on their utilization following certain changes in ownership of the entity generating the loss carryforward. The NOL carryforwards for tax return purposes are different from the NOL carryforwards for financial statement purposes, primarily due to the reduction of NOL carryforwards for financial statement purposes under the authoritative guidance on accounting for uncertainty in income taxes. We have U.S. federal, state and foreign tax credit carryforwards of approximately $8.3 million and $7.1 million at January 31, 2012 and 2011, respectively, the utilization of which is subject to limitation. At January 31, 2012, approximately $1.5 million of these tax credit carryforwards may be carried forward indefinitely. The balance of $6.8 million expires in various years ending from January 31, 2015 to 2031.

As of January 31, 2012, we have not provided for deferred taxes on the excess of financial reporting over the tax basis of investments in certain foreign subsidiaries in the amount of $173.9 million because we plan to reinvest such earnings indefinitely outside the United States. If these earnings were repatriated in the future, additional income and withholding tax expense would be incurred. Due to complexities in the laws of the foreign jurisdictions and the assumptions that would have to be made, it is not practicable to estimate the total amount of income taxes that would have to be provided on such earnings.

As required by the authoritative guidance on accounting for income taxes, we evaluate the realizability of deferred tax assets on a jurisdictional basis at each reporting date. Accounting for income taxes requires that a valuation allowance be established when it is more likely than not that all or a portion of the deferred tax assets will not be realized. In circumstances where there is sufficient negative evidence indicating that the deferred tax assets are not more likely than not realizable, we establish a valuation allowance. We have recorded valuation allowances in the amounts of $100.8 million and $105.7 million at January 31, 2012 and 2011, respectively. The $4.9 million decrease in the valuation allowance between January 31, 2011 and January 31, 2012 arose primarily as a result of an overall decrease in net deferred tax assets, primarily related to changes in acquired intangibles, deferred revenue and equity compensation.

The recorded valuation allowance consisted of the following at January 31, 2012 and 2011:

	Year Ended January 31,
(in thousands)	2012			2011
Valuation allowance, beginning of year	$	(105,720	)	$	(124,568	)
(Provision for) benefit from income taxes	5,575			13,042
Additional paid-in capital	477			5,771
Acquisitions	(1,663		)	—
Cumulative translation adjustment	489			35
Valuation allowance, end of year	$	(100,842	)	$	(105,720	)

In accordance with the authoritative guidance for accounting for stock-based compensation, we use a “with-and-without” approach to applying the intra-period allocation rules in accordance with accounting for income taxes. Under this approach, the windfall tax benefit is calculated based on the incremental tax benefit received from deductions related to stock-based compensation. The amount is measured by calculating the tax benefit both “with” and “without” the excess tax deduction; the resulting difference between the two calculations is considered the windfall. We did not recognize a windfall benefit in our U.S. income tax provision for the years ended January 31, 2012, 2011, and 2010.

On February 1, 2007, we implemented the provisions of the authoritative guidance on accounting for uncertainty in income taxes. The guidance contains a two-step approach to recognizing and measuring uncertain tax positions. The first step is to determine whether any amount of tax benefit may be recognized by evaluating tax positions taken or expected to be taken in a tax return and assessing whether, based solely on their technical merits, they are more likely than not sustainable upon examination, including resolution of any related appeals or litigation process. The second step is to measure the amount of associated tax benefit that may be recorded for each position as the largest amount that we believe is more likely than not sustainable. Differences between the amount of tax benefits taken or expected to be taken in our income tax returns and the amount of tax benefits recognized in our financial statements, determined by applying the prescribed methodologies of accounting for uncertainty in income taxes, represent our unrecognized income tax benefits, which we either record as a liability or as a reduction of deferred tax assets.

For the years ended January 31, 2012, 2011, and 2010, the aggregate changes in the balance of gross unrecognized tax benefits were as follows:

	Year Ended January 31,
(in thousands)	2012			2011			2010
Gross unrecognized tax benefits, beginning of year	$	32,672		$	37,495		$	35,172
Increases related to tax positions taken during the current year	4,424			4,778			2,715
Increases as a result of acquisitions	2,781			—			—
Increases related to tax positions taken during prior years	1,904			2,271			—
Increases (decreases) related to foreign currency exchange rate fluctuations	(71		)	97			1,545
Reductions for tax positions of prior years	(2,320		)	(10,829		)	(152		)
Reduction for settlements with taxing authorities	—			—			(508		)
Lapses of statutes of limitation	(3,013		)	(1,140		)	(1,277		)
Gross unrecognized tax benefits, end of year	$	36,377		$	32,672		$	37,495

As of January 31, 2012, we had $36.4 million of unrecognized tax benefits, of which $30.7 million represents the amount that, if recognized, would impact the effective income tax rate in future periods. We recorded ($0.7) million, ($0.6) million, and $0.3 million of interest and penalties related to uncertain tax positions in our provision for income taxes for the years ended January 31, 2012, 2011, and 2010, respectively. The accrued liability for interest and penalties was $8.2 million, $6.6 million, and $7.2 million at January 31, 2012, 2011, and 2010, respectively. Interest and penalties are recorded as a component of the provision for income taxes in the consolidated financial statements.

Our income tax returns are subject to ongoing tax examinations in several jurisdictions in which we operate. In the United States, we are no longer subject to federal income tax examination for years prior to January 31, 2008. We are currently in discussions with the Israeli tax authorities regarding adjustments that will be made to income tax returns for the years ended January 31, 2006 through January 31, 2010 due to our restated results of operations. As of January 31, 2012, income tax returns are under examination in the following major tax jurisdictions:

Jurisdiction		Tax Years
Canada		January 31, 2010
United Kingdom		December 31, 2006 - January 31, 2008
Hong Kong		March 31, 2003 - March 31, 2005, January 31, 2006 - January 31, 2007
India		March 31, 2006 - March 31, 2008, March 31, 2010

We regularly assess the adequacy of our provisions for income tax contingencies. As a result, we may adjust the reserves for unrecognized tax benefits for the impact of new facts and developments, such as changes to interpretations of relevant tax law, assessments from taxing authorities, settlements with taxing authorities, and lapses of statutes of expiration. We believe that it is reasonably possible that the total amount of unrecognized tax benefits at January 31, 2012 could decrease by approximately $4.0 million in the next twelve months as a result of settlement of certain tax audits or lapses of statutes of limitation. Such decreases may involve the payment of additional taxes, the adjustment of certain deferred taxes including the need for additional valuation allowances and the recognition of tax benefits. We also believe that it is reasonably possible that new issues may be raised by tax authorities or developments in tax audits may occur which would require increases or decreases to the balance of reserves for unrecognized tax benefits; however, an estimate of such changes cannot reasonably be made.

- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Regulation S-X (SX)
-Number 210
-Section 08
-Paragraph h
-Article 4

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 109
-Paragraph 136, 172
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 109
-Paragraph 43, 44, 45, 46, 47, 48, 49
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 4: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 15
-URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32718-109319

Reference 5: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 9
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-Name Accounting Standards Codification
-Topic 235
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-Paragraph 1
-Subparagraph (SX 210.4-08.(h))
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+ Details

FAIR VALUE MEASUREMENTS

12 Months Ended

Jan. 31, 2012

FAIR VALUE MEASUREMENTS

FAIR VALUE MEASUREMENTS

12. FAIR VALUE MEASUREMENTS

Fair value is defined as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities required to be recorded at fair value, we consider the principal or most advantageous market in which we would transact and consider assumptions that market participants would use when pricing the asset or liability, such as inherent risk, transfer restrictions, and risk of nonperformance.

Accounting guidance establishes a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. An instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. This fair value hierarchy consists of three levels of inputs that may be used to measure fair value:

· Level 1: quoted prices in active markets for identical assets or liabilities;

· Level 2: inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices in active markets for similar assets or liabilities, quoted prices for identical or similar assets or liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities; or

· Level 3: unobservable inputs that are supported by little or no market activity.

Assets and liabilities are classified based on the lowest level of input that is significant to the fair value measurements. We review the fair value hierarchy classification of our applicable assets and liabilities on a quarterly basis. Changes in the observability of valuation inputs may result in transfers within the fair value measurement hierarchy. We did not identify any transfers between levels of the fair value measurement hierarchy during the year ended January 31, 2012.

Assets and Liabilities Measured at Fair Value on a Recurring Basis

Our assets and liabilities measured at fair value on a recurring basis consisted of the following as of January 31, 2012 and 2011:

	January 31, 2012
	Fair Value Hierarchy Category
(in thousands)	Level 1		Level 2		Level 3
Assets:
Money market funds (included in cash and cash equivalents)	$	44,494	$	—	$	—
Foreign currency forward contracts	—		978		—
Total assets	$	44,494	$	978	$	—

Liabilities:
Foreign currency forward contracts	$	—	$	530	$	—
Contingent consideration - business combinations	—		—		38,646
Total liabilities	$	—	$	530	$	38,646

	January 31, 2011
	Fair Value Hierarchy Category
(in thousands)	Level 1		Level 2		Level 3
Assets:
Money market funds (included in cash and cash equivalents)	$	24,505	$	—	$	—
Foreign currency forward contracts	—		88		—
Total assets	$	24,505	$	88	$	—

Liabilities:
Foreign currency forward contracts	$	—	$	1,886	$	—
Contingent consideration - business combination	—		—		3,686
Total liabilities	$	—	$	1,886	$	3,686

The following table presents the change in the estimated fair value of our liability for contingent consideration measured using significant unobservable inputs (Level 3) for the years ended January 31, 2012 and 2011:

	Year Ended January 31,
(in thousands)	2012			2011
Fair value measurement at beginning of year	$	3,686		$	—
Contingent consideration liability recorded for business combinations	42,404			3,424
Change in fair value recorded in operating expenses	(3,337		)	262
Payments of contingent consideration	(4,107		)	—
Fair value measurement at end of year	$	38,646		$	3,686

Our estimated liability for contingent consideration represents potential payments of additional consideration for business combinations, payable if certain defined performance goals are achieved. Changes in fair value of contingent consideration are recorded in the consolidated statements of operations within selling, general and administrative expenses.

Fair Value Measurements

Money Market Funds - We value our money market funds using quoted market prices for such funds.

Foreign Currency Forward Contracts - The estimated fair value of foreign currency forward contracts is based on quotes received from the counterparties thereto. These quotes are reviewed for reasonableness by discounting the future estimated cash flows under the contracts, considering the terms and maturities of the contracts and market exchange rates using readily observable market prices for similar contracts.

Contingent Consideration — Business Combinations - The fair value of the contingent consideration related to business combinations is estimated using a probability-adjusted discounted cash flow model. These fair value measurements are based on significant inputs not observable in the market. The key assumptions used in these models are discount rates and the probabilities assigned to the milestones to be achieved. We remeasure the fair value of the contingent consideration at each reporting period, and any changes in fair value resulting from either the passage of time or events occurring after the acquisition date, such as changes in the probability of achieving the performance target, are recorded in earnings.

Other Financial Instruments

The carrying amounts of accounts receivable, accounts payable and accrued liabilities approximate fair value due to their short maturities.

As of January 31, 2012, the estimated fair value of our term loan borrowings was $597.0 million. As of January 31, 2011, the estimated fair value of our term loan was $586.2 million. The estimated fair value of the term loan is based upon the estimated bid and ask prices as determined by the agent responsible for the syndication of our term loan.

Assets and Liabilities Not Measured at Fair Value on a Recurring Basis

In addition to assets and liabilities that are measured at fair value on a recurring basis, we also measure certain assets and liabilities at fair value on a nonrecurring basis. Our non-financial assets, including goodwill, intangible assets and property, plant and equipment, are measured at fair value when there is an indication of impairment and the carrying amount exceeds the asset’s projected undiscounted cash flows. These assets are recorded at fair value only when an impairment charge is recognized. Further details regarding our regular impairment reviews appear in Note 1, “Summary of Significant Accounting Policies”.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References

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-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 133
-Paragraph 44A, 44B
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
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-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
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-Subparagraph a-d
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Reference 5: http://www.xbrl.org/2003/role/presentationRef
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Reference 6: http://www.xbrl.org/2003/role/presentationRef
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+ Details

DERIVATIVE FINANCIAL INSTRUMENTS

12 Months Ended

Jan. 31, 2012

DERIVATIVE FINANCIAL INSTRUMENTS

DERIVATIVE FINANCIAL INSTRUMENTS

13. DERIVATIVE FINANCIAL INSTRUMENTS

Our primary objective for holding derivative financial instruments is to manage foreign currency exchange rate risk and interest rate risk, when deemed appropriate. We enter into these contracts in the normal course of business to mitigate risks and not for speculative purposes.

Foreign Currency Forward Contracts

Under our risk management strategy, we periodically use derivative instruments to manage our short-term exposures to fluctuations in foreign currency exchange rates. We utilize foreign exchange forward contracts to hedge certain operational cash flow exposures resulting from changes in foreign currency exchange rates. These cash flow exposures result from portions of our forecasted operating expenses, primarily compensation and related expenses, which are transacted in currencies other than the U.S. dollar, primarily the Israeli shekel and the Canadian dollar. We also periodically utilize foreign currency forward contracts to manage exposures resulting from forecasted customer collections to be remitted in currencies other than the applicable functional currency. Our joint venture, which has a Singapore dollar functional currency, also utilizes foreign exchange forward contracts to manage its exposure to exchange rate fluctuations related to settlement of liabilities denominated in U.S. dollars. These foreign currency forward contracts are reported at fair value on our consolidated balance sheets and generally have maturities of no longer than twelve months, although occasionally we will execute a contract that extends beyond twelve months, depending upon the nature of the underlying risk.

The counterparties to our derivative financial instruments consist of several major international financial institutions. We regularly monitor the financial strength of these institutions. While the counterparties to these contracts expose us to credit-related losses in the event of a counterparty’s non-performance, the risk would be limited to the unrealized gains on such affected contracts. We do not anticipate any such losses.

Certain of these foreign currency forward contracts are not designated as hedging instruments under accounting guidance for derivatives, and gains and losses from changes in their fair values are therefore reported in other income (expense), net. Changes in the fair values of foreign currency forward contracts that are designated and effective as cash flow hedges are recorded net of related tax effects in accumulated other comprehensive income (loss), and are reclassified to the consolidated statement of operations when the effects of the item being hedged are recognized in the consolidated statement of operations.

Interest Rate Swap Agreement

On May 25, 2007, concurrently with entry into our credit facility, we executed a pay-fixed/ receive-variable interest rate swap agreement with a high credit-quality multinational financial institution to mitigate a portion of the risk associated with variable interest rates on the term loan. We recorded losses of $3.1 million on the interest rate swap for the year ended January 31, 2011. In July 2010, we terminated this interest rate swap agreement.

The interest rate swap agreement was not designated as a hedging instrument under accounting guidance for derivatives, and gains and losses from changes in its fair value were therefore reported in other income (expense), net.

Notional Amounts of Derivative Financial Instruments

Our outstanding derivative financial instruments consisted only of foreign currency forward contracts with notional amounts of $94.1 million and $51.1 million as of January 31, 2012 and January 31, 2011, respectively.

Fair Values of Derivative Financial Instruments

The fair values of our derivative financial instruments as of January 31, 2012 and 2011 were as follows:

	January 31, 2012
	Assets			Liabilities
(in thousands)	Balance Sheet Classification	Fair Value		Balance Sheet Classification	Fair Value
Derivative financial instruments designated as hedging instruments:
Foreign currency forward contracts	Prepaid expenses and other current assets	$	978	Accrued expenses and other liabilities	$	227
Total derivative financial instruments designated as hedging instruments		$	978		$	227

Derivative financial instruments not designated as hedging instruments:
Foreign currency forward contracts	—	$	—	Accrued expenses and other liabilities	$	303
Total derivative financial instruments not designated as hedging instruments		$	—		$	303

	January 31, 2011
	Assets			Liabilities
(in thousands)	Balance Sheet Classification	Fair Value		Balance Sheet Classification	Fair Value
Derivative financial instruments designated as hedging instruments:
Foreign currency forward contracts	Prepaid expenses and other current assets	$	88	Accrued expenses and other liabilities	$	396
Total derivative financial instruments designated as hedging instruments		$	88		$	396

Derivative financial instruments not designated as hedging instruments:
Foreign currency forward contracts		$	—	Accrued expenses and other liabilities	$	1,490
Total derivative financial instruments not designated as hedging instruments		$	—		$	1,490

Derivative Financial Instruments in Cash Flow Hedging Relationships

The effects of derivative financial instruments in cash flow hedging relationships for the years ended January 31, 2012 and 2011 were as follows:

	Net Gains (Losses) Recognized in Accumulated Other Comprehensive Loss					Classification of Net Gains (Losses) Reclassified from Other Comprehensive Loss into	Net Gains (Losses) Reclassified from Other Accumulated Comprehensive Loss into the Consolidated Statements of Operations
	January 31,					the Consolidated	Year Ended January 31,
(in thousands)	2012		2011			Statements of Operations	2012			2011
Foreign currency forward contracts	$	666	$	(245	)	Operating Expenses	$	(373	)	$	925

There were no gains or losses from ineffectiveness of these hedges recorded for the years ended January 31, 2012 and 2011. All of the foreign currency forward contracts underlying the $0.7 million of net gains recorded in our Accumulated Other Comprehensive Loss at January 31, 2012 mature within twelve months, and therefore we expect all such gains to be reclassified into earnings within the next twelve months.

Derivative Financial Instruments Not Designated as Hedging Instruments

Losses recognized on derivative financial instruments not designated as hedging instruments in our consolidated statements of operations for the years ended January 31, 2012, 2011, and 2010 were as follows:

	Classification in Consolidated Statement	Year Ended January 31,
(in thousands)	of Operations	2012			2011			2010
Interest rate swap agreement	Other expense, net	$	—		$	(3,102	)	$	(13,591	)
Foreign currency forward contracts	Other expense, net	(896		)	(2,761		)	(1,118		)
Total		$	(896	)	$	(5,863	)	$	(14,709	)

- Definition

The entire disclosure for the entity's entire derivative instruments and hedging activities. Describes an entity's risk management strategies, derivatives in hedging activities and non-hedging derivative instruments, the assets, obligations, liabilities, revenues and expenses arising therefrom, and the amounts of and methodologies and assumptions used in determining the amounts of such items.

+ References

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-Name Statement of Financial Accounting Standard (FAS)
-Number 133
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+ Details

STOCK-BASED COMPENSATION AND OTHER BENEFIT PLANS

12 Months Ended

Jan. 31, 2012

STOCK-BASED COMPENSATION AND OTHER BENEFIT PLANS

STOCK-BASED COMPENSATION AND OTHER BENEFIT PLANS

14. STOCK-BASED COMPENSATION AND OTHER BENEFIT PLANS

Stock-Based Compensation Plans

Plan Summaries

Our stock-based incentive awards are provided to employees and directors under the terms of our multiple outstanding stock benefit plans (the “Plans” or “Stock Plans”) and/or forms of equity award agreements approved by the board of directors.

The 1996 Stock Incentive Compensation Plan, as amended (the “1996 Plan”), was approved by our stockholders and became effective on September 10, 1996. The 1996 Plan allowed for the granting of awards of deferred stock, restricted stock awards (“RSAs”) and restricted stock units (“RSUs”), incentive and non-qualified stock options, and stock appreciation rights to our employees, directors, and consultants. The deadline for making new awards under the 1996 Plan was March 10, 2012.

On May 25, 2007, in connection with the acquisition of Witness, we assumed a stock plan referred to as the Witness Systems, Inc. Amended and Restated Stock Incentive Plan, as amended (the “1997 Plan”). Under the 1997 Plan, we were permitted to grant awards of deferred stock, RSAs, and RSUs, incentive and non-qualified stock options, and stock appreciation rights to our employees, directors, and consultants. The 1997 Plan contained an evergreen provision, which allowed for an increase in the number of shares available for issuance, up to a maximum of 3.0 million shares per year. The deadline for making new awards under the 1997 Plan was November 18, 2009. Additionally, in connection with the acquisition of Witness, we assumed certain new-hire inducement grants made by Witness outside of its shareholder-approved equity plans prior to May 25, 2007.

Terminations of the 1996 Plan and 1997 Plan did not affect outstanding awards under those Plans, which remain in effect until such awards shall have been exercised or shall have expired in accordance with their terms.

Our stockholders approved the 2004 Stock Incentive Compensation Plan (the “2004 Plan”) on July 27, 2004. Under the 2004 Plan, we are permitted to grant awards of deferred stock, RSAs and RSUs, incentive and non-qualified stock options, and stock appreciation rights to our employees, directors, and consultants. To the extent not used under the 1996 Plan, the shares available pursuant to the 2004 Plan may be increased by a maximum of 1.0 million shares for awards granted under the 1996 Plan that are forfeited, expire, or are cancelled on or after July 28, 2004. The 2004 Plan will remain in full force and effect until the earlier of July 27, 2014 or the date it is terminated by our board of directors. Termination of the 2004 Plan shall not affect awards outstanding under the 2004 Plan at the time of termination.

On October 5, 2010, our stockholders approved the 2010 Long-Term Stock Incentive Plan (the “2010 Plan”). Under the 2010 Plan, we are permitted to grant stock options (both incentive and non-qualified), stock appreciation rights, RSAs, RSUs, performance awards, performance compensation awards or other awards to eligible employees, directors and consultants (“Participants”). The 2010 Plan provides that the amount may not exceed, in the aggregate, 4.0 million shares of common stock, subject to adjustments as provided for in the 2010 Plan. No grant will be made under the 2010 Plan more than ten years after the date on which the 2010 Plan is first approved by our board of directors, but all grants made on or prior to such date will continue in effect thereafter subject to the terms and of the 2010 Plan.

On August 4, 2011, in connection with the acquisition of Vovici, we assumed a stock plan referred to as the Vovici 2006 Amended and Restated Stock Plan, as amended (the “Vovici Plan”). Under the Vovici Plan, we were permitted to grant stock options (both incentive and nonstatutory), stock purchase rights, and restricted stock units. The Vovici Plan shall continue in effect until July 28, 2020. However, our board of directors may at any time amend, alter, suspend, or terminate the Vovici Plan.

The table below summarizes key information for the Plans as of January 31, 2012:

(in thousands)	Number of Shares Reserved for Grants	Number of Shares Outstanding	Number of Shares Available for Grants
The 1996 Plan	5,000	671	191
The 1997 Plan	6,400	35	—
The 1997 Blue Pumpkin inducement grants	158	—	—
The 2004 Plan	3,000	824	307
The 2010 Plan	4,000	1,001	1,337
The Vovici Plan	317	34	275
Total	18,875	2,565	2,110

As presented in the table above, the number of shares outstanding excludes, and the number of shares available for grants has not been reduced for, approximately 0.5 million RSUs awarded to officers which are subject to future performance vesting conditions not yet established by our board. Under applicable accounting guidance, if an award is subject to a performance vesting condition, an accounting grant date for the award is generally not established until the performance vesting condition has been defined and communicated.

Awards are generally subject to multi-year vesting periods and generally expire 10 years or less after the date of grant. We recognize compensation expense for awards on a straight-line basis over the life of the vesting period, reduced by estimated forfeitures. Upon exercise of stock options, issuance of restricted stock, or issuance of shares under the Plans, we generally issue new shares of common stock, but occasionally may issue treasury shares.

Stock-Based Compensation Expense

As described in Note 1, “Summary of Significant Accounting Policies”, we recognize stock-based compensation expense based on the grant date fair value of stock-based awards granted to employees and others.

We recognized stock-based compensation expense in the following line items on the consolidated statements of operations for the years ended January 31, 2012, 2011, and 2010:

	Year Ended January 31,
(in thousands, except per share amounts)	2012		2011		2010
Component of income before provision for income taxes:
Cost of revenue - product	$	883	$	1,595	$	1,302
Cost of revenue - service and support	2,424		4,612		4,543
Research and development, net	3,060		7,081		7,960
Selling, general and administrative	21,544		33,531		30,422
Stock-based compensation expense	27,911		46,819		44,227

Income tax benefits related to stock-based compensation (before consideration of valuation allowance)	7,175		12,165		11,716
Stock-based compensation, net of taxes	$	20,736	$	34,654	$	32,511

Impact on net income per common share attributable to Verint Systems Inc. :

Basic	$	0.54	$	1.00	$	1.00
Diluted	$	0.52	$	0.93	$	0.98

The following table summarizes stock-based compensation expense by type of award for the years ended January 31, 2012, 2011, and 2010:

	Year Ended January 31,
(in thousands)	2012		2011		2010
Component of stock-based compensation expense:
Stock options	$	723	$	3,135	$	7,332
Restricted stock awards and restricted stock units	21,414		25,583		23,917
Phantom stock units	2,533		18,101		12,978
Stock bonus program	3,241		—		—
Stock-based compensation expense	$	27,911	$	46,819	$	44,227

The table above includes stock-based compensation amounts where we modified certain option awards to revise exercising terms for certain terminated employees and recognized incremental compensation expense of $0.1 million and $0.2 million for the years ended January 31, 2011, and 2010, respectively. No amount was recognized for the year ended January 31, 2012. Participants in the Plans were restricted from exercising options due to our inability to use our Registration Statement on Form S-8 during our previous extended filing delay period. As such, we modified grants held by terminated employees by extending the time a terminated employee would normally have to exercise vested stock option awards. The number of employees affected under such modifications was 36 and 54 for the years ended January 31, 2011 and 2010, respectively. No employees were affected for the year ended January 31, 2012.

Total stock-based compensation expense by classification was as follows for the years ended January 31, 2012, 2011, and 2010:

	Year Ended January 31,
(in thousands)	2012		2011		2010
Equity-classified awards	$	21,781	$	28,784	$	31,195
Liability-classified awards	6,130		18,035		13,032
Total stock-based compensation expense	$	27,911	$	46,819	$	44,227

Our liability-classified awards include our phantom stock awards, the values of which track the market price of our common stock and are therefore subject to volatility, and which are settled with cash payments equivalent to the market value of our common stock upon vesting. Awards under our Stock Bonus Program, which are settled with a variable number of shares of common stock determined using a discounted average price of our common stock, as defined in the program, are also liability-classified awards. Upon settlement of certain liability-classified awards with equity, compensation expense associated with those awards is reported within equity-classified awards in the table above.

Net excess tax benefits resulting from our Stock Plans were $0.7 million for the year ended January 31, 2012 and were recorded as increases to additional paid-in capital. We did not recognize excess tax benefits for the years ended January 31, 2011, and 2010. Excess tax benefits represent a reduction in income taxes otherwise payable during the period, attributable to the actual gross tax benefits in excess of the expected tax benefits.

Stock Options

When stock options are awarded, the fair value of the options is estimated on the date of grant using the Black-Scholes option-pricing model. Expected volatility and the expected term are the input factors to that model that require the most significant management judgment. Expected volatility is estimated utilizing daily historical volatility over a period that equates to the expected life of the option. The expected life (estimated period of time outstanding) is estimated using the historical exercise behavior of employees. The risk-free interest rate is the implied daily yield currently available on U.S. Treasury issues with a remaining term closely approximating the expected term used as the input to the Black-Scholes option pricing model.

We generally did not grant stock options during the years ended January 31, 2012, 2011, and 2010. However, in connection with our acquisition of Vovici on August 4, 2011, stock options to purchase Vovici common stock were converted into stock options to purchase approximately 42,000 shares of our common stock.

The fair values of the options granted August 2011 in connection with the acquisition of Vovici were estimated using a Black-Scholes option pricing model with the weighted-average assumptions presented in the following table:

Expected Life (in years)	5.43
Risk-free interest rate	1.26	%
Expected volatility	50.40	%
Dividend Yield	0	%

We utilized the simplified method to calculate the expected lives of options granted to Vovici employees due to the limited data available regarding the exercise patterns of Vovici option holders.

The following table summarizes stock option activity under the Plans for the years ended January 31, 2012, 2011, and 2010:

	Year Ended January 31,
	2012				2011				2010
(in thousands, except exercise prices)	Stock Options		Weighted- Average Exercise Price		Stock Options		Weighted- Average Exercise Price		Stock Options		Weighted- Average Exercise Price
Beginning balance	1,767		$	27.33	4,731		$	23.16	5,225		$	22.36
Granted	42		$	9.28	—		$	—	—		$	—
Exercised	(623	)	$	20.51	(2,164	)	$	18.88	—		$	—
Forfeited	—		$	—	(4	)	$	23.94	(30	)	$	21.69
Expired	(72	)	$	28.07	(796	)	$	25.56	(464	)	$	14.23
Ending balance	1,114		$	30.40	1,767		$	27.33	4,731		$	23.16
Stock options exercisable	1,083		$	31.03	1,764		$	27.33	4,499		$	23.24

As of January 31, 2012, the aggregate intrinsic value for the options vested and exercisable was $2.2 million with a weighted-average remaining contractual life of 2.6 years. Additionally, there were 1.1 million options vested and expected to vest with a weighted-average exercise price of $30.5 per share and an aggregate intrinsic value of $2.8 million with a weighted-average remaining contractual life of 2.8 years.

The unrecognized compensation expense calculated under the fair value method for options expected to vest (unvested shares net of expected forfeitures) as of January 31, 2012 was $0.6 million and is expected to be recognized over a weighted-average period of 2.8 years.

The following table summarizes information about stock options as of January 31, 2012:

	Options Outstanding				Options Exercisable
(number of options in thousands)	Number of Options	Weighted- Average Remaining Contractual Term	Weighted- Average Exercise		Number of Options	Weighted- Average Exercise
Range of Exercise Prices	Outstanding	(years)	Price		Exercisable	Price
$ 4.93 - $17.00	141	2.85	$	13.87	111	$	15.28
$ 17.98 - $23.00	138	1.85	$	22.62	137	$	22.65
$ 28.41 - $28.41	42	2.22	$	28.41	42	$	28.41
$ 28.60 - $28.60	8	0.08	$	28.60	8	$	28.60
$ 29.27 - $29.27	8	0.23	$	29.27	8	$	29.27
$ 31.78 - $31.78	18	2.43	$	31.78	18	$	31.78
$ 32.16 - $32.16	15	3.27	$	32.16	15	$	32.16
$ 34.40 - $34.40	137	3.95	$	34.40	137	$	34.40
$ 35.11 - $35.11	583	2.82	$	35.11	583	$	35.11
$ 37.99- $37.99	24	3.64	$	37.99	24	$	37.99
$ 4.93 - $37.99	1,114	2.80	$	30.41	1,083	$	31.03

The following table summarizes key data points for exercised options:

	Year Ended January 31,
(in thousands)	2012		2011		2010
Intrinsic value of options exercised	$	8,034	$	18,430	$	—
Cash received from the exercise of stock options	$	12,474	$	40,787	$	—
Tax benefits realized from stock options exercised	$	3,219	$	3,391	$	—
Fair value of options vested	$	20,413	$	30,209	$	69,575

Restricted Stock Awards and Restricted Stock Units

Stock awards are granted in the form of RSAs and RSUs. The fair value of these awards is equivalent to the market value of our common stock on the grant date. The principal difference between these instruments is that RSUs are not shares of our common stock and do not have any of the rights or privileges thereof, including voting or dividend rights. On the applicable vesting date, the holder of an RSU becomes entitled to a share of our common stock. Both RSAs and RSUs are subject to certain restrictions and forfeiture provisions prior to vesting.

We have granted RSUs to executive officers and certain employees that require us to estimate the expected achievement of performance targets over the performance period. The expense associated with such awards is included in our stock-based compensation expense.

During the year ended January 31, 2010, we removed certain performance vesting conditions for certain restricted stock units granted to executive officers prior to the year ended January 31, 2010 as a result of the amendment of time-based and performance-based equity award agreements. The removals of the performance vesting conditions were accounted for as modifications, based upon our assessment. As a result of the modifications of the vesting conditions, additional stock-based compensation expense of $2.6 million was recognized during the year ended January 31, 2010.

RSUs that settle, or are expected to settle, with cash payments upon vesting are reflected as liabilities on our consolidated balance sheets.

The following table summarizes RSA and RSU activity under the Plans for the years ended January 31, 2012, 2011, and 2010:

	Year Ended January 31,
	2012				2011				2010
(in thousands, except grant-date fair values)	Shares		Weighted- Average Grant-Date Fair Value		Shares		Weighted- Average Grant-Date Fair Value		Shares		Weighted- Average Grant-Date Fair Value
Beginning balance	1,935		$	18.09	3,412		$	14.92	1,830		$	24.48
Granted	902		$	34.84	1,102		$	26.01	1,812		$	6.50
Released	(1,336	)	$	15.72	(2,503	)	$	17.39	(116	)	$	29.93
Forfeited	(51	)	$	28.85	(76	)	$	13.23	(114	)	$	19.94
Ending balance	1,450		$	30.25	1,935		$	18.09	3,412		$	14.92

The unrecognized compensation expense related to 1.4 million unvested RSUs expected to vest as of January 31, 2012 was approximately $20.2 million, with remaining weighted-average vesting periods of approximately 1.3 years, over which such expense is expected to be recognized. The total fair value of restricted stock units vested during the years ended January 31, 2012, 2011, and 2010 was $21.0 million, $43.5 million, and $3.5 million, respectively.

Phantom Stock Units

During the year ended January 31, 2007, we began awarding phantom stock units to non-officer employees that settle, or are expected to settle, with cash payments upon vesting, pursuant to the terms of a form of a phantom stock award agreement approved by the board of directors or under the 2010 Plan. Phantom stock units provide for the payment of a cash bonus equivalent to the value of our common stock as of the vesting date of the award. Phantom stock units generally have a multi-year vesting and are generally subject to the same vesting conditions as equity awards granted on the same date. We recognize compensation expense for phantom stock units on a straight-line basis, reduced by estimated forfeitures. Phantom stock units are being accounted for as liabilities and as such their value tracks our stock price and is subject to market volatility.

The total accrued liability for phantom stock units was $1.9 million, $9.8 million, and $14.5 million as of January 31, 2012, 2011, and 2010, respectively. Total cash payments made upon vesting of phantom stock units were $10.3 million, $22.9 million, and $2.5 million for the years ended January 31, 2012, 2011, and 2010, respectively.

The following table summarizes phantom stock unit activity for the years ended January 31, 2012, 2011, and 2010:

	Year Ended January 31,
(in thousands)	2012		2011		2010
Beginning balance, in units	403		1,106		1,239
Granted	10		196		421
Released	(298	)	(865	)	(482	)
Forfeited	(25	)	(34	)	(72	)
Ending balance, in units	90		403		1,106

The phantom stock units granted during the years ended January 31, 2012, 2011, and 2010 primarily vest over two-year and three-year periods, subject to applicable performance conditions.

The unrecognized compensation expense related to 90,000 unvested phantom stock units expected to vest as of January 31, 2012 was approximately $0.5 million, based on our stock price of $28.28 at January 31, 2012 with a remaining weighted-average vesting period of approximately 0.7 years over which such expense is expected to be recognized.

Stock Bonus Program

In September 2011, our board of directors approved, and in December 2011 revised, a Stock Bonus Program under which eligible employees may receive a portion of their bonus for the year or for the fourth quarter (depending on the employee’s bonus plan) in the form of fully vested shares of our common stock. As of the date hereof, executive officers are not eligible to participate in this program. This program is subject to annual funding approval by our board of directors and an annual cap on the number of shares that can be issued. Subject to these limitations, the number of shares to be issued under the program for a given year is determined using a five-day trailing average price of our common stock when the awards are calculated, reduced by a discount to be determined by the board of directors each year. To the extent that this program is not funded in a given year or the number of shares of common stock needed to fully satisfy employee enrollment exceeds the annual cap, the applicable portion of the employee bonuses will generally revert to being paid in cash. All shares of common stock awarded pursuant to this program will be issued under one of our stockholder-approved equity incentive plans.

For the year ended January 31, 2012, our board of directors approved up to 150,000 shares of common stock for awards under this program and a discount of 20%. Shares of common stock earned under this program for the year ended January 31, 2012 are expected to be issued during the first half of the year ending January 31, 2013. We recognized $3.2 million of compensation expense for the Stock Bonus Program for the year ended January 31, 2012.

Tandem and Hybrid Awards

We issued grants known as “tandem” awards to certain of our Israeli employees during the year ended January 31, 2009. These tandem awards included two components - a share of deferred stock and a share of phantom stock. The recipient received two different units and two separate award agreements. The tandem awards were structured such that, on any given vesting date, only one component of the awards vested. The tandem awards were being accounted for as liabilities based on our assessment that the tandem awards would likely be settled in phantom stock units upon vesting.

We also issued grants known as “hybrid” awards to our employees during the year ended January 31, 2009 which vested in restricted stock units upon the achievement of certain performance conditions that were set by our board of directors. In the event that any of the stock-settle conditions were not satisfied on the vesting date, no shares of common stock were issued and instead we settled these awards with cash payments equal to the fair market value (as defined in the award agreement) of our common stock on the vesting date. These hybrid awards were being accounted for as liabilities based upon our assessment that the hybrid awards would likely be settled in cash upon vesting.

As of January 31, 2011, the “tandem” awards and “hybrid” awards were fully settled.

Employee Stock Purchase Plan

Effective September 1, 2002, we adopted and implemented the 2002 Employee Stock Purchase Plan (“ESPP”), which was amended and restated, on May 22, 2003. Any employee who had completed three months of employment and was employed by us on the applicable offering commencement date was eligible to participate in the ESPP. Participants elected to have amounts withheld through payroll deductions at the rate of up to 10% of their annualized base salary, to purchase shares of our common stock at 85% of the lesser of the market price at the offering commencement date or the offering termination date.

The number of shares available under the ESPP is 1.0 million, of which approximately 260,000 have been issued. The ESPP was suspended in March 2006 in connection with the beginning of our previous extended filing delay period and remained inactive as of January 31, 2012.

No expense related to the ESPP was recorded during the years ended January 31, 2012, 2011, and 2010 due to the suspension of the ESPP during those periods.

401(k) Plan and Other Retirement Plans

We maintain a 401(k) Plan for our full-time employees in the United States. The plan allows eligible employees who attain the age of 21 with three months of service to elect to contribute up to 60% of their annual compensation, subject to the prescribed maximum amount. We match employee contributions at a rate of 50%, up to a maximum annual matched contribution of $2,000 per employee.

Employee contributions are always fully vested, while our matching contributions for each year vest on the last day of the calendar year provided the employee remains employed with us on that day.

Our matching contribution expense for our 401(k) Plan was $1.5 million, $1.4 million, and $1.2 million for the years ended January 31, 2012, 2011, and 2010, respectively.

We provide retirement benefits for non-U.S. employees as required by local laws or to a greater extent as we deem appropriate through plans that function similar to 401(k) plans. Funding requirements for programs required by local laws are determined on an individual country and plan basis and are subject to local country practices and market circumstances.

Liability for Severance Pay

We are obligated to make severance payments for the benefit of certain employees of our foreign subsidiaries. Severance payments made to Israeli employees are considered significant compared to all other subsidiaries with severance payment arrangements. Under Israeli law, we are obligated to make severance payments to employees of our Israeli subsidiaries, subject to certain conditions. In most cases, our liability for these severance payments is fully provided for by regular deposits to funds administered by insurance providers and by an accrual for the amount of our liability which has not yet been deposited.

Severance expenses for the years ended January 31, 2012, 2011, and 2010, were $5.2 million, $4.0 million, and $3.4 million, respectively.

- Definition

The entire disclosure for compensation costs, including compensated absences accruals, compensated absences liability, deferred compensation arrangements and income statement compensation items. Deferred compensation arrangements may include a description of an arrangement with an individual employee, which is generally an employment contract between the entity and a selected officer or key employee containing a promise by the employer to pay certain amounts at designated future dates, usually including a period after retirement, upon compliance with stipulated requirements. This type of arrangement is distinguished from broader based employee benefit plans as it is usually tailored to the employee. Disclosure also typically includes the amount of related compensation expense recognized during the reporting period, the number of shares (units) issued during the period under such arrangements, and the carrying amount as of the balance sheet date of the related liability.

+ References + Details

RELATED PARTY TRANSACTIONS

12 Months Ended

Jan. 31, 2012

RELATED PARTY TRANSACTIONS

RELATED PARTY TRANSACTIONS

15. RELATED PARTY TRANSACTIONS

Relationships with Comverse and its Other Subsidiaries

Preferred Stock Financing

On May 25, 2007, in connection with our acquisition of Witness, we entered into the Securities Purchase Agreement with Comverse pursuant to which Comverse purchased, for cash, an aggregate of 293,000 shares of our preferred stock for $293.0 million. In connection with the sale of the preferred stock we entered into the New Registration Rights Agreement with Comverse. Further details regarding the preferred stock and the related registration rights agreement appear within Note 8, “Convertible Preferred Stock”.

Original Registration Rights Agreement

Shortly before our IPO in 2002, we entered into the Original Registration Rights Agreement with Comverse that covered all shares of common stock then held by Comverse and any additional shares of common stock acquired by Comverse at a later date. Under the Original Registration Rights Agreement, Comverse was provided the right to demand registration of its shares on a stand-alone filing, or to participate in other registrations we may undertake (piggyback rights). In addition, we are required to pay registration-related expenses and indemnify Comverse from liabilities that may arise from sale of shares registered pursuant to the Original Registration Rights Agreement.

Comverse exercised its one demand registration right under the Original Registration Rights Agreement in July 2010, demanding that we prepare and file with the SEC a registration statement on Form S-1 so as to permit the public offering and sale of up to 2.8 million shares of our common stock owned by Comverse. In connection with the exercise of this demand, we entered into a letter agreement with Comverse pursuant to which we agreed not to exercise our rights under the Original Registration Rights Agreement to delay the filing of, or offer shares pursuant to, the prospectus, subject to certain limitations. Comverse subsequently reduced the size of the offering to 2.3 million shares. A registration statement relating to these securities was filed with the SEC, and in January 2011, was declared effective.

Service and Tax Agreements with Comverse

There were, and still are, several agreements in place between us and Comverse and its other subsidiaries, which were executed prior to our IPO in order to allow us to continue to receive certain services from Comverse and its other subsidiaries following our IPO. A separate agreement clarifies the income tax relationship between us and Comverse. Since our IPO, we have established our own systems and reduced or eliminated our reliance on these services. Activity under the service agreements was not significant during the three years ended January 31, 2012. As of January 31, 2012 and 2011, we had liabilities to Comverse for past services under these agreements of $1.8 million at each date, which are presented as liabilities to affiliates on our consolidated balance sheets at those dates. The following is an overview of certain of these agreements with Comverse:

Satellite Services Agreement

Under the Satellite Services Agreement, Comverse Inc., a subsidiary of Comverse, formerly provided us with the exclusive use of the services of specified employees and facilities of Comverse Inc. located in countries where we did not have our own legal presence or facilities. The fee for this service was equal to the expenses Comverse Inc. incurred in providing these services plus ten percent. We did not incur any expenses under this agreement for the years ended January 31, 2012 and 2011. For the year ended January 31, 2010, we recorded expenses of $0.3 million for the services provided by Comverse Inc. under this agreement. We do not anticipate using further services under this agreement in the future.

Federal Income Tax Sharing Agreement

We are party to a tax sharing agreement with Comverse which applies to periods prior to our IPO in which we were included in Comverse’s consolidated federal tax return. By virtue of its controlling ownership and this tax sharing agreement, Comverse effectively controlled all of our tax decisions for periods ending prior to the completion of our IPO, which took place in May 2002. Under the agreement, for periods during which we were included in Comverse’s consolidated tax return, we were required to pay Comverse an amount equal to the tax liability we would have owed, if any, had we filed a federal tax return on our own, as computed by Comverse in its reasonable discretion. Under the agreement, we were not entitled to receive any payments from Comverse in respect of, or to otherwise take advantage of, any loss resulting from the calculation of our separate tax liability. The tax sharing agreement also provided for certain payments in the event of adjustments to the group’s tax liability. The tax sharing agreement continues in effect until 60 days after the expiration of the applicable statute of limitations for the final year in which we were part of the Comverse consolidated group for tax purposes.

Other Related Party Transactions

Our joint venture incurs certain operating expenses, including office rent and other administrative costs, under arrangements with one of its noncontrolling shareholders. These expenses totaled $0.5 million, $0.4 million, and $0.4 million for the years ended January 31, 2012, 2011, and 2010, respectively. The joint venture also recognized $0.2 million, $0.2 million, and $0.7 million of revenue from this noncontrolling shareholder for the years ended January 31, 2012, 2011, and 2010, respectively.

- Definition

The entire disclosure for related party transactions, including the nature of the relationship(s), a description of the transactions, the amount of the transactions, the effects of any change in the method of establishing the terms of the transaction from the previous period, stated interest rate, expiration date, terms and manner of settlement per the agreement with the related party, and amounts due to or from related parties. If the entity and one or more other entities are under common ownership or management control and this control affects the operating results or financial position, disclosure includes the nature of the control relationship even if there are no transactions between the entities. Disclosure may also include the aggregate amount of current and deferred tax expense for each statement of earnings presented where the entity is a member of a group that files a consolidated tax return, the amount of any tax related balances due to or from affiliates as of the date of each statement of financial position presented, the principal provisions of the method by which the consolidated amount of current and deferred tax expense is allocated to the members of the group and the nature and effect of any changes in that method. Examples of related party transactions include transactions between (a) a parent company and its subsidiary; (b) subsidiaries of a common parent; (c) and entity and its principal owners; and (d) affiliates.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Regulation S-X (SX)
-Number 210
-Article 4
-Section 08
-Paragraph k

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Regulation S-X (SX)
-Number 210
-Article 3A
-Section 04
-Paragraph b

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 57
-Paragraph 1-4
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 4: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 850
-SubTopic 10
-Section 50
-Paragraph 4
-URI http://asc.fasb.org/extlink&oid=6457730&loc=d3e39622-107864

Reference 5: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 850
-SubTopic 10
-Section 50
-Paragraph 1
-URI http://asc.fasb.org/extlink&oid=6457730&loc=d3e39549-107864

Reference 6: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 850
-SubTopic 10
-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=6457730&loc=d3e39603-107864

Reference 7: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08.(k))
-URI http://asc.fasb.org/extlink&oid=6881521&loc=d3e23780-122690

Reference 8: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 850
-SubTopic 10
-Section 50
-Paragraph 6
-URI http://asc.fasb.org/extlink&oid=6457730&loc=d3e39691-107864

Reference 9: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 850
-SubTopic 10
-Section 50
-Paragraph 5
-URI http://asc.fasb.org/extlink&oid=6457730&loc=d3e39678-107864

+ Details

COMMITMENTS AND CONTINGENCIES

12 Months Ended

Jan. 31, 2012

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES

16. COMMITMENTS AND CONTINGENCIES

Operating and Capital Leases

We lease office, manufacturing, and warehouse space, as well as certain equipment, under non-cancelable operating lease agreements. We have also periodically entered into capital leases. Terms of the leases, including renewal options and escalation clauses, vary by lease. When determining the term of a lease, we include renewal options that are reasonably assured. The lease agreements generally provide that we pay taxes, insurance, and maintenance expenses related to the leased assets over the initial lease term and those renewal periods that are reasonably assured.

Our facility leases may contain rent escalation clauses or rent holidays, commencing at various times during the terms of the agreements. Rent expense on operating leases with scheduled rent increases or holidays during the lease term is recognized on a straight-line basis. The difference between rent expense and rent paid is recorded as deferred rent. Leasehold improvements are depreciated over the shorter of their economic lives, which begin once the assets are ready for their intended use, or the term of the lease.

Rent expense incurred under all operating leases was $16.3 million, $12.9 million, and $13.1 million for the years ended January 31, 2012, 2011, and 2010, respectively.

As of January 31, 2012, our minimum future rentals under non-cancelable operating and capital leases were as follows:

(in thousands)	Operating		Capital
Years Ending January 31,	Leases		Leases
2013	$	13,212	$	412
2014	9,245		407
2015	9,669		200
2016	8,484		—
2017	5,671		—
2018 and thereafter	32,595		—
Total	$	78,876	1,019
Less amount representing interest			(264		)
Present value of minimum lease payments			$	755

In November 2011, we executed a lease agreement for a new facility in Alpharetta, Georgia. This new facility will be occupied in connection with the expiration of our existing facility lease in Roswell, Georgia at the end of November 2012, and will also include the consolidation of the Atlanta, Georgia office of GMT, which we acquired in October 2011. The lease term extends through September 2026. The aggregate minimum lease commitment over the term of this new lease, excluding operating expenses, is approximately $36.1 million, which is reflected within Operating Leases in the above table.

We sublease certain space to third parties. As of January 31, 2012, total expected future sublease income is $2.8 million and ranges from $0.5 million to $0.6 million on an annual basis through February 2017.

Unconditional Purchase Obligations

In the ordinary course of business, we enter into certain unconditional purchase obligations, which are agreements to purchase goods or services that are enforceable, legally binding, and that specify all significant terms, including: fixed or minimum quantities to be purchased; fixed, minimum, or variable price provisions; and the approximate timing of the transaction. Our purchase orders are based on current needs and are typically fulfilled by our vendors within a relatively short time horizon.

As of January 31, 2012, our unconditional purchase obligations totaled approximately $47.5 million, the majority of which were scheduled to occur within the subsequent twelve months. Due to the relatively short life of the obligations, the carrying value approximates their fair value at January 31, 2012.

Warranty Liability

The following table summarizes the activity in our warranty liability, which is included in accrued expenses and other liabilities in the consolidated balance sheets, for the years ended January 31, 2012, 2011, and 2010.

	Year Ended January 31,
(in thousands)	2012			2011			2010
Warranty liability, beginning of year	$	1,996		$	1,292		$	1,188
Provision charged to expenses	675			957			220
Warranty charges	(389		)	(121		)	(42		)
Foreign currency translation and other	(267		)	(132		)	(74		)
Warranty liability, end of year	$	2,015		$	1,996		$	1,292

We accrue for warranty costs as part of our cost of revenue based on associated product costs, labor costs, and associated overhead. Our Enterprise Intelligence solutions are sold with a warranty of generally one year on hardware and 90 days for software. Our Video Intelligence solutions and Communications Intelligence solutions are sold with warranties that typically range in duration from 90 days to 3 years, and in some cases longer.

Licenses and Royalties

We license certain technology and pay royalties under such licenses and other agreements entered into in connection with research and development activities.

As discussed in Note 1, “Summary of Significant Accounting Policies”, we receive non-refundable grants from the OCS that fund a portion of our research and development expenditures. The Israeli law under which the OCS grants are made limits our ability to manufacture products, or transfer technologies, developed using these grants outside of Israel. If we were to seek approval to manufacture products, or transfer technologies, developed using these grants outside of Israel, we could be subject to additional royalty requirements or be required to pay certain redemption fees. If we were to violate these restrictions, we could be required to refund any grants previously received, together with interest and penalties, and may be subject to criminal penalties.

Preferred Stock Dividends, Conversion, and Redemption

On May 25, 2007, in connection with our acquisition of Witness, we entered into the Securities Purchase Agreement under which Comverse purchased, for cash, an aggregate of 293,000 shares of our preferred stock, for $293.0 million. Upon a fundamental change event, as defined, and subject to certain exceptions, the holders of the preferred stock would have the right to require us to purchase the preferred stock for 100% of the liquidation preference then in effect. Fundamental change events include the sale of substantially all of our assets, and certain changes in beneficial ownership, board of directors’ representation, and business reorganizations. Further information regarding the terms of the preferred stock, including liquidation preferences, dividends, conversion, and redemption rights are included in Note 8, “Convertible Preferred Stock”.

Off-Balance Sheet Risk

In the normal course of business, we provide certain customers with financial performance guarantees, which are generally backed by standby letters of credit or surety bonds. In general, we would only be liable for the amounts of these guarantees in the event that our nonperformance permits termination of the related contract by our customer, which we believe is remote. At January 31, 2012, we had approximately $41.2 million of outstanding letters of credit and surety bonds relating primarily to these performance guarantees. As of January 31, 2012, we believe we were in compliance with our performance obligations under all contracts for which there is a financial performance guarantee, and the ultimate liability, if any, incurred in connection with these guarantees will not have a material adverse effect on our consolidated results of operations, financial position, or cash flows. Our historical non-compliance with our performance obligations has been insignificant.

Indemnifications

In the normal course of business, we provide indemnifications of varying scopes to customers against claims of intellectual property infringement made by third parties arising from the use of our products. Historically, costs related to these indemnification provisions have not been significant and we are unable to estimate the maximum potential impact of these indemnification provisions on our future results of operations.

To the extent permitted under Delaware law or other applicable law, we indemnify our directors, officers, employees, and agents against claims they may become subject to by virtue of serving in such capacities for us. We also have contractual indemnification agreements with our directors, officers, and certain senior executives. The maximum amount of future payments we could be required to make under these indemnification arrangements and agreements is potentially unlimited; however, we have insurance coverage that limits our exposure and enables us to recover a portion of any future amounts paid. We are not able to estimate the fair value of these indemnification arrangements and agreements in excess of applicable insurance coverage, if any.

We are party to a business opportunities agreement with Comverse which addresses potential conflicts of interest between Comverse and us. This agreement allocates between Comverse and us opportunities to pursue transactions or matters that, absent such allocation, could constitute corporate opportunities of both companies. Under the agreement, each party is precluded from pursuing opportunities it may become aware of which are offered to an employee of the other party, even if such employee serves as a director of the other entity. We have agreed to indemnify Comverse and its directors, officers, employees, and agents against any liabilities as a result of any claim that any provision of the agreement, or the failure to offer any business opportunity to us, violates or breaches any duty that may be owed to us by Comverse or any such person. Unless earlier terminated by the parties, the agreement will remain in place until Comverse no longer holds 20% of our voting power and none of our board members serves as a director or employee of Comverse.

Litigation

On March 26, 2009, a motion to approve a class action lawsuit (the “Labor Motion”), and the class action lawsuit itself (the “Labor Class Action”) (Labor Case No. 4186/09), were filed against our subsidiary, Verint Systems Limited (“VSL”), by a former employee of VSL, Orit Deutsch, in the Tel Aviv Labor Court. Ms. Deutsch purports to represent a class of our employees and ex-employees who were granted options to buy shares of Verint and to whom allegedly damages were caused as a result of the blocking of the ability to exercise Verint options by our employees or ex-employees during our previous extended filing delay period. The Labor Class Action seeks compensatory damages for the entire class in an unspecified amount. On July 9, 2009, we filed a motion for summary dismissal and alternatively for the stay of the Labor Motion. On February 8, 2010, the Tel Aviv Labor Court dismissed the case for lack of material jurisdiction and ruled that it would be transferred to the District Court in Tel Aviv. On October 11, 2011, the District Court in Tel Aviv ordered a stay of proceedings until legal proceedings in the United States with respect to related shareholder claims against Comverse are concluded. The parties are expected to update the District Court on any developments in the cases no later than April 4, 2012.

From time to time we or our subsidiaries may be involved in legal proceedings and/or litigation arising in the ordinary course of our business. While the outcome of these matters cannot be predicted with certainty, we do not believe that the outcome of any current claims will have a material effect on our consolidated financial position, results of operations, or cash flows.

- Definition

The entire disclosure for commitments and contingencies.

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+ Details

SEGMENT, GEOGRAPHIC, AND SIGNIFICANT CUSTOMER INFORMATION

12 Months Ended

Jan. 31, 2012

SEGMENT, GEOGRAPHIC, AND SIGNIFICANT CUSTOMER INFORMATION

SEGMENT, GEOGRAPHIC, AND SIGNIFICANT CUSTOMER INFORMATION

17. SEGMENT, GEOGRAPHIC, AND SIGNIFICANT CUSTOMER INFORMATION

Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the enterprise’s chief operating decision maker (“CODM”), or decision making group, in deciding how to allocate resources and in assessing performance. Our Chief Executive Officer is our CODM.

We conduct our business in three operating segments - Enterprise Intelligence Solutions (“Enterprise Intelligence”), Video and Situation Intelligence Solutions (“Video Intelligence”), and Communications and Cyber Intelligence Solutions (“Communications Intelligence”). Our Enterprise Intelligence segment was previously referred to as our Workforce Optimization segment.

Our Enterprise Intelligence solutions help large organizations and small-to-medium sized business organizations to extract and analyze valuable information from customer interactions and related operational and transactional data for the purpose of optimizing the performance of their customer service operations, including contact centers, back offices, branches, and remote locations.

Our Video Intelligence solutions help organizations enhance safety and security by enabling them to deploy an end-to-end IP video solution with integrated analytics or evolve to IP video operations without discarding their investments in analog Closed Circuit Television technology.

Our Communications Intelligence solutions are designed to generate evidence and intelligence and are used to detect and neutralize criminal and terrorist threats.

We measure the performance of our operating segments based upon operating segment revenue and operating segment contribution. Operating segment contribution includes segment revenue and expenses incurred directly by the segment, including material costs, service costs, research and development and selling, marketing, and administrative expenses. We do not allocate certain expenses, which include the majority of general and administrative expenses, facilities and communication expenses, purchasing expenses, manufacturing support and logistic expenses, depreciation and amortization, amortization of capitalized software development costs, stock-based compensation, and special charges such as restructuring costs when calculating operating segment contribution. These expenses are included in the unallocated expenses section of the table presented below. Revenue from transactions between our operating segments is not material.

The accounting policies used to determine the performance of the operating segments are the same as those described in the summary of significant accounting policies in Note 1, “Summary of Significant Accounting Policies”.

Revenue adjustments for the year ended January 31, 2012 represent revenue of acquired companies which is included within segment revenue reviewed by the CODM, but not recognizable within GAAP revenue. These adjustments primarily relate to the acquisition-date excess of the historical carrying value over the fair value of acquired companies’ future maintenance and service performance obligations.

With the exception of goodwill and acquired intangible assets, we do not identify or allocate our assets by operating segment. Consequently, it is not practical to present assets by operating segment. The allocation of goodwill and acquired intangible assets by operating segment appears in Note 5, “Intangible Assets and Goodwill”.

Operating results by segment for the years ended January 31, 2012, 2011, and 2010 were as follows:

	Year Ended January 31,
(in thousands)	2012			2011			2010

Revenue:
Enterprise Intelligence
Segment revenue	$	444,700		$	410,529		$	374,778
Revenue adjustment	(6,682		)	—			—
	438,018			410,529			374,778
Video Intelligence
Segment revenue	140,610			134,012			144,970
Revenue adjustment	(2,594		)	—			—
	138,016			134,012			144,970
Communications Intelligence
Segment revenue	210,937			182,258			183,885
Revenue adjustment	(4,323		)	—			—
	206,614			182,258			183,885

Total revenue	$	782,648		$	726,799		$	703,633

Segment contribution:
Enterprise Intelligence	$	198,428		$	191,068		$	178,674
Video Intelligence	34,697			42,318			57,200
Communications Intelligence	63,296			66,802			62,348
Total segment contribution	296,421			300,188			298,222

Unallocated expenses, net:
Amortization of other acquired intangible assets	35,302			30,554			30,289
Stock-based compensation	27,911			46,819			44,227
Other unallocated expenses	146,730			149,710			158,027
Total unallocated expenses, net	209,943			227,083			232,543
Operating income	86,478			73,105			65,679
Other expense, net	(40,321		)	(34,580		)	(41,471		)
Income before provision for income taxes	$	46,157		$	38,525		$	24,208

Geographic Information

Revenue by major geographic region is based upon the geographic location of the customers who purchase our products. The geographic locations of distributors, resellers, and systems integrators who purchase and resell our products may be different from the geographic locations of end customers. The information below summarizes revenue from unaffiliated customers by geographic area for the years ended January 31, 2012, 2011, and 2010:

	Year Ended January 31,
(in thousands)	2012		2011		2010
United States	$	342,479	$	292,604	$	328,420
United Kingdom	83,787		102,389		65,793
Other	356,382		331,806		309,420
Total revenue	$	782,648	$	726,799	$	703,633

Our long-lived assets primarily consist of net property and equipment, goodwill and other intangible assets, capitalized software development costs, deferred cost of revenue, and deferred income taxes. We believe that our tangible long-lived assets, which consist of our net property and equipment, are exposed to greater geographic area risks and uncertainties than intangible assets and long-term cost deferrals, because these tangible assets are difficult to move and are relatively illiquid.

Property and equipment, net by geographic area consisted of the following as of January 31, 2012 and 2011:

	January 31,
(in thousands)	2012		2011
United States	$	11,406	$	9,322
Israel	10,150		8,221
Germany	2,309		2,474
United Kindgom	2,024		796
Canada	694		371
Other	1,706		1,992
Total property and equipment, net	$	28,289	$	23,176

Significant Customers

No single customer accounted for more than 10% of our total revenue during any of the years ended January 31, 2012, 2011, and 2010.

- Definition

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

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+ Details

SELECTED QUARTERLY FINANCIAL INFORMATION (UNAUDITED)

12 Months Ended

Jan. 31, 2012

SELECTED QUARTERLY FINANCIAL INFORMATION (UNAUDITED)

SELECTED QUARTERLY FINANCIAL INFORMATION (UNAUDITED)

18. SELECTED QUARTERLY FINANCIAL INFORMATION (UNAUDITED)

Summarized consolidated quarterly financial information for the years ended January 31, 2012 and 2011 appears in the following tables:

	Quarter Ended
(in thousands, except per share data)	April 30, 2011			July 31, 2011		October 31, 2011		January 31, 2012
Revenue	$	176,332		$	194,959	$	199,364	$	211,993
Gross profit	120,983			125,850		129,225		138,229
Income before provision for (benefit from) income taxes	3,064			14,437		9,217		19,439
Net income	1,555			11,274		9,921		17,875
Net income (loss) attributable to Verint Systems Inc.	(112		)	10,475		9,451		17,179
Net income (loss) attributable to Verint Systems Inc. common shares:
for basic net income (loss) per common share	(3,661		)	6,768		5,704		13,392
for diluted net income (loss) per common share	(3,661		)	6,768		5,704		13,392

Net income (loss) per common share attributable to Verint Systems Inc.
Basic	$	(0.10	)	$	0.18	$	0.15	$	0.34
Diluted	$	(0.10	)	$	0.17	$	0.15	$	0.34

	Quarter Ended
(in thousands, except per share data)	April 30, 2010			July 31, 2010		October 31, 2010		January 31, 2011
Revenue	$	172,613		$	180,676	$	186,641	$	186,869
Gross profit	114,806			120,330		127,700		125,619
Income (loss) before provision for (benefit from) income taxes	(13,545		)	15,532		23,720		12,818
Net income (loss)	(15,616		)	12,391		18,388		13,422
Net income (loss) attributable to Verint Systems Inc.	(16,208		)	11,475		17,174		13,140
Net income (loss) attributable to Verint Systems Inc. common shares:
for basic net income (loss) per common share	(19,611		)	7,921		13,582		9,511
for diluted net income (loss) per common share	(19,611		)	7,921		17,174		9,511

Net income (loss) per common share attributable to Verint Systems Inc.
Basic	$	(0.60	)	$	0.24	$	0.38	$	0.26
Diluted	$	(0.60	)	$	0.23	$	0.36	$	0.25

Net income (loss) per common share attributable to Verint Systems Inc. is computed independently for each quarterly period and for the year. Therefore, the sum of quarterly net income (loss) per common share amounts may not equal the amounts reported for the years.

The computation of diluted net income per common share attributable to Verint Systems Inc. for the quarter ended October 31, 2010 assumes the conversion of our convertible preferred stock into common stock.

Quarterly operating results for the year ended January 31, 2012 include the following:

· An $8.1 million loss on extinguishment of debt in the three months ended April 30, 2011 associated with the termination of our Prior Credit Agreement.

Quarterly operating results for the year ended January 31, 2011 include the following:

· Professional fees and related expenses associated with our restatement of previously filed financial statements for periods through January 31, 2005 and previous extended filing delay status of approximately $20 million, $6 million, $1 million, and $2 million for the four quarterly periods ended January 31, 2011, respectively.

· Realized and unrealized losses on our interest rate swap of $1.6 million and $1.5 million, for the quarterly periods ended April 30, 2010 and July 31, 2010, respectively.

As is typical for many software and technology companies, our business is subject to seasonal and cyclical factors. Our revenue and operating income are typically highest in the fourth quarter and lowest in the first quarter. Moreover, revenue and operating income in the first quarter of a new year may be lower than in the fourth quarter of the preceding year, potentially by a significant margin. In addition, we generally receive a higher volume of orders in the last month of a quarter, with orders concentrated in the later part of that month. We believe that these seasonal and cyclical factors primarily reflects customer spending patterns and budget cycles, as well as the impact of compensation incentive plans for our sales personnel. While seasonal and cyclical factors such as these are common in the software and technology industry, this pattern should not be considered a reliable indicator of our future revenue or financial performance. Many other factors, including general economic conditions, also have an impact on our business and financial results. See “Risk Factors” under Item 1A for a more detailed discussion of factors which may affect our business and financial results.

- Definition

The entire disclosure for the quarterly financial data in the annual financial statements. The disclosure may include a tabular presentation of financial information for each fiscal quarter for the current and previous year, including revenues, gross profit, income or loss before extraordinary items and earnings per share data. It also includes an indication if the information in the note is unaudited, comments on the aggregate effect of year-end adjustments, and an explanation of matters or transactions that affect comparability or are pertinent to an understanding of the information furnished.

+ References + Details

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)

12 Months Ended

Jan. 31, 2012

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

Basis of Presentation

Use of Estimates

Use of Estimates

Cash and Cash Equivalents

Cash and Cash Equivalents

Restricted Cash and Bank Time Deposits

Restricted Cash and Bank Time Deposits

Investments

Investments

Concentrations of Credit Risk

Concentrations of Credit Risk

Accounts Receivable, Net

Accounts Receivable, Net

Trade accounts receivable are recorded at the invoiced amount and are not interest-bearing.

Allowance for Doubtful Accounts

Allowance for Doubtful Accounts

The following table summarizes the activity in our allowance for doubtful accounts for the years ended January 31, 2012, 2011, and 2010:

	Year Ended January 31,
(in thousands)	2012			2011			2010
Balance at beginning of year	$	5,395		$	4,706		$	5,989
Provisions charged to expense	399			1,832			801
Amounts written off	(2,912		)	(1,126		)	(2,210		)
Other (1)	47			(17		)	126
Balance at end of year	$	2,929		$	5,395		$	4,706

(1) Includes balances from acquisitions and changes in balances due to foreign currency exchange rates.

Inventories

Inventories

Property and Equipment, net

Property and Equipment, net

Goodwill, Other Acquired Intangible Assets, and Long-lived Assets

Goodwill, Other Acquired Intangible Assets, and Long-lived Assets

We did not record any impairment of goodwill for the years ended January 31, 2012, 2011, and 2010.

Our IPR&D assets were acquired during the fourth quarter of the year ended January 31, 2012, and we did not record any impairment of these IPR&D assets for the year ended January 31, 2012.

No impairments of long-lived assets were recorded during the years ended January 31, 2012, 2011, and 2010.

Fair Values of Financial Instruments

Fair Values of Financial Instruments

Derivative Financial Instruments

Derivative Financial Instruments

Long-term Debt

Long-term Debt

Segment Reporting

Segment Reporting

Revenue Recognition

Revenue Recognition

(i)

provide updated guidance on when and how the deliverables in a multiple-deliverable arrangement should be separated, and how the consideration should be allocated;

	(ii)	require an entity to allocate revenue in an arrangement that has separate units of accounting, using estimated selling prices (“ESP”) of deliverables if a vendor does not have vendor-specific objective evidence (“VSOE”) of selling price, or third-party evidence of selling price (“TPE”); and

	(iii)	eliminate the use of the residual method and require an entity to allocate revenue using the relative selling price method to the separate units of accounting.

Our revenue recognition policies, reflecting the impact of the new guidance, are described below.

TPE of selling price is established by evaluating largely similar and interchangeable competitor products or services in stand-alone sales to similarly situated customers.

Under the bell-shaped curve approach of establishing VSOE, we perform VSOE compliance tests to ensure that a substantial majority of our actual PCS renewals are within a narrow range of pricing.

Cost of Revenue

Cost of Revenue

Research and Development, net

Research and Development, net

Software Development Costs

Software Development Costs

Internal-Use Software

Internal-Use Software

Capitalization of such costs was not material during the years ended January 31, 2012, 2011, and 2010.

Income Taxes

Income Taxes

Functional Currency and Foreign Currency Transaction Gains and Losses

Functional Currency and Foreign Currency Transaction Gains and Losses

Stock-Based Compensation

Stock-Based Compensation

Net Income Per Common Share Attributable to Verint Systems Inc.

Net Income Per Common Share Attributable to Verint Systems Inc.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)

12 Months Ended

Jan. 31, 2012

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Summary of activity in allowance for doubtful accounts

	Year Ended January 31,
(in thousands)	2012			2011			2010
Balance at beginning of year	$	5,395		$	4,706		$	5,989
Provisions charged to expense	399			1,832			801
Amounts written off	(2,912		)	(1,126		)	(2,210		)
Other (1)	47			(17		)	126
Balance at end of year	$	2,929		$	5,395		$	4,706

(1) Includes balances from acquisitions and changes in balances due to foreign currency exchange rates.

NET INCOME PER COMMON SHARE ATTRIBUTABLE TO VERINT SYSTEMS INC. (Tables)

12 Months Ended

Jan. 31, 2012

NET INCOME PER COMMON SHARE ATTRIBUTABLE TO VERINT SYSTEMS INC.

Schedule of calculation of basic and diluted net income per common share attributable to Verint Systems Inc.

	Year Ended January 31,
(in thousands, except per share amounts)	2012			2011			2010
Net income	$	40,625		$	28,585		$	17,100
Net income attributable to noncontrolling interest	3,632			3,004			1,483
Net income attributable to Verint Systems Inc.	36,993			25,581			15,617
Dividends on preferred stock	(14,790		)	(14,178		)	(13,591		)
Net income attributable to Verint Systems Inc. for basic net income per common share	22,203			11,403			2,026
Dilutive effect of dividends on preferred stock	—			—			—
Net income attributable to Verint Systems Inc. for diluted net income per common share	$	22,203		$	11,403		$	2,026
Weighted-average shares outstanding:
Basic	38,419			34,544			32,478
Dilutive effect of employee equity award plans	1,080			2,635			649
Dilutive effect of assumed conversion of preferred stock	—			—			—
Diluted	39,499			37,179			33,127
Net income per common share attributable to Verint Systems Inc.
Basic	$	0.58		$	0.33		$	0.06
Diluted	$	0.56		$	0.31		$	0.06

Schedule of anti-dilutive securities

	Year Ended January 31,
(in thousands)	2012	2011	2010
Shares excluded from calculation:
Stock options and restricted stock-based awards	813	1,158	4,714
Convertible preferred stock	10,625	10,223	9,836

BUSINESS COMBINATIONS (Tables)

12 Months Ended

Jan. 31, 2012

BUSINESS COMBINATIONS

Schedule of components and allocations of purchase prices

The following table sets forth the components and the allocations of the purchase prices, some of which are preliminary, for business combinations completed during the year ended January 31, 2012:

(in thousands)	Vovici			GMT			Other
Components of Purchase Price:
Cash	$	55,708		$	24,596		$	33,835
Fair value of contingent consideration	9,900			12,000			20,504
Fair value of stock options	60			—			—
Bank debt, repaid at closing	435			—			—
Other purchase price adjustments	—			—			786
Total purchase price	$	66,103		$	36,596		$	55,125

Allocation of Purchase Price:
Net tangible assets (liabilities):
Accounts receivable	$	1,106		$	512		$	842
Other current assets	5,398			1,717			15,650
Other assets	913			483			5,579
Current and other liabilities	(3,165		)	(1,915		)	(15,419		)
Deferred revenue	(2,264		)	(1,234		)	(944		)
Bank debt	—			—			(3,330		)
Deferred income taxes - current and long-term	(6,021		)	(108		)	(3,587		)
Net tangible assets (liabilities)	(4,033		)	(545		)	(1,209		)
Identifiable intangible assets:
Developed technology	11,300			7,400			10,043
Customer relationships	15,400			6,200			7,460
Trademarks and trade names	1,700			400			1,350
In-process research and development assets	—			—			2,500
Other identifiable intangible assets	—			—			1,421
Total identifiable intangible assets (1)	28,400			14,000			22,774
Goodwill	41,736			23,141			33,560
Total purchase price	$	66,103		$	36,596		$	55,125

(1) The weighted-average estimated useful life of all finite-lived identifiable intangible assets is 7.5 years.

Schedule of unaudited pro forma revenue and net income (loss) as if Vovici and GMT had been acquired on February 1, 2010

	Year Ended January 31,
(in thousands)	2012		2011
Revenue	$	804,006	$	746,097
Net income attributable to Verint Systems Inc.	$	43,652	$	6,331

- Definition

Tabular disclosure of pro forma results of operations for a material business acquisition or series of individually immaterial business acquisitions that are material in the aggregate.

+ References + Details

INTANGIBLE ASSETS AND GOODWILL (Tables)

12 Months Ended

Jan. 31, 2012

INTANGIBLE ASSETS AND GOODWILL

Schedule of acquisition-related intangible assets

	January 31, 2012
(in thousands)	Cost		Accumulated Amortization			Net
Intangible assets with finite lives:
Customer relationships	$	225,929	$	(95,173	)	$	130,756
Acquired technology	94,295		(49,732		)	44,563
Trade names	12,824		(9,805		)	3,019
Non-competition agreements	5,779		(3,656		)	2,123
Distribution network	2,440		(1,352		)	1,088
Backlog	843		(19		)	824
Total intangible assets with finite lives:	342,110		(159,737		)	182,373
In-process research and development, with indefinite lives	2,500		—			2,500
Total	$	344,610	$	(159,737	)	$	184,873

	January 31, 2011
(in thousands)	Cost		Accumulated Amortization			Net
Intangible assets, all with finite lives:
Customer relationships	$	198,106	$	(74,412	)	$	123,694
Acquired technology	66,794		(37,579		)	29,215
Trade names	9,552		(9,177		)	375
Non-competition agreements	5,215		(2,760		)	2,455
Distribution network	2,440		(1,108		)	1,332
Total	$	282,107	$	(125,036	)	$	157,071

Schedule of net acquisition-related intangible assets by reportable segment

	January 31,
(in thousands)	2012		2011
Enterprise Intelligence	$	160,258	$	148,471
Video Intelligence	5,059		934
Communications Intelligence	19,556		7,666
Total	$	184,873	$	157,071

Schedule of estimated future amortization expense on finite-lived acquisition-related intangible assets

(in thousands)
Years Ending January 31,	Amount
2013	$	39,664
2014	34,499
2015	31,069
2016	29,731
2017	26,969
2018 and thereafter	20,441
Total	$	182,373

Schedule of goodwill activity

				Reportable Segment
(in thousands)	Total			Enterprise Intelligence			Video Intelligence			Communications Intelligence
Year Ended January 31, 2011
Goodwill, gross, at January 31, 2010	$	791,535		$	694,465		$	66,998		$	30,072
Accumulated impairment losses at January 31, 2010	(66,865		)	(30,791		)	(36,074		)	—
Goodwill, net, at January 31, 2010	724,670			663,674			30,924			30,072
Business acquisition	12,776			12,776			—			—
Foreign currency translation and other	1,228			(39		)	(209		)	1,476
Goodwill, net, at January 31, 2011	$	738,674		$	676,411		$	30,715		$	31,548

Year Ended January 31, 2012
Goodwill, gross, at January 31, 2011	$	805,539		$	707,202		$	66,789		$	31,548
Accumulated impairment losses at January 31, 2011	(66,865		)	(30,791		)	(36,074		)	—
Goodwill, net, at January 31, 2011	738,674			676,411			30,715			31,548
Business acquisitions	98,437			66,877			10,141			21,419
Foreign currency translation and other	(5,424		)	(3,547		)	(716		)	(1,161		)
Goodwill, net, at January 31, 2012	$	831,687		$	739,741		$	40,140		$	51,806

Balance at January 31, 2012
Goodwill, gross, at January 31, 2012	$	898,552		$	770,532		$	76,214		$	51,806
Accumulated impairment losses at January 31, 2012	(66,865		)	(30,791		)	(36,074		)	—
Goodwill, net, at January 31, 2012	$	831,687		$	739,741		$	40,140		$	51,806

- Definition

Tabular disclosure of goodwill by reportable segment and in total. Disclosure details may include, but are not limited to, the carrying amount of goodwill, goodwill acquired during the year, goodwill impairment losses recognized, goodwill written-off due to the sale of a business unit, goodwill not yet allocated, and any other changes to goodwill.

+ References + Details

LONG-TERM DEBT (Tables)

12 Months Ended

Jan. 31, 2012

LONG-TERM DEBT

Summary of long-term debt

	January 31,
(in thousands)	2012			2011
Term loan facility - new credit agreement:
Gross loan	$	597,000		$	—
Unamortized debt discount	(2,685		)	—
Other debt	3,064			—
Term loan facility - prior credit agreement	—			583,234
Total debt	597,379			583,234
Less: current maturities	6,228			—
Long-term debt	$	591,151		$	583,234

Summary of future scheduled principal payments on term loan

(in thousands)
Years Ending January 31,	Amount
2013	$	6,000
2014	6,000
2015	6,000
2016	6,000
2017	6,000
2018 and thereafter	567,000
Total	$	597,000

- Definition

Tabular disclosure of long-debt instruments or arrangements, including identification, terms, features, collateral requirements and other information necessary to a fair presentation. These are debt arrangements that originally required repayment more than twelve months after issuance or greater than the normal operating cycle of the entity, if longer.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Regulation S-X (SX)
-Number 210
-Section 02
-Paragraph 22
-Article 5

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 835
-SubTopic 30
-Section 45
-Paragraph 2
-URI http://asc.fasb.org/extlink&oid=6451184&loc=d3e28551-108399

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 835
-SubTopic 30
-Section 45
-Paragraph 1A
-URI http://asc.fasb.org/extlink&oid=6451184&loc=d3e28541-108399

Reference 4: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21475-112644

Reference 5: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 210
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02.22)
-URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682

Reference 6: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 6
-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21506-112644

Reference 7: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 8
-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21538-112644

Reference 8: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 7
-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21521-112644

Reference 9: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 835
-SubTopic 30
-Section 55
-Paragraph 8
-URI http://asc.fasb.org/extlink&oid=6584090&loc=d3e28878-108400

Reference 10: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 942
-SubTopic 470
-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=6479336&loc=d3e64711-112823

Reference 11: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08.(e),(f))
-URI http://asc.fasb.org/extlink&oid=6881521&loc=d3e23780-122690

+ Details

SUPPLEMENTAL CONSOLIDATED FINANCIAL STATEMENT INFORMATION (Tables)

12 Months Ended

Jan. 31, 2012

SUPPLEMENTAL CONSOLIDATED FINANCIAL STATEMENT INFORMATION

Schedule of inventories

	January 31,
(in thousands)	2012		2011
Raw materials	$	4,959	$	7,112
Work-in-process	5,777		5,112
Finished goods	3,678		4,763
Total inventories	$	14,414	$	16,987

Schedule of property and equipment, net

	January 31,
(in thousands)	2012			2011
Land	$	3,741		$	3,861
Buildings	2,204			2,204
Leasehold improvements	11,554			10,097
Software	27,694			23,973
Equipment, furniture, and other	49,298			45,874
	94,491			86,009
Less: accumulated depreciation and amortization	(66,202		)	(62,833		)
Total property and equipment, net	$	28,289		$	23,176

Schedule of other assets

	January 31,
(in thousands)	2012		2011
Deferred debt issuance costs, net	$	14,060	$	9,725
Other	14,901		10,335
Total other assets	$	28,961	$	20,060

Schedule of accrued expenses and other liabilities

	January 31,
(in thousands)	2012		2011
Compensation and benefits	$	56,873	$	57,863
Billings in excess of costs and estimated earnings on uncompleted contracts	38,960		47,692
Professional and consulting fees	8,140		6,962
Derivative financial instruments - current portion	530		1,886
Distributor and agent commissions	4,954		7,511
Taxes other than income taxes	11,530		8,357
Interest on indebtedness	4,701		5,699
Contingent consideration - current portion	10,152		2,194
Other	32,285		24,486
Total accrued expenses and other liabilities	$	168,125	$	162,650

Schedule of other liabilities

	January 31,
(in thousands)	2012		2011
Unrecognized tax benefits, including interest and penalties	$	23,883	$	21,032
Obligation for severance compensation	3,027		3,279
Contingent consideration - non current portion	28,494		1,492
Other	3,784		6,009
Total other liabilities	$	59,188	$	31,812

Schedule of other income (expense), net

	Year Ended January 31,
(in thousands)	2012			2011			2010
Foreign currency gains (losses), net	$	1,382		$	857		$	(1,898	)
Losses on derivative financial instruments, net	(896		)	(5,864		)	(14,709		)
Other, net	(974		)	(131		)	(516		)
Total other income (expense), net	$	(488	)	$	(5,138	)	$	(17,123	)

Schedule of supplemental information regarding consolidated cash flows

	Year Ended January 31,
(in thousands)	2012		2011		2010
Cash paid for interest	$	29,227	$	21,053	$	24,705
Cash paid for income taxes, net of refunds received	$	16,629	$	8,528	$	11,661
Non-cash investing and financing transactions:
Accrued but unpaid purchases of property and equipment	$	832	$	1,047	$	642
Inventory transfers to property and equipment	$	637	$	874	$	621
Liabilities for contingent consideration in business combinations	$	42,404	$	3,424	$	—
Stock options exercised, proceeds received subsequent to year end	$	383	$	65	$	—
Purchases under supplier financing arrangements, including capital leases	$	1,090	$	1,859	$	—

STOCKHOLDERS' EQUITY (DEFICIT) (Tables)

12 Months Ended

Jan. 31, 2012

STOCKHOLDERS' EQUITY (DEFICIT)

Summary of components of accumulated other comprehensive loss

	January 31,
(in thousands)	2012			2011
Foreign currency translation losses, net	$	(48,402	)	$	(41,829	)
Unrealized gains (losses) on derivative financial instruments, net	666			(245		)
Unrealized gains on available-for-sale marketable securities	—			5
Total accumulated other comprehensive loss	$	(47,736	)	$	(42,069	)

RESEARCH AND DEVELOPMENT, NET (Tables)

12 Months Ended

Jan. 31, 2012

RESEARCH AND DEVELOPMENT, NET

Schedule of capitalized software development costs

	Year Ended January 31,
(in thousands)	2012			2011			2010
Capitalized software development costs, net, beginning of year	$	6,787		$	8,530		$	10,489
Software development costs capitalized during the year	3,399			2,527			2,715
Amortization of capitalized software development costs	(4,135		)	(4,236		)	(4,717		)
Foreign currency translation and other	(205		)	(34		)	43
Capitalized software development costs, net, end of year	$	5,846		$	6,787		$	8,530

INCOME TAXES (Tables)

12 Months Ended

Jan. 31, 2012

INCOME TAXES

Schedule of components of income before income taxes

	Year Ended January 31,
(in thousands)	2012			2011		2010
Domestic	$	(40,272	)	$	13,746	$	(47,139	)
Foreign	86,429			24,779		71,347
Total income before income taxes	$	46,157		$	38,525	$	24,208

Schedule of provision for income taxes

	Year Ended January 31,
(in thousands)	2012			2011			2010
Current income tax provision (benefit):
Federal	$	145		$	24		$	(835	)
State	1,387			1,140			415
Foreign	15,101			9,868			7,590
Total current income tax provision	16,633			11,032			7,170
Deferred income tax provision (benefit):
Federal	(4,865		)	(16		)	500
State	(1,040		)	459			777
Foreign	(5,196		)	(1,535		)	(1,339		)
Total deferred income tax benefit	(11,101		)	(1,092		)	(62		)
Total provision for income taxes	$	5,532		$	9,940		$	7,108

Reconciliation of the U.S. federal statutory rate to the entity's effective tax rate on income before income taxes

	Year Ended January 31,
(in thousands)	2012			2011			2010
U.S. federal statutory income tax rate	35.0		%	35.0		%	35.0		%

Income tax provision at the U.S. federal statutory rate	$	16,155		$	13,484		$	8,471
State tax provision	2,443			3,720			756
Foreign rate differential	(7,408		)	(2,204		)	(8,869		)
Tax incentive	(8,846		)	(2,114		)	(9,762		)
Valuation allowance	(5,575		)	(13,042		)	7,737
Stock-based and other compensation	1,480			1,823			3,262
Non-deductible expenses	2,392			787			882
Tax credits	(2,034		)	(1,880		)	(2,019		)
Tax contingencies	(223		)	(4,233		)	1,102
Changes in tax rates	(486		)	(516		)	1,227
U.S. tax effects of foreign operations	7,864			13,774			4,750
Other, net	(230		)	341			(429		)
Total provision for income taxes	$	5,532		$	9,940		$	7,108
Effective income tax rate	12.0		%	25.8		%	29.4		%

Schedule of deferred tax assets and liabilities

	January 31,
(in thousands)	2012			2011
Deferred tax assets:
Accrued expenses	$	5,203		$	5,040
Allowance for doubtful accounts	2,257			1,246
Deferred revenue	22,611			24,954
Depreciation of property and equipment	2,386			3,804
Loss carryforwards	103,263			98,938
Tax credits	7,815			6,566
Stock-based and other compensation	14,616			16,567
Capitalized research and development expenses	3,732			4,395
Other long-term liabilities	1,796			1,938
Other, net	3,073			3,088
Total deferred tax assets	166,752			166,536
Deferred tax liabilities:
Deferred cost of revenue	(3,842		)	(6,270		)
Goodwill and other intangible assets	(53,276		)	(47,655		)
Other, net	(904		)	(617		)
Total deferred tax liabilities	(58,022		)	(54,542		)
Valuation allowance	(100,842		)	(105,720		)
Net deferred tax assets	$	7,888		$	6,274

Recorded as:
Current deferred tax assets	$	13,060		$	13,179
Long-term deferred tax assets	9,237			6,700
Current deferred tax liabilities	(1,056		)	(379		)
Long-term deferred tax liabilities	(13,353		)	(13,226		)
Net deferred tax assets	$	7,888		$	6,274

Schedule of valuation allowance

	Year Ended January 31,
(in thousands)	2012			2011
Valuation allowance, beginning of year	$	(105,720	)	$	(124,568	)
(Provision for) benefit from income taxes	5,575			13,042
Additional paid-in capital	477			5,771
Acquisitions	(1,663		)	—
Cumulative translation adjustment	489			35
Valuation allowance, end of year	$	(100,842	)	$	(105,720	)

Schedule of aggregate changes in the balance of gross unrecognized tax benefits

	Year Ended January 31,
(in thousands)	2012			2011			2010
Gross unrecognized tax benefits, beginning of year	$	32,672		$	37,495		$	35,172
Increases related to tax positions taken during the current year	4,424			4,778			2,715
Increases as a result of acquisitions	2,781			—			—
Increases related to tax positions taken during prior years	1,904			2,271			—
Increases (decreases) related to foreign currency exchange rate fluctuations	(71		)	97			1,545
Reductions for tax positions of prior years	(2,320		)	(10,829		)	(152		)
Reduction for settlements with taxing authorities	—			—			(508		)
Lapses of statutes of limitation	(3,013		)	(1,140		)	(1,277		)
Gross unrecognized tax benefits, end of year	$	36,377		$	32,672		$	37,495

Schedule of income tax returns under examination in major tax jurisdictions

Jurisdiction		Tax Years
Canada		January 31, 2010
United Kingdom		December 31, 2006 - January 31, 2008
Hong Kong		March 31, 2003 - March 31, 2005, January 31, 2006 - January 31, 2007
India		March 31, 2006 - March 31, 2008, March 31, 2010

- Definition

Tabular disclosure of tax positions taken in the tax returns filed or to be filed for which it is more likely than not that the tax position will not be sustained upon examination by taxing authorities (i.e., uncertain tax positions) and other types of income tax contingencies, including: (1) the policy on classification of interest and penalties; (2) a tabular reconciliation of the total amounts of unrecognized tax benefits at the beginning and end of the period; the total amount(s) of: (3) unrecognized tax benefits that, if recognized, would affect the effective tax rate, and (4) interest and penalties recognized in each of the income statement and balance sheet; (5) for positions for which it is reasonably possible that the total amounts unrecognized will significantly change within 12 months of the reporting date the: (i) nature of the uncertainty, (ii) nature of the event that could occur that would cause the change, and (iii) an estimate of the range of the reasonably possible change or a statement that an estimate of the range cannot be made; and (6) a description of tax years that remain subject to examination by major tax jurisdictions.

+ References + Details

- Definition

Tabular disclosure of income tax examinations that an enterprise is currently subject to or that have been completed in the current period typically including a description of the examination, the jurisdiction conducting the examination, the tax year(s) under examination, the likelihood of an unfavorable settlement, the range of possible losses, the liability recorded, the increase or decrease in the liability from the prior period, and any penalties and interest that have been recorded.

+ References + Details

- Definition

Tabular disclosure of valuation allowances to reduce deferred tax assets to net realizable value, including identification of the deferred tax asset more likely than not will not be fully realized and the corresponding amount of the valuation allowance.

+ References + Details

FAIR VALUE MEASUREMENTS (Tables)

12 Months Ended

Jan. 31, 2012

FAIR VALUE MEASUREMENTS

Schedule of assets and liabilities measured at fair value on recurring basis

	January 31, 2012
	Fair Value Hierarchy Category
(in thousands)	Level 1		Level 2		Level 3
Assets:
Money market funds (included in cash and cash equivalents)	$	44,494	$	—	$	—
Foreign currency forward contracts	—		978		—
Total assets	$	44,494	$	978	$	—

Liabilities:
Foreign currency forward contracts	$	—	$	530	$	—
Contingent consideration - business combinations	—		—		38,646
Total liabilities	$	—	$	530	$	38,646

	January 31, 2011
	Fair Value Hierarchy Category
(in thousands)	Level 1		Level 2		Level 3
Assets:
Money market funds (included in cash and cash equivalents)	$	24,505	$	—	$	—
Foreign currency forward contracts	—		88		—
Total assets	$	24,505	$	88	$	—

Liabilities:
Foreign currency forward contracts	$	—	$	1,886	$	—
Contingent consideration - business combination	—		—		3,686
Total liabilities	$	—	$	1,886	$	3,686

Schedule of changes in the estimated fair value of liability for contingent consideration measured using significant unobservable inputs (Level 3)

	Year Ended January 31,
(in thousands)	2012			2011
Fair value measurement at beginning of year	$	3,686		$	—
Contingent consideration liability recorded for business combinations	42,404			3,424
Change in fair value recorded in operating expenses	(3,337		)	262
Payments of contingent consideration	(4,107		)	—
Fair value measurement at end of year	$	38,646		$	3,686

- Definition

Tabular disclosure of the fair value measurement of liabilities using significant unobservable inputs (Level 3), a reconciliation of the beginning and ending balances, separately presenting changes during the period attributable to the following: (1) total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings (or changes in net assets), and gains or losses recognized in other comprehensive income and a description of where those gains or losses included in earnings (or changes in net assets) are reported in the statement of income (or activities); (2) purchases, sales, issuances, and settlements (each type disclosed separately); and (3) transfers in and transfers out of Level 3 (for example, transfers due to changes in the observability of significant inputs) by class of liability.

+ References + Details

DERIVATIVE FINANCIAL INSTRUMENTS (Tables)

12 Months Ended

Jan. 31, 2012

DERIVATIVE FINANCIAL INSTRUMENTS

Schedule of fair values of derivative financial instruments

	January 31, 2012
	Assets			Liabilities
(in thousands)	Balance Sheet Classification	Fair Value		Balance Sheet Classification	Fair Value
Derivative financial instruments designated as hedging instruments:
Foreign currency forward contracts	Prepaid expenses and other current assets	$	978	Accrued expenses and other liabilities	$	227
Total derivative financial instruments designated as hedging instruments		$	978		$	227

Derivative financial instruments not designated as hedging instruments:
Foreign currency forward contracts	—	$	—	Accrued expenses and other liabilities	$	303
Total derivative financial instruments not designated as hedging instruments		$	—		$	303

	January 31, 2011
	Assets			Liabilities
(in thousands)	Balance Sheet Classification	Fair Value		Balance Sheet Classification	Fair Value
Derivative financial instruments designated as hedging instruments:
Foreign currency forward contracts	Prepaid expenses and other current assets	$	88	Accrued expenses and other liabilities	$	396
Total derivative financial instruments designated as hedging instruments		$	88		$	396

Derivative financial instruments not designated as hedging instruments:
Foreign currency forward contracts		$	—	Accrued expenses and other liabilities	$	1,490
Total derivative financial instruments not designated as hedging instruments		$	—		$	1,490

Schedule of the effects of derivative financial instruments in cash flow hedging relationships

	Net Gains (Losses) Recognized in Accumulated Other Comprehensive Loss					Classification of Net Gains (Losses) Reclassified from Other Comprehensive Loss into	Net Gains (Losses) Reclassified from Other Accumulated Comprehensive Loss into the Consolidated Statements of Operations
	January 31,					the Consolidated	Year Ended January 31,
(in thousands)	2012		2011			Statements of Operations	2012			2011
Foreign currency forward contracts	$	666	$	(245	)	Operating Expenses	$	(373	)	$	925

Schedule of losses recognized on derivative financial instruments not designated as hedging instruments

	Classification in Consolidated Statement	Year Ended January 31,
(in thousands)	of Operations	2012			2011			2010
Interest rate swap agreement	Other expense, net	$	—		$	(3,102	)	$	(13,591	)
Foreign currency forward contracts	Other expense, net	(896		)	(2,761		)	(1,118		)
Total		$	(896	)	$	(5,863	)	$	(14,709	)

STOCK-BASED COMPENSATION AND OTHER BENEFIT PLANS (Tables)

12 Months Ended

Jan. 31, 2012

STOCK-BASED COMPENSATION AND OTHER BENEFIT PLANS

Summary of key information for the Plans

(in thousands)	Number of Shares Reserved for Grants	Number of Shares Outstanding	Number of Shares Available for Grants
The 1996 Plan	5,000	671	191
The 1997 Plan	6,400	35	—
The 1997 Blue Pumpkin inducement grants	158	—	—
The 2004 Plan	3,000	824	307
The 2010 Plan	4,000	1,001	1,337
The Vovici Plan	317	34	275
Total	18,875	2,565	2,110

Schedule of recognized stock-based compensation expense on the consolidated statements of operations

	Year Ended January 31,
(in thousands, except per share amounts)	2012		2011		2010
Component of income before provision for income taxes:
Cost of revenue - product	$	883	$	1,595	$	1,302
Cost of revenue - service and support	2,424		4,612		4,543
Research and development, net	3,060		7,081		7,960
Selling, general and administrative	21,544		33,531		30,422
Stock-based compensation expense	27,911		46,819		44,227

Income tax benefits related to stock-based compensation (before consideration of valuation allowance)	7,175		12,165		11,716
Stock-based compensation, net of taxes	$	20,736	$	34,654	$	32,511

Impact on net income per common share attributable to Verint Systems Inc. :

Basic	$	0.54	$	1.00	$	1.00
Diluted	$	0.52	$	0.93	$	0.98

Summary of stock-based compensation expense by type of award

	Year Ended January 31,
(in thousands)	2012		2011		2010
Component of stock-based compensation expense:
Stock options	$	723	$	3,135	$	7,332
Restricted stock awards and restricted stock units	21,414		25,583		23,917
Phantom stock units	2,533		18,101		12,978
Stock bonus program	3,241		—		—
Stock-based compensation expense	$	27,911	$	46,819	$	44,227

Schedule of total stock-based compensation expense by classification

	Year Ended January 31,
(in thousands)	2012		2011		2010
Equity-classified awards	$	21,781	$	28,784	$	31,195
Liability-classified awards	6,130		18,035		13,032
Total stock-based compensation expense	$	27,911	$	46,819	$	44,227

Schedule of weighted-average assumptions using a Black-Scholes option pricing model

Expected Life (in years)	5.43
Risk-free interest rate	1.26	%
Expected volatility	50.40	%
Dividend Yield	0	%

Schedule of stock option activity under the Plans

	Year Ended January 31,
	2012				2011				2010
(in thousands, except exercise prices)	Stock Options		Weighted- Average Exercise Price		Stock Options		Weighted- Average Exercise Price		Stock Options		Weighted- Average Exercise Price
Beginning balance	1,767		$	27.33	4,731		$	23.16	5,225		$	22.36
Granted	42		$	9.28	—		$	—	—		$	—
Exercised	(623	)	$	20.51	(2,164	)	$	18.88	—		$	—
Forfeited	—		$	—	(4	)	$	23.94	(30	)	$	21.69
Expired	(72	)	$	28.07	(796	)	$	25.56	(464	)	$	14.23
Ending balance	1,114		$	30.40	1,767		$	27.33	4,731		$	23.16
Stock options exercisable	1,083		$	31.03	1,764		$	27.33	4,499		$	23.24

Summary of information about stock options

The following table summarizes information about stock options as of January 31, 2012:

	Options Outstanding				Options Exercisable
(number of options in thousands)	Number of Options	Weighted- Average Remaining Contractual Term	Weighted- Average Exercise		Number of Options	Weighted- Average Exercise
Range of Exercise Prices	Outstanding	(years)	Price		Exercisable	Price
$ 4.93 - $17.00	141	2.85	$	13.87	111	$	15.28
$ 17.98 - $23.00	138	1.85	$	22.62	137	$	22.65
$ 28.41 - $28.41	42	2.22	$	28.41	42	$	28.41
$ 28.60 - $28.60	8	0.08	$	28.60	8	$	28.60
$ 29.27 - $29.27	8	0.23	$	29.27	8	$	29.27
$ 31.78 - $31.78	18	2.43	$	31.78	18	$	31.78
$ 32.16 - $32.16	15	3.27	$	32.16	15	$	32.16
$ 34.40 - $34.40	137	3.95	$	34.40	137	$	34.40
$ 35.11 - $35.11	583	2.82	$	35.11	583	$	35.11
$ 37.99- $37.99	24	3.64	$	37.99	24	$	37.99
$ 4.93 - $37.99	1,114	2.80	$	30.41	1,083	$	31.03

Summary of key data points for exercised options

	Year Ended January 31,
(in thousands)	2012		2011		2010
Intrinsic value of options exercised	$	8,034	$	18,430	$	—
Cash received from the exercise of stock options	$	12,474	$	40,787	$	—
Tax benefits realized from stock options exercised	$	3,219	$	3,391	$	—
Fair value of options vested	$	20,413	$	30,209	$	69,575

Summary of RSA and RSU activity under the Plans

	Year Ended January 31,
	2012				2011				2010
(in thousands, except grant-date fair values)	Shares		Weighted- Average Grant-Date Fair Value		Shares		Weighted- Average Grant-Date Fair Value		Shares		Weighted- Average Grant-Date Fair Value
Beginning balance	1,935		$	18.09	3,412		$	14.92	1,830		$	24.48
Granted	902		$	34.84	1,102		$	26.01	1,812		$	6.50
Released	(1,336	)	$	15.72	(2,503	)	$	17.39	(116	)	$	29.93
Forfeited	(51	)	$	28.85	(76	)	$	13.23	(114	)	$	19.94
Ending balance	1,450		$	30.25	1,935		$	18.09	3,412		$	14.92

Summary of phantom stock unit activity

	Year Ended January 31,
(in thousands)	2012		2011		2010
Beginning balance, in units	403		1,106		1,239
Granted	10		196		421
Released	(298	)	(865	)	(482	)
Forfeited	(25	)	(34	)	(72	)
Ending balance, in units	90		403		1,106

COMMITMENTS AND CONTINGENCIES (Tables)

12 Months Ended

Jan. 31, 2012

COMMITMENTS AND CONTINGENCIES

Schedule of minimum future rentals under non-cancelable operating and capital leases

As of January 31, 2012, our minimum future rentals under non-cancelable operating and capital leases were as follows:

(in thousands)	Operating		Capital
Years Ending January 31,	Leases		Leases
2013	$	13,212	$	412
2014	9,245		407
2015	9,669		200
2016	8,484		—
2017	5,671		—
2018 and thereafter	32,595		—
Total	$	78,876	1,019
Less amount representing interest			(264		)
Present value of minimum lease payments			$	755

Summary of activity in warrant liability

	Year Ended January 31,
(in thousands)	2012			2011			2010
Warranty liability, beginning of year	$	1,996		$	1,292		$	1,188
Provision charged to expenses	675			957			220
Warranty charges	(389		)	(121		)	(42		)
Foreign currency translation and other	(267		)	(132		)	(74		)
Warranty liability, end of year	$	2,015		$	1,996		$	1,292

SEGMENT, GEOGRAPHIC, AND SIGNIFICANT CUSTOMER INFORMATION (Tables)

12 Months Ended

Jan. 31, 2012

SEGMENT, GEOGRAPHIC, AND SIGNIFICANT CUSTOMER INFORMATION

Operating results by segment

	Year Ended January 31,
(in thousands)	2012			2011			2010

Revenue:
Enterprise Intelligence
Segment revenue	$	444,700		$	410,529		$	374,778
Revenue adjustment	(6,682		)	—			—
	438,018			410,529			374,778
Video Intelligence
Segment revenue	140,610			134,012			144,970
Revenue adjustment	(2,594		)	—			—
	138,016			134,012			144,970
Communications Intelligence
Segment revenue	210,937			182,258			183,885
Revenue adjustment	(4,323		)	—			—
	206,614			182,258			183,885

Total revenue	$	782,648		$	726,799		$	703,633

Segment contribution:
Enterprise Intelligence	$	198,428		$	191,068		$	178,674
Video Intelligence	34,697			42,318			57,200
Communications Intelligence	63,296			66,802			62,348
Total segment contribution	296,421			300,188			298,222

Unallocated expenses, net:
Amortization of other acquired intangible assets	35,302			30,554			30,289
Stock-based compensation	27,911			46,819			44,227
Other unallocated expenses	146,730			149,710			158,027
Total unallocated expenses, net	209,943			227,083			232,543
Operating income	86,478			73,105			65,679
Other expense, net	(40,321		)	(34,580		)	(41,471		)
Income before provision for income taxes	$	46,157		$	38,525		$	24,208

Summary of revenue from unaffiliated customers by geographic area

	Year Ended January 31,
(in thousands)	2012		2011		2010
United States	$	342,479	$	292,604	$	328,420
United Kingdom	83,787		102,389		65,793
Other	356,382		331,806		309,420
Total revenue	$	782,648	$	726,799	$	703,633

Property and equipment, net by geographic area

	January 31,
(in thousands)	2012		2011
United States	$	11,406	$	9,322
Israel	10,150		8,221
Germany	2,309		2,474
United Kindgom	2,024		796
Canada	694		371
Other	1,706		1,992
Total property and equipment, net	$	28,289	$	23,176

- Definition

Tabular disclosure of the profit or loss and total assets for each reportable segment. An entity discloses certain information on each reportable segment if the amounts (a) are included in the measure of segment profit or loss reviewed by the chief operating decision maker or (b) are otherwise regularly provided to the chief operating decision maker, even if not included in that measure of segment profit or loss.

+ References + Details

SELECTED QUARTERLY FINANCIAL INFORMATION (UNAUDITED) (Tables)

12 Months Ended

Jan. 31, 2012

SELECTED QUARTERLY FINANCIAL INFORMATION (UNAUDITED)

Summarized consolidated quarterly financial information

	Quarter Ended
(in thousands, except per share data)	April 30, 2011			July 31, 2011		October 31, 2011		January 31, 2012
Revenue	$	176,332		$	194,959	$	199,364	$	211,993
Gross profit	120,983			125,850		129,225		138,229
Income before provision for (benefit from) income taxes	3,064			14,437		9,217		19,439
Net income	1,555			11,274		9,921		17,875
Net income (loss) attributable to Verint Systems Inc.	(112		)	10,475		9,451		17,179
Net income (loss) attributable to Verint Systems Inc. common shares:
for basic net income (loss) per common share	(3,661		)	6,768		5,704		13,392
for diluted net income (loss) per common share	(3,661		)	6,768		5,704		13,392

Net income (loss) per common share attributable to Verint Systems Inc.
Basic	$	(0.10	)	$	0.18	$	0.15	$	0.34
Diluted	$	(0.10	)	$	0.17	$	0.15	$	0.34

	Quarter Ended
(in thousands, except per share data)	April 30, 2010			July 31, 2010		October 31, 2010		January 31, 2011
Revenue	$	172,613		$	180,676	$	186,641	$	186,869
Gross profit	114,806			120,330		127,700		125,619
Income (loss) before provision for (benefit from) income taxes	(13,545		)	15,532		23,720		12,818
Net income (loss)	(15,616		)	12,391		18,388		13,422
Net income (loss) attributable to Verint Systems Inc.	(16,208		)	11,475		17,174		13,140
Net income (loss) attributable to Verint Systems Inc. common shares:
for basic net income (loss) per common share	(19,611		)	7,921		13,582		9,511
for diluted net income (loss) per common share	(19,611		)	7,921		17,174		9,511

Net income (loss) per common share attributable to Verint Systems Inc.
Basic	$	(0.60	)	$	0.24	$	0.38	$	0.26
Diluted	$	(0.60	)	$	0.23	$	0.36	$	0.25

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details)	12 Months Ended
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details)	Jan. 31, 2012
Less than
Basis of Presentation
Maximum ownership interest in cost method investments (as a percent)	20.00%
Joint venture, variable interest entity in which entity is primary beneficiary
Basis of Presentation
Equity interest in a joint venture (as a percent)	50.00%

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 2)	12 Months Ended
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 2)	Jan. 31, 2012 Y D M
Cash and Cash Equivalents
Maximum original maturity period of cash equivalents (in months) \| M	3
Investments
Available-for-sale securities stated maturities period, short-term classification if securities are highly marketable and readily convertible into cash for current operations, stated maturities period greater than (in years) \| Y	1
Restricted bank time deposits \| Minimum
Restricted Cash and Bank Time Deposits
Original maturity period of restricted cash equivalents (in days)	30
Restricted bank time deposits \| Maximum
Restricted Cash and Bank Time Deposits
Original maturity period of restricted cash equivalents (in days)	360

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 3) - USD ($) $ in Thousands	12 Months Ended
	Jan. 31, 2012	Jan. 31, 2011	Jan. 31, 2010
Accounts Receivable, Net
Costs in excess of billings and estimated earnings	$ 11,200	$ 4,400
Allowance for Doubtful Accounts
Activity in the allowance for doubtful accounts
Balance at beginning of year	5,395	4,706	$ 5,989
Provisions charged to expenses	399	1,832	801
Amounts written off	(2,912)	(1,126)	(2,210)
Other	47	(17)	126
Balance at end of year	$ 2,929	$ 5,395	$ 4,706

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 4)	12 Months Ended
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 4)	Jan. 31, 2012 Y segment apporoach
Goodwill, Other Acquired Intangible Assets, and Long-lived Assets
Number of primary approaches to assess fair value in impairment test \| apporoach	3
Segment Reporting
Number of operating segments and reportable segments \| segment	3
Buildings
Property and equipment, net
Estimated useful lives, low end of range (in years)	25
Estimated useful lives, high end of range (in years)	30
Equipment, furniture and other
Property and equipment, net
Estimated useful lives, low end of range (in years)	3
Estimated useful lives, high end of range (in years)	10
Software
Property and equipment, net
Estimated useful lives, low end of range (in years)	3
Estimated useful lives, high end of range (in years)	4

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 5) $ in Millions	12 Months Ended
	Jan. 31, 2012 USD ($) Y category Element
Revenue Recognition
Number of categories in which revenue is derived and reported \| category	2
Number of elements for multiple-element software arrangements for which various available indicators of fair value and judgment are used to classify the arrangement's revenue into product revenue and service revenue, VSOE cannot be established and where such arrangements are recognized ratably, minimum \| Element	1
Term of software maintenance period over which PCS revenue is recognized (in years)	1
Estimated economic lives of software products, low end of range (in years)	5
Estimated economic lives of software products, high end of range (in years)	7
Multiple-deliverable revenue arrangements
Revenue Recognition
Recognition of additional revenue \| $	$ 12.4
Recognition of additional income before provision for income taxes \| $	$ 6.3

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 6) $ in Thousands	12 Months Ended
	Jan. 31, 2012 USD ($) Y M	Jan. 31, 2011 USD ($)	Jan. 31, 2010 USD ($)
Cost of Revenue
Maximum period of time for recognizing revenue for deferred cost of revenue classified as current (in months) \| M	12
Functional Currency and Foreign Currency Transaction Gains and Losses
Net foreign currency transaction gains (losses) \| $	$ 1,382	$ 857	$ (1,898)
Capitalized software development costs
Software Development Costs
Amortization period (in years)	4
Internal-Use Software
Software Development Costs
Amortization period (in years)	4

- Definition

The aggregate foreign currency transaction gain (loss) (both realized and unrealized) included in determining net income for the reporting period. Excludes foreign currency transactions designated as hedges of net investment in a foreign entity and intercompany foreign currency transactions that are of a long-term nature, when the entities to the transaction are consolidated, combined, or accounted for by the equity method in the reporting enterprise's financial statements. For certain enterprises, primarily banks, that are dealers in foreign exchange, foreign currency transaction gains (losses) may be disclosed as dealer gains (losses).

+ References + Details

NET INCOME PER COMMON SHARE ATTRIBUTABLE TO VERINT SYSTEMS INC. (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended								12 Months Ended
	Jan. 31, 2012	Oct. 31, 2011	Jul. 31, 2011	Apr. 30, 2011	Jan. 31, 2011	Oct. 31, 2010	Jul. 31, 2010	Apr. 30, 2010	Jan. 31, 2012	Jan. 31, 2011	Jan. 31, 2010
NET INCOME PER COMMON SHARE ATTRIBUTABLE TO VERINT SYSTEMS INC.
Net income	$ 17,875	$ 9,921	$ 11,274	$ 1,555	$ 13,422	$ 18,388	$ 12,391	$ (15,616)	$ 40,625	$ 28,585	$ 17,100
Net income attributable to noncontrolling interest									3,632	3,004	1,483
Net income attributable to Verint Systems Inc.	17,179	9,451	10,475	(112)	13,140	17,174	11,475	(16,208)	36,993	25,581	15,617
Dividends on preferred stock									(14,790)	(14,178)	(13,591)
Net income attributable to Verint Systems Inc. common shares	13,392	5,704	6,768	(3,661)	9,511	13,582	7,921	(19,611)	22,203	11,403	2,026
Net income attributable to Verint Systems Inc. for diluted net income per common share	$ 13,392	$ 5,704	$ 6,768	$ (3,661)	$ 9,511	$ 17,174	$ 7,921	$ (19,611)	$ 22,203	$ 11,403	$ 2,026
Weighted-average shares outstanding:
Basic (in shares)									38,419	34,544	32,478
Dilutive effect of employee equity award plans (in shares)									1,080	2,635	649
Diluted (in shares)									39,499	37,179	33,127
Net income per common share attributable to Verint Systems Inc.
Basic (in dollars per share)	$ 0.34	$ 0.15	$ 0.18	$ (0.10)	$ 0.26	$ 0.38	$ 0.24	$ (0.60)	$ 0.58	$ 0.33	$ 0.06
Diluted (in dollars per share)	$ 0.34	$ 0.15	$ 0.17	$ (0.10)	$ 0.25	$ 0.36	$ 0.23	$ (0.60)	$ 0.56	$ 0.31	$ 0.06
Stock options and restricted stock-based awards
Shares excluded from calculation:
Anti-dilutive securities (in shares)									813	1,158	4,714
Convertible preferred stock
Shares excluded from calculation:
Anti-dilutive securities (in shares)									10,625	10,223	9,836

INVESTMENTS (Details)	12 Months Ended
INVESTMENTS (Details)	Jan. 31, 2012 Y
INVESTMENTS
Period of no investment in marketable debt or equity securities (in years)	3

BUSINESS COMBINATIONS (Details) - USD ($) $ in Thousands	1 Months Ended
BUSINESS COMBINATIONS (Details) - USD ($) $ in Thousands	Aug. 31, 2011	Jan. 31, 2012	Oct. 07, 2011	Aug. 04, 2011
Vovici Corporation
BUSINESS COMBINATIONS
Combined consideration				$ 66,103
Cash paid at closing				56,100
Cash paid at closing to repay Vovici's bank debt				435
Potential additional cash payments to former shareholders, maximum				19,100
Fair value of contingent obligation				9,900
Vovici Corporation \| Options to acquire shares of Verint common stock
BUSINESS COMBINATIONS
Number of unvested Vovici stock options converted into options to acquire Verint common stock	42,000
Fair value of Verint stock options				1,000
Compensation for pre-acquisition services included in the consideration transferred				60
Compensation to be recognized as stock-based compensation expense over the remaining future vesting periods of the awards				$ 900
Global Management Technologies
BUSINESS COMBINATIONS
Combined consideration			$ 36,596
Cash paid at closing			24,596
Potential additional cash payments to former shareholders, maximum			17,400
Fair value of contingent obligation			$ 12,000
Other Business Combinations
BUSINESS COMBINATIONS
Combined consideration		$ 55,125
Cash paid at closing		33,835
Potential additional cash payments to former shareholders, maximum		41,000
Fair value of contingent obligation		$ 20,500

BUSINESS COMBINATIONS (Details 2) - Contingent consideration - USD ($) $ in Millions	1 Months Ended		12 Months Ended
	Oct. 31, 2011	Aug. 31, 2011	Jan. 31, 2012
Vovici Corporation
Contingent consideration obligation
Contingent consideration liability recorded for business combinations		$ 9.9
Expense (benefit) from change in fair value			$ (2.7)
Fair value of contingent consideration obligation			7.2
Global Management Technologies
Contingent consideration obligation
Contingent consideration liability recorded for business combinations	$ 12.0
Expense (benefit) from change in fair value			(2.4)
Fair value of contingent consideration obligation			9.6
Other Business Combinations
Contingent consideration obligation
Expense (benefit) from change in fair value			(0.4)
Fair value of contingent consideration obligation			$ 20.1

BUSINESS COMBINATIONS (Details 3) $ in Thousands	6 Months Ended	12 Months Ended
BUSINESS COMBINATIONS (Details 3) $ in Thousands	Jan. 31, 2012 USD ($)	Jan. 31, 2012 USD ($) Y	Oct. 07, 2011 USD ($)	Aug. 04, 2011 USD ($)	Aug. 02, 2011 USD ($)
Vovici Corporation
BUSINESS COMBINATIONS
Estimated profit margin (as a percent)				15.00%
Deferred revenue, carrying value at acquisition date				$ 5,300
Deferred revenue				2,264
Revenue attributable to the acquired entity	$ 5,000
Transaction and related costs				3,400
Goodwill associated with business combinations				$ 41,736
Global Management Technologies
BUSINESS COMBINATIONS
Estimated profit margin (as a percent)			20.00%
Deferred revenue, carrying value at acquisition date			$ 4,300
Deferred revenue			1,234
Transaction and related costs	1,600	$ 1,600
Goodwill associated with business combinations			$ 23,141
Other Business Combinations
BUSINESS COMBINATIONS
Deferred revenue	944	944
Transaction and related costs	5,000	5,000
Goodwill associated with business combinations	33,560	33,560
Other Business Combinations \| Video and Situation Intelligence
BUSINESS COMBINATIONS
Goodwill associated with business combinations	10,100	10,100
Other Business Combinations \| Enterprise Intelligence
BUSINESS COMBINATIONS
Goodwill associated with business combinations	2,000	2,000
Other Business Combinations \| Communications Intelligence
BUSINESS COMBINATIONS
Goodwill associated with business combinations	21,400	21,400
Other Business Combinations \| In-process research and development assets
BUSINESS COMBINATIONS
Estimated total fair value of intangible assets acquired in business combinations	2,500	$ 2,500
Period within which projects are expected to be completed (in years) \| Y		2
August 2011 Business Combination
BUSINESS COMBINATIONS
Liabilities recorded					$ 10,700
Current liabilities associated with preacquisition business activities					5,500
Long-term liabilities associated with preacquisition business activities					5,200
Current liabilities associated with preacquisition business activities	4,300	$ 4,300
Long-term liabilities associated with preacquisition business activities	$ 4,700	$ 4,700
Reduction in the estimated acquisition-date liabilities					$ 800

BUSINESS COMBINATIONS (Details 4) $ in Thousands	1 Months Ended		12 Months Ended
BUSINESS COMBINATIONS (Details 4) $ in Thousands	Oct. 31, 2011 USD ($) Y	Aug. 31, 2011 USD ($) Y	Jan. 31, 2012 USD ($) Y	Oct. 07, 2011 USD ($)	Aug. 04, 2011 USD ($)
Adjustments in purchase price allocations
Maximum time period for determining fair values for assets acquired and liabilities assumed (in years) \| Y			1
Vovici Corporation
Components of Purchase Price
Cash consideration to shareholders					$ 55,708
Cash consideration					56,100
Fair value of contingent consideration					9,900
Bank debt, repaid at closing					435
Total purchase price					66,103
Allocation of Purchase Price
Accounts receivable					1,106
Other current assets					5,398
Other assets					913
Current and other liabilities					(3,165)
Deferred revenue					(2,264)
Deferred income taxes - current and long-term					(6,021)
Net tangible assets (liabilities)					(4,033)
Identifiable intangible assets					28,400
Goodwill					41,736
Total purchase price					66,103
Identifiable intangible assets
Weighted-average estimated useful life of all finite-lived identifiable intangible assets (in years) \| Y		8.1
Adjustments in purchase price allocations
Increase in certain liabilities		$ 1,100
Associated asset recorded reflecting the selling shareholders' indemnification obligations		1,000
Increase (decrease) in acquisition-date goodwill		100
Increase in goodwill due to adjustment in certain income tax assets and liabilities		$ 4,000
Vovici Corporation \| Developed technology
Allocation of Purchase Price
Identifiable intangible assets					11,300
Identifiable intangible assets
Maximum estimated useful life of all finite-lived identifiable assets (in years) \| Y		6
Vovici Corporation \| Customer relationships
Allocation of Purchase Price
Identifiable intangible assets					15,400
Identifiable intangible assets
Maximum estimated useful life of all finite-lived identifiable assets (in years) \| Y		10
Vovici Corporation \| Trademarks and trade names
Allocation of Purchase Price
Identifiable intangible assets					1,700
Identifiable intangible assets
Maximum estimated useful life of all finite-lived identifiable assets (in years) \| Y		5
Vovici Corporation \| Options to acquire shares of Verint common stock
Components of Purchase Price
Fair value of stock options					$ 60
Global Management Technologies
Components of Purchase Price
Cash consideration				$ 24,596
Fair value of contingent consideration				12,000
Total purchase price				36,596
Allocation of Purchase Price
Accounts receivable				512
Other current assets				1,717
Other assets				483
Current and other liabilities				(1,915)
Deferred revenue				(1,234)
Deferred income taxes - current and long-term				(108)
Net tangible assets (liabilities)				(545)
Identifiable intangible assets				14,000
Goodwill				23,141
Total purchase price				36,596
Identifiable intangible assets
Weighted-average estimated useful life of all finite-lived identifiable intangible assets (in years) \| Y	7.2
Adjustments in purchase price allocations
Increase (decrease) in acquisition-date goodwill	$ 1,100
Increase in goodwill due to adjustment in certain income tax assets and liabilities	$ 400
Global Management Technologies \| Developed technology
Allocation of Purchase Price
Identifiable intangible assets				7,400
Identifiable intangible assets
Maximum estimated useful life of all finite-lived identifiable assets (in years) \| Y	5
Adjustments in purchase price allocations
Increase (decrease) in the estimated acquisition-date fair values of the intangible assets identified in the acquisition	$ 100
Global Management Technologies \| Customer relationships
Allocation of Purchase Price
Identifiable intangible assets				6,200
Identifiable intangible assets
Maximum estimated useful life of all finite-lived identifiable assets (in years) \| Y	10
Adjustments in purchase price allocations
Increase (decrease) in the estimated acquisition-date fair values of the intangible assets identified in the acquisition	$ 1,000
Global Management Technologies \| Trademarks and trade names
Allocation of Purchase Price
Identifiable intangible assets				$ 400
Identifiable intangible assets
Maximum estimated useful life of all finite-lived identifiable assets (in years) \| Y	3
Other
Components of Purchase Price
Cash consideration			$ 33,835
Fair value of contingent consideration			20,504
Other purchase price adjustments			786
Total purchase price			55,125
Allocation of Purchase Price
Accounts receivable			842
Other current assets			15,650
Other assets			5,579
Current and other liabilities			(15,419)
Deferred revenue			(944)
Bank debt			(3,330)
Deferred income taxes - current and long-term			(3,587)
Net tangible assets (liabilities)			(1,209)
Identifiable intangible assets			22,774
Goodwill			33,560
Total purchase price			$ 55,125
Identifiable intangible assets
Weighted-average estimated useful life of all finite-lived identifiable intangible assets (in years) \| Y			6.8
Other \| In-process research and development assets
Allocation of Purchase Price
Estimated total fair value of intangible assets acquired in business combinations			$ 2,500
Other \| Developed technology
Allocation of Purchase Price
Identifiable intangible assets			$ 10,043
Identifiable intangible assets
Minimum useful life of all finite-lived identifiable intangible assets (in years) \| Y			6
Maximum estimated useful life of all finite-lived identifiable assets (in years) \| Y			7
Other \| Customer relationships
Allocation of Purchase Price
Identifiable intangible assets			$ 7,460
Identifiable intangible assets
Minimum useful life of all finite-lived identifiable intangible assets (in years) \| Y			4
Maximum estimated useful life of all finite-lived identifiable assets (in years) \| Y			10
Other \| Trademarks and trade names
Allocation of Purchase Price
Identifiable intangible assets			$ 1,350
Identifiable intangible assets
Minimum useful life of all finite-lived identifiable intangible assets (in years) \| Y			4
Maximum estimated useful life of all finite-lived identifiable assets (in years) \| Y			5
Other \| Other identifiable intangible assets
Allocation of Purchase Price
Identifiable intangible assets			$ 1,421
Identifiable intangible assets
Minimum useful life of all finite-lived identifiable intangible assets (in years) \| Y			3
Maximum estimated useful life of all finite-lived identifiable assets (in years) \| Y			4
Business Combinations Year Ended January 31, 2012
Identifiable intangible assets
Weighted-average estimated useful life of all finite-lived identifiable intangible assets (in years) \| Y			7.5
August 2011 Business Combination
Adjustments in purchase price allocations
Increase (decrease) in acquisition-date goodwill		$ (400)
Increase in goodwill due to adjustment in certain income tax assets and liabilities		3,100
Increase in the fair value of contingent consideration obligation		500
Increase in the fair value of contingent consideration asset		500
Decrease in fair value of performance obligation under customer contracts assumed		1,700
Increase in acquisition-date goodwill due to combined adjustments		1,500
August 2011 Business Combination \| Developed technology
Adjustments in purchase price allocations
Increase (decrease) in the estimated acquisition-date fair values of the intangible assets identified in the acquisition		200
August 2011 Business Combination \| Customer relationships
Adjustments in purchase price allocations
Increase (decrease) in the estimated acquisition-date fair values of the intangible assets identified in the acquisition		$ 200

BUSINESS COMBINATIONS (Details 5) $ in Thousands	1 Months Ended	12 Months Ended
BUSINESS COMBINATIONS (Details 5) $ in Thousands	Feb. 28, 2010 Y	Jan. 31, 2012 USD ($)	Jan. 31, 2011 USD ($)	Dec. 31, 2011 USD ($)	Feb. 04, 2010 USD ($)
Iontas Limited
BUSINESS COMBINATIONS
Total consideration					$ 21,700
Cash consideration					17,700
Milestone-based contingent consideration, maximum					3,800
Period over which certain performance targets are to be achieved (in years) \| Y	2
Fair value of contingent obligation					3,200
Prepayments for product licenses and support services procured prior to the acquisition date included in purchase price					1,500
Trade accounts payable as of the acquisition date included in purchase price					700
Consideration allocated to tangible net assets (liabilities)					1,700
Consideration allocated to goodwill					12,800
Weighted-average estimated useful life of all finite-lived identifiable intangible assets (in years) \| Y	5.9
Fair value of contingent consideration					3,200
Transaction and related costs					1,300
Iontas Limited \| Developed technology
BUSINESS COMBINATIONS
Consideration allocated to identifiable intangible assets					6,900
Weighted-average estimated useful life of all finite-lived identifiable intangible assets (in years) \| Y	6
Iontas Limited \| Non-competition agreements
BUSINESS COMBINATIONS
Consideration allocated to identifiable intangible assets					$ 300
Weighted-average estimated useful life of all finite-lived identifiable intangible assets (in years) \| Y	3
December 2010 Business Combination - technology and other assets \| Communications Intelligence
BUSINESS COMBINATIONS
Increase in fair value of liability for contingent consideration		$ 1,900
December 2010 Business Combination - technology and other assets \| Communications Intelligence \| Maximum
BUSINESS COMBINATIONS
Total consideration				$ 15,000
Vovici and GMT
Pro Forma Information
Revenue		804,006	$ 746,097
Net income attributable to Verint Systems Inc.		$ 43,652	$ 6,331

BUSINESS COMBINATIONS (Details 6) - Contingent consideration - Iontas Limited - USD ($) $ in Millions	12 Months Ended
	Jan. 31, 2012	Jan. 31, 2011
Contingent consideration obligation
Contingent consideration paid	$ 2.0
Fair value of remaining contingent consideration obligation	1.7
Increases in the fair value of contingent consideration obligation recorded in operating assets	$ 0.2	$ 0.3

INTANGIBLE ASSETS AND GOODWILL (Details) - USD ($) $ in Thousands	12 Months Ended
	Jan. 31, 2012	Jan. 31, 2011	Jan. 31, 2010
Acquisition-related intangible assets
Intangible assets with finite lives, Cost	$ 342,110	$ 282,107
Intangible assets with finite lives, Accumulated Amortization	(159,737)	(125,036)
Intangible assets with finite lives, Net	182,373	157,071
Total intangible assets, cost	344,610	282,107
Total intangible assets, net	184,873	157,071
Total amortization expense for acquisition-related intangible assets	35,300	30,600	$ 30,300
Estimated future amortization expense on finite-lived acquisition-related intangible assets
2013	39,664
2014	34,499
2015	31,069
2016	29,731
2017	26,969
2018 and thereafter	20,441
Total	182,373
In-process research and development assets
Acquisition-related intangible assets
Intangible assets with indefinite lives, cost	2,500
Enterprise Intelligence
Acquisition-related intangible assets
Intangible assets with finite lives, Net	160,258	148,471
Video and Situation Intelligence
Acquisition-related intangible assets
Intangible assets with finite lives, Net	5,059	934
Communications Intelligence
Acquisition-related intangible assets
Intangible assets with finite lives, Net	19,556	7,666
Customer relationships
Acquisition-related intangible assets
Intangible assets with finite lives, Cost	225,929	198,106
Intangible assets with finite lives, Accumulated Amortization	(95,173)	(74,412)
Intangible assets with finite lives, Net	130,756	123,694
Acquired technology
Acquisition-related intangible assets
Intangible assets with finite lives, Cost	94,295	66,794
Intangible assets with finite lives, Accumulated Amortization	(49,732)	(37,579)
Intangible assets with finite lives, Net	44,563	29,215
Trade names
Acquisition-related intangible assets
Intangible assets with finite lives, Cost	12,824	9,552
Intangible assets with finite lives, Accumulated Amortization	(9,805)	(9,177)
Intangible assets with finite lives, Net	3,019	375
Non-competition agreements
Acquisition-related intangible assets
Intangible assets with finite lives, Cost	5,779	5,215
Intangible assets with finite lives, Accumulated Amortization	(3,656)	(2,760)
Intangible assets with finite lives, Net	2,123	2,455
Distribution network
Acquisition-related intangible assets
Intangible assets with finite lives, Cost	2,440	2,440
Intangible assets with finite lives, Accumulated Amortization	(1,352)	(1,108)
Intangible assets with finite lives, Net	1,088	$ 1,332
Backlog
Acquisition-related intangible assets
Intangible assets with finite lives, Cost	843
Intangible assets with finite lives, Accumulated Amortization	(19)
Intangible assets with finite lives, Net	$ 824

INTANGIBLE ASSETS AND GOODWILL (Details 2) - USD ($) $ in Thousands	12 Months Ended
	Jan. 31, 2012	Jan. 31, 2011	Jan. 31, 2010
Goodwill
Goodwill, gross at the beginning of the period	$ 898,552	$ 805,539	$ 791,535
Accumulated impairment losses	(66,865)	(66,865)	(66,865)
Goodwill, net at the beginning of the period	738,674	724,670
Business acquisition	98,437	12,776
Foreign currency translation and other	(5,424)	1,228
Goodwill, net, at the end of the period	831,687	738,674
Enterprise Intelligence
Goodwill
Goodwill, gross at the beginning of the period	770,532	707,202	694,465
Accumulated impairment losses	(30,791)	(30,791)	(30,791)
Goodwill, net at the beginning of the period	676,411	663,674
Business acquisition	66,877	12,776
Foreign currency translation and other	(3,547)	(39)
Goodwill, net, at the end of the period	739,471	676,411
Video and Situation Intelligence
Goodwill
Goodwill, gross at the beginning of the period	76,214	66,789	66,998
Accumulated impairment losses	(36,074)	(36,074)	(36,074)
Goodwill, net at the beginning of the period	30,715	30,924
Business acquisition	10,141
Foreign currency translation and other	(716)	(209)
Goodwill, net, at the end of the period	40,140	30,715
Communications Intelligence
Goodwill
Goodwill, gross at the beginning of the period	51,806	31,548	$ 30,072
Goodwill, net at the beginning of the period	31,548	30,072
Business acquisition	21,419
Foreign currency translation and other	(1,161)	1,476
Goodwill, net, at the end of the period	$ 51,806	$ 31,548

- Definition

Carrying amount as of the balance sheet date, which is the cumulative amount paid and (if applicable) the fair value of any noncontrolling interest in the acquiree, adjusted for any amortization recognized prior to the adoption of any changes in generally accepted accounting principles (as applicable) and for any impairment charges, in excess of the fair value of net assets acquired in one or more business combination transactions.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 142
-Paragraph 45
-Subparagraph e
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 142
-Paragraph 43
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 141R
-Paragraph 68
-Subparagraph l
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 4: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 350
-SubTopic 20
-Section 45
-Paragraph 1
-URI http://asc.fasb.org/extlink&oid=6388280&loc=d3e13770-109266

Reference 5: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 350
-SubTopic 20
-Section 50
-Paragraph 1
-URI http://asc.fasb.org/extlink&oid=6905597&loc=d3e13816-109267

Reference 6: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 141R
-Paragraph 72
-Subparagraph d
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 7: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 142
-Paragraph 45
-Subparagraph e
-Clause 1
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 8: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 141R
-Paragraph 34
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

+ Details

- Definition

The increase (decrease) in the recorded value of goodwill for foreign currency translation adjustments and purchase accounting adjustments needed to revise the carrying amount of goodwill to fair value.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 142
-Subparagraph e
-Paragraph 45
-Clause 6
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 350
-SubTopic 20
-Section 50
-Paragraph 1
-Subparagraph (f)
-URI http://asc.fasb.org/extlink&oid=6905597&loc=d3e13816-109267

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 141R
-Paragraph 72
-Subparagraph d
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 4: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 142
-Subparagraph e
-Paragraph 45
-Clause 3
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 5: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 142
-Subparagraph e
-Paragraph 45
-Clause 7
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

+ Details

LONG-TERM DEBT (Details) $ in Thousands	1 Months Ended		3 Months Ended		12 Months Ended
LONG-TERM DEBT (Details) $ in Thousands	Apr. 30, 2011 USD ($)	May 31, 2007 USD ($) Y	Oct. 31, 2011 USD ($) BusinessCombination	Apr. 30, 2011 USD ($)	Jan. 31, 2012 USD ($) numerator denominator payment	Jan. 31, 2011 USD ($)	Jan. 31, 2010 USD ($)	Aug. 02, 2011 USD ($)	Jul. 31, 2010 USD ($)
LONG-TERM DEBT
Total debt					$ 597,379	$ 583,234
Less: current maturities					6,228
Long-term debt					591,151	583,234
Loss on extinguishment of debt				$ (8,100)	(8,136)
Credit Agreement
LONG-TERM DEBT
Maximum borrowing capacity	$ 770,000			770,000
Deferred debt issuance costs	14,800		$ 200	14,800
Fees to secure waivers of certain provisions to structure the financing for business combinations			$ 500
Number of business combinations for which fees were incurred to secure waivers of certain provisions to structure financing in a favorable manner \| BusinessCombination			1
Debt fees expensed			$ 300
Interest expense					28,100	26,200	$ 22,600
Amortization of deferred debt issuance costs reported within interest expense					$ 2,800	2,800	1,900
Additional amortization associated with unscheduled principal repayments						300	$ 100
Credit Agreement \| Until July 31, 2013
LONG-TERM DEBT
Numerator for the ratio of Consolidated Total Debt to Consolidated EBITDA, maximum \| numerator					5.00
Denominator for the ratio of Consolidated Total Debt to Consolidated EBITDA, maximum \| denominator					1
Credit Agreement \| After July 31, 2013
LONG-TERM DEBT
Numerator for the ratio of Consolidated Total Debt to Consolidated EBITDA, maximum \| numerator					4.50
Denominator for the ratio of Consolidated Total Debt to Consolidated EBITDA, maximum \| denominator					1
Term loan
LONG-TERM DEBT
Gross loan					$ 597,000
Unamortized debt discount	3,000			3,000	$ (2,685)
Maximum borrowing capacity	$ 600,000			600,000
Term loan discount (as a percent)	0.50%
Net term loan proceeds	$ 597,000
Deferred debt issuance costs	10,200			10,200
Interest rate at end or period (as a percent)					4.50%
Effective interest rate (as a percent)					4.91%
Amortization of original issuance term loan discount reported within interest expense					$ 300
Principal payments required per quarter					$ 1,500
Prepayment premium applicable in the event of a Re-pricing Transaction (as a percent)					1.00%
Number of consecutive scheduled principal payments to which prepayments are applied first \| payment					8
Future scheduled principal payments on term loan
2013					$ 6,000
2014					6,000
2015					6,000
2016					6,000
2017					6,000
2018 and thereafter					567,000
Total					$ 597,000
Revolving credit facility
LONG-TERM DEBT
Current borrowing capacity	170,000			170,000
Maximum borrowing capacity	300,000			300,000
Deferred debt issuance costs	4,600			4,600
Commitment fee on undrawn portion (as a percent)					0.50%
Eurodollar loans \| Adjusted LIBO Rate
LONG-TERM DEBT
Variable rate basis					LIBO
Interest rate margin (as a percent)					3.25%
Rate used to calculate reference rate (as a percent)					1.25%
Eurodollar loans \| Adjusted LIBO Rate \| Corporate ratings of at least BB- and Ba3 or better
LONG-TERM DEBT
Interest rate margin (as a percent)					3.00%
Base Rate loans \| Adjusted LIBO Rate
LONG-TERM DEBT
Variable rate basis					Adjusted LIBO
Interest rate margin (as a percent)					1.00%
Base Rate loans \| Base Rate
LONG-TERM DEBT
Variable rate basis					Base Rate
Interest rate margin (as a percent)					2.25%
Base Rate loans \| Base Rate \| Corporate ratings of at least BB- and Ba3 or better
LONG-TERM DEBT
Interest rate margin (as a percent)					2.00%
Base Rate loans \| Federal Funds Effective Rate
LONG-TERM DEBT
Variable rate basis					Federal Funds Effective Rate
Interest rate margin (as a percent)					0.50%
Other debt
LONG-TERM DEBT
Total debt					$ 3,064
Other debt \| Communications Intelligence, acquisition
LONG-TERM DEBT
Total debt					$ 3,100
Interest rate at end or period (as a percent)					7.00%
Future scheduled principal payments on term loan
Development bank and government debt assumed								$ 3,300
Prior Credit Agreement
LONG-TERM DEBT
Maximum borrowing capacity		$ 675,000
Unamortized deferred costs	9,000			9,000
Loss on extinguishment of debt	8,100
Prior term loan facility
LONG-TERM DEBT
Total debt						$ 583,234
Maximum borrowing capacity		$ 650,000
Term of credit agreement (in years) \| Y		7
Payment of outstanding term loans	583,200
Prior revolving line of credit
LONG-TERM DEBT
Maximum borrowing capacity		$ 25,000							$ 75,000
Term of credit agreement (in years) \| Y		6
Prior Credit Agreement and Credit Agreement
LONG-TERM DEBT
Unamortized deferred costs	$ 900			$ 900

SUPPLEMENTAL CONSOLIDATED FINANCIAL STATEMENT INFORMATION (Details) - USD ($) $ in Thousands	12 Months Ended
	Jan. 31, 2012	Jan. 31, 2011	Jan. 31, 2010
Inventories
Raw materials	$ 4,959	$ 7,112
Work-in-process	5,777	5,112
Finished goods	3,678	4,763
Total inventories	14,414	16,987
Property and equipment, net
Property and equipment, gross	94,491	86,009
Less: accumulated depreciation and amortization	(66,202)	(62,833)
Total property and equipment, net	28,289	23,176
Depreciation expense
Depreciation expense on property and equipment	10,800	11,400	$ 12,400
Other assets
Deferred debt issuance costs, net	14,060	9,725
Other	14,901	10,335
Total other assets	28,961	20,060
Accrued expenses and other liabilities
Compensation and benefits	56,873	57,863
Billings in excess of costs and estimated earnings on uncompleted contracts	38,960	47,692
Professional and consulting fees	8,140	6,962
Derivative financial instruments - current portion	530	1,886
Distributor and agent commissions	4,954	7,511
Taxes other than income taxes	11,530	8,357
Interest on indebtedness	4,701	5,699
Contingent consideration - current portion	10,152	2,194
Other	32,285	24,486
Total accrued expenses and other liabilities	168,125	162,650
Other liabilities
Unrecognized tax benefits, including interest and penalties	23,883	21,032
Obligation for severance compensation	3,027	3,279
Contingent consideration - non current portion	28,494	1,492
Other	3,784	6,009
Total other liabilities	59,188	31,812
Other income (expense), net:
Foreign currency gains (losses), net	1,382	857	(1,898)
Losses on derivative financial instruments, net	(896)	(5,864)	(14,709)
Other, net	(974)	(131)	(516)
Total other income (expense), net	(488)	(5,138)	(17,123)
Supplemental information regarding consolidated cash flows
Cash paid for interest	29,227	21,053	24,705
Cash paid for income taxes, net of refunds received	16,629	8,528	11,661
Non-cash investing and financing transactions:
Accrued but unpaid purchases of property and equipment	832	1,047	642
Inventory transfers to property and equipment	637	874	$ 621
Liabilities for contingent consideration in business combinations	42,404	3,424
Stock options exercised, proceeds received subsequent to period end	383	65
Purchases under supplier financing arrangements, including capital leases	1,090	1,859
Land
Property and equipment, net
Property and equipment, gross	3,741	3,861
Buildings
Property and equipment, net
Property and equipment, gross	2,204	2,204
Leasehold improvements
Property and equipment, net
Property and equipment, gross	11,554	10,097
Software
Property and equipment, net
Property and equipment, gross	27,694	23,973
Equipment, furniture and other
Property and equipment, net
Property and equipment, gross	$ 49,298	$ 45,874

CONVERTIBLE PREFERRED STOCK (Details) $ / shares in Units, $ in Thousands	1 Months Ended		3 Months Ended	12 Months Ended
	Feb. 29, 2008	May 31, 2007 USD ($) shares	Jan. 31, 2012 USD ($) $ / shares shares	Jan. 31, 2012 USD ($) D $ / shares shares	Jan. 31, 2011 USD ($)	Feb. 02, 2008 USD ($)	May 25, 2007 USD ($)
CONVERTIBLE PREFERRED STOCK
Liquidation preference			$ 352,034	$ 352,034
Carrying value of the preferred stock			$ 285,542	$ 285,542	$ 285,542
Minimum
CONVERTIBLE PREFERRED STOCK
Minimum reduction in basis points on variable term loan (as a percent)			0.50%
Series A Convertible Preferred Stock
CONVERTIBLE PREFERRED STOCK
Direct issuance cost		$ 200
Purchase price per share \| $ / shares			$ 1,000	$ 1,000
Initial liquidation preference per share purchase price \| $ / shares			$ 1,000	$ 1,000
Percentage of liquidation preference at which the holders of the preferred stock would have the right to repurchase the preferred stock in event of fundamental change by the entity				100.00%
Cumulative undeclared dividends			$ 59,000	$ 59,000
Liquidation preference			$ 352,000	$ 352,000
Initial fair value							$ 293,900
Reduced interest rate used to calculate the fair value of the embedded derivative financial instrument (as a percent)		3.875%
Stated dividend rate (as a percent)	3.875%	4.25%
Carrying value of the preferred stock						$ 285,500
Initial conversion rate of common stock for each share of preferred stock \| shares			30.6185	30.6185
Preferred stock conversion price per share \| $ / shares				$ 32.66
Number of shares of common stock in which the preferred stock is convertible \| shares				10,800,000
Closing price as a percentage of the conversion price that must be equal to or greater than for right to convert the preferred stock to become exercisable				135.00%
Series A Convertible Preferred Stock \| Minimum
CONVERTIBLE PREFERRED STOCK
Additional shares of common stock issuable for every share of preferred stock in the event of a fundamental change \| shares				0
Series A Convertible Preferred Stock \| Maximum
CONVERTIBLE PREFERRED STOCK
Additional shares of common stock issuable for every share of preferred stock in the event of a fundamental change \| shares				3.7
Comverse
CONVERTIBLE PREFERRED STOCK
Initial fair value of embedded derivative financial instrument							$ 900
Fair value of derivative asset, reclassified amount						$ 8,100
Percentage of volume of weighted average price of common stock, when and if declared				95.00%
Number of consecutive trading days used to determine the value of the common stock dividend \| D				5
Comverse \| Series A Convertible Preferred Stock
CONVERTIBLE PREFERRED STOCK
Shares issued \| shares		293,000
Aggregate purchase price		$ 293,000

STOCKHOLDERS' EQUITY (DEFICIT) (Details) - USD ($) $ in Thousands	1 Months Ended	12 Months Ended
	Jan. 31, 2012	Jan. 31, 2012	Jan. 31, 2011	Jan. 31, 2010
STOCKHOLDERS' EQUITY (DEFICIT)
Treasury stock, shares	283,000	283,000	260,000
Treasury stock, cost	$ 7,466	$ 7,466	$ 6,639
Number of shares of common stock repurchased		53,000	157,000
Aggregate number of shares of common stock issued to certain current and former employees and a former director			135,000
Number of shares of common stock repurchased	30,000
Cost of shares of common stock repurchased	$ 800
Number of shares reissued under stock-based employee benefit plans	2,000
Number of shares retired	28,000
Components of accumulated other comprehensive loss
Foreign currency translation losses, net	$ (48,402)	$ (48,402)	$ (41,829)
Unrealized gains (losses) on derivative financial instruments, net	666	666	(245)
Unrealized gains on available-for-sale marketable securities			5
Total accumulated other comprehensive loss	$ (47,736)	(47,736)	(42,069)
Total other comprehensive income		34,846	29,918	$ 32,416
Total other comprehensive income attributable to Verint Systems Inc.		31,300	26,600	30,900
Total other comprehensive income attributable to the noncontrolling interest		$ 3,500	$ 3,300	$ 1,500
Noncontrolling equity interest in joint venture (as a percent)	50.00%	50.00%

RESEARCH AND DEVELOPMENT, NET (Details) - USD ($) $ in Thousands	12 Months Ended
	Jan. 31, 2012	Jan. 31, 2011	Jan. 31, 2010
RESEARCH AND DEVELOPMENT, NET
Gross research and development expenses	$ 115,700	$ 100,800	$ 86,700
Grants from OCS recorded as a reduction in gross research and development expenses	3,200	3,000	2,100
Reimbursements of other research and development expenses	1,500	1,300	800
Capitalized software development costs
Capitalized software development costs, net, at the beginning of the period	6,787	8,530	10,489
Software development costs capitalized during the year	3,399	2,527	2,715
Amortization of capitalized software development costs	(4,135)	(4,236)	(4,717)
Foreign currency translation and other	(205)	(34)	43
Capitalized software development costs, net, at the end of the period	$ 5,846	$ 6,787	$ 8,530

INCOME TAXES (Details) $ in Thousands	3 Months Ended								12 Months Ended
INCOME TAXES (Details) $ in Thousands	Jan. 31, 2012 USD ($)	Oct. 31, 2011 USD ($)	Jul. 31, 2011 USD ($)	Apr. 30, 2011 USD ($)	Jan. 31, 2011 USD ($)	Oct. 31, 2010 USD ($)	Jul. 31, 2010 USD ($)	Apr. 30, 2010 USD ($)	Jan. 31, 2012 USD ($) Y	Jan. 31, 2011 USD ($)	Jan. 31, 2010 USD ($)
Components of income before income taxes
Domestic									$ (40,272)	$ 13,746	$ (47,139)
Foreign									86,429	24,779	71,347
Income before provision for income taxes	$ 19,439	$ 9,217	$ 14,437	$ 3,064	$ 12,818	$ 23,720	$ 15,532	$ (13,545)	46,157	38,525	24,208
Current income tax provision (benefit):
Federal									145	24	(835)
State									1,387	1,140	415
Foreign									15,101	9,868	7,590
Total current income tax provision									16,633	11,032	7,170
Deferred income tax provision (benefit):
Federal									(4,865)	(16)	500
State									(1,040)	459	777
Foreign									(5,196)	(1,535)	(1,339)
Total deferred income tax provision benefit									(11,101)	(1,092)	(62)
Total provision for income taxes									$ 5,532	$ 9,940	$ 7,108
Reconciliation of the U.S. federal statutory rate to the entity's effective tax rate on income before income taxes
U.S. federal statutory income tax rate (as a percent)									35.00%	35.00%	35.00%
Income tax provision (benefit) at the U.S. federal statutory rate									$ 16,155	$ 13,484	$ 8,471
State tax provision									2,443	3,720	756
Foreign rate differential									(7,408)	(2,204)	(8,869)
Tax incentive									(8,846)	(2,114)	(9,762)
Valuation allowance									(5,575)	(13,042)	7,737
Stock-based and other compensation									1,480	1,823	3,262
Non-deductible expenses									2,392	787	882
Tax credits									(2,034)	(1,880)	(2,019)
Tax contingencies									(223)	(4,233)	1,102
Change in tax rates									(486)	(516)	1,227
U.S. tax effects of foreign operations									7,864	13,774	4,750
Other, net									(230)	341	(429)
Total provision for income taxes									$ 5,532	$ 9,940	$ 7,108
Effective income tax rate (as a percent)									12.00%	25.80%	29.40%
Operations in Israel
Israeli Law for Encouragement of Capital Investments, 1959
Period of tax exemption for income attributable to approved enterprise (in years) \| Y									2
Reduction in effective tax rates resulting from tax incentives (as a percent)									19.20%	5.50%	40.30%
Operations in Israel \| Minimum
Israeli Law for Encouragement of Capital Investments, 1959
Period of reduced income tax rate attributable to approved enterprise (in years) \| Y									5
Reduced income tax rate for income attributable to approved enterprise (as a percent)									10.00%
Operations in Israel \| Maximum
Israeli Law for Encouragement of Capital Investments, 1959
Period of reduced income tax rate attributable to approved enterprise (in years) \| Y									8
Reduced income tax rate for income attributable to approved enterprise (as a percent)									25.00%

INCOME TAXES (Details 2) - USD ($) $ in Thousands	Jan. 31, 2012	Jan. 31, 2011
Deferred tax assets:
Accrued expenses	$ 5,203	$ 5,040
Allowance for doubtful accounts	2,257	1,246
Deferred revenue	22,611	24,954
Depreciation of property and equipment	2,386	3,804
Loss carryforwards	103,263	98,938
Tax credits	7,815	6,566
Stock-based and other compensation	14,616	16,567
Capitalized research and development expenses	3,732	4,395
Other long-term liabilities	1,796	1,938
Other, net	3,073	3,088
Total deferred tax assets	166,752	166,536
Deferred tax liabilities:
Deferred cost of revenue	(3,842)	(6,270)
Goodwill and other intangible assets	(53,276)	(47,655)
Other, net	(904)	(617)
Total deferred tax liabilities	(58,022)	(54,542)
Valuation allowance	(100,842)	(105,720)
Net deferred tax assets	7,888	6,274
Recorded as:
Current deferred tax assets	13,060	13,179
Long-term deferred tax assets	9,237	6,700
Current deferred tax liabilities	(1,056)	(379)
Long-term deferred tax liabilities	(13,353)	(13,226)
Net deferred tax assets	$ 7,888	$ 6,274

INCOME TAXES (Details 3) - USD ($) $ in Millions	Jan. 31, 2012	Jan. 31, 2011
Net operating loss carryforwards
U.S. federal, state and foreign tax credit carryforwards	$ 8.3	$ 7.1
Tax credit carryforwards, indefinite carryforward	1.5
Tax credit carryforwards expiring in various future years	6.8
U.S. federal
Net operating loss carryforwards
NOLs	287.8	282.4
State
Net operating loss carryforwards
NOLs	205.0	179.7
Foreign
Net operating loss carryforwards
NOLs	39.7	$ 28.3
NOL carryforwards expiring in various future years	$ 1.6

INCOME TAXES(Details 4) - USD ($) $ in Thousands	12 Months Ended
INCOME TAXES(Details 4) - USD ($) $ in Thousands	Jan. 31, 2012	Jan. 31, 2011
INCOME TAXES
Deferred tax not provided on excess of financial reporting over tax basis of investments in certain foreign subsidiaries	$ 173,900
Valuation allowance, deferred tax assets
Recorded valuation allowance on deferred tax assets
Decrease in valuation allowance	(4,900)
Recorded valuation allowance
Balance at beginning of year	(105,720)	$ (124,568)
(Provision for) benefit from income taxes	5,575	13,042
Additional paid in capital	477	5,771
Acquisitions	1,663
Cumulative translation adjustment	489	35
Balance at end of year	$ (100,842)	$ (105,720)

INCOME TAXES (Details 5) - USD ($) $ in Thousands	12 Months Ended
INCOME TAXES (Details 5) - USD ($) $ in Thousands	Jan. 31, 2012	Jan. 31, 2011	Jan. 31, 2010
Aggregate changes in balance of gross unrecognized tax benefits
Gross unrecognized tax benefits, beginning of year	$ 32,672	$ 37,495	$ 35,172
Increases related to tax positions taken during the current year	4,424	4,778	2,715
Increases as a result of acquisitions	2,781
Increases related to tax positions taken during prior years	1,904	2,271
Increases (decreases) related to foreign currency exchange rate fluctuations	(71)	97	1,545
Reductions for tax positions of prior years	(2,320)	(10,829)	(152)
Reduction for settlements with taxing authorities			(508)
Lapses of statutes of limitation	(3,013)	(1,140)	(1,277)
Gross unrecognized tax benefits, end of year	36,377	32,672	37,495
Unrecognized tax benefits that, if recognized would impact effective income tax rate	30,700
Interest and penalties recorded related to uncertain tax positions	(700)	(600)	300
Accrued liability for interest and penalties	8,200	$ 6,600	$ 7,200
Amount of unrecognized tax benefits that could reasonably decrease in next twelve months	$ 4,000

FAIR VALUE MEASUREMENTS (Details) - Recurring - USD ($) $ in Thousands	Jan. 31, 2012	Jan. 31, 2011
Level 1
Assets:
Money market funds (included in cash and cash equivalents)	$ 44,494	$ 24,505
Total assets	44,494	24,505
Level 2
Assets:
Foreign currency forward contracts	978	88
Total assets	978	88
Liabilities:
Foreign currency forward contracts	530	1,886
Total liabilities	530	1,886
Level 3
Liabilities:
Contingent consideration- business combinations	38,646	3,686
Total liabilities	$ 38,646	$ 3,686

FAIR VALUE MEASUREMENTS (Details 2) - Liability for contingent consideration - USD ($) $ in Thousands	12 Months Ended
	Jan. 31, 2012	Jan. 31, 2011
Changes in the estimated fair value of liability for contingent consideration measured using significant unobservable inputs (Level 3)
Fair value measurement at the beginning of the period	$ 3,686
Contingent consideration liability recorded for business combinations	42,404	$ 3,424
Change in fair value recorded in operating expenses	(3,337)	262
Payments of contingent consideration	(4,107)
Fair value measurement at the end of the period	$ 38,646	$ 3,686

FAIR VALUE MEASUREMENTS (Details 3) - Estimated fair value - USD ($) $ in Millions	Jan. 31, 2012	Jan. 31, 2011
Term loan borrowings
Other Financial Instruments
Long-term debt	$ 597.0
Prior term loan
Other Financial Instruments
Long-term debt		$ 586.2

DERIVATIVE FINANCIAL INSTRUMENTS (Details) - USD ($) $ in Thousands	3 Months Ended		12 Months Ended
	Jul. 31, 2010	Apr. 30, 2010	Jan. 31, 2011	Jan. 31, 2012
DERIVATIVE FINANCIAL INSTRUMENTS
Losses on interest rate swap not designated as a hedging instrument	$ (1,500)	$ (1,600)	$ (3,100)
Derivative designated as hedging instruments
Fair Values of Derivative Financial Instruments
Assets, Fair Value			88	$ 978
Liabilities, Fair Value			396	227
Derivative not designated as hedging instruments
Fair Values of Derivative Financial Instruments
Liabilities, Fair Value			1,490	$ 303
Foreign currency forward contracts
Fair Values of Derivative Financial Instruments
Term to maturity of derivative contracts is generally this period (in months)				12 months
Notional amounts of derivative financial instruments			51,100	$ 94,100
Foreign currency forward contracts \| Derivative designated as hedging instruments
Fair Values of Derivative Financial Instruments
Assets, Fair Value			88	978
Liabilities, Fair Value			396	227
Foreign currency forward contracts \| Derivative not designated as hedging instruments
Fair Values of Derivative Financial Instruments
Liabilities, Fair Value			$ 1,490	$ 303

DERIVATIVE FINANCIAL INSTRUMENTS (Details2) - USD ($) $ in Thousands	12 Months Ended
	Jan. 31, 2012	Jan. 31, 2011	Jan. 31, 2010
DERIVATIVE FINANCIAL INSTRUMENTS
Net Gains (Losses) Recognized in Accumulated Other Comprehensive Loss	$ 666	$ (245)
Foreign currency forward contracts underlying net gains recorded in accumulated other comprehensive loss expected to be reclassified into earnings within the next twelve months	800
Derivative not designated as hedging instruments
DERIVATIVE FINANCIAL INSTRUMENTS
Losses recognized	(896)	(5,863)	$ (14,709)
Interest rate swap agreement \| Derivative not designated as hedging instruments
DERIVATIVE FINANCIAL INSTRUMENTS
Losses recognized		(3,102)	(13,591)
Foreign currency forward contracts \| Derivative not designated as hedging instruments
DERIVATIVE FINANCIAL INSTRUMENTS
Losses recognized	(896)	(2,761)	$ (1,118)
Foreign currency forward contracts \| Cash flow hedging \| Derivative designated as hedging instruments
DERIVATIVE FINANCIAL INSTRUMENTS
Net Gains (Losses) Recognized in Accumulated Other Comprehensive Loss	666	(245)
Net Gains (Losses) Reclassified from Other Accumulated Comprehensive Loss into the Consolidated Statements of Operations	$ (373)	$ 925

STOCK-BASED COMPENSATION AND OTHER BENEFIT PLANS (Details) shares in Thousands	3 Months Ended	12 Months Ended
	Jan. 31, 2012 Y shares	Jan. 31, 2012 shares	Nov. 18, 2009 shares
Stock-Based Compensation Plans
Number of Shares Reserved for Grants	18,875	18,875
Number of Shares Outstanding	2,565	2,565
Number of Shares Available for Grants	2,110	2,110
Maximum
Stock-Based Compensation Plans
Term of award (in years)		P10Y
Performance based RSUs
Stock-Based Compensation Plans
Award subject to future performance vesting conditions, not yet defined (in shares)	500	500
The 1996 Plan
Stock-Based Compensation Plans
Number of Shares Reserved for Grants	5,000	5,000
Number of Shares Outstanding	671	671
Number of Shares Available for Grants	191	191
The 1997 Plan
Stock-Based Compensation Plans
Number of Shares Reserved for Grants	6,400	6,400
Number of Shares Outstanding	35	35
The 1997 Plan \| Maximum
Stock-Based Compensation Plans
Annual increase in the number of shares available for issuance			3,000
The 1997 Plan Blue Pumpkin inducement grants
Stock-Based Compensation Plans
Number of Shares Reserved for Grants	158	158
The 2004 Plan
Stock-Based Compensation Plans
Number of Shares Reserved for Grants	3,000	3,000
Number of Shares Outstanding	824	824
Number of Shares Available for Grants	307	307
The 2004 Plan \| Maximum
Stock-Based Compensation Plans
Annual increase in the number of shares available for issuance	1,000	1,000
The 2010 Plan
Stock-Based Compensation Plans
Number of Shares Reserved for Grants	4,000	4,000
Number of Shares Outstanding	1,001	1,001
Number of Shares Available for Grants	1,337	1,337
The 2010 Plan \| Maximum
Stock-Based Compensation Plans
Number of years awards can be granted after plan approval by the board of directors \| Y	10
The Vovici Plan
Stock-Based Compensation Plans
Number of Shares Reserved for Grants	317	317
Number of Shares Outstanding	34	34
Number of Shares Available for Grants	275	275

STOCK-BASED COMPENSATION AND OTHER BENEFIT PLANS (Details 2) $ / shares in Units, $ in Thousands	12 Months Ended
	Jan. 31, 2012 USD ($) $ / shares	Jan. 31, 2011 USD ($) employee $ / shares	Jan. 31, 2010 USD ($) employee $ / shares
Stock-based compensation expense
Stock-based compensation expense	$ 27,911	$ 46,819	$ 44,227
Income tax benefits related to stock-based compensation (before consideration of valuation allowance)	7,175	12,165	11,716
Stock-based compensation, net of taxes	20,736	$ 34,654	$ 32,511
Net excess tax benefits resulting from Stock Plans recorded as increases to additional paid-in capital	$ 700
Impact on net income per common share attributable to Verint Systems Inc.
Basic (in dollars per share) \| $ / shares	$ 0.54	$ 1.00	$ 1.00
Diluted (in dollars per share) \| $ / shares	$ 0.52	$ 0.93	$ 0.98
Stock options
Stock-based compensation expense
Stock-based compensation expense	$ 723	$ 3,135	$ 7,332
Modifications
Incremental compensation expense		$ 100	$ 200
Number of employees affected \| employee		36	54
Restricted stock awards and restricted stock units
Stock-based compensation expense
Stock-based compensation expense	21,414	$ 25,583	$ 23,917
Phantom stock units
Stock-based compensation expense
Stock-based compensation expense	2,533	18,101	12,978
Stock bonus program
Stock-based compensation expense
Stock-based compensation expense	3,241
Equity-classified awards
Stock-based compensation expense
Stock-based compensation expense	21,781	28,784	31,195
Liability-classified awards
Stock-based compensation expense
Stock-based compensation expense	6,130	18,035	13,032
Cost of revenue - product
Stock-based compensation expense
Stock-based compensation expense	883	1,595	1,302
Cost of revenue - service and support
Stock-based compensation expense
Stock-based compensation expense	2,424	4,612	4,543
Research and development, net
Stock-based compensation expense
Stock-based compensation expense	3,060	7,081	7,960
Selling, general and administrative
Stock-based compensation expense
Stock-based compensation expense	$ 21,544	$ 33,531	$ 30,422

STOCK-BASED COMPENSATION AND OTHER BENEFIT PLANS (Details 3) - Stock options $ / shares in Units, $ in Millions	1 Months Ended	12 Months Ended
	Aug. 31, 2011 Y	Jan. 31, 2012 USD ($) Y $ / shares shares	Jan. 31, 2011 $ / shares shares	Jan. 31, 2010 $ / shares shares	Aug. 04, 2011 shares
Stock option activity
Beginning balance (in shares)		1,767,000	4,731,000	5,225,000
Granted (in shares)		42,000
Exercised (in shares)		(623,000)	(2,164,000)
Forfeited (in shares)			(4,000)	(30,000)
Expired (in shares)		(72,000)	(796,000)	(464,000)
Ending balance (in shares)		1,114,000	1,767,000	4,731,000
Stock options exercisable (in shares)		1,083,000	1,764,000	4,499,000
Weighted-Average Exercise Price
Beginning balance (in dollars per share) \| $ / shares		$ 27.33	$ 23.16	$ 22.36
Granted (in dollars per share) \| $ / shares		9.28
Exercised (in dollars per share) \| $ / shares		20.51	18.88
Forfeited (in dollars per share) \| $ / shares			23.94	21.69
Expired (in dollars per share) \| $ / shares		28.07	25.56	14.23
Ending balance (in dollars per share) \| $ / shares		30.40	27.33	23.16
Stock options exercisable (in dollars per share) \| $ / shares		$ 31.03	$ 27.33	$ 23.24
Additional disclosures
Aggregate intrinsic value for the options vested and exercisable \| $		$ 2.2
Weighted-average remaining contractual life of options vested and exercisable (in years) \| Y		2.6
Options vested and expected to vest (in shares)		1,100,000
Weighted-average exercise price of options vested and expected to vest (in dollars per share) \| $ / shares		$ 30.5
Aggregate intrinsic value of options vested and expected to vest \| $		$ 2.8
Weighted-average remaining contractual life of options vested and expected to vest (in years) \| Y		2.8
Unrecognized compensation expense for options expected to vest \| $		$ 0.6
Weighted-average period of unrecognized compensation expense expected to be recognized (in years) \| Y		2.8
Vovici
Stock-Based Compensation Plans
Number of stock options to purchase Vovici common stock converted into stock options of the company					42,000
Weighted-average assumptions using Black-Scholes option pricing model
Expected Life (in years) \| Y	5.43
Risk-free interest rate (as a percent)	1.26%
Expected volatility (as a percent)	50.40%
Dividend Yield (as a percent)	0.00%

STOCK-BASED COMPENSATION AND OTHER BENEFIT PLANS (Details 4) shares in Thousands	12 Months Ended
	Jan. 31, 2012 Y $ / shares shares
$4.93 - $17.00
Information about stock options by range of exercise prices
Exercise price, low end of range (in dollars per share)	$ 4.93
Exercise price, high end of range (in dollars per share)	$ 17.00
Options Outstanding
Number of Options Outstanding (in shares) \| shares	141
Weighted-Average Remaining Contractual Term (in years) \| Y	2.85
Weighted-Average Exercise Price (in dollars per share)	$ 13.87
Options Exercisable
Number of Options Exercisable (in shares) \| shares	111
Weighted-Average Exercise Price (in dollars per share)	$ 15.28
$17.98 - $23.00
Information about stock options by range of exercise prices
Exercise price, low end of range (in dollars per share)	17.98
Exercise price, high end of range (in dollars per share)	$ 23.00
Options Outstanding
Number of Options Outstanding (in shares) \| shares	138
Weighted-Average Remaining Contractual Term (in years) \| Y	1.85
Weighted-Average Exercise Price (in dollars per share)	$ 22.62
Options Exercisable
Number of Options Exercisable (in shares) \| shares	137
Weighted-Average Exercise Price (in dollars per share)	$ 22.65
$28.41 - $28.41
Information about stock options by range of exercise prices
Exercise price, low end of range (in dollars per share)	28.41
Exercise price, high end of range (in dollars per share)	$ 28.41
Options Outstanding
Number of Options Outstanding (in shares) \| shares	42
Weighted-Average Remaining Contractual Term (in years) \| Y	2.22
Weighted-Average Exercise Price (in dollars per share)	$ 28.41
Options Exercisable
Number of Options Exercisable (in shares) \| shares	42
Weighted-Average Exercise Price (in dollars per share)	$ 28.41
$28.60 - $28.60
Information about stock options by range of exercise prices
Exercise price, low end of range (in dollars per share)	28.60
Exercise price, high end of range (in dollars per share)	$ 28.60
Options Outstanding
Number of Options Outstanding (in shares) \| shares	8
Weighted-Average Remaining Contractual Term (in years) \| Y	0.08
Weighted-Average Exercise Price (in dollars per share)	$ 28.60
Options Exercisable
Number of Options Exercisable (in shares) \| shares	8
Weighted-Average Exercise Price (in dollars per share)	$ 28.60
$29.27 - $29.27
Information about stock options by range of exercise prices
Exercise price, low end of range (in dollars per share)	29.27
Exercise price, high end of range (in dollars per share)	$ 29.27
Options Outstanding
Number of Options Outstanding (in shares) \| shares	8
Weighted-Average Remaining Contractual Term (in years) \| Y	0.23
Weighted-Average Exercise Price (in dollars per share)	$ 29.27
Options Exercisable
Number of Options Exercisable (in shares) \| shares	8
Weighted-Average Exercise Price (in dollars per share)	$ 29.27
$31.78 - $31.78
Information about stock options by range of exercise prices
Exercise price, low end of range (in dollars per share)	31.78
Exercise price, high end of range (in dollars per share)	$ 31.78
Options Outstanding
Number of Options Outstanding (in shares) \| shares	18
Weighted-Average Remaining Contractual Term (in years) \| Y	2.43
Weighted-Average Exercise Price (in dollars per share)	$ 31.78
Options Exercisable
Number of Options Exercisable (in shares) \| shares	18
Weighted-Average Exercise Price (in dollars per share)	$ 31.78
$32.16 - $32.16
Information about stock options by range of exercise prices
Exercise price, low end of range (in dollars per share)	32.16
Exercise price, high end of range (in dollars per share)	$ 32.16
Options Outstanding
Number of Options Outstanding (in shares) \| shares	15
Weighted-Average Remaining Contractual Term (in years) \| Y	3.27
Weighted-Average Exercise Price (in dollars per share)	$ 32.16
Options Exercisable
Number of Options Exercisable (in shares) \| shares	15
Weighted-Average Exercise Price (in dollars per share)	$ 32.16
$34.40 - $34.40
Information about stock options by range of exercise prices
Exercise price, low end of range (in dollars per share)	34.40
Exercise price, high end of range (in dollars per share)	$ 34.40
Options Outstanding
Number of Options Outstanding (in shares) \| shares	137
Weighted-Average Remaining Contractual Term (in years) \| Y	3.95
Weighted-Average Exercise Price (in dollars per share)	$ 34.40
Options Exercisable
Number of Options Exercisable (in shares) \| shares	137
Weighted-Average Exercise Price (in dollars per share)	$ 34.40
$35.11 - $35.11
Information about stock options by range of exercise prices
Exercise price, low end of range (in dollars per share)	35.11
Exercise price, high end of range (in dollars per share)	$ 35.11
Options Outstanding
Number of Options Outstanding (in shares) \| shares	583
Weighted-Average Remaining Contractual Term (in years) \| Y	2.82
Weighted-Average Exercise Price (in dollars per share)	$ 35.11
Options Exercisable
Number of Options Exercisable (in shares) \| shares	583
Weighted-Average Exercise Price (in dollars per share)	$ 35.11
$37.99 - $37.99
Information about stock options by range of exercise prices
Exercise price, low end of range (in dollars per share)	37.99
Exercise price, high end of range (in dollars per share)	$ 37.99
Options Outstanding
Number of Options Outstanding (in shares) \| shares	24
Weighted-Average Remaining Contractual Term (in years) \| Y	3.64
Weighted-Average Exercise Price (in dollars per share)	$ 37.99
Options Exercisable
Number of Options Exercisable (in shares) \| shares	24
Weighted-Average Exercise Price (in dollars per share)	$ 37.99
$4.93 - $37.99
Information about stock options by range of exercise prices
Exercise price, low end of range (in dollars per share)	4.93
Exercise price, high end of range (in dollars per share)	$ 37.99
Options Outstanding
Number of Options Outstanding (in shares) \| shares	1,114
Weighted-Average Remaining Contractual Term (in years) \| Y	2.80
Weighted-Average Exercise Price (in dollars per share)	$ 30.41
Options Exercisable
Number of Options Exercisable (in shares) \| shares	1,083
Weighted-Average Exercise Price (in dollars per share)	$ 31.03

STOCK-BASED COMPENSATION AND OTHER BENEFIT PLANS (Details 5) - Stock options - USD ($) $ in Thousands	12 Months Ended
	Jan. 31, 2012	Jan. 31, 2011	Jan. 31, 2010
Stock-Based Compensation Plans
Intrinsic value of options exercised	$ 8,034	$ 18,430
Cash received from the exercise of stock options	12,474	40,787
Tax benefits realized from stock options exercised	3,219	3,391
Fair value of options vested	$ 20,413	$ 30,209	$ 69,575

STOCK-BASED COMPENSATION AND OTHER BENEFIT PLANS (Details 6) $ / shares in Units, $ in Thousands	12 Months Ended
	Jan. 31, 2012 USD ($) Y D $ / shares shares	Jan. 31, 2011 USD ($) $ / shares shares	Jan. 31, 2010 USD ($) $ / shares shares	Jan. 31, 2009 component unit agreement $ / shares shares
Additional disclosures
Maximum number of shares approved	18,875,000
Compensation expense recognized \| $	$ 27,911	$ 46,819	$ 44,227
Number of shares available	2,110,000
Number of shares issued	39,265,000	37,349,000
Performance based RSUs
Stock-Based Compensation Plans
Additional stock-based compensation expense on modifications \| $			$ 2,600
Summary of award activity
Ending balance (in shares)	500,000
Restricted stock awards and restricted stock units
Summary of award activity
Beginning balance (in shares)	1,935,000	3,412,000	1,830,000
Granted (in shares)	902,000	1,102,000	1,812,000
Released (in shares)	(1,336,000)	(2,503,000)	(116,000)
Forfeited (in shares)	(51,000)	(76,000)	(114,000)
Ending balance (in shares)	1,450,000	1,935,000	3,412,000	1,830,000
Weighted-Average Grant-Date Fair Value
Beginning balance (in dollars per share) \| $ / shares	$ 18.09	$ 14.92	$ 24.48
Granted (in dollars per share) \| $ / shares	34.84	26.01	6.50
Released (in dollars per share) \| $ / shares	15.72	17.39	29.93
Forfeited (in dollars per share) \| $ / shares	28.85	13.23	19.94
Ending balance (in dollars per share) \| $ / shares	$ 30.25	$ 18.09	$ 14.92	$ 24.48
Additional disclosures
Compensation expense recognized \| $	$ 21,414	$ 25,583	$ 23,917
RSUs
Summary of award activity
Ending balance (in shares)	1,400,000
Additional disclosures
Unrecognized compensation expense \| $	$ 20,200
Remaining weighted-average vesting period over which expense is expected to be recognized (in years) \| Y	1.3
Total fair value of units vested \| $	$ 21,000	43,500	3,500
Phantom stock units
Stock-Based Compensation Plans
Total accrued liability \| $	1,900	9,800	14,500
Total cash payments made upon vesting of stock units \| $	$ 10,300	$ 22,900	$ 2,500
Summary of award activity
Beginning balance (in shares)	403,000	1,106,000	1,239,000
Granted (in shares)	10,000	196,000	421,000
Released (in shares)	(298,000)	(865,000)	(482,000)
Forfeited (in shares)	(25,000)	(34,000)	(72,000)
Ending balance (in shares)	90,000	403,000	1,106,000	1,239,000
Additional disclosures
Vesting period, minimum (in years)	P2Y	P2Y	P2Y
Vesting period, maximum (in years)	P3Y	P3Y	P3Y
Unrecognized compensation expense \| $	$ 500
Stock price (in dollars per share) \| $ / shares	$ 28.28
Remaining weighted-average vesting period over which expense is expected to be recognized (in years) \| Y	0.7
Compensation expense recognized \| $	$ 2,533	$ 18,101	$ 12,978
Stock Bonus Program
Additional disclosures
Trailing period of average price of common stock to determine the number of shares to be issued (in days) \| D	5
Maximum number of shares approved	150,000
Discount from market price (as a percent)	20.00%
Compensation expense recognized \| $	$ 3,241
Tandem Awards
Additional disclosures
Number of components \| component				2
Number of units received by recipient \| unit				2
Number of award agreements received by recipient \| agreement				2
Number of components structured to vest \| component				1
Employee Stock Purchase Plan
Additional disclosures
Maximum number of shares approved	1,000,000
Period of employment to be eligible to participate (in months)	3 months
Maximum percentage of salary an employee may use to purchase stock under the ESPP	10.00%
Purchase price expressed as percentage of the market price of common stock	85.00%
Number of shares available	1,000,000
Number of shares issued	260,000

STOCK-BASED COMPENSATION AND OTHER BENEFIT PLANS (Details 7)	12 Months Ended
	Jan. 31, 2012 USD ($) Y M	Jan. 31, 2011 USD ($)	Jan. 31, 2010 USD ($)
401(k) Plan and Other Retirement Plans
Minimum age required to participate in 401(k) plan (in years) \| Y	21
Minimum service period to participate in 401(k) plan (in months) \| M	3
Employee contribution limit (as a percentage of compensation)	60.00%
Company's matching contribution as percentage of employee's annual compensation	50.00%
Maximum annual matched contribution per employee	$ 2,000
Matching contribution expense	1,500,000	$ 1,400,000	$ 1,200,000
Liability for Severance Pay
Severance expenses	$ 5,200,000	$ 4,000,000	$ 3,400,000

- Definition

The charge against earnings in the period for known and estimated costs of termination benefits provided to current employees that are involuntarily terminated under a benefit arrangement associated with exit from or disposal of business activities or restructurings pursuant to a duly authorized plan, excluding costs or losses pertaining to an entity newly acquired in a business combination or a discontinued operation as defined by generally accepted accounting principles and costs associated with one-time termination benefits.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Staff Accounting Bulletin (SAB)
-Number Topic 5
-Section P
-Subsection 3, 4

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name FASB Staff Position (FSP)
-Number FAS146-1
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 132R
-Paragraph 5-8
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 4: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 112
-Paragraph 7
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 5: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 146
-Paragraph 8-13, 20
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 6: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 230
-SubTopic 10
-Section 45
-Paragraph 28
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=6943989&loc=d3e3602-108585

Reference 7: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 420
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SAB TOPIC 5.P.3)
-URI http://asc.fasb.org/extlink&oid=6394695&loc=d3e140864-122747

Reference 8: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 420
-SubTopic 10
-Section 50
-Paragraph 1
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=6394359&loc=d3e17939-110869

Reference 9: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 420
-SubTopic 10
-Section S99
-Paragraph 2
-Subparagraph (SAB TOPIC 5.P.4(b))
-URI http://asc.fasb.org/extlink&oid=6394695&loc=d3e140904-122747

Reference 10: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 715
-SubTopic 20
-Section 50
-Paragraph 1
-Subparagraph (a)(10)
-URI http://asc.fasb.org/extlink&oid=6962843&loc=d3e1928-114920

+ Details

RELATED PARTY TRANSACTIONS (Details) $ in Thousands	1 Months Ended		12 Months Ended
RELATED PARTY TRANSACTIONS (Details) $ in Thousands	Jul. 31, 2010 right shares	May 31, 2007 USD ($) shares	Jan. 31, 2012 USD ($) D	Jan. 31, 2011 USD ($) shares	Jan. 31, 2010 USD ($)
Relationship with Comverse and its Other Subsidiaries
Liabilities to affiliates			$ 1,760	$ 1,847
Comverse
Relationship with Comverse and its Other Subsidiaries
Liabilities to affiliates			$ 1,800	$ 1,800
Period after expiration of applicable statute of limitations, for which the tax sharing agreement continues to be in effect (in days) \| D			60
Comverse \| Preferred stock
Relationship with Comverse and its Other Subsidiaries
Shares issued \| shares		293,000
Aggregate purchase price		$ 293,000
Comverse \| Common Stock
Relationship with Comverse and its Other Subsidiaries
Number of demand registration rights exercised under the Original Registration Rights Agreement \| right	1
Share available for issuance as part of public offering \| shares	2,800,000			2,300,000
Comverse Inc., a subsidiary of Comverse
Relationship with Comverse and its Other Subsidiaries
Percentage charged in addition to actual expenditure incurred for services provided by related party			0.10
Expenses recorded for services provided by related parties					$ 300
Noncontrolling shareholder \| Joint venture, variable interest entity in which entity is primary beneficiary
Relationship with Comverse and its Other Subsidiaries
Expenses recorded for services provided by related parties			$ 500	$ 400	400
Revenue from related parties			$ 200	$ 200	$ 700

COMMITMENTS AND CONTINGENCIES (Details) $ in Thousands	12 Months Ended
COMMITMENTS AND CONTINGENCIES (Details) $ in Thousands	Jan. 31, 2012 USD ($) M	Jan. 31, 2011 USD ($)	Jan. 31, 2010 USD ($)	Nov. 30, 2011 USD ($)
COMMITMENTS AND CONTINGENCIES
Rent expenses incurred under all operating leases	$ 16,300	$ 12,900	$ 13,100
Minimum future rentals under non-cancelable operating and capital leases
2013	13,212
2014	9,245
2015	9,669
2016	8,484
2017	5,671
2018 and thereafter	32,595
Total	78,876
Aggregate minimum lease commitment over the term of the new lease				$ 36,100
Sublease rental payments
Total expected future sublease income	2,800
Total minimum expected future sublease income on an annual basis through February 2017	500
Total maximum expected future sublease income on an annual basis through February 2017	600
Minimum future rentals under non-cancelable capital leases
2013	412
2014	407
2015	200
Total	1,019
Less amount representing interest	(264)
Present value of minimum lease payments	755
Unconditional Purchase Obligations
Unconditional purchase obligation	$ 47,500
Unconditional purchase obligation, subsequent fulfillment period (in months) \| M	12

COMMITMENTS AND CONTINGENCIES (Details 2) $ in Thousands	12 Months Ended
COMMITMENTS AND CONTINGENCIES (Details 2) $ in Thousands	Jan. 31, 2012 USD ($) Y D	Jan. 31, 2011 USD ($)	Jan. 31, 2010 USD ($)
Warranty Liability
Warranty liability, beginning of year	$ 1,996	$ 1,292	$ 1,188
Provision charged to expenses	675	957	220
Warranty charges	(389)	(121)	(42)
Foreign currency translation and other	(267)	(132)	(74)
Warranty liability, end of year	$ 2,015	$ 1,996	$ 1,292
Enterprise Intelligence \| Hardware
Warrant Liability
Warranty period (in days/years) \| Y	1
Enterprise Intelligence \| Software
Warrant Liability
Warranty period (in days/years) \| D	90
Video and Situation Intelligence \| Minimum
Warrant Liability
Warranty period (in days/years) \| D	90
Video and Situation Intelligence \| Maximum
Warrant Liability
Warranty period (in days/years) \| Y	3
Communications Intelligence \| Minimum
Warrant Liability
Warranty period (in days/years) \| D	90
Communications Intelligence \| Maximum
Warrant Liability
Warranty period (in days/years) \| Y	3

COMMITMENTS AND CONTINGENCIES (Details 3) - USD ($) $ in Millions	1 Months Ended	12 Months Ended
	May 31, 2007	Jan. 31, 2012
Off-Balance Sheet Risk
Outstanding letters of credit and surety bonds		$ 41.2
Preferred stock
Preferred Stock Dividends, Conversion, and Redemption
Percentage of liquidation preference at which the holders of the preferred stock would have the right to repurchase the preferred stock in event of fundamental change by the entity		100.00%
Comverse Technology, Inc. (Comverse) \| Preferred stock
Preferred Stock Dividends, Conversion, and Redemption
Shares issued	293,000
Aggregate purchase price	$ 293.0

COMMITMENTS AND CONTINGENCIES (Details 4)	12 Months Ended
COMMITMENTS AND CONTINGENCIES (Details 4)	Jan. 31, 2012
COMMITMENTS AND CONTINGENCIES
Voting power percentage of Comverse required for business opportunities agreement to remain in place	20.00%

SEGMENT, GEOGRAPHIC, AND SIGNIFICANT CUSTOMER INFORMATION (Details) $ in Thousands	3 Months Ended								12 Months Ended
	Jan. 31, 2012 USD ($)	Oct. 31, 2011 USD ($)	Jul. 31, 2011 USD ($)	Apr. 30, 2011 USD ($)	Jan. 31, 2011 USD ($)	Oct. 31, 2010 USD ($)	Jul. 31, 2010 USD ($)	Apr. 30, 2010 USD ($)	Jan. 31, 2012 USD ($) segment	Jan. 31, 2011 USD ($)	Jan. 31, 2010 USD ($)
SEGMENT, GEOGRAPHIC, AND SIGNIFICANT CUSTOMER INFORMATION
Number of operating segments \| segment									3
Revenue:
Total revenue	$ 211,993	$ 199,364	$ 194,959	$ 176,332	$ 186,869	$ 186,641	$ 180,676	$ 172,613	$ 782,648	$ 726,799	$ 703,633
Reconciliation of segment contribution to operating income
Amortization of other acquired intangible assets									35,300	30,600	30,300
Stock-based compensation expense									27,911	46,819	44,227
Total operating expenses									427,809	415,350	398,019
Operating income									86,478	73,105	65,679
Other expense, net									(40,321)	(34,580)	(41,471)
Income before provision for income taxes	$ 19,439	$ 9,217	$ 14,437	$ 3,064	$ 12,818	$ 23,720	$ 15,532	$ (13,545)	46,157	38,525	24,208
Enterprise Intelligence
Revenue:
Segment revenue									444,700	410,529	374,778
Revenue adjustment									(6,682)
Total revenue									438,018	410,529	374,778
Reconciliation of segment contribution to operating income
Operating income									198,428	191,068	178,674
Video and Situation Intelligence
Revenue:
Segment revenue									140,610	134,012	144,970
Revenue adjustment									(2,594)
Total revenue									138,016	134,012	144,970
Reconciliation of segment contribution to operating income
Operating income									34,697	42,318	57,200
Communications Intelligence
Revenue:
Segment revenue									210,937	182,258	183,885
Revenue adjustment									(4,323)
Total revenue									206,614	182,258	183,885
Reconciliation of segment contribution to operating income
Operating income									63,296	66,802	62,348
Total operating segments
Reconciliation of segment contribution to operating income
Operating income									296,421	300,188	298,222
Unallocated
Reconciliation of segment contribution to operating income
Amortization of other acquired intangible assets									35,302	30,554	30,289
Stock-based compensation expense									27,911	46,819	44,227
Other unallocated expenses									146,730	149,710	158,027
Total operating expenses									$ 209,943	$ 227,083	$ 232,543

SEGMENT, GEOGRAPHIC, AND SIGNIFICANT CUSTOMER INFORMATION (Details 2) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Jan. 31, 2012	Oct. 31, 2011	Jul. 31, 2011	Apr. 30, 2011	Jan. 31, 2011	Oct. 31, 2010	Jul. 31, 2010	Apr. 30, 2010	Jan. 31, 2012	Jan. 31, 2011	Jan. 31, 2010
Geographic Information
Total revenue	$ 211,993	$ 199,364	$ 194,959	$ 176,332	$ 186,869	$ 186,641	$ 180,676	$ 172,613	$ 782,648	$ 726,799	$ 703,633
Total property and equipment, net	28,289				23,176				28,289	23,176
United States
Geographic Information
Total revenue									342,479	292,604	328,420
Total property and equipment, net	11,406				9,322				11,406	9,322
Israel
Geographic Information
Total property and equipment, net	10,150				8,221				10,150	8,221
Germany
Geographic Information
Total property and equipment, net	2,309				2,474				2,309	2,474
United Kingdom
Geographic Information
Total revenue									83,787	102,389	65,793
Total property and equipment, net	2,024				796				2,024	796
Canada
Geographic Information
Total property and equipment, net	694				371				694	371
Other
Geographic Information
Total revenue									356,382	331,806	$ 309,420
Total property and equipment, net	$ 1,706				$ 1,992				$ 1,706	$ 1,992

SEGMENT, GEOGRAPHIC, AND SIGNIFICANT CUSTOMER INFORMATION (Details 3)	12 Months Ended
	Jan. 31, 2012	Jan. 31, 2011	Jan. 31, 2010
Revenue \| Total revenue \| Minimum
Significant Customers
Percentage required for qualification as major customer	10.00%	10.00%	10.00%

SELECTED QUARTERLY FINANCIAL INFORMATION (UNAUDITED) (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended								12 Months Ended
	Jan. 31, 2012	Oct. 31, 2011	Jul. 31, 2011	Apr. 30, 2011	Jan. 31, 2011	Oct. 31, 2010	Jul. 31, 2010	Apr. 30, 2010	Jan. 31, 2012	Jan. 31, 2011	Jan. 31, 2010
SELECTED QUARTERLY FINANCIAL INFORMATION (UNAUDITED)
Revenue	$ 211,993	$ 199,364	$ 194,959	$ 176,332	$ 186,869	$ 186,641	$ 180,676	$ 172,613	$ 782,648	$ 726,799	$ 703,633
Gross profit	138,229	129,225	125,850	120,983	125,619	127,700	120,330	114,806	514,287	488,455	463,698
Income before provision for (benefit from) income taxes	19,439	9,217	14,437	3,064	12,818	23,720	15,532	(13,545)	46,157	38,525	24,208
Net income	17,875	9,921	11,274	1,555	13,422	18,388	12,391	(15,616)	40,625	28,585	17,100
Net income (loss) attributable to Verint Systems Inc.	17,179	9,451	10,475	(112)	13,140	17,174	11,475	(16,208)	36,993	25,581	15,617
Net income (loss) attributable to Verint Systems Inc. common shares, for basic net income (loss) per common share	13,392	5,704	6,768	(3,661)	9,511	13,582	7,921	(19,611)	22,203	11,403	2,026
Net income (loss) attributable to Verint Systems Inc. common shares, for diluted net income (loss) per common share	$ 13,392	$ 5,704	$ 6,768	$ (3,661)	$ 9,511	$ 17,174	$ 7,921	$ (19,611)	$ 22,203	$ 11,403	$ 2,026
Net income per common share attributable to Verint Systems Inc.
Basic (in dollars per share)	$ 0.34	$ 0.15	$ 0.18	$ (0.10)	$ 0.26	$ 0.38	$ 0.24	$ (0.60)	$ 0.58	$ 0.33	$ 0.06
Diluted (in dollars per share)	$ 0.34	$ 0.15	$ 0.17	$ (0.10)	$ 0.25	$ 0.36	$ 0.23	$ (0.60)	$ 0.56	$ 0.31	$ 0.06
Quarterly operating results
Loss on extinguishment of debt				$ 8,100					$ 8,136
Professional fees and related expenses associated with restatement of previously filed financial statements and previous extended filing delay status					$ 2,000	$ 1,000	$ 6,000	$ 20,000
Realized and unrealized losses on interest rate swap							$ 1,500	$ 1,600		$ 3,100