The Advisory Board Company Reports Fiscal Year 2008 Third Quart...( operating activities - ...),Health

operating activities -

Depreciation 2,598 1,457

Amortization of intangible assets 188 143

Deferred income taxes 11,032 9,417

Excess tax benefits from share-based

payments (5,377) (4,905)

Share-based compensation expense 10,443 9,165

Amortization of marketable securities

premiums 716 732

Changes in operating assets and

liabilities:

Member fees receivable (35,642) (35,185)

Prepaid expenses and other current

assets (654) 142

Deferred incentive compensation and

other charges (8,970) (3,375)

Deferred revenues 35,289 26,901

Accounts payable and accrued liabilities 5,890 2,222

Accrued incentive compensation (539) 1,459

Other liabilities 141 876

Net cash flows provided

by operating activities 38,644 29,266

Cash flows from investing activities:

Purchases of property and equipment (6,151) (5,954)

Capitalized software development costs (294) (320)

Cash paid for acquisition, net of cash

acquired - (895)

Redemption of marketable securities 31,605 11,500

Purchases of marketable securities (26,345) (9,500)

Net cash flows used
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