Use these links to rapidly review the documentTABLE OF CONTENTS Item 8. Financial Statements and Supplementary Data



UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549

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FORM 10-K

|ý                                | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 (Mark One)
|-------------------------------- | -----------------------------------------------------------------------------------------------
|                                 | For the fiscal year ended November 30, 2007                                                    
|OR                              
|o                                | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934       
|                                 | For the transition period
from                                    to                           
|Commission file number 001-32511

|
|

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IHS INC.(Exact name of registrant as specified in its charter)

|Delaware                                                       |  | 13-3769440                       
|-------------------------------------------------------------- |  | ---------------------------------
|(State or Other Jurisdiction of
Incorporation or Organization) |  | (IRS Employer
Identification No.)

15 Inverness Way East
Englewood, CO 80112(Address of Principal Executive Offices)

(303) 790-0600(Registrant's telephone number, including area code)

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Securities
registered pursuant to Section 12(b) of the Act:

|Title of each class                                                                                                                                  |  | Name of each exchange on which registered
|---------------------------------------------------------------------------------------------------------------------------------------------------- |  | -----------------------------------------
|Class A Common Stock, $0.01 par value per share
Series A junior participating preferred stock purchase rights
(attached to the Class A Common Stock) |  | New York Stock Exchange                  

Securities
registered pursuant to Section 12(g) of the Act: None.

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Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.



Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act.



Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the
past 90 days.



Indicate by check mark if disclosure of delinquent filer pursuant to Item 405 of Regulation S-K is not contained herein, and will not be
contained, to the best of the registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of the Form 10-K or any amendment to
the Form 10-K. ý

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of
"accelerated filer and large accelerated filer" in Rule 12b-2 of the Exchange Act. (Check one):

|Large accelerated filer ý |  | Accelerated filer o |  | Non-accelerated filer o
|------------------------- |  | ------------------- |  | -----------------------

Indicate
by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).



The aggregate market value of the voting and non-voting common equity held by non-affiliates, based upon the closing price for the Common
Stock as reported on the New York Stock Exchange composite tape on the last business day of the Registrant's most recently completed second fiscal quarter, was approximately $848 million. All
executive officers, directors, and holders of 5% or more of the outstanding Common Stock of the registrant have been deemed, solely for purposes of the foregoing calculation, to be "affiliates" of the
registrant.

As
of December 31, 2007, there were 48,754,266 shares of the registrant's Class A Common Stock outstanding and 13,750,000 shares of the registrant's Class B Common
Stock outstanding.

DOCUMENTS INCORPORATED BY REFERENCE

The information required by Part III of the Form 10-K, to the extent not set forth herein, is incorporated herein by reference from the
registrant's definitive proxy statement for the Annual Meeting of Shareholders to be held on April 23, 2008, to be filed with the Securities and Exchange Commission pursuant to
Regulation 14A not later than 120 days after the close of the registrant's fiscal year.



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TABLE OF CONTENTS



|                           |          |     |                                                                                                                  | Page
|-------------------------- | -------- | --- | ---------------------------------------------------------------------------------------------------------------- | ----
|Forward-Looking Statements |          | ii 
|PART I                     |          | 3  
|                           | Item 1.  |     | Business                                                                                                         |     
|                           | Item 1A. |     | Risk Factors                                                                                                     |     
|                           | Item 1B. |     | Unresolved Staff Comments                                                                                        |     
|                           | Item 2.  |     | Properties                                                                                                       |     
|                           | Item 3.  |     | Legal Proceedings                                                                                                |     
|                           | Item 4.  |     | Submission of Matters to a Vote of Security Holders                                                              |     
|PART II                    |          | 33 
|                           | Item 5.  |     | Market for the Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities |     
|                           | Item 6.  |     | Selected Financial Data                                                                                          |     
|                           | Item 7.  |     | Management's Discussion and Analysis of Financial Condition and Results of Operations                            |     
|                           | Item 7A. |     | Quantitative and Qualitative Disclosures About Market Risk                                                       |     
|                           | Item 8.  |     | Financial Statements and Supplementary Data                                                                      |     
|                           | Item 9.  |     | Changes in and Disagreements With Accountants on Accounting and Financial Disclosure                             |     
|                           | Item 9A. |     | Controls and Procedures                                                                                          |     
|                           | Item 9B. |     | Other Information                                                                                                |     
|PART III                   |          | 110
|                           | Item 10. |     | Directors, Executive Officers and Corporate Governance                                                           |     
|                           | Item 11. |     | Executive Compensation                                                                                           |     
|                           | Item 12. |     | Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters                   |     
|                           | Item 13. |     | Certain Relationships and Related Transactions, and Director Independence                                        |     
|                           | Item 14. |     | Principal Accountant Fees and Services                                                                           |     
|PART IV                    |          | 111
|                           | Item 15. |     | Exhibits and Financial Statement Schedules                                                                       |     
|SIGNATURES                 |          | 114

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FORWARD-LOOKING STATEMENTS

We have made statements under the captions "Risk Factors," "Management's Discussion and Analysis of Financial Condition and Results of Operations," and "Business
and Properties" and in other sections of this Form 10-K that are forward-looking statements. In some cases, you can identify these statements by forward-looking words such as "may,"
"might," "will," "should," "expect," "plan," "anticipate," "believe," "estimate," "predict," "potential," or "continue," the negative of these terms, and other comparable terminology. These
forward-looking statements, which are subject to risks, uncertainties, and assumptions, may include projections of our future financial performance based on our growth strategies and anticipated
trends in our business. These statements are only predictions based on our current expectations and projections about future events. There are important factors that could cause our actual results,
level of activity, performance, or achievements to differ materially from the results, level of activity, performance, or achievements expressed or implied by the forward-looking statements. In
particular, you should consider the risks outlined under "Risk Factors."

Although
we believe the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, level of activity, performance, or achievements.
Moreover, neither we nor any other person assumes responsibility for the accuracy or completeness of any of these forward-looking statements. You should not rely upon forward-looking statements as
predictions of future events. We are under no duty to update any of these forward-looking statements after the date of this Form 10-K to conform our prior statements to actual
results or revised expectations.

*
* * *



Our fiscal years end on November 30 of each year. Unless otherwise indicated, references herein to an individual year means the fiscal year ended
November 30. For example, "2007" refers to the fiscal year ended November 30, 2007.

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PART I

Item 1.    Business

Overview

IHS is a leading provider and comprehensive source of Critical Information and Insight in a sizable and growing global information market. Our customers rely on
our products and services to facilitate crucial decision-making, support key processes, and improve productivity. We provide information-driven solutions to meet our customers' needs, which include
gaining insight into global energy market movements, managing product lifecycles, meeting growing environmental challenges, and assessing national or corporate security issues. IHS customers range
from governments and large multinational corporations to small companies and technical professionals, doing business in more than 180 countries.

At
the heart of our Critical Information products and services is data obtained from public sources, third parties, and our own proprietary databases. We transform that data into
Critical Information and Insight that is both useful to our customers and available where and when they need it by combining data with our proprietary and third-party technology to create graphical
user interfaces, interactive search and navigation tools, and online databases. We deliver these products primarily through Internet-based applications and portals. In many cases, the combination of
our data with these Internet-based tools provides the customer with a unique solution. Some products are also delivered through traditional media. We further transform our Critical Information into
Insight products and services with analysis from our teams of experts.

IHS
has a leading position in vertical markets we serve. We sell our offerings primarily though online subscriptions to our numerous software tools, search interfaces, and analytical
services. As a result of our subscription-based business model and historically high renewal rates, we generate recurring revenue and cash flow. IHS also has a scalable operating model that we believe
offers significant operating leverage. Our compelling strategies, discussed later, combined with an experienced management team continue to drive profitable growth. IHS was organized as a Delaware
corporation in 1994. We have been in business since 1959 and employ more than 3,000 people worldwide.

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Vision

Our vision is to bethe Sourcefor Critical Information and Insight. When Critical Information or
Insightor bothare mission-critical to our customers in achieving their business goals anywhere around the globe, we intend to be the source that they trust, rely upon, and
come to first. Over many years, we have established our reputation for providing high-quality solutions to customers' information needs. In recent years, we have executed a shift to
Internet-based tools and portals that better meet the demands of our customers' businesses. And in the past year we have targeted the information needs of our customers by identifying four specific
information "domains" (Energy, Product Lifecycle, Security, and Environmental) where we believe we have the best opportunity to bethe Sourcefor our
customers.

CHART

Each
of these four strategic information domains represents a significant market opportunity and our goal is to be the leading source of Critical Information and Insight in each of them.
In addition, these domains are often inter-related and inter-linked; thus the intersections between them represent areas of critical interest for our customers and a further market opportunity for
IHS.

Since
these four information domains represent areas where our customers have needs for Critical Information and Insight, we use these domains to set priorities and design our business
objectives. As we continue to deliver Critical Information and Insight in those four information domains, we prepare
and analyze our financial reports to include each of the four domains in our two operating segments. Our Energy segment is focused primarily on the Energy information domain while our Engineering
segment is focused primarily on the Product Lifecycle, Security, and Environmental information domains. However, as discussed below, some of our greatest opportunities to serve our customers occur in
the intersection of these information domains. Accordingly, there may be increasing overlap among information domains and between our two operating segments. We expect that overlap, as well as the
ongoing evolution of our operating model, to drive changes in the way we manage our business. As those changes continue, the way we discuss our business and report on our operating segments may
change.

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Information Domains

The Energy domain encompasses exploration and production of hydrocarbons through to distribution, power generation, and consumption. Examples of Critical
Information and Insight in the Energy domain include:



The
Product Lifecycle domain contains information required to take a product from conception to research and development on through to production, maintenance, and disposal. Examples of
Critical Information and Insight in the Product Lifecycle domain include:



The
Security domain contains information and insight to assist in security planning, from preparation through to crisis response and military action. Examples of Critical Information and
Insight in the Security domain include:



The
Environmental domain contains information and tools that support compliance with environmental regulations and related issues. Examples of Critical Information and Insight in the
Environmental domain include:



As
well as strength in each information domain, we believe we have a unique competitive advantage at the intersection of these domains. One key advantage lies in our ability to offer
highly

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adaptable
software tools, including customer resources on Internet-based portals, that can combine disparate databases, user interfaces, and other products from multiple information sources.

CHART

For
example, in the intersection between the Security and Product Lifecycle domains, we believe we have an opportunity to help customers manage product cost with a better understanding
of security around sourcing materials and products. Similarly, at the intersection of the Security and Energy information domains, we believe that we can help customers understand and manage security
issues as a significant driver of cost in exploring for, producing, and delivering energy around the world.

At
the intersection of the Energy and Environmental information domains, we plan to help customers with their growing need for information and insight as they manage the increasingly
important issue of environmental impact from energy exploration, production, and delivery. In addition, between the Environmental and Product Lifecycle domains, we see an opportunity to help a wide
range of customers understand and manage the cost of both regulatory compliance and the actual environmental impact in their manufacturing processes.

Goals

In order to achieve our vision to bethe Sourcefor Critical Information and Insight, we have set four broad
objectivesour goalsupon which we focus our efforts. These four goals are:



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We
are committed to measuring our progress on these four goals using quantifiable, objective metrics. For instance, to measure Customer Delight and colleague success, we use third-party
surveys and set goals based on those metrics. In 2008, our goal is to improve both of those measures by a minimum of ten percent. Our commitment to deliver profitable growth will be evident in each of
our quarterly and annual reports to our shareholders. Our measure of shareholder success relative to our peer group will be derived from our peers' publicly reported financial results as compared to
our own performance each year.

Profitable Growth Strategies

With our four goals in place as a foundation, we look to our strategies as the roadmap to achieving our goals. Inherent in all of our strategies is a firm
commitment to put our customers first in everything that we do. We believe that maintaining a disciplined "outside-in" approach will allow us to better serve our customers and our
shareholders. In addition, we believe that the success of every strategy requires us to constantly strive to create a best-in-class work environment for our colleagues.

Our
primary strategy is to achieve and strengthen a leading position inand at the intersection ofour targeted information domains (including Energy, Product
Lifecycle, Security and Environmental). We also intend to continue driving margin and quality improvement through operational transformation. And finally, we intend to enhance the effectiveness of our
other strategies with a continued emphasis on acquisitions.

To
support these strategies, we have several on-going cross-functional projects led by members of the senior leadership team. Our operational transformation is an evolution,
one which started over three years ago and will continue for a few years to come. We have not designed these initiatives as purely cost-cutting events. Rather, they are multi-faceted
endeavors designed to simultaneously improve the quality of our offerings while optimizing the efficiency and effectiveness of the processes involved.

Our
current initiatives are designed to focus on three key areas: our customers, financial model, and operational improvements. These initiatives include the following:



Acquisitions

Since acquisitions play a key role in expanding our information domain leadership and driving profitable growth, we emphasize strategy and discipline in
determining which targets to pursue and ultimately acquire. Our acquisition strategy is guided by our four targeted information domains

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(Energy,
Product Lifecycle, Security, and Environmental). To maintain a disciplined approach to acquisitions, we have established a set of guiding principles. In general, an acquisition should:



We
have completed and integrated 16 strategic acquisitions over the last three years. Some were relatively large, others were small, but they all filled a strategic need. Our larger
acquisitions enable us to achieve greater reach in a given domainfor example, the Jane's business. Similarly, our "bolt-on" or "tuck-in" acquisitions, while generally smaller, tend to
consist of databases or datasets (such as EDS or GCS) that provide a strategic broadening of our Critical Information offerings. These bolt-on acquisitions often come with little to no overhead,
require minimal integration, and deliver higher incremental margins than larger acquisitions.

During
2007, we made the following acquisitions:



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During
2006, we made the following acquisitions:



We
also made three acquisitions during 2005 for an aggregate purchase price of approximately $3.5 million.

Critical Information and Insight

We deliver our solutions through a combination of critical information and insight. At the heart of our Critical Information products and services is data
obtained from public sources, third parties, and

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our
own proprietary databases. We transform that data into Critical Information and Insight that is both useful to our customers and available where and when they need it by combining data with our
proprietary and third-party technology to create graphical user interfaces, interactive search and navigation tools, and online databases. We deliver these products primarily through Internet-based
applications and portals. In many cases, the combination of our data with these Internet-based tools provides the customer with a unique solution. Some products are also delivered through traditional
media. We further transform our Critical Information into Insight products and services with analysis from our teams of experts.

Critical Information

We provide Critical Informationa comprehensive collection of current and historical technical and business information that is highly relevant to
customers in the information domains we servethrough our proprietary user interfaces and technology-driven solutions. We continually augment, update, organize, and refine this information
for breadth, depth, usability, currency, and accuracy in order to deliver it according to industry requirements and customer needs. In addition, we offer our customers interactive tools,
Internet-based portals, and user interfaces designed to enable informed and effective decisions in each customer's business. For instance, some of our portals provide interactive tools that produce
graphical renditions of data or intuitive navigation systems that make data manageable. While we still offer customers some products on less robust media
such as DVDs or print media, our goal is to offer the most useful and capable offerings possible using online technology. See below for specific examples of some of our technology.

Our
Critical Information is gathered from various sources, including through our global network of industry sources and our longstanding relationships with government agencies,
manufacturers, distributors, standard development organizations (SDOs), editors and freelance contributors from all around the world. Additionally, specific to some of our Energy and Security
information domain offerings, we employ a network of independent contractors who each utilize an informal network of industry and government sources to obtain data. Each of these independent
contractors has entered into a written agreement with IHS to follow our standards and applicable laws in the course of obtaining data. Several of our Energy products and several products in our Jane's
business rely heavily upon the work product of these independent contractors.

Once
we obtain data, we process it rigorously. For example, in our Energy information domain products, we test data accuracy, cross-reference it against numerous sources, verify
applicable surface and subsurface attributes, and standardize and create common industry codes. We are recognized as an industry leader in setting information standards and codes, working with our
global customer base and industry groups to define and maintain Critical Information standards and formats.

We
offer this information to our customers in a timely and user-friendly manner primarily through online subscriptions. To a lesser extent, we may offer our information
products on CD-ROM, DVD, or print media. Most of our Critical Information offerings are interactive software tools. Depending on the terms of a customer's subscription, they can be made
available through Internet-based portals, installed on the customer's network for local access, or reproduced on for local distribution and access.

We
integrate Critical Information with technology and applications to meet the needs of a range of users across our four targeted information domains (Energy, Product Lifecycle,
Security, and Environmental). These tools enable our customers to integrate our information and their proprietary information within their workflows and business processes. Our decision-support tools
range from easy-to-use "browse and search" applications, which are interfaces that allow customers to browse through all available information and search terms to locate
specific information, to more sophisticated analytic systems. The underlying information could consist of a single database or multiple collections of information, depending on the subscription
selected by the customer. In our more advanced

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decision-support
tools, we strive to maintain a simple interface on the user's computer, but we design them to draw upon multiple sources of information and manipulate and organize the information
into models, estimates, and other highly organized output. For example, within the energy information domain, our sophisticated engineering, cost analysis, and economics tools can help a customer
estimate drilling costs, assess project economics, optimize exploration and production activities, and improve production yields.

Insight

IHS is the trusted source not only for in-depth, accurate information, but for the expert analysis that makes that information actionable.
Accordingly, in addition to our proprietary skill at delivering Critical Information, IHS offers our customers a unique expertise in transforming that Critical Information into valuable insight.
Within our information domains, our experts start with a core of relevant, data-driven information, then analyze, distill and sort it to a point of relevant, actionable intelligence: what
we callInsight.

We
provide our Insight to governments around the globe, major energy producers, security and defense agencies, and corporations in a wide range of industries. Our customers rely on the
advantage of IHS thought leadership that results from transforming nearly 50 years of Critical Information management into vital Insight. Using our Insight products and services, our customers
are better able to serve their customers, compete in global markets, and understand geopolitical conditions.

The
IHS focus on the four information domains where our customers have critical business needs (Energy, Product Lifecycle, Security, and Environmental) enables us to deliver Insight to
customers not only within those domains, but also where those domains intersect and overlap. We believe that IHS is uniquely positioned within and across those four information domains to deliver
Critical Information and Insight.

Energy Information Domain

We are one of the leading global providers of Critical Information and Insight for the energy industry. For more than four decades, we have provided comprehensive
information to energy organizations around the world. We develop and deliver critical oil and gas industry data on exploration, development, production, and transportation to major oil and gas
companies, national oil companies, electric power companies, financial institutions, and governments. We also provide operational, research, and strategic advisory services to these customers and to
utilities and transportation, petrochemical, coal, and power companies.

We
complement this information with economic, political, fiscal, and regulatory analysis, as well as operational, research, and strategic advisory services. By integrating our offerings,
we help energy organizations analyze their operations and make better use of information, which we believe enhances their ability to effectively evaluate investment opportunities, reduce operating
costs, and increase their productivity.

Critical Information

Energy activity data.Our energy activity data includes comprehensive and timely information, organized by country, on
current and future seismic, drilling, and development activities. This data also includes detailed reports on contractual activity and changes in legislation, regulation, petroleum rights, and fiscal
matters. Our customers use this data daily to track global energy activities, actively assess and mitigate potential risks to energy assets and operations, react to competitive industry pressures, and
capitalize on developing opportunities. This data includes continually updated online information on energy activities in more than 180 countries and 335 hydrocarbon-producing regions around the
world;

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daily
breaking energy news alerts; and country and region maps detailing wells, fields, licenses, pipelines, facilities, and other pertinent geological data.

Production data.Our production data tracks information on more than 90% of the world's oil and gas production, including
monthly production volumes for wells and fields in more than 100 countries. This data includes cumulative statistics on monthly oil and gas production volumes for more than two million oil assets and
more than 70,000 producing fields globally. It is used by reservoir engineers and commercial analysts to assess the productivity and longevity of energy producing assets, determine the current and
future value of these assets, and develop and assess investment and operating plans.

Oil and gas well data.Our oil and gas well data includes as many as 20,000 elements, narrative comments, and other
information from as far back as the mid-1800s on over four million wells around the world. This data includes comprehensive geological information on current and historic wells, including
lease, operator, field, reservoir, fluid, linking well, permit, drilling activity, completion record, and other data, as well as digital geologic and reservoir images representing billions of feet of
subsurface measurements. Geoscientists, petrophysicists, and reservoir engineers use this data to evaluate the production potential and economic value of current and future exploration and production
wells.

Reservoir data.Our reservoir data includes reservoir pressure and geological formation data for assets in key
energy-producing regions of the world. Geoscientists and engineers use this data to analyze reservoir potential and identify geological pressure hazards to optimize drilling activities by maximizing
yields and reducing downtime.

Basin data.Our basin data includes information on more than 30,000 hydrocarbon basins around the world. It also includes
location, development, contractual, and ownership information, as well as
comprehensive geological data on each basin. This data is developed and maintained by industry experts and used by exploration geologists to evaluate hydrocarbon potential, analyze production
opportunities, and assess the feasibility of drilling opportunities.

Infrastructure data.Our infrastructure data provides location, capacity, and ownership information on oil and gas wells and
facilities. It also includes transportation and refining infrastructure data on pipelines, ports, refineries, capacity specifications, and tariffs and rates, including information on major industrial
plants and key retail consumers. Customers use this data to evaluate transportation options and to analyze oil field and infrastructure projects.

Upstream data.Our upstream data contains legal, regulatory, economic, contractual, political, and risk information relating
to upstream energy exploration and production activities in more than 100 countries. It is used by commercial analysts, economists, corporate planners, and lawyers to better understand investment
environments and assess risk.

Exploration analysis.We integrate production, well, and reservoir information to enable geoscientists to search for and
analyze oil and gas opportunities around the world. These tools provide surface and subsurface information, analysis, and graphical interfaces to facilitate geoscience workflows.

Production engineering.We integrate current and historical production information with performance analysis software. Energy
engineers use these tools to optimize their well and field production systems by monitoring oil and gas production, modeling well performance, and performing production gradient and flow assurance
calculations.

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Insight

Operational services.We offer our customers access to our expertise in subsurface analysis, engineering, economics, fiscal,
and regulatory matters and asset optimization through several services, including the following:



Cost analysis.We produce detailed capital and operating cost estimates for planning activities and project optimization. Our
customers use these tools to analyze the economic feasibility of competing projects, significantly reduce cycle times in engineering work flows, and ultimately reduce costs.

Economics.We evaluate the after-tax economics of projects, fields, licenses, and country and company portfolios
based on more than 200 pre-modeled fiscal regimes and our other Critical Information to evaluate a variety of economic factors, such as reservoir and reserve performance, estimated
ultimate recovery, and projected cash flows with the goal of enabling our customers to make rapid and informed acquisition, divestiture, and operations decisions.

Research and expert analysis.Through our research offerings, we provide customers with insight and analysis into challenges
facing the energy industry, including economic, geopolitical, financial, technological, regulatory, environmental, and managerial matters. Our research helps customers anticipate trends in the
industry in order to make informed strategic, investment, and market decisions. For example, both energy companies and financial institutions use research and analysis from Cambridge Energy Research
Associates (CERA), an IHS company, to make informed decisions about energy investments and markets.

CERA
offers syndicated research services, each focusing on different combinations of segments and regions in the energy industry, as well as custom consulting. Examples of such research
offerings includeGlobal Oil, European Gas, China Energy, and Global Liquefied Natural Gas. In addition to these
syndicated research offerings, we have recently engaged in a number of multi-client research studies, such asCrossing the Divide: the Future of Clean
Energy;,Dawn of a New Age: Global Energy Scenarios for Strategic Decision-makingThe Energy Future to 2030; Beyond The Crossroads: The Future
Direction of Power Industry Restructuring; andEuropean Emissions Trading: A New Market
Paradigm.

We
also develop and organize executive research summits where high level industry, financial, and governmental decision makers interact with our senior research experts and discuss
energy industry trends and market dynamics. These events provide a significant opportunity for our experts and customers to exchange knowledge and ideas. We conduct more than 75 events each year,
including our premier event, CERAWeek. CERAWeek is an annual executive conference that has been addressing

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challenges
facing international energy markets and companies for 27 years. Attracting more than 1,600 of the energy industry's leading executives and companies, financial executives, and
policymakers annually, it is considered to be the most important meeting of its kind and ranked one of the top five CEO-level conferences in the world. In addition to CERAWeek, other
examples of our executive research summits are the Global Power Forum, Eurasia Transportation Forum and the Capital Cost Analysis Forum at the "East Meets West" conference in Istanbul.

Strategic Advisory Services.We assist customers in assessing their strategic options by providing the Critical Information
and Insight required for sound decision-making. Our services focus on a range of key issues, such as global oil and gas planning, exploration and production issues, alternative business line
assessments, scenario planning and facilitation, market analysis, renewable energy and corporate facilitation. For example, we recently completed a country-wide gas planning project in
China and an oil and gas regulation project in Kuwait. Other current projects include the design of an energy regulatory system for a Middle Eastern country, development of a more market-based system
for a national oil company, economic and market analysis for a pipeline in the Former Soviet Union, and the development of a an energy efficiency strategy for a major U.S. electric power company. Most
of these services are provided through the CERA business.

The
Chairman of CERA is its co-founder, Dr. Daniel Yergin, who is a member of the U.S. Secretary of Energy's Advisory Board and the National Petroleum Council, a
Trustee of the Brookings Institution, and a director of the United States Energy Association. Dr. Yergin is the author of the Pulitzer Prize-winning book titledThe
Prize: The Epic Quest for Oil, Money and Power.

Company financial and operational analysis.With the acquisition of John S. Herold in August 2007, IHS acquired
a leading position in energy company financial and operational analyses. John S. Herold, founded in 1948, is a uniquely positioned information services company, providing online transaction
databases and deal analyses essential to understanding and executing energy mergers and acquisitions and capital markets transactions. Its client base is comprised of virtually every major oil and gas
company, the world's leading commercial and investment banks, and top institutional and investment money managers. John S. Herold also serves clients with focused consulting services and the
highly regarded annual Pacesetters Energy Conference.

Coal industry Insight.The McCloskey Group, acquired in December 2007, keeps its customer base of coal producers,
traders, shippers, and coal consumers informed via eight print and online publications as well annual conferences and consulting services. McCloskey's goal is to be the reference point for information
on the coal markets. For example, major transactions in the coal markets and steam coal deals in Europe are executed with McCloskey price information as their reference. The McCloskey Group shares
with IHS a vision to provide high-quality Critical Information and Insight. Its leading role in global coal markets is highly complementary to the IHS business model, aligning closely with
our focus on data, markets, and fundamental analysis.

Product Lifecycle Information Domain

IHS is one of the leading providers of Critical Information and Insight supporting the product lifecycle from up front R&D through design, production, maintenance
and obsolescence management. Our products and services are used by our customers in their workflows, to enhance quality, reduce costs, and improve productivity.

We
have been providing product lifecycle information for almost five decades, and through this have built deep, trusted relationships with our customers globally. Through these
solutions, we touch most industries and segments, with particularly large presences in the aerospace, defense, electronics, telecommunications, construction, energy and automotive industries.

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Critical Information

Specifications and standards.We provide engineering organizations worldwide with single-source access to specifications and
standards so they can control costs, improve decision speed and effectiveness, manage compliance, and reduce design times. We provide searchable documents and scanned document images containing
commonly used and hard-to-find specifications and standards. Our online database contains over a million documents and images covering national, international, corporate,
military, and other specifications and standards that we organize into hundreds of discrete data sets. For example, our military specifications and standards data set contains what we believe is the
world's largest collection of unclassified U.S. military specifications and standards, with over 82,000 active and 387,000 historical military documents.

Our
SDO relationships are critical to our specifications and standards business. SDOs generally consist of manufacturer, service provider, and laboratory representatives who establish
compliance guidelines, or specifications and standards, for an industry. Most engineering work is governed by a wide array of specifications and standards that are designed to ensure that products and
component parts conform to generally accepted design practices, performance criteria, and quality, safety, and reliability requirements. We enter into licensing agreements with SDOs, including the
SDOs that publish the most commonly used specifications and standards, to distribute this information to customers.

We
supplement this SDO information with complementary content, including government and military specifications and standards, regulations, manufacturer and parts data, and logistics and
procurement data. We use a number of methods, including proprietary technologies, to gather, update, organize, index, and cross-reference the information. These processes, along with our research and
industry expertise, allow us to create unique packages of content to meet the specific business needs of our customers.

Our
specification and standards information is delivered primarily through our proprietary web-based applicationStandards Expert which was released
in 2007 and was based on more than 45 years of experience and analysis of our customers' workflow. This application includes a number of critical tools and functionality such as:



Regulatory data.We provide access to critical regulations for our targeted industries, such as aviation, construction, and
energy. For example, one of our regulatory offerings contains over one million pages of essential aviation regulations and related documents relating to the airworthiness, regulatory compliance, and
safety of aircraft. This Internet-based database provides a wide range of information from U.S. and international aviation regulatory agencies. We also track regulations that affect multiple
industries, such as occupational health and safety regulations. Our regulations data can be integrated with specifications and standards to provide customers with a broader range of compliance
information.

Electronic components parts information.The IHS electronic components eCatalog is one of the leading sources of information
for this critical component category. With our solution, companies can instantly access product critical component information, including component alternates, part status, manufacturer documentation,
datasheets, application notes, timing diagrams, and product change

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notifications
(PCNs). This product also provides direct access to analytical predictive lifecycle information and alert part notifications, allowing users to proactively identify and quickly minimize
lifecycle management challenges, accelerating ROI.

Obsolescence Management Tools.Utilizing the information in our electronic components parts product, IHS offers a tool for
our customers to help them manage parts obsolescence. Bill of materials (BOM) or component manufacturer part number lists are imported and then automatically matched against our industry- reference
component database. Provided for each matched manufacturer part number is current manufacturer availability, suggested Form-Fit-Function (FFF) alternate part numbers, and our
proprietary life cycle modeling and part availability predictive data.

Government Parts Information.IHS offers a parts and logistics management system, centered on parts procured by the U.S.
government. It provides crucial integrated and interoperable logistics information so that processes can be automated, labor and research costs may be reduced, and new levels of efficiency and return
on investment can be realized. This solution contains information on more than 100 million items in the U.S. Federal Supply Catalog and over 40 U.S. Army, Navy, Air Force, and related military
databases. Access to the National Forging Tooling Database (NFTD) provides visibility to spare parts and tooling. Superior search engine capabilities enable users to search by a wide range of
criteria, databases, or other commands to returns relevant results in seconds.

Fasteners Parts Information.The IHS Fasteners eCatalog provides decision support for the identification, specification and
sourcing of Aerospace & Defense standard fasteners such as bolts, screws, nuts, washers, rivets, and studs. Designed with the engineering workflow in mind, the IHS Fasteners eCatalog helps
solve time-consuming challenge engineers experience when navigating through various "flat" standards. It simplifies the human element of incorporating approved standard parts into drawings
and empowers the engineer with the ability to search for fasteners by part number, document number or parametric, based on the proprietary normalization and categorization of fastener physical and
mechanical attributes.

Catalog Information.Our solution delivers a valuable and comprehensive collection of manufacturer's catalogs to our
customers' desktops with speed, accuracy, and reliability. This product contains more than 300,000 catalogs from over 16,000 manufacturers, directory listings on an additional 500,000 manufacturers,
and more than 120 million part number references.

Maintenance, Repair, and Operations (MRO) project support.Utilizing our tools and proprietary MRO database, IHS offers
project-based services to cleanse and enhance a customer's database of indirect parts. This service offering can be used to greatly reduce a customer's inventory and procurement costs and improve
uptime.

Defense Information Services.IHS offers customers within the U.S. federal government a turnkey solution for managing parts
information at federal facilities, primarily in the armed forces. Core elements of this service include integration of parts information and support through a dedicated team of information solutions
professionals.

Integration Services and Support.We offer these services to integrate our content and tools into specific customer workflows
and systems. Our goal is to create significant value for the customer by interweaving our tools and content directly into their core systems and business processes, with the additional goal of
enhancing a long-term relationship with the customer and driving increased demand for our subscription tools and information.

Insight

Engineering methods.We have developed a comprehensive proprietary database of engineering processes, principles, and related
equations. The database covers more than 250 specific structural and

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mechanical
topics, including noise and vibration, stress and fatigue, metals and composites, structure, and dynamics.

Security Information Domain

Security needs of our customers encompass a diverse range of focus, including equipment, military forces, organizations, businesses, markets and geopolitics. In
our increasingly competitive and uncertain world, planning for effective security protection in any realm begins with a full understanding of the types and sources of risk that organizations face to
stay ahead of potential threats. With the 2007 acquisition of Jane's, we believe IHS provides the most up to date security information and intelligence so that customers can accurately assess strength
and vulnerability when making a security analysis.

From
its inception in 1898, Jane's has built a global brand by providing impartial, accurate and reliable security information and insight to leading corporations, governments and
agencies around the world. With a large team of dedicated editors, researchers, and analysts monitoring, evaluating, and reporting developments, Jane's solutions blend public data, media content, and
professional and academic sources with expert analysis to provide insight on global developments and trends. A variety of electronic and print formats are available for seamless integration into our
customers' own intelligence and decision-making processes.

Critical Information

Jane's collects critical information relating to national and international security, defense intelligence, terrorism and insurgency, transportation, law
enforcement and public safety. We utilize our staff of editors and expert to interpret and enhance the information. As such, we consider all of our security solutions today to be under our Insight
umbrella, as listed below.

Insight

Comprehensive coverage.The broad array of content coverage includes: Worldwide news and features; Reference content, images
and video; Company/organizations (profiles, capabilities, people, capacity, culture, strategy, performance and prospects); Equipment (specifications, utilization, markets, inventories, manufacturers
and forecasts); Markets (demographics, history, current status and developments, trends and forecasts, and future opportunities); Governments (the political parties, people, policies and budgets that
underpin the national standing); Countries (demographics, military forces, state stability, international relations, proliferation and procurement, risk assessments, terrorism and other threats); and
Events (tracking the events, incidents and announcements that occur every day around the world).

National and international security.Analyses of the internal and external dynamics of almost every country in the world and
how their military and political environments and relationships influence the landscape, including major developments in the world's trouble spots and their predicted outcomes; accurate pinpointing
and prediction of geopolitical threats and risk around the world; analysis on a country's sphere of influence, ambitions and risk levels; and assessments of military strength and vulnerability for
threat analysis and strategy development.

Defense intelligence.Analysis on the latest defense equipment and technology, emerging systems and industry developments,
including developments, programs, specifications on all currently operational defense equipment systems and armament; world renown orders-of-battle breakdowns for most of the
armies, navies and air forces around the world.

Terrorism and insurgency.A unique monitoring service which records and scales every significant terrorist or insurgent event
in the world, including detailed breakdown of the characteristics, threat assessment, nature, motives and structure of significant terrorist and insurgent groups;

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country-by-country
level of counter-terrorism ability; in-depth post-analysis of major terrorist events; and briefings on significant developments.

Transportation.Specialist reference looks across the global air, land and maritime environments, including airport
developments, security analysis, airspace management, policy and regulation; financial news and information for both the debt and equity markets in aircraft, shipping and rail; products and services
provided by specialist airport contractors; major new railway and urban transportation projects
and programs, intermodal operations and traction and rolling stock reference; and design, build and operation of high-speed marine craft.

Law enforcement.We are a global resource on police and security equipment, including news and analysis on current UK
policing issues and policy matters; product and service reference on equipment, armament, and personal protection for law enforcement personnel; and procedure, use, and technologies behind
less-lethal weapons.

Public safety.Handbooks and guides to safeguard our global and local communities to prepare for and respond to incidents of
violence, terrorism, and natural disasters, including chemical-biological attacks, crisis communications, facility security, mass casualty situations, school and teachers' safety, unconventional
weapons response, and workplace security.

Intelligence centers.An extension to the news, analysis, imagery and reference information, Intelligence Centers integrate
like topics with the analytical tools needed to discover in-depth and relevant insight, including advanced searching, data visualization, report building, active interlinking of content
and related documents, alerting, personalized tools and data output capabilities. Topics include Chemical, Biological, Radiological and Nuclear Assessments; Defense Equipment and Technology; Defense
Forecasts; Defense Industry and Markets; Military and Security Assessments, and Terrorism and Insurgency.

Strategic advisory services.Jane's Strategic Advisory Services provide strategic consulting services to governments and
businesses to carry out detailed, specialist research into key areas of concern, and to prepare reports to feed into customers strategic planning processes. A global network of expert analysts
provides extensive experience in aerospace and defense, national security, geopolitics, threat/risk analysis, and corporate strategy development. Practice areas are split between Corporate and
Government & Public Policy services. Corporate services include market forecasting, competitive analysis, customer analysis, program tracking and opportunity identification. In addition, a
Mergers and Acquisitions service provides investment and divestment screening, M&A impact analysis, transactions support, due diligence, and regulatory risk analysis. The Government and Public Policy
service offers training, collection and analysis of open source intelligence; special studies in the areas of threat assessments, policy analysis, order of battle studies, and regional/country
assessments; procurement support in the way of technology assessments, budget and funding analysis, RFP support and bid analysis; as well as workshops and gaming exercises.

Environmental Information Domain

Building off our success and experience in the other three domains, IHS is building a leading presence in providing Critical Information and Insight supporting
decisions around the environment, particularly business strategy and environmental impact. To accomplish this, we are leveraging products and solutions from our other three domains, supplemented by
targeted acquisitions.

Critical Information

ROHS product data information.As a critical addition to our electronic parts database, IHS tracks and maintains content
around several critical hazardous materials which may be found in certain electronic components. Certain regions forbid the importation and sales of products containing these materials, and the IHS
database is critical to ensure compliance with local regulations.

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Product Environmental Compliance Tool.IHS offers a tool that allows our customers to quickly match their component list
against our list of hazardous materials, and offers suitable substitutions that allow our customer to remain compliant with local regulations

Hazardous Materials Compliance.From our acquisition of EnvironMax in October, 2007, IHS gained a leading position in
hazardous materials management systems (HMMS). Our HMMS tool allows facilities managers and compliance officers to track hazardous materials from the point they enter a facility, through usage, to
disposal. This tool is critical to maintain compliance with reporting regulations.

Hazardous Materials Parts Management.IHS collects and standardizes HAZMAT data according to a customer's specific
requirements and compliance obligations, such as those cited in the EU RoHS/WEEE directives, in addition to other safety and regulatory requirements. IHS also provides services and software for
integration into enterprise/parts management applications and ongoing maintenance systems. In support of our solution, IHS can provide a HAZMAT information database available to current and future
customers.

Insight

Environmental Consulting.IHS currently provides Environmental Insight primarily through consulting engagements. These
engagements leverage our knowledge of the environmental and carbon emissions markets. Examples of the types of engagement include: assessment of voluntary carbon emissions markets; carbon emission
policy analyses; market strategies for clients affected by new environmental policies; and corporate Investment strategies in light of the changing environmental laws and regulations.

Our History

IHS has been a trusted name in the business of managing technical information since 1959. Over the years, we have expanded our offerings from a catalog database
for aerospace engineers to become one of the leading providers of Critical Information and Insight in the Energy, Product Lifecycle, Security, and Environmental information domains. In the late 1990s,
we acquired several established energy information providers that we organized into our Energy segment. The businesses that now comprise our Energy information domain offerings have accumulated and
developed well production and geological information from industry and government sources dating back to the nineteenth century. With the evolution of new technologies, we transitioned our delivery
methods from microfilm to the Internet and other electronic media. As our offerings have developed over the years, we have remained committed to providing our customers with solutions that facilitate
decision-making, support key processes, and improve productivity.

Ownership Structure

Our authorized capital stock consists of 80,000,000 shares of Class A common stock and 13,750,000 shares of Class B common stock. These classes have
equal dividend rights and liquidation rights. However, the holders of our Class A common stock are entitled to one vote per share and holders of our Class B common stock are entitled to
ten votes per share on all matters to be voted upon by the stockholders. Each share of Class B common stock is convertible at any time at the option of the holder into one share of
Class A common stock. In addition, each share of Class B common stock will convert automatically, without any action by the holder, into one share of Class A common stock upon the
earliest to occur of:



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Once
transferred and converted into Class A common stock, the Class B common stock shall not be reissued. No class of common stock may be subdivided or combined unless the
other class of common stock concurrently is subdivided or combined in the same proportion and in the same manner.

The
following diagram summarizes our current ownership structure:

CHART

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Product Development and Technology

Our product development efforts and use of technology focus on the collection, management, and delivery of Critical Information to our customers through our
offerings. We manage our comprehensive collection of critical technical information through what we refer to as our "core schema." The data itself is stored in a network of information repositories,
many of which are linked directly to our core schema. The development, management, and expansion of our core schema and information repositories are central to our product development efforts. We
continuously update and enhance our core schema and repositories through proprietary methods and the use of technology encompassing the following steps:



Our
core schema and other information management tools allow content to be identified by a variety of search and cross-reference methods. We use proprietary and
non-proprietary technologies that index Critical Information in a variety of ways, such as broad field categories, document type, document title, and industry segment. We employ robust,
redundant storage technology to ensure that our Critical Information is highly available. Our processes allow for updating as soon as new and relevant information becomes available.

Our
product development teams create customer solutions by integrating our data with proprietary and widely used decision-support technology, thus producing Critical Information designed
for the needs of our customers. These teams also develop the user interfaces and search capabilities that our customers employ when using our offerings. Our offerings are designed and developed by
cross-

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functional
teams that include sales and marketing, product development, and customer support personnel as well as, in some cases, the customers themselves. Customer feedback is shared with these teams
so that decision-support tools can be enhanced to address changing customer requirements.

Our
product development teams have also created proprietary web services and application interfaces that enhance access to our Critical Information. These services enable our customers
to integrate our Critical Information with other data, business processes, and applications (e.g., computer-aided design, enterprise resource planning,
supply chain management, and product data/lifecycle management).

We
use a series of digital rights management ("DRM") methods and technologies to preserve our intellectual property rights and the intellectual property rights of third-party licensors.
These methods and technologies (for certain of which we have patent applications pending) involve applying and tracking the license rights granted to a given customer, while simultaneously assuring
that Critical Information outside of a customer's licensed rights is not accessible. They also permit customers to download files or produce hard copies that are "watermarked" with license information
and security codes designed to discourage unauthorized distribution of the content. See "Risk FactorsWe may not be able to protect intellectual property rights."

Our
core schema is driven by industry standard relational database technologies such as Oracle and Microsoft. In addition, we have standardized hardware, decision-support tools, and
application platforms from industry-leading companies. We also have proprietary technology to support our core schema, information repositories, and offerings.

As
a global company, we seek cost-efficient and technologically advanced locations for our data centers, data entry, quality assurance, and development functions. To that end
we have established "Centers of Excellence" (COEs) to serve as our primary sites for handling data. These COEs are located in Colorado, the United Kingdom, Canada, India, and Malaysia. Our COEs are
supported by "Off-Shore Development Centers" (ODCs) in India, China, and Eastern Europe.

Customers

We have a diverse customer base that includes many of the largest companies and government organizations. Our solutions are applicable in numerous industries,
though we have a particularly large presence in the energy industry as well as customers in defense, aerospace, construction, manufacturing and other industries. Our customers range from large
entities such as governments and large multinational companies to smaller companies and technical professionals. We are not dependent upon any single customer, or a few customers, the loss of which
would have a material adverse effect.

We
serve a global customer base with approximately half of our revenues coming from the United States and the other half coming from the rest of the world. Our operating profit from our
international operations is typically higher than it is from our domestic operations.

Government Contracts

We sell our products to various government agencies and entities. No individual contract is significant to our business. Although our government contracts are
subject to terms that would allow renegotiation of profits or termination at the election of the government, we believe that no renegotiation or termination of any given contract or subcontract at the
election of the government would have a material adverse effect on our financial results.

Sales and Marketing

Our sales force is generally organized in teams focused on particular industry verticals and geographies. Each team is comprised of one or more relationship
managers and product experts. The

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relationship
managers serve as the primary sales interface with the customer. As part of the annual renewal process, they are responsible for reviewing offerings purchased by existing customers, as
well as seeking opportunities to expand the offerings purchased by these customers. To expand customer penetration, the relationship manager utilizes the entire expert resources resident within our
organization. For smaller customers, we use an inside team that is responsible for sales and renewal efforts. We compensate our sales teams primarily based on revenue generation and renewal rates.

New
customer acquisition is largely conducted by our dedicated new business team. This team systematically identifies potential new customer opportunities and a sales approach for larger
new business opportunities. Our inside sales team also pursues smaller new customer opportunities. We supplement all of our sales efforts with our web store, which enables customers to purchase
offerings online.

We
use an extensive dealer network to reach customers in locations where it is not cost-effective to use our sales teams or maintain a sales office. We have approximately 60
dealers that are independent contractors, each employing from one to five sales persons. Some of the dealers are focused on our offerings, but many of the dealers are in the business of providing
similar products that are generally not in direct competition with us.

We
review, on an annual basis, our go-to-market sales strategy. We do this to optimize the allocation of our sales resources across our customer segments, to
capture the most attractive new business opportunities, and to further penetrate our existing customer base.

Our
marketing teams are primarily responsible for ensuring that our offerings are meeting the needs of our customers. These teams conduct ongoing market research to understand changing
needs within our targeted industries. They analyze industry investment patterns and work with our product development teams to ensure that we are creating Critical Information Insight offerings that
are relevant to our customers. These teams also study industries we do not currently target to determine if there are potential users that could benefit from our offerings.

Our
marketing teams are also responsible for analyzing the offerings of our competitors to ensure that we remain competitive. Our marketing teams support our sales teams both by driving
brand awareness and demand generation. We tailor marketing programs both by target audience and regional
customization leveraging a marketing mix consisting of public relations, e-marketing, events, advertising and sales tools

Customer Support

Our customer support program includes customer service and customer training:



Our
customer service and customer training teams work with each other and with the sales teams representing our customers. This enables our customers to work with the same team of IHS
employees for all their needs, which we believe results in greater customer satisfaction and stronger customer relationships.

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We
are proactive in managing ongoing customer needs by maintaining a key issues database that identifies patterns of customer service and support needs. This database is shared with
product managers who, where appropriate, implement product improvements.

Starting
in 2007, we initiated a significant program called "Customer First." This program utilizes detailed customer surveys using third party methodologies to track the behaviors and
initiators of customer loyalty, resulting in an overall "Customer Delight" score that we will measure and track
annually. Beginning in 2008, every IHS employee has personal objectives tied to improving this score. Improvements made against this "Customer Delight" score correlate to a portion of each employee's
annual salary adjustment.

Competition

We believe the principal competitive factors in our business include the depth, breadth, timeliness, and accuracy of information provided, quality of
decision-support tools and services, quality and relevance of our analysis and insight, ease of use, customer support, and value for the price. We believe that we compete favorably on each of these
factors. Although we do not believe that we have a direct competitor across all of the offerings we provide, we do face competition in specific industries and with respect to specific offerings.

In
our Energy segment (representing our activities in the Energy information domain) our U.S. well and production data offerings compete with offerings from TGS-NOPEC
Geophysical Company and DrillingInfo, Inc., in addition to smaller companies. Certain of our Energy segment's other offerings compete with products from Wood Mackenzie Ltd.,
Divestco Inc., and Geologic Data Systems, Inc., in addition to other specialized companies. Our Energy segment's advisory services compete with PFC Energy in addition to other smaller
consulting companies.

Our
Engineering segment (which includes our offerings in the Product Lifecycle, Security, and Environmental information domains) competes against a fragmented set of companies. In the
Product Lifecycle information domain, we compete with SAI Global's ILI, Thomson Corporation's Techstreet, United Business Media's Barbour, and some of the SDOs. Also within that domain,
our parts offerings compete with products from PartMiner, Inc., SAI Global's ILI, Total Parts Plus, Inc., GlobalSpec, and Thomas Publishing Company, among others. In the Security
information domain, we compete against large publishers such as Amada, McGraw-Hill, and Gannet, and smaller niche players such as Forecast International, Control Risks, and JSA Partners,
among others. The Environmental information domain is highly fragmented. Primary competition in this marketplace comes from internal customer resources, as well as small niche players.

Intellectual Property

We rely heavily on intellectual property, including the intellectual property we own and license. We regard our trademarks, copyrights, licenses, and other
intellectual property as valuable assets and use intellectual property laws, as well as license and confidentiality agreements with our employees, dealers, and others, to protect our rights. In
addition, we exercise reasonable measures to protect our intellectual property rights and enforce these rights when we become aware of any potential or actual violation or misuse.

Intellectual
property licensed from third parties, including SDOs, is a vital component of our offerings and, in many cases, cannot be independently replaced or recreated by us or
others. We have longstanding relationships with most of the SDOs, government agencies, and manufacturers from whom we license information. Almost all of the licenses that we rely upon are nonexclusive
and expire within one to two years unless renewed.

We
maintain more than 100 trademarks registered around the world that we will need to renew from time to time. In addition, we have applied for patents in the United States relating to
digital

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rights
management, remote access printing, and print on demand. See "Risk FactorsWe may not be able to protect intellectual property rights."

Employees

We have approximately 3,000 employees, of which approximately 1,550 are located in the United States and approximately 1,450 are located abroad. None of our
employees are represented by a collective bargaining agreement and we consider our employee relations to be good.

Available Information

Our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and
amendments to those reports are available, without charge, on our website,www.ihs.com, as soon as reasonably practicable after they are filed
electronically with the SEC. We have also posted our code of ethics on our website. Copies are also available, without charge, from IHS Investor Relations and Corporate Communications,
15 Inverness Way East, Englewood, CO 80112.

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Item 1A.    Risk Factors

We are exposed to a variety of risks and uncertainties in conducting our business, including, but not limited to, the risks described
below. This section includes forward-looking statements and future expectations as of the date of this annual report. You should carefully consider the risks described in this section and all of the
other information provided in this annual report. If any of the events or developments described below actually occurs, our business, financial condition, and results of operations may be adversely
affected. In that case, the trading price of our Class A common stock could decline and you could lose all or part of your investment.

Our growth strategy may prove unsuccessful.

Our growth strategy involves enhancing our offerings to meet our customers' needs. Our success in meeting these needs depends in large part upon our ability to
deliver consistent, high-quality, and timely offerings covering issues, developments and trends that our customers view as important. In addition, we plan to grow by achieving our strategy
of being the leading source of Critical Information and Insight in our targeted information domains through profitable organic growth and acquisitions. We have already begun to invest in our growth
strategy and it may take a considerable amount of time and expense to fully execute it or benefit from it. If we are unable to execute our growth strategy, or if we do so less capably than our
competitors, our operating performance including our ability to generate additional revenues on a profitable basis may be adversely affected.

If we are unable to successfully identify or effectively integrate acquisitions, our financial results may be adversely affected.

We intend to continue to selectively pursue acquisitions to complement our internal growth. There can be no assurance that we will be able to identify suitable
candidates for successful acquisitions at acceptable prices. In addition, our ability to achieve the expected returns and synergies from our past
and future acquisitions and alliances depends in part upon our ability to integrate the offerings, technology, administrative functions, and personnel of these businesses into our business in an
efficient and effective manner. We cannot assure you that we will be successful in integrating acquired businesses or that our acquired businesses will perform at the levels we anticipate. In
addition, our past and future acquisitions may subject us to unanticipated risks or liabilities or disrupt our operations and divert management's attention from our day-to-day
operations.

If we are unable to consistently renew subscriptions for our offerings, our results could weaken.

In 2007, we derived more than 74% of our revenues from subscriptions to our offerings. These subscriptions are generally for a term of one year. Our results
depend on our ability to achieve and sustain high annual renewal rates on existing subscriptions and to enter into new subscription arrangements on commercially acceptable terms. Our failure to
achieve high annual renewal rates on commercially acceptable terms would have a material adverse effect on our business, financial condition, and operating results.

Our international operations are subject to exchange rate fluctuations and other risks relating to non-U.S. operations.

We operate in over 100 countries around the world and a significant part of our revenue comes from international sales. In 2007, we generated approximately half
of our revenues from sales outside the United States, and we expect to increase our international presence over time. Operations outside of the United States may be affected by changes in trade
protection laws, policies and measures, and other regulatory requirements affecting trade and investment; unexpected changes in regulatory requirements; social, political, labor or economic conditions
in a specific country or region; and

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difficulties
in staffing and managing foreign operations. In addition, we must manage the uncertainties of obtaining data and creating solutions that are relevant to particular geographic markets; the
complexity of maintaining and monitoring effective policies and procedures in locations around the world; differing levels of intellectual property protection in various jurisdictions; and
restrictions or limitations on the repatriation of funds.

Significant
fluctuations in exchange rates between the U.S. dollar and foreign currencies may adversely affect our net revenues. Our primary operations outside the United States are in
the United Kingdom, Canada, and Switzerland. Our operating profit outside the United States has historically exceeded our domestic operating profit.

We
are expanding our sales and marketing efforts in certain emerging markets. Expanding our business into emerging markets may present additional risks beyond those associated with more
developed international markets. In any emerging market, we may face additional risks, including cash-based economies, inconsistent government policies, political instability and civil
unrest, and sudden currency revaluations.

The loss of, or the inability to attract and retain, key personnel could impair our future success.

Our future success depends in part on the continued service of our employeesincluding executive officers and other key management, sales, marketing,
product development, and operations personneland on our ability to continue to attract, motivate, and retain additional highly qualified employees. The loss of the services of one or more
of our key personnel or our inability to recruit replacements for such personnel or to otherwise attract, motivate, or retain qualified personnel could have an adverse effect on our business,
operating results, and financial condition.

We may not be able to protect intellectual property rights.

We rely on copyright laws and nondisclosure, license, and confidentiality arrangements to protect our proprietary rights as well as the intellectual property
rights of third parties whose content we license. However, it is not possible to prevent all unauthorized uses of these rights. We cannot assure you that the steps we have taken to protect our
intellectual property rights, and the rights of those from whom we license intellectual property, are adequate to deter misappropriation or that we will be able to detect unauthorized uses and take
timely and effective steps to remedy this unauthorized conduct. In particular, a significant portion of our revenues are derived internationally including jurisdiction where protecting intellectual
property rights may prove even more challenging. To prevent or respond to unauthorized uses of our intellectual property, we might be required to engage in costly and time-consuming
litigation and we may not ultimately prevail. In addition, our offerings could be less differentiated from those of our competitors, which could adversely affect the fees we are able to charge.

We rely on a network of independent contractors and dealers whose actions could have an adverse effect on our business.

We obtain some of our critical information from independent contractors, particularly in our Energy segment and for certain offerings of our Jane's business. In
addition, we rely on a network of dealers to sell our offerings in locations where we do not maintain a sales office or sales teams. These independent contractors and dealers are not employees of our
company. As a result, we are limited in our ability to monitor and direct their activities. The loss of a significant number of these independent contractors or dealers could disrupt our
information-gathering efforts or our sales, marketing, and distribution activities. In addition, if any actions or business practices of these individuals or entities violate our policies or
procedures or are otherwise deemed inappropriate or illegal, we could be subject

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to
litigation, regulatory sanctions, or reputation damage, any of which could adversely affect our business.

As
part of our strategic business model, we outsource certain operations and engage independent contractors to perform work in various locations around the world. Examples include "back
office" services such as payroll as well as highly technical services such as data entry, programming, indexing, and testing. By entering into these independent contractor arrangements, we face risks
that one or more independent contractors may unexpectedly cease operations, that they may perform work that deviates from our standards, that events in a given region may disrupt the independent
contractor's operations, or that we may not be able to adequately protect our intellectual property. If these risks were to occur, they could adversely affect our business.

We are affected by conditions and trends in our targeted industries, which may inhibit our ability to grow or otherwise adversely affect our business.

Our business, financial condition, and results of operations depend upon conditions and trends affecting the industries in which our customers do business.
Examples of such industries include energy, defense, aviation, and manufacturing. It is possible that a global economic decline or a decline in several of our customers' industries, for any reason,
could adversely impact our customers and thus reduce our revenues. Our ability to grow will depend in part upon the growth of these industries as well as our ability to increase sales of our offerings
to customers in these industries. It is possible that, if we fail to manage our sales and marketing efforts, consolidation of businesses could reduce our current and potential customers and could have
a material adverse effect on our business. Moreover, the larger organizations resulting from consolidation could have greater bargaining power, which could adversely affect the pricing of our
offerings. Factors that adversely affect revenues and cash flows in our customers' industries, including operating results, capital requirements, regulation, and litigation, could reduce the funds
available to them to purchase our offerings. Our failure to maintain our revenues or margins could have a material adverse effect on our business, financial condition, and operating results.

We depend on content obtained through agreements with third parties, including Standards Development Organizations (SDOs) for offerings in our Product
Lifecycle domain, and the failure to maintain these agreements on commercially reasonable terms could prove harmful to our business.

Certain of our offerings in the Engineering segment (particularly our Specs and Standards offerings in the Product Lifecycle information domain) include content
that is either purchased or licensed from third parties, including SDOs. Offerings that rely upon SDO information accounted for approximately 27% of our total revenue in 2007. We believe that the
content licensed from many of these third parties, particularly the SDOs referred to above, cannot be obtained from alternate sources on favorable terms, if at all. Our license agreements with these
third parties are generally nonexclusive and many are terminable on less than one year's notice. In addition, many of these third parties compete with one another and us. As a result, we may not be
able to maintain or renew these agreements at cost-effective prices, and these third parties might restrict or withdraw their content from us for competitive or other reasons. When SDO
royalty payments increase, our Engineering segment operating margins may decline. If we are unable to maintain or renew a significant number of these third party content agreements, particularly those
we have with SDOs, or if we renew a significant number of these agreements on terms that are less favorable to us, the quality of our offerings and our business, operating results, and financial
condition may be adversely affected.

Our investments in technology may not be sufficient and may not result in an increase in our revenue or decreases in our operating costs.

As the technological landscape continues to evolve, it may become increasingly difficult for us to make timely, cost-effective changes to our
offerings in a manner that adequately differentiates them

28

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from
those of our competitors. We cannot assure you that our investments have been or will be sufficient to maintain or improve our competitive position or that the development of new or improved
technologies and products by our competitors will not have a material adverse effect on our businesses.

We operate in competitive markets, which may adversely affect our market share and financial results.

Some of our competitors focus on sub-markets within our targeted industries while others have significant financial and information-gathering
resources, recognized brands, technological expertise, and market experience. We believe that competitors are continuously enhancing their
products and services, developing new products and services, and investing in technology to better serve the needs of their existing customers and to attract new customers.

We
face competition in specific industries and with respect to specific offerings. We may also face competition from organizations and businesses that have not traditionally competed
with us but that could adapt their products and services to meet the demands of our customers. Increased competition may require us to reduce the prices of our offerings or make additional capital
investments which would adversely affect our margins. If we are unable or unwilling to do so, we may lose market share in our target markets and our financial results may be adversely affected.

Most
of our license agreements with SDOs are nonexclusive, which allow the SDOs to distribute their standards themselves or license them to other third parties for distribution. In
addition, some of the critical information we use in our offerings is publicly available in raw form at little or no cost. The Internet and other electronic media have simplified the process of
locating, gathering, and disseminating information. If users choose to obtain the critical information they need from our competitors, SDOs, or public sources, our business, financial condition, and
results of operations could be adversely affected.

We could experience property damage, system failures, or capacity constraints, which could interrupt the delivery of our offerings to customers and
ultimately cause us to lose customers.

Our ability to protect our data centers against damage from interruptions or breach of information systems security, fire, power loss, sabotage,
telecommunications failure, or other accidents or disasters is critical. Any delays or failures in our systems or errors in the technology that we use to store and deliver our content to customers
would harm our business. The growth of our customer base may also strain our systems in the future. In addition, our products could be affected by failures of third-party technology used in our
products and we could have no control over remedying these failures. Any failures or problems with our systems or offerings could force us to incur significant costs to remedy the failures or
problems, decrease customer demand for our products, tarnish our reputation, and harm our business.

We may be exposed to litigation related to content we make available to customers, and we may face legal liability or damage to our reputation if our
customers are not satisfied with our offerings or if our offerings are misused.

As a provider of Critical Information and Insight, and as a user of third-party content, we face potential liability for, among other things, breach of contract,
negligence, and copyright and trademark infringement. Our professional reputation is an important factor in attracting and retaining our customers and in building relationships with the third parties.
If customers were to become dissatisfied with the quality of our offerings, our reputation could be damaged and our business could be materially
adversely affected. In addition, if the information in our offerings is incorrect for any reason, or if it is misused or used inappropriately, we could be subject to reputation damage or litigation.

29

---



Our offerings could infringe on the intellectual property rights of others, which may require us to engage in costly litigation and could disrupt our
business.

Third parties may assert infringement or other intellectual property claims against us based on their intellectual property rights. If such claims are successful,
we may have to pay substantial damages, possibly including treble damages, for past infringement. We might also be prohibited from selling our offerings or providing certain information without first
obtaining a license from the third party, which, if available at all, may require us to pay additional royalties. Even if infringement claims against us are without merit, defending a lawsuit takes
significant time, may be expensive, and may divert our management's attention from other business concerns.

We are controlled by an entity whose interests may differ from yours.

Our Class B common stock is entitled to ten votes per share and our Class A common stock is entitled to one vote per share. As of
November 30, 2007, our principal stockholder, Urvanos Investments Limited ("Urvanos"), a wholly-owned subsidiary of TBG Holdings N.V. ("TBG"), owned 100% of our Class B common
stock and less than two percent of our outstanding Class A common stock. In the aggregate, this ownership represents approximately 74% of the voting power of our outstanding capital stock
(compared to approximately 23.5% of the overall economic interest). The Class B common stock may be converted into Class A common stock at any time and will automatically be converted
into Class A common stock upon the earlier of the occurrence of specified events (see"BusinessOwnership Structure" above) or
November 16, 2009.

Voting
and investment decisions with respect to our common stock that is owned by Urvanos have historically been made by TBG. As a result, TBG controls all matters requiring stockholder
approval, including amendments to our certificate of incorporation, the election of directors, and significant corporate transactions, such as transactions involving a change of control of IHS. TBG is
indirectly wholly-owned by TB Continuity II Trust, of which Georg Heinrich Thyssen-Bornemisza is the sole primary beneficiary. Georg Heinrich Thyssen-Bornemisza is the chairman of the board of
directors of TBG. Christoph v. Grolman, co-chief executive officer of TBG, is a member of our board of directors. Jerre L. Stead, our chief executive officer and the chairman
of our board of directors, is a member of the board of directors of TBG. TBG or its shareholder may have interests that conflict with yours and actions may be taken that you do not view as beneficial.

Under
Delaware law, the directors of a corporation owe fiduciary duties to all stockholders of the corporation, not just to the controlling stockholders. In addition, seven of the nine
directors serving on our board are "independent" of management, as defined by the New York Stock Exchange rules and regulations, and our directors are elected for staggered terms with three of our
nine director seats open for election each year. However, in light of the significant control that TBG has over all matters requiring stockholder approval (including the election of directors), no
assurances can be provided that these protections will prevent actions that may be viewed as adverse to the Class A stockholders.

Shares eligible for future sale could depress the price of our shares.

Sales of substantial amounts of the Class A common stock in the public market, or the perception that such sales could occur, could adversely affect the
market price of the shares. As of November 30, 2007, there were 48,758,518 shares of Class A common stock and 13,750,000 shares of Class B common stock outstanding. TBG indirectly
owned an aggregate of 958,859 shares of Class A common stock and all 13,750,000 shares of Class B common stock. In addition, investment entities affiliated with General
Atlantic LLC owned 3,487,500 shares of Class A common stock. Following our acquisition of Jane's Information, Woodbridge International Holdings S.A. owned 4,399,000 shares of
Class A common stock.

30

---



In
addition, as of November 30, 2007, Tak Tent (F) Limited owned 2,000,000 shares of Class A common stock and Augustus Limited owned 3,500,000 shares of
Class A common stock. Each of Tak Tent (F) Limited (and its permitted transferees) and Augustus Limited (and its permitted transferees) have made 1,500,000 shares of Class A
common stock available for sale pursuant to a post-effective amendment to a registration statement dated May 21, 2007, subject to certain contractual limitations on the timing and
amount of securities that may be sold. The shares of Class A common stock owned by Tak Tent (F) Limited and Augustus Limited, respectively, that are not eligible for sale under the
registration statement may be eligible for sale into the public market under Rule 144 under the Securities Act of 1933, as amended.

Urvanos
and Woodbridge are entitled to require us to register their shares under the Securities Act under certain conditions. For rights and conditions applicable to Urvanos see "Selling
StockholdersRegistration Rights Agreements" under our post-effective amendment to a registration statement dated May 21, 2007. For rights and conditions applicable to
Woodbridge, see the Jane's Information Group Stock Purchase Agreement included as an exhibit to our report on Form 10-Q for the quarter ended August 31, 2007. The sale by us
or any of these stockholders of shares of common stock in the public market, or the perception that such sales might occur, could have a material adverse effect on the price of our shares.

The price of our Class A common stock may be volatile and may be affected by market conditions beyond our control.

Our share price is likely to fluctuate in the future because of the volatility of the stock market in general and a variety of factors, many of which are beyond
our control.

Market
fluctuations could result in volatility in the price of shares of our Class A common stock, which could cause a decline in the value of your investment. In addition, if our
operating results fail to meet the expectations of stock analysts or investors, we may experience an immediate and significant decline in the trading price of our Class A common stock.

Provisions in our charter documents and under Delaware law could discourage a takeover that stockholders may consider favorable.

Certain provisions in our governing documents could make a merger, tender offer, or proxy contest involving us difficult, even if such events would be beneficial
to the interests of our stockholders. These provisions include our dual class structure, our classified board, our supermajority voting requirements, and our adoption of a rights agreement, commonly
known as a "poison pill." In addition, we are subject to certain Delaware anti-takeover provisions. Under Delaware law, a corporation may not engage in a business combination with any
holder of 15% or more of its capital stock unless the holder has held the stock for three years or, among other things, the board of directors has approved the transaction. Accordingly, our board of
directors could rely upon these or other provisions in our governing documents and upon Delaware law to prevent or delay an acquisition of us. See "Description of Capital Stock."

31

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Item 1B.    Unresolved Staff Comments

None.

Item 2.    Properties

Facilities

We own two office buildings in Englewood, Colorado, which comprise our headquarters, and other office buildings in London and Tetbury, England; Geneva,
Switzerland; and Johannesburg, South Africa. We lease space for a total of 56 offices in 20 countries, including offices in Cambridge, Massachusetts; Dallas, Grapevine, Midland, Onalaska and Houston,
Texas; Salt Lake City, Utah; Arlington, VA; Tulsa and Oklahoma City, Oklahoma; Pasadena and San Francisco, California; Westminster, Colorado; New York, New York; Bangalore, India; Copenhagen, Denmark;
Paris, France; Eastwood, Australia; Dubai, United Arab Emirates; Singapore; Moscow, Russia; Tokyo, Japan; Beijing, Shanghai, Shenzhen, and Hong Kong, China; five locations in Canada; four locations in
the United Kingdom; one location in Germany; one location in South Africa; one location in Brazil; one location in The Netherlands; one location in Sweden; one location in Switzerland; two locations
in Mexico; and two locations in Malaysia. We believe that our properties, taken as a whole, are in good operating condition and are suitable and adequate for our current business operations, and that
additional or alternative space will be available on commercially reasonable terms for future use and expansion.

Our
ownership and operation of real property and our operation of our business is subject to various foreign, federal, state, and local environmental protection and health and safety
laws and regulations. Some environmental laws hold current and previous owners and operators of businesses and real property liable for contamination on owned or operated property and on properties at
which they disposed of hazardous waste, even if they did not know of and were not responsible for the contamination, and for claims for property damage or personal injury associated with the exposure
to or the release of hazardous or toxic substances. We have not incurred and do not currently anticipate incurring any material liabilities in connection with such environmental laws.

Item 3.    Legal Proceedings

We are not party to any material litigation and are not aware of any pending or threatened litigation that could have a material adverse effect upon our business,
operating results, or financial condition.

Item 4.    Submission of Matters to a Vote of Security Holders

No matters were submitted to a vote of our stockholders during the fourth quarter of the fiscal year.

32

---





PART II

Item 5.    Market for the Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

Our Class A common stock has been quoted on the New York Stock Exchange under the symbol "IHS" since November 11, 2005. Prior to that time, there
was no public market for our stock. The following table sets forth for the indicated periods the high and low sales prices per share for our Class A common stock on the New York Stock Exchange:

Fiscal Year 2007 Quarters Ended:

High

LowFebruary 28, 2007

$
41.42

$
34.96May 31, 2007


45.02


35.91August 31, 2007


51.77


39.74November 30, 2007


70.49


49.94


|
|

Fiscal Year 2006 Quarters Ended:

High

LowFebruary 28, 2006

$
27.45

$
17.10May 31, 2006


29.63


22.75August 31, 2006


33.44


25.00November 30, 2006


37.49


28.25


Our
Class B common stock is neither listed nor publicly traded.

We
have been advised by our transfer agent, Computershare Trust Company, Inc., that we had 17 holders of record of our Class A Common Stock as of January 14, 2008.
Based on reports of security position listings compiled for the 2007 annual meeting of shareholders, we believe we may have in
excess of 3,300 beneficial holders of our Class A Common Stock. There is exactly one holder of our Class B Common Stock.

Dividend Policy

We currently anticipate that we will retain all available funds for use in the operation and expansion of our business, and we do not anticipate paying any
dividends in the foreseeable future.

33

---



Securities Authorized for Issuance Under Equity Compensation Plans

The following table sets forth information as of the end of the fiscal year 2007 with respect to compensation plans under which equity securities are authorized
for issuance.

Equity Compensation Plan Information

|Plan Category                                             |        | Number of
securities to be
issued upon
exercise of
outstanding
options,
warrants and
rights |           | Weighted-
average
exercise price
of
outstanding
options,
warrants and
rights |       | Number of
securities
remaining
available for
future issuance
under equity
compensation
plans
(excluding
securities
reflected in
column (a)) |          
|--------------------------------------------------------- | ------ | ------------------------------------------------------------------------------------------- | --------- | ---------------------------------------------------------------------------- | ----- | ------------------------------------------------------------------------------------------------------------------------------------------- | ---------
|
|Equity compensation plans approved by security holders    |        | 2,144,597                                                                                   | (1)       | $                                                                            | 35.29 | (2)                                                                                                                                         | 1,122,773
|Equity compensation plans not approved by securityholders |        | N/A                                                                                         |           |                                                                              | N/A   |                                                                                                                                             | N/A      
|                                                          | Total: |                                                                                             | 2,144,597 |                                                                              | $     | 35.29                                                                                                                                       |          

---

Unregistered Sales of Equity Securities

The issuances of the securities described in the transactions below were deemed to be exempt from registration under the Securities Act of 1933 in reliance on
Rule 701 promulgated under the Securities Act as transactions pursuant to a compensatory benefit plan or a written contract related to compensation.

In
fiscal year 2005, we issued the following securities:



34

---





Issuer Purchases of Equity Securities

Late in 2006, our board of directors approved a stock buyback program whereby IHS was authorized to acquire up to one million shares per year in the open market
to more fully offset the dilutive effect of our employee equity programs. We first started repurchasing shares in 2007. During 2007, we repurchased 689,962 shares of our Class A common stock
for approximately $29.2 million, or $42.29 per share, to offset the dilutive effect of our employee equity programs. In late 2007, the board of directors renewed this program for 2008.

Repurchases
of equity securities during the fourth quarter of 2007 are listed in the following table:

|Period                           |       | Total Number
of Shares
Acquired |         | Average
Price Paid
per Share |       | Total Number
of Shares
Purchased as
Part of Publicly
Announced
Plans or
Programs |        | Maximum
Number of
Shares That
May Yet Be
Purchased
Under the Plans
or Programs
|-------------------------------- | ----- | ------------------------------- | ------- | ---------------------------- | ----- | -------------------------------------------------------------------------------- | ------ | ------------------------------------------------------------------------------
|September 1 - September 30, 2007 |       | 99,100                          |         | $                            | 52.55 |                                                                                  | 99,100 |                                                                               
|October 1 - October 31, 2007     |       | 10,000                          |         | $                            | 55.88 |                                                                                  | 10,000 |                                                                               
|November 1 - November 30, 2007   |       |                                |         | $                            |      |                                                                                  |       |                                                                               
|                                 |       |                                 |         |                              |       |                                                                                  |        |                                                                               
|                                 | Total |                                 | 109,100 |                              | $     | 52.86                                                                            |        | 109,100                                                                       
|                                 |       |                                 |         |                              |       |                                                                                  |        |                                                                               

In
2006, we initiated a program to reduce the dilutive effects of employee equity grants, which have consisted primarily of restricted stock. This program continued throughout 2007. We
withhold shares to fund employee statutory withholding tax requirements. As shares vest and tax withholdings come due, we withhold enough shares in treasury to cover the tax liability and make a
payment to the tax authority out of corporate cash. During the years ended November 30, 2007 and 2006, we withheld

35

---



$9.3 million
and $7.6 million, respectively, of treasury stock under this program. The table below sets forth the total number of shares withheld and the average fair market value of
those shares.

|Period                           |       | Total Number
of Shares
Withheld |         | Average Fair
Market Value
per Share |       | Total Number
of Shares
Purchased as
Part of Publicly
Announced
Plans or
Programs |   | Maximum
Number of
Shares That
May Yet Be
Purchased
Under the Plans
or Programs |    
|-------------------------------- | ----- | ------------------------------- | ------- | ----------------------------------- | ----- | -------------------------------------------------------------------------------- | - | ------------------------------------------------------------------------------ | ---
|December 1 - December 31, 2006   |       |                                |         | $                                   |      |                                                                                  |  |                                                                                |   
|January 1 - January 31, 2007     |       | 2,211                           |         | $                                   | 37.92 |                                                                                  |  |                                                                                |   
|February 1 - February 28, 2007   |       | 2,564                           |         | $                                   | 38.54 |                                                                                  |  |                                                                                |   
|March 1 - March 31, 2007         |       | 384                             |         | $                                   | 37.07 |                                                                                  |  |                                                                                |   
|April 1 - April 30, 2007         |       | 750                             |         | $                                   | 40.98 |                                                                                  |  |                                                                                |   
|May 1 - May 31, 2007             |       | 635                             |         | $                                   | 40.18 |                                                                                  |  |                                                                                |   
|June 1 - June 30, 2007           |       | 777                             |         | $                                   | 40.59 |                                                                                  |  |                                                                                |   
|July 1 - July 31, 2007           |       | 33,900                          |         | $                                   | 49.61 |                                                                                  |  |                                                                                |   
|August 1 - August 31, 2007       |       | 635                             |         | $                                   | 50.58 |                                                                                  |  |                                                                                |   
|September 1 - September 30, 2007 |       | 1,608                           |         | $                                   | 50.58 |                                                                                  |  |                                                                                |   
|October 1 - October 31, 2007     |       | 65,223                          |         | $                                   | 58.94 |                                                                                  |  |                                                                                |   
|November 1 - November 30, 2007   |       | 50,564                          |         | $                                   | 67.12 |                                                                                  |  |                                                                                |   
|                                 |       |                                 |         |                                     |       |                                                                                  |   |                                                                                |    
|                                 | Total |                                 | 159,251 |                                     | $     | 58.51                                                                            |   |                                                                               | (1)
|                                 |       |                                 |         |                                     |       |                                                                                  |   |                                                                                |    
|Fiscal Year 2006:                |       |                                 |         |                                     |       |                                                                                  |   |                                                                                |    
|September 1 - September 30, 2006 |       | 102,700                         |         | $                                   | 30.34 |                                                                                  |  |                                                                                |   
|October 1 - October 31, 2006     |       | 7,761                           |         | $                                   | 35.44 |                                                                                  |  |                                                                                |   
|November 1 - November 30, 2006   |       | 113,101                         |         | $                                   | 36.79 |                                                                                  |  |                                                                                |   
|                                 |       |                                 |         |                                     |       |                                                                                  |   |                                                                                |    
|                                 | Total |                                 | 223,562 |                                     | $     | 33.78                                                                            |   |                                                                               | (1)
|                                 |       |                                 |         |                                     |       |                                                                                  |   |                                                                                |    

---

36

---



Two-Year Financial Performance Graph: 2005-2007

The annual changes for the two-year period shown in the graph on this page are based on the assumption that $100 had been invested in IHS
Class A common stock, the Standard & Poor's 500 Stock Index and a "Peer Group" index on November 11, 2005the date our Class A shares were initially quoted on
the New York Stock Exchangeand that all quarterly dividends were reinvested at the average of the closing stock prices at the beginning and end of the quarter. The "Peer Group" index
represents the weighted average percentage return of The Advisory Board Committee, Choicepoint Inc., The Dun & Bradstreet Corporation, Equifax Inc, The Corporate Executive Board
Company, FactSet Research Systems Inc., Fair Isaac Corporation, and The Thomson Corporation. The total cumulative dollar returns shown on the graph represent the value that such investments
would have had on November 30, 2007.

COMPARISON OF CUMULATIVE TOTAL RETURN
Among IHS Inc., S&P 500 Index, and Peer Group

CHART

Value of $100.00 investment in stock or index:

11/11/2005

11/30/2005

11/30/2006

11/30/2007IHS

$
100.00

$
112.63

$
216.67

$
410.18Peer Group

$
100.00

$
100.91

$
116.76

$
113.11S&P 500

$
100.00

$
101.20

$
113.44

$
119.96


37

---



Item 6.    Selected Financial Data

You should read the following selected consolidated financial data in conjunction with "Management's Discussion and Analysis of Financial Condition and Results of
Operations" and our consolidated financial statements and the related notes appearing elsewhere in this Form 10-K.

|                                                                                                       |                                                      | Years Ended November 30,               |        
|------------------------------------------------------------------------------------------------------ | ---------------------------------------------------- | -------------------------------------- | -------
|
|
|Statement of Operations Data:                                                                          |                                                      |                                        |        
|Revenue                                                                                                |                                                      | $                                      | 688,392
|Operating expenses:                                                                                    |                                                      |                                        |        
|                                                                                                       | Cost of revenue(1)                                   |                                        |        
|                                                                                                       | Selling, general and administrative(1)               |                                        |        
|                                                                                                       | Depreciation and amortization                        |                                        |        
|                                                                                                       | Restructuring and offering charges (credits)         |                                        |        
|                                                                                                       | (Gain) loss on sales of assets, net                  |                                        |        
|                                                                                                       | Impairment of assets                                 |                                        |        
|                                                                                                       | Net periodic pension and post-retirement benefits(2) |                                        |        
|                                                                                                       | Earnings in unconsolidated subsidiaries              |                                        |        
|                                                                                                       | Other expense (income), net                          |                                        |        
|                                                                                                       |                                                      |                                        |        
|                                                                                                       |                                                      | Total operating expenses               |        
|                                                                                                       |                                                      |                                        |        
|Operating income                                                                                       |                                                      |                                        | 116,602
|                                                                                                       | Gain on sale of investment in affiliate(3)           |                                        |        
|                                                                                                       | Interest income                                      |                                        |        
|                                                                                                       | Interest expense                                     |                                        |        
|                                                                                                       |                                                      |                                        |        
|                                                                                                       |                                                      | Non-operating income (expense), net    |        
|                                                                                                       |                                                      |                                        |        
|Income from continuing operations before income taxes, minority interests, and discontinued operations |                                                      |                                        | 122,666
|Provision for income taxes                                                                             |                                                      |                                        | (38,827
|                                                                                                       |                                                      |                                        |        
|Income from continuing operations before minority interests and discontinued operations                |                                                      |                                        | 83,839 
|Minority interests                                                                                     |                                                      |                                        | (64    
|                                                                                                       |                                                      |                                        |        
|Income from continuing operations                                                                      |                                                      |                                        | 83,775 
|Discontinued operations:(4)                                                                            |                                                      |                                        |        
|                                                                                                       |                                                      | Loss from discontinued operations, net |        
|                                                                                                       |                                                      |                                        |        
|                                                                                                       |                                                      | Net income                             |        
|                                                                                                       |                                                      |                                        |        
|Income from continuing operations per share:                                                           |                                                      |                                        |        
|                                                                                                       | Basic (Class A and Class B common stock)             |                                        | $      
|                                                                                                       |                                                      |                                        |        
|                                                                                                       | Diluted (Class A and Class B common stock)           |                                        | $      
|                                                                                                       |                                                      |                                        |        
|Net income per share:                                                                                  |                                                      |                                        |        
|                                                                                                       | Basic (Class A and Class B common stock)             |                                        | $      
|                                                                                                       |                                                      |                                        |        
|                                                                                                       | Diluted (Class A and Class B common stock)           |                                        | $      
|                                                                                                       |                                                      |                                        |        

38

---



|Balance Sheet Data (as of period end):  |  |   |           |  |   |         |  |   |         |  |   |         |  |   |         | 
|--------------------------------------- |  | - | --------- |  | - | ------- |  | - | ------- |  | - | ------- |  | - | ------- | 
|Cash and cash equivalents               |  | $ | 148,484   |  | $ | 180,034 |  | $ | 132,365 |  | $ | 124,452 |  | $ | 24,051  | 
|Total assets                            |  |   | 1,323,807 |  |   | 944,301 |  |   | 807,156 |  |   | 752,644 |  |   | 620,113 | 
|Total long-term debt and capital leases |  |   | 37        |  |   | 74      |  |   | 262     |  |   | 607     |  |   | 725     | 
|Total stockholders' equity              |  |   | 840,908   |  |   | 565,191 |  |   | 477,180 |  |   | 421,051 |  |   | 360,765 | 

---

Years Ended November 30,2007

2006

2005

2004

2003(In thousands)Cost of revenue

$
1,142

$
2,882

$
551

$
4,437

$
Selling, general and administrative


29,299


18,820


4,721


17,065


Discontinued operations





254





303


Total stock-based compensation expense

$
30,441

$
21,956

$
5,272

$
21,805

$



Years Ended November 30,2007

2006

2005

2004

2003(In thousands)Net pension (income) expense

$
1,281

$
(1,596
)
$
(5,733
)
$
(9,800
)
$
(12,580
)Post-retirement benefit (income) expense


(1,949
)

(1,149
)

2,378


4,667


4,289Net periodic pension and post-retirement benefits income

$
(668
)
$
(2,745
)
$
(3,355
)
$
(5,133
)
$
(8,291
)


39

---





Item 7.    Management's Discussion and Analysis of Financial Condition and Results of Operations

The following discussion of our financial condition and operating results should be read in conjunction with "Selected Financial Data" and
our consolidated financial statements and accompanying notes included in this Form 10-K.

IHS
is a leading provider and comprehensive source of Critical Information and Insight in a sizable and growing global information market. Our customers rely on our products and services
to facilitate crucial decision-making, support key processes, and improve productivity. We provide information-driven solutions to meet our customers' needs, which include gaining insight into global
energy market movements, managing product lifecycles, meeting growing environmental challenges, and assessing national or corporate security issues. IHS customers range from governments and large
multinational corporations to small companies and technical professionals, doing business in more than 180 countries.

At
the heart of our Critical Information products and services is data obtained from public sources, third parties, and our own proprietary databases. We transform that data into
Critical Information and Insight that is both useful to our customers and available where and when they need it by combining data with our proprietary and third-party technology to create graphical
user interfaces, interactive search and navigation tools, and online databases. We deliver these products primarily through Internet-based applications and portals. In many cases, the combination of
our data with these Internet-based tools provides the customer with a unique solution. Some products are also delivered through traditional media. We further transform our Critical Information into
Insight products and services with analysis from our teams of experts.

Our
vision is to bethe Sourcefor Critical Information and Insight. When Critical Information or Insightor
bothare mission-critical to our customers in achieving their business goals anywhere around the globe, we intend to be the source that they trust, rely on, and come to first. We have
targeted four specific information "domains" (Energy, Product Lifecycle, Security, and Environmental) where we believe we have the best opportunity to bethe
Sourcefor our customers. Each of these four strategic information domains represents a significant market opportunity and our goal is to be the leading source of Critical
Information and Insight in each of them. In addition, these domains are often inter-related and inter-linked; thus, the intersections between them represent areas of critical interest for our
customers and a further market opportunity for IHS.

Since
these four information domains represent areas where our customers have needs for Critical Information and Insight, we use these domains to set priorities and design our business
objectives. As we continue to deliver Critical Information and Insight in those four information domains, we prepare and analyze our financial reports to include each of the four domains in our two
operating segments. Our Energy segment is focused primarily on the Energy information domain while our Engineering segment is focused primarily on the Product Lifecycle, Security, and Environmental
information domains. However, as discussed above (see "Business"), some of our greatest opportunities to serve our customers occur in the intersection of these information domains. Accordingly, there
may be increasing overlap among information domains and between our two operating segments. We expect that overlap, as well as the ongoing evolution of our operating model, to drive changes in the way
we manage our business. As those changes continue, the way we discuss our business and report on our operating segments may change.

Executive Summary



We sell our offerings primarily through subscriptions. As a result of our subscription-based business model and historically high renewal rates, we generate
recurring revenue and cash flow. We

40

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generally
recognize revenue from subscriptions (which are usually for one-year periods) ratably over the term of the subscription. However, our business does have seasonal aspects. For
example, our first-quarter results have benefited from the inclusion of the results from CERAWeek, an annual energy executive conference. Also, our Jane's business typically generates higher revenue
and operating profit during the second half of the year due to the timing of certain of its publications.

Subscriptions
are generally paid in full within one-to-two months after the subscription period commences. As a result, the timing of our cash flows generally
precedes the recognition of revenue and income. Due to the historical timing and alignment of our sales to correspond to certain of our customers' budget and funding cycles, our cash flow provided by
operating activities tends to be higher in the first half of our fiscal year as we receive subscription payments.

IHS
customers are governments and large multinational corporations, as well as small companies and technical professionals, doing business in more than 180 countries.

We
generate approximately half of our total revenue from outside the United States. Our primary operations outside the United States are in the United Kingdom, Canada, and Switzerland.
Our operating profit outside the United States has historically exceeded our domestic operating profit.



Our revenue by type of offering for the periods presented is set forth below:

Years Ended November 30,2007

2006

2005(In thousands)Critical information

$
464,045

$
374,532

$
339,815Decision-support tools


108,990


83,942


56,015Services


115,357


92,296


80,287Total revenue

$
688,392

$
550,770

$
476,117




We have completed and integrated 16 strategic acquisitions over the last three years. Some were relatively large, others were small, but they all filled a
strategic need. Our larger acquisitions enable us to achieve greater reach in a given domainfor example, the Jane's business. Similarly, our "bolt-on" or "tuck-in" acquisitions, while
generally smaller, tend to consist of databases or datasets (such as EDS or GCS) that provide a strategic broadening of our Critical Information offerings. These bolt-on acquisitions often come with
little to no overhead, require minimal integration, and deliver higher incremental margins than larger acquisitions.

During
2007, we made the following acquisitions:



41

---





42

---





The
purchase prices for these 2007 acquisitions, excluding acquired cash and including acquisition-related costs, were initially allocated as follows (in thousands):

Jane's

Herold

All others

TotalAssets:Current assets

$
18,444

$
2,680

$
3,615

$
24,739Property and equipment


4,683


292


489


5,464Intangible assets


93,423


28,100


27,129


148,652Goodwill


115,631


32,752


47,680


196,063Other long-term assets


292








292Total assets


232,473


63,824


78,913


375,210Liabilities:Current liabilities


33,756


6,906


4,116


44,778Deferred taxes


25,278


9,701


2,437


37,416Other long-term liabilities


1,841


44





1,885Total liabilities


60,875


16,651


6,553


84,079Purchase price

$
171,598

$
47,173

$
72,360

$
291,131


During
2006, we made the following acquisitions:



We
also made three acquisitions during 2005 for an aggregate purchase price of approximately $3.5 million.

Our
consolidated financial statements include the results of operations and cash flows for these acquisitions beginning on their respective dates of acquisition.

43

---





The table below presents the split of revenue by type of offering for each of our two segments:

Energy

Engineering2007

2006

2005

2007

2006

2005Critical information

53
%
55
%
56
%
84
%
83
%
88
%Decision-support tools

19

18

16

12

12

7Services

28

27

28

4

5

5Total revenue

100
%
100
%
100
%
100
%
100
%
100
%


Each
of our segments' results from operations is primarily driven by organic growth and acquisitions. Organic growth is driven by several factors, including our ability to further
penetrate existing customers, generate new customers, raise prices, introduce new offerings, update existing offerings, execute our sales and marketing plans, and world economic and other events.



Many of our sales are customized on an annual basis to meet individual customer needs and are based on a number of factors, including the number of customer
locations, the number of simultaneous users and the breadth of the content to be included in the offering. In light of the customized nature of many of these offerings, pricing terms are also
customized. In addition, the difficulty in contrasting
price changes from period to period is exacerbated by the fact that the offering sets purchased by customers are often not constant between periods. As a result, we are not able to precisely
differentiate between pricing and volume impacts on changes in revenue from these products from period to period.



We serve some of the world's largest corporations across multiple industries, as well as governments and other organizations, in more than 100 countries. We
generated revenue of $332.9 million outside the United States during the year ended November 30, 2007, which represented almost half of our total revenue. Our primary operations outside
the United States are in the United Kingdom, Canada, and Switzerland. Our operating profit outside the United States has historically exceeded our domestic operating profit. Set forth below for the
years ended November 30 is our revenue indicated by country based on the location of our subsidiary generating the revenue (which differs in some cases from the location of the customer):

2007

2006

2005(In thousands)United States

$
355,474

$
290,367

$
245,187United Kingdom


125,514


83,768


78,660Canada


67,272


58,089


47,812Switzerland


95,257


78,127


64,840Rest of world


44,875


40,419


39,618Total revenue

$
688,392

$
550,770

$
476,117


Our
international operations expose us to foreign-currency risk. Fluctuations in foreign-currency rates increased our revenues by approximately $15.0 million, $0.1 million
and $2.7 million for the years ended November 30, 2007, 2006, and 2005, respectively, and increased (decreased) our operating income by approximately $4.4 million,
$(3.3) million and $2.5 million for the same respective periods. See "Qualitative and Quantitative Disclosures About Market RiskForeign Currency Risk."

44

---





During the fourth quarter of 2006, we executed a restructuring initiative principally affecting our Engineering segment. This initiative was undertaken to further
focus on offerings with the most growth potential, but it also had the added benefit of trimming the cost structure. During the course of the restructuring, we reduced our aggregate workforce by
approximately 40 employees.

The
$2.5 million restructuring charge was incurred in its entirety during the fourth quarter of 2006 and comprised entirely of employee severance and other termination benefits
costs. Of this amount, we disbursed $0.4 million as of November 30, 2006.

Similarly,
during the third quarter of 2005, we executed a restructuring initiative affecting our Engineering segment and certain corporate costs. This initiative was undertaken to
reduce costs, further integrate the operations of previous acquisitions, streamline our data delivery processes, and realign our marketing efforts to support our core product initiatives. During the
course of the restructuring, we reduced our aggregate workforce by over 100 employees and closed two offices, one in the U.S. and one in the U.K.

We
also incurred $0.8 million and $5.5 million of costs associated with our 2006 secondary and 2005 initial public offerings, respectively. We were required to expense
these costs since we did not issue any shares in connection with either offering; rather, all shares were sold by the exiting shareholders, and not by us.



During the third quarter of 2005, we classified a business in our Energy segment as being held for sale. The business held for sale was a manufacturing operation,
which was not part of our core operations. We continually evaluate opportunities to align our business activities within our core operations.

During
the first quarter of 2006, we revised our estimate and wrote down the value of the assets of the discontinued operation by $1.0 million based on our experience to date in
the sales process. During the third quarter of 2006, we sold the business to an unrelated third party for approximately $0.3 million, and recognized a loss of less than $0.1 million on
the sale of the business.

The
related results of operations are shown as a discontinued operation, net of tax, in our consolidated statement of operations. The related net loss from this discontinued operation
was approximately $1.9 million, $2.3 million, $2.0 million, for the years ended November 30, 2006, 2005 and 2004, respectively. Discontinuing this business did not have a
material impact on our results of operations or liquidity.



Cost of operating our business.We incur our cost of revenue primarily to acquire, manage, and deliver our critical
information and decision-support tools. These costs include royalty payments to third-party information providers, as well as personnel, information technology, and occupancy costs related to these
activities. Royalty payments generally vary based on subscription sales in our Engineering segment. Our cost of revenue for our services offerings is primarily comprised of personnel costs. Our
selling, general, and administrative expenses primarily include wages and other personnel costs, commissions, corporate occupancy costs, and marketing costs.

A
large portion of our operating expenses are not directly variable with volume sold, particularly in our Energy segment which does not generally pay royalties for critical information.
Within our Engineering segment, a portion of our critical information revenue is driven from the sale of specifications and standards, the content for which is obtained from SDOs.

45

---



Stock-based compensation expense.We have issued equity-based compensatory awards, primarily restricted stock units, for
which we will record the cost over its vesting period, none of which exceed five years. As of November 30, 2007, we had 2.7 million of outstanding nonvested shares and options granted to
our officers, employees and non-employee directors in the form of performance shares, performance units, restricted shares, restricted stock units and stock options. Assuming that all of
the performance measures are met, we expect stock-based compensation expense for the next three years to approximate the following:

Years Ending November 30,2008

2009

2010(In thousands)Total projected stock-based compensation expense

$
42,000

$
37,000

$
17,000


The
above projection includes our annual award grant which will be made on February 1, 2008, but does not reflect any expected future award grants thereafter.

Pension and post-retirement benefits.Net periodic pension and post-retirement benefits are primarily
comprised of U.S. pension income, U.K. pension expense and U.S. post-retirement benefit expense shown on a net basis.

Net
periodic pension and post-retirement benefits income were comprised of the following:

Years Ending November 30,2007

2006

2005(In thousands)Net pension (income) expense

$
1,281

$
(1,596
)
$
(5,733
)Post-retirement benefit (income) expense


(1,949
)

(1,149
)

2,378Net periodic pension and post-retirement benefits income

$
(668
)
$
(2,745
)
$
(3,355
)


During
the first quarter of 2006, we notified our U.S. employees of certain changes adopted by the human resources committee of our board of directors regarding our U.S. pension and
postretirement benefit plans. We started accounting for the impact of these changes beginning February 2006, the communication date of these changes to our employees. The amendments to our U.S.
plans impacted these plans as follows:



Provision for income taxes.Our effective tax rate was 31.7%, 31.5%, and 31.6% in the years ended November 30, 2007,
2006, and 2005, respectively. We expect our fiscal year 2008 effective tax rate to be slightly higher than the fiscal year 2007 rate. See our consolidated financial statements included elsewhere in
this Form 10-K.

46

---



Critical Accounting Policies and Estimates

Our consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States, or GAAP. To apply GAAP, we
must make significant estimates that affect our reported amounts of assets, liabilities, revenues, and expenses, and related disclosure of contingent assets and liabilities. In many instances, we
could reasonably have used different accounting estimates. In addition, changes in the accounting estimates are reasonably likely to occur from period to period. Accordingly, actual results could
differ significantly from our estimates. To the extent that there are material differences between these estimates and actual results, our financial condition or results of operations will be
affected. We base our estimates on historical experience and other assumptions that we believe to be reasonable under the circumstances and we evaluate these estimates on an ongoing basis. We refer to
accounting estimates of this type as critical accounting policies and estimates, which are discussed further below.



The majority of our offerings are provided under agreements containing standard terms and conditions. In our non-standard agreements, we make
judgments to determine how to appropriately account for them. These judgments generally involve assessments regarding matters such as:



We
evaluate the binding nature of the terms and conditions of our agreements, as well as whether customer acceptance has been achieved, based on management's judgments, and as
appropriate, advice from legal counsel.

Historically,
our judgments have been accurate because we have not experienced significant disputes with our customers regarding the timing and acceptance of delivered products and
services. However, our actual experience in future periods with respect to binding terms and conditions and customer acceptance may differ from our historical experience.



We account for our business acquisitions in accordance with the provisions of SFAS No. 141,Business
Combinations,using the purchase method of accounting. We allocate the total cost of an acquisition to the underlying net assets based on their respective estimated fair
values. As part of this allocation process, we identify and attribute values and estimated lives to the intangible assets acquired. These determinations involve significant estimates and assumptions
regarding multiple, highly subjective variables, including those with respect to future cash flows, discount rates, asset lives, and the use of different valuation models and therefore require
considerable judgment. Our estimates and assumptions may be based, in part, on the availability of listed market prices or other transparent market data. These determinations will affect the amount of
amortization expense recognized in future periods. We base our fair value estimates on assumptions we believe to be reasonable but are inherently uncertain. Depending on the size of the purchase price
of a particular acquisition as well as the mix of intangible assets acquired, our financials results could be materially impacted by the application of a different set of assumptions and estimates.



We review the carrying values of identifiable intangible assets with indefinite lives and goodwill at least annually to assess impairment because these assets are
not amortized. Additionally, we review the carrying value of any intangible asset or goodwill whenever events or changes in circumstances indicate that its carrying amount may not be recoverable.
Examples of such events or changes in circumstances,

47

---



many
of which are subjective in nature, include significant negative industry or economic trends, significant changes in the manner of our use of the acquired assets or our strategy, a significant
decrease in the market value of the asset, and a significant change in legal factors or in the business climate that could affect the value of the asset. We assess impairment by comparing the fair
value of an identifiable intangible asset or goodwill with its carrying value. The determination of fair value involves significant management judgment as described further below. Impairments are
expensed when incurred. Specifically, we test for impairment as follows:



An intangible asset that is subject to amortization is reviewed when impairment indicators are present in accordance with SFAS No. 144, Accounting for the
Impairment or Disposal of Long-Lived Assets. We compare the expected undiscounted future operating cash flows associated
with finite-lived assets to their respective carrying values to determine if the asset is fully recoverable. If the expected future operating cash flows are not sufficient to recover the carrying
value, we estimate the fair value of the asset. Impairment is recognized when the carrying amount of the asset is not recoverable and when the carrying value exceeds fair value. The projected cash
flows require several assumptions related to, among other things, relevant market factors, revenue growth, if any, and operating margins. While we believe our assumptions are reasonable, changes in
these assumptions may have a material impact on our financial results.



In accordance with SFAS No. 142,Goodwill and Other Intangible Assets, we perform the impairment test for
indefinite-lived intangible assets by comparing the asset's fair value to its carrying value on at least an annual basis. An impairment charge is recognized if the asset's estimated fair value is less
than its carrying value.

We
estimate the fair value based on projected discounted future cash flows, which, in turn, are based on our views of uncertain variables such as growth rates, anticipated future
economic conditions and the appropriate discount rates relative to risk and estimates of residual values. The use of different estimates or assumptions within our discounted cash flow model when
determining the fair value of our indefinite-lived intangible assets or using a methodology other than a discounted cash flow model could result in different values for our indefinite-lived intangible
assets and could result in an impairment charge.



In accordance with SFAS No. 142, we test goodwill for impairment on a "reporting unit" level as defined by reference to SFAS No. 131, Disclosures about
Segments of an Enterprise and Related Informationon at least an annual basis. A reporting unit is a group of businesses
(i) for which discrete financial information is available and (ii) that have similar economic characteristics. We test goodwill for impairment using the following two-step
approach:



48

---





The
use of different estimates or assumptions within our discounted cash flow model when determining the fair value of our reporting units or using a methodology other than a discounted
cash flow model could result in different values for reporting units and could result in an impairment charge.

Income Taxes

We account for income taxes in accordance with SFAS No. 109,Accounting for Income Taxes. Significant
judgment is required in determining our provision for income taxes, current tax assets and liabilities, deferred tax assets and liabilities, and our future taxable income for purposes of assessing our
ability to realize future benefit from our deferred tax assets. A valuation allowance is established to reduce our deferred tax assets to the amount that is considered more likely than not to be
realized through the generation of future taxable income and other tax planning opportunities. To the extent that a determination is made to establish or adjust a valuation allowance, the expense or
benefit is recorded in the period in which the determination is made.

Our
accounting for income taxes requires us to exercise judgment for known issues under discussion with tax authorities and transactions yet to be settled. As a result, we maintain a tax
liability for contingencies and regularly assess the adequacy of this tax liability. We record liabilities for known tax contingencies in the period when it is probable that a liability has been
incurred, and adjust our tax contingencies in the period in which it is probable that the actual results will differ from our estimates.

If
actual results differ from estimates we have used, or if we adjust these estimates in future periods, our operating results and financial position could be materially affected.

In
July 2006, the Financial Accounting Standards Board (FASB) issued FASB Interpretation No. 48,Accounting for Uncertainty in Income Taxesan
interpretation of FASB Statement No. 109(FIN 48), which provides clarification related to the process associated with accounting for uncertain tax positions recognized
in consolidated financial statements. FIN 48 prescribes a more-likely-than-not threshold for financial statement recognition and measurement of a tax position taken, or expected to be taken, in
a tax return. FIN 48 also provides guidance related to, among other things, classification, accounting for interest and penalties associated with tax positions, and disclosure requirements. We
are required to adopt FIN 48 on December 1, 2007, the first day of our 2008 fiscal year. We are currently evaluating the impact of adopting FIN 48 on our consolidated financial
statements.

Pension and Postretirement Benefits

We have defined benefit plans that cover the majority of our employees in the U.S. and the U.K. We also have postretirement plans in the U.S. that provide medical
benefits for retirees and eligible dependents. The accounting for these plans is subject to the guidance provided in SFAS No. 87,Employers' Accounting for
Pensions, and SFAS No. 106,Employers' Accounting for Postretirement Benefits Other than Pensions, and SFAS
No. 158,Employers' Accounting for Defined Benefit Plans and Other Postretirement Plans. These statements require that management make certain
assumptions relating to the long-term rate of return on plan assets, discount rates used to measure future obligations and expenses, salary increases, inflation,
health-care-cost-trend rates and other assumptions. We believe that the accounting estimates related to our pension and postretirement plans are critical accounting
estimates because they are highly susceptible to change from period to period based on market conditions.

49

---



Key
assumptions in measuring the plan obligations include the discount rate, the rate of future salary increases, the long-term expected return on plan assets, and various
demographic assumptions, as follows:



Depending
on the assumptions and estimates used, our net periodic pension and postretirement benefit income could vary within a range of outcomes and have a material impact on our
financial results.

Discount
rates and expected rates of return on plan assets are selected at the end of a given fiscal year and impact expense in the subsequent year. A fifty-basis-point decrease in
certain assumptions made at the beginning of 2007 would have had the following effects on 2007 pension expense:

|                                                     |  | Impact to Pension ResultsU.S. Plan |       
|---------------------------------------------------- |  | ----------------------------------- | ------
|
|
|50-basis-point decrease in discount rate             |  | $                                   | 919   
|50-basis-point increase in discount rate             |  | $                                   | (861  
|50-basis-point decrease in expected return on assets |  | $                                   | 1,231 
|50-basis-point increase in expected return on assets |  | $                                   | (1,231

|
|

|                                                     |  | Impact to Pension ResultsU.K. Plan |     
|---------------------------------------------------- |  | ----------------------------------- | ----
|
|
|50-basis-point decrease in discount rate             |  | £                                   | 117 
|50-basis-point increase in discount rate             |  | £                                   | (111
|50-basis-point decrease in expected return on assets |  | £                                   | 65  
|50-basis-point increase in expected return on assets |  | £                                   | (65 

Stock-Based Compensation

We have one share-based compensation plan, the Amended and Restated IHS Inc. 2004 Long-Term Incentive Plan (the "2004 Long-Term
Incentive Plan"), that provides for the grant of non-qualified stock options, incentive stock options, stock appreciation rights, restricted stock, restricted stock units, performance
units and performance shares, cash-based awards, other stock-based awards, and covered employee annual incentive awards. Our Amended and Restated IHS Inc. 2004 Directors

50

---



Stock
Plan, a sub-plan under our 2004 Long-Term Incentive Plan, provides for the grant of restricted stock and restricted stock units to non-employee directors as
defined in that plan.

As
of November 30, 2007, we had approximately 2.4 million stock-based awards outstanding, of which approximately 1.2 million were performance-based awards, assuming
maximum potential payout of the performance awards.

The
vesting of 0.3 million of these performance-based award shares will occur on February 29, 2008, based on certain financial performance levels being met during fiscal
year 2007.

The
vesting of the remaining performance shares is principally based on achieving certain financial performance levels during the fiscal year 2009, with a possible reduction in payout if
additional designated performance metrics are not met in 2008. As of November 30, 2007, we have estimated that the maximum number of shares issuable will vest based on our 2007 actual
performance and our projected performance for 2008 and 2009. The projected share-based compensation expense reflects this estimate. A change in the actual performance levels achieved by the Company
could result in a change in the actual amount of stock based compensation that we recognize. For example, in the event we do not achieve the performance metrics for 2009, our performance-based stock
compensation expense would substantially decrease.

We
believe that the assumptions related to our performance-based stock awards are critical because they are susceptible to change from period to period based on market and other
uncertain conditions beyond our control.

We
determine the fair value of our stock options using the Black-Scholes pricing model. This valuation model requires management to make assumptions and to apply judgment to determine
the fair value of our awards. These assumptions and judgments include estimating:



In
particular, significant judgment is required in estimating the future volatility of our stock price. Since we have been publicly traded for only two years, our volatility rate is
based on a basket of peer-company-stock prices. The determination of which company is considered to be a peer is highly subjective.

Given
that we only had 0.3 million options outstanding as of November 30, 2007, changes in these assumptions were not likely to materially affect our financial results.
However, if the number of options granted materially increases in the future, the likelihood that changes in our valuation assumptions could materially impact our financial results also increases.

51

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Results of Operations

Set forth below are our results of operations expressed as a percentage of revenue.

|                                                                             |                                                   | Years Ended November 30,  |   
|---------------------------------------------------------------------------- | ------------------------------------------------- | ------------------------- | --
|
|Revenue:                                                                     |                                                   |                           |   
|                                                                             | Products                                          |                           | 83
|                                                                             | Services                                          |                           | 17
|                                                                             |                                                   |                           |   
|                                                                             |                                                   | Total revenue             |   
|Operating expenses:                                                          |                                                   |                           |   
|                                                                             | Cost of revenue                                   |                           | 44
|                                                                             | Selling, general and administrative               |                           | 36
|                                                                             | Depreciation and amortization                     |                           | 4 
|                                                                             | Restructuring and offering charges                |                           |  
|                                                                             | Gain on sales of assets, net                      |                           |  
|                                                                             | Net periodic pension and post-retirement benefits |                           |  
|                                                                             | Earnings in unconsolidated subsidiaries           |                           |  
|                                                                             | Other expense, net                                |                           | (1
|                                                                             |                                                   |                           |   
|                                                                             |                                                   | Total operating expenses  |   
|                                                                             |                                                   |                           |   
|Operating income                                                             |                                                   | 17                        |   
|                                                                             | Interest income                                   |                           | 1 
|                                                                             | Interest expense                                  |                           |  
|                                                                             |                                                   |                           |   
|                                                                             |                                                   | Non-operating income, net |   
|                                                                             |                                                   |                           |   
|Income from continuing operations before income taxes and minority interests |                                                   | 18                        |   
|Provision for income taxes                                                   |                                                   | (6                        | ) 
|                                                                             |                                                   |                           |   
|Income from continuing operations before minority interests                  |                                                   | 12                        |   
|Minority interests                                                           |                                                   |                          |   
|                                                                             |                                                   |                           |   
|Income from continuing operations                                            |                                                   | 12                        |   
|                                                                             |                                                   |                           |   
|Discontinued operations:                                                     |                                                   |                           |   
|                                                                             | Loss from discontinued operations, net            |                           |  
|                                                                             |                                                   |                           |   
|                                                                             |                                                   | Net income                |   
|                                                                             |                                                   |                           |   

Set
forth below is our revenue and operating income for our Energy and Engineering segments for the years ended November 30, 2007, 2006 and 2005. Certain shared-services functions
are not allocated to our operating segments. Unallocated amounts include corporate-level restructuring and offering

52

---



charges,
stock-based compensation expense, net periodic pension and post-retirement benefits income, corporate-level impairments, and gains on sales of corporate assets.

Years Ended November 30,2007

2006

2005(In thousands)Energy revenue

$
373,518

$
294,277

$
242,312Engineering revenue


314,874


256,493


233,805Total revenue

$
688,392

$
550,770

$
476,117Energy operating income

$
121,932

$
82,873

$
63,376Engineering operating income


59,978


46,808


28,365Shared services operating expense


(65,308
)

(49,496
)

(29,889
)Total operating income

$
116,602

$
80,185

$
61,852


Year Ended November 30, 2007 Compared to the Year Ended November 30, 2006

Revenue.Revenue was $688.4 million for the year ended November 30, 2007, compared to $550.8 million for
the year ended November 30, 2006, an increase of $137.6 million or 25%. Revenue increased primarily due to organic growth, which contributed $64.0 million. Acquisitions grew
revenue by $58.7 million and the impact of foreign currency added $15.0 million.

Revenue
for our Energy segment was $373.5 million for the year ended November 30, 2007, compared to $294.3 million for the year ended November 30, 2006, an
increase of $79.2 million or 27%. The increase was principally due to organic growth, which contributed $51.7 million. Additionally, acquisitions added $20.8 million. Favorable
foreign currency movements grew revenue by $6.8 million. Organic growth during the year ended November 30, 2007, was primarily driven by price increases, growth in certain
critical-information subscription products and our decision-support tools, stronger results from CERAWeek, higher demand for services, and favorable energy-industry conditions.

Revenue
for our Engineering segment was $314.9 million for the year ended November 30, 2007, compared to $256.5 million for the year ended November 30, 2006,
an increase of $58.4 million, or 23%. Acquisitions added $37.9 million. Organic growth contributed $12.3 million. Also, foreign currency movements grew revenue
$8.2 million. Organic growth was partially driven by sales from the once-every-three-year release of a certain engineering standard, the Boiler Pressure Vessel Code.
Also, increased sales in our specifications-and-standards and parts-management offerings were partially offset by lower services revenue, which decreased due to our fourth-
quarter-2006 restructuring.

Cost of Revenue.Cost of revenue was $302.6 million for the year ended November 30, 2007, compared to
$252.4 million for the year ended November 30, 2006, an increase of $50.1 million, or 20%. As a percentage of revenue, cost of revenue decreased to 44.0% from 45.8%. Margins
within our Energy segment increased principally due to the additional revenue discussed above coupled with our ability to leverage a relatively fixed-cost structure. Margins within our
Engineering segment declined slightly despite increased revenue, discussed above, and relatively flat effective royalty rates. The once-every-three-year release of a certain
engineering standard, the Boiler Pressure Vessel Code, and our Jane's acquisition carried lower margins than our overall
portfolio. Additionally, margins were negatively impacted by the modification of certain agency relationships.

Selling, General and Administrative Expenses.Selling, general and administrative expenses (SG&A) were $249.6 million
for the year ended November 30, 2007, compared to $200.7 million for the year ended November 30, 2006, an increase of $48.9 million or 24%. Stock-based compensation expense
included in SG&A increased $10.5 million. Of the remaining $38.4 million SG&A increase, $11.6 million was organic, $22.8 million was due to acquisitions, and
$4.0 million was related to foreign-exchange

53

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movements.
As a percentage of revenue and excluding stock-based compensation expense, SG&A was 32.0% for the year ended November 30, 2007, down from 33.0% for the year ended November 30,
2006. The organic increase in SG&A related to several factors, including increased selling expense because of higher sales and a revised commission structure, costs associated with our human resources
information system implementation and our ongoing transformational initiatives, and merit-based salary increases.

Depreciation and Amortization Expenses.Depreciation and amortization expenses were $25.5 million for the year ended
November 30, 2007, compared to $15.7 million for the year ended November 30, 2006, an increase of $9.8 million, or 62%. The increase was primarily due to acquisitions.

Operating Income.Operating income was $116.6 million for the year ended November 30, 2007, compared to
$80.2 million for the year ended November 30, 2006, an increase of $36.4 million, or 45%. As a percentage of revenue, operating income increased to 16.9% for the year ended
November 30, 2007 from 14.6% for the year ended November 30, 2006.

Operating
income for our Energy segment was $121.9 million for the year ended November 30, 2007, compared to $82.9 million for the year ended November 30,
2006, an increase of $39.1 million, or 47%. The increase was primarily attributable to increased revenue discussed above coupled with our ability to leverage a relatively fixed-cost
structure.

Operating
income for our Engineering segment was $60.0 million for the year ended November 30, 2007, compared to $46.8 million for the year ended November 30,
2006, an increase of $13.2 million, or 28%. Operating income increased due to sales from the once-every-three-year release of a certain engineering standard, the Boiler
Pressure Vessel Code. Additionally, increased sales in our subscriptions-based business were partially offset by lower services revenue, due to our fourth-quarter-2006 restructuring.
Additionally, operating income was negatively impacted by the modification of certain agency relationships.

Operating
expenses for our shared services were $65.3 million for the year ended November 30, 2007, compared to $49.5 million for the year ended November 30,
2006, an increase of $15.8 million, or 32%.
Increased stock-based compensation expense contributed $8.5 million. Costs associated with our human resources information system implementation and our ongoing transformational initiatives and
merit-based salary increases also contributed to the increase.

Provision for Income Taxes.Our effective tax rate for the year ended November 30, 2007 was 31.7%, compared to 31.5%
for the year ended November 30, 2006. The effective tax rate for 2007 reflects the benefits from the release of the valuation allowance on certain deferred-tax assets, including
foreign-tax credits and the release of certain tax reserves, offset by the impact from changes to certain estimates. The effective tax rate for 2006 reflects the benefits from the release
of certain tax reserves and tax-exempt interest income, offset by an increase in the valuation allowance on the realizability of foreign-tax credits.

Year Ended November 30, 2006 Compared to the Year Ended November 30, 2005

Revenue.Revenue was $550.8 million for the year ended November 30, 2006 compared to $476.1 million for
the year ended November 30, 2005, an increase of $74.7 million or 16%. Revenue increased primarily due to organic growth, which contributed $60.3 million, and acquisitions, which
contributed approximately $15.6 million.

Revenue
for our Energy segment was $294.3 million for the year ended November 30, 2006 compared to $242.3 million for the year ended November 30, 2005, an
increase of $52.0 million or 21%. The increase was principally due to organic growth, which contributed $46.3 million. Also, acquisitions contributed $5.0 million. The remainder
of the change was attributable to foreign-currency movements. Organic growth in 2006 was driven principally by price increases, an expanding subscription base, higher one-time sales of
certain data, and favorable energy-industry conditions.

54

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Revenue for our Engineering segment was $256.5 million for the year ended November 30, 2006 compared to $233.8 million for the year ended November 30, 2005,
an increase of $22.7 million, or 10%. This increase was primarily driven by organic growth, which increased revenue by $14.0 million. Acquisitions also contributed $10.7 million,
partially offset by foreign-currency movements. Organic growth resulted primarily from price increases and increased sales within our specifications-and-standards and parts-management offerings.

Cost of Revenue.Cost of revenue was $252.4 million for the year ended November 30, 2006, compared to
$228.2 million for the year ended November 30, 2005, an increase of $24.2 million, or 11%. As a percentage of revenue, cost of revenue decreased to 45.8% in 2006 from 47.9% in
2005. Margins within our Energy segment increased primarily due to increased revenue, discussed above, on a relatively fixed-cost structure. Margins within our Engineering business
benefited from the cost savings from the 2005 restructuring and relatively flat effective royalty rates.

Selling, General and Administrative Expenses.Selling, general and administrative expenses were $200.7 million for the
year ended November 30, 2006, compared to $166.8 million for the year ended November 30, 2005, an increase of $33.9 million, or 20%. Stock-based compensation expense
increased $14.1 million year over year, including $4.7 million pertaining to the retirement of our former Chief Executive Officer during the fourth quarter of 2006. Acquisitions
contributed $3.7 million of the increase. CEO retirement costs added $1.9 million. The remainder of the increase was primarily due to increased
sales-and-marketing and back-office costs to support increased sales, and, at the corporate level, increased costs related to our first year as a publicly traded
company. Cost savings from the 2005 restructuring partially offset the above. As a percentage of revenue, selling, general and administrative expenses, excluding stock-based compensation expense, were
33.0% for the year ended November 30, 2006, down from 34.1% for the year ended November 30, 2005.

Depreciation and Amortization Expenses.Depreciation and amortization expenses were $15.7 million for the year ended
November 30, 2006, compared to $11.4 million for the year ended November 30, 2005, an increase of $4.3 million, or 38%. The increase was primarily due to acquisitions.

Restructuring and Offering Charges.Restructuring and offering charges were $3.1 million for the year ended
November 30, 2006, compared to $13.7 million for the year ended November 30, 2005, a decrease of $10.6 million. The restructuring initiative undertaken in 2006 was much
smaller in scope and expense, $2.5 million in 2006 compared to $8.2 million in 2005. Additionally, offering charges related to the
secondary offering, or $0.8 million, were much smaller than those associated with the initial public offering, $5.5 million.

Operating Income.Operating income was $80.2 million for the year ended November 30, 2006, compared to
$61.9 million for the year ended November 30, 2005, an increase of $18.3 million, or 30%. As a percentage of revenue, operating income increased to 14.6% in 2006 from 13.0% in
2005.

Operating
income for our Energy segment was $82.9 million for the year ended November 30, 2006, compared to $63.4 million for the year ended November 30,
2005, an increase of $19.5 million, or 31%. The increase was primarily attributable to increased revenue discussed above coupled with a relatively fixed-cost structure.

Operating
income for our Engineering segment was $46.8 million for the year ended November 30, 2006, compared to $28.4 million for the year ended November 30,
2005, an increase of $18.4 million, or 65%. The increase was primarily driven by increased sales combined with costs savings resulting from our third-quarter 2005 restructuring. Also, we
incurred $2.5 million more in restructuring charges in 2005 than in 2006.

Operating
expenses for our shared services were $49.5 million for the year ended November 30, 2006, compared to $29.9 million for the year ended November 30,
2005, an increase of $19.6 million, or

55

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66%.
Increased stock-based compensation expense contributed $16.4 million. Costs associated with our ongoing transformational initiatives and merit-based salary increases also contributed to
the increase.

Provision for Income Taxes.Our effective tax rate for the year ended November 30, 2006 was 31.5%, compared to 31.6%
for the year ended November 30, 2005. The effective tax rate for 2006 reflects the benefits from the release of certain tax reserves and tax exempt interest income, offset by an increase in the
valuation allowance on the realizability of foreign tax credits. The effective tax rate for 2005 reflects the benefit of the favorable outcome of tax audits during the period, changes to certain
estimates and the impact of non-deductible items.

Liquidity and Capital Resources

As of November 30, 2007, we had cash and cash equivalents of $148.5 million, short-term investments of $10.5 million, and
virtually no debt. We have generated strong cash flows from operations over the last few years. As a result of these factors, as well as the availability of funds under
our credit facility, we believe we will have sufficient cash to meet our anticipated working capital and capital expenditure needs.

Our
future capital requirements will depend on many factors, including the timing and extent of spending to support product development efforts, the expansion of sales and marketing
activities, the timing of introductions of new products, our ongoing companywide initiatives, changing technology, and the continued market acceptance of our offerings. We could be required, or could
elect, to seek additional funding through public or private equity or debt financing for possible future acquisitions. Additional funds may not be available on terms acceptable to us or at all. We
expect our capital expenditures, excluding potential acquisitions, to be approximately $14 million for 2008.



During 2006, our board of directors approved a program to reduce the dilutive effects of employee equity grants, by allowing employees to surrender shares back to
the company for a value equal to their statutory tax liability. IHS then pays the statutory tax on behalf of the employee. Later in 2006, our board of directors approved an additional
programa stock buyback programwhereby IHS was authorized to acquire up to one million shares per year in the open market to more fully offset the dilutive effect of our
employee equity programs. This program was renewed by the board of directors in late 2007 for fiscal year 2008. During 2007, we repurchased 689,962 shares of our Class A common stock for
approximately $29.2 million, or $42.29 per share, pursuant to the stock buyback program and 159,251 shares for approximately $9.3 million, or $58.51 per share, related to shares withheld
for taxes.



Net cash provided by operating activities was $141.7 million for the year ended November 30, 2007, compared to $115.7 million for the year
ended November 30, 2006. The increase was principally due to our business growing profitably year over year, primarily due to increased pricing, an expanding subscription base, increased sales
and the positive impact of our acquisitions. Our subscription-based business model typically generates a high rate of cash flow and is aided by the following:



56

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The
positive cash flow impact of our growing business in 2007 was partially offset by the following:



Net
cash provided by operating activities was $115.7 million for the year ended November 30, 2006, compared to $48.3 million for the year ended November 30,
2005. The increase was principally due to our business growing profitably year over year, primarily due to increased pricing, an expanding subscription base, increased sales and the positive impact of
our acquisitions. Our subscription-based business model typically generates a high rate of cash flow and is aided by items noted above. Additionally, the year-over-year
comparison was aided by the unusually strong receivable collections at the end of 2006.

Net
cash used in investing activities was $133.8 million for the year ended November 30, 2007, compared to $72.3 million for the year ended November 30, 2006.
The increase in cash used in investing activities was primarily driven by two events. First, we disbursed $30.2 million more on acquisitions during 2007 than we did in 2006. Second, we had an
$8.5 million net cash outflow in 2007 due to the purchases and sales/maturities of investments. In contrast, we had a $25.7 million net cash inflow in 2006 due to the purchases and
sales/maturities of investments.

Net
cash used in investing activities was $72.3 million for the year ended November 30, 2006, compared to $39.3 million for the year ended November 30, 2005.
The increase in net cash used was primarily attributable to increased acquisition activity in 2006we disbursed $84.5 million in 2006 on acquisitions as opposed to only
$3.5 million in 2005and increased capital expenditures. This was offset by greater purchases of investments in 2005, the year in which we implemented our
cash-management policy.

Net
cash used in financing activities was $38.0 million for the year ended November 30, 2007. Net cash provided by financing activities was $2.8 million for the year
ended November 30, 2006. The difference in cash flows was primarily caused by the additional $30.9 million disbursed in 2007 for the buyback of our shares. Additionally, we recognized
$9.5 million more tax benefit from equity compensation plans, discussed more below, in 2006.

Net
cash provided by financing activities was $2.8 million for the year ended November 30, 2006. Net cash used in financing activities was $0.4 million for the year
ended November 30, 2005. On December 1, 2005, the first day of our fiscal 2006 year, we adopted SFAS No. 123(R),Share-Based
Payment. This standard amended SFAS No. 95,Statement of Cash Flows, to require that excess tax benefits be reported as a
financing cash inflow rather than as a reduction of taxes paid. Accordingly, we recognized a $10.5 million benefit during 2006 relating to vesting equity awards during the period. This amount
was partially offset by the $7.6 million buyback of our shares during 2006.



On September 7, 2007, we entered into an amended and restated credit agreement (the "Revolver"). The $385 million unsecured revolving credit
agreement allows us, under certain conditions, to increase the facility to a maximum of $500 million. The agreement expires in September 2012.

The
interest rates for borrowing under the Revolver are based upon our Leverage Ratio, which is the ratio of Consolidated Funded Indebtedness to rolling four quarter Consolidated
Earnings Before Interest Expense, Taxes, Depreciation and Amortization (EBITDA), as defined in the Revolver. The

57

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rate
ranges from the applicable LIBOR plus 50 basis points to 125 basis points or the agent bank's base rate. A commitment fee is payable periodically and ranges from 10 to 25 basis points based upon
our Leverage Ratio. The Revolver contains certain financial and other covenants, including limitations on capital lease obligations and maximum Leverage and Interest Coverage Ratios, as defined in the
Revolver.

As
of November 30, 2007, we were in compliance with all of the covenants in the agreement and had no outstanding borrowings. However, we had outstanding letters of credit totaling
approximately $1.8 million as of November 30, 2007, that served to reduce the amount available to $383.2 million.

Off-Balance Sheet Transactions

We have no off-balance sheet transactions.

Contractual Obligations and Commercial Commitments

We have various contractual obligations and commercial commitments which are recorded as liabilities in our consolidated financial statements. Other items, such
as certain purchase commitments and other executory contracts, are not recognized as liabilities in our consolidated financial statements but are required to be disclosed. The following table
summarizes our contractual obligations and commercial commitments at November 30, 2007, and the future periods in which such obligations are expected to be settled in cash:

|                                                   |       | Payment due by period
|-------------------------------------------------- | ----- | ---------------------
|
|
|Operating leases                                   |       | $                    
|Post-retirement medical-benefit plan contributions |       |                      
|Unconditional purchase obligations                 |       |                      
|                                                   |       |                      
|                                                   | Total |                      
|                                                   |       |                      

We
do not expect to contribute to our U.S. pension plan in 2008 since it is currently over-funded. In 2008, we expect to contribute $2.7 million to our U.K. pension
plan and $0.3 million to our Supplemental Income Plan, both of which are currently under-funded. See our consolidated financial statements included elsewhere in this
Form 10-K.

Recent Accounting Pronouncements

In July 2006, the Financial Accounting Standards Board (FASB) issued FASB Interpretation No. 48,Accounting for Uncertainty
in Income Taxesan interpretation of FASB Statement No. 109(FIN 48), which provides clarification related to the process associated with accounting
for uncertain tax positions recognized in consolidated financial statements. FIN 48 prescribes a more-likely-than-not threshold for financial statement
recognition and measurement of a tax position taken, or expected to be taken, in a tax return. FIN 48 also provides guidance related to, among other things, classification, accounting for
interest and penalties associated with tax positions, and disclosure requirements. We are required to adopt FIN 48 on December 1, 2007, the first day of our 2008 fiscal year. We are
currently evaluating the impact of adopting FIN 48 on our consolidated financial statements.

In
September 2006, the FASB issued SFAS No. 157,Fair Value Measurements(SFAS No. 157). Among other requirements,
SFAS No. 157 defines fair value and establishes a framework for measuring fair value and also expands disclosure about the use of fair value to measure assets and liabilities. SFAS
No. 157 is effective beginning the first fiscal year that begins after November 15, 2007. We are required

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to
adopt SFAS No. 157 on December 1, 2007. Subsequent to the Standard's issuance, the FASB issued an exposure draft that provides for a one year deferral for the implementation of
SFAS 157 for non-financial assets and liabilities. We do not expect the adoption of SFAS No. 157 to have a material impact our financial statements.

In
September 2006, the FASB issued SFAS No. 158,Employer's Accounting for Defined Benefit Pension and Other Postretirement Plansan
Amendment of FASB Statements No. 87, 88, 106 and 132(R)(SFAS No. 158), and it was effective for our annual fiscal year ending November 30, 2007. The
standard requires an employer to recognize the funded status of any defined benefit pension and/or other postretirement benefit plans as an asset or liability in its statement of financial position.
Funded status is the difference between the projected benefit obligation and the market value of plan assets for defined benefit pension plans, and is the difference between the accumulated benefit
obligation and the market value of plan assets (if any) for other post retirement benefit plans. SFAS No. 158 also requires an employer to recognize changes in that funded status in the year in
which the changes occur through other comprehensive income.

As
a result of the adoption of SFAS No. 158, the prepaid asset related to our overfunded U.S. defined benefit pension plan decreased by $3.3 million, liabilities related to
our other defined benefit pension and postretirement plans decreased by $2.1 million and our accumulated other comprehensive income, net of related deferred income taxes, decreased by
approximately $0.9 million as of November 30, 2007. A portion of the change in accumulated other comprehensive income related to the adoption of SFAS No. 158 will be
recognized in the statement of operations as a component of net periodic pension
benefit income in future periods. Such amount is estimated to be approximately $3.5 million before tax, in 2008.

In
addition, this statement requires companies to measure plan assets and obligations at the date of their year-end statement of financial position, with limited exceptions.
This measurement date provision will be effective for our annual 2008 year end and will not have an impact on our financial statements as we currently measure plan assets and obligations as of our
fiscal year-end.

The
impact of adopting SFAS 158 is displayed in the table below:

As of November 30, 2007Before
Application of
SFAS No. 158

Adjustments

After
Application of
SFAS No. 158(In thousands)AssetsPrepaid pension asset

$
94,368

$
(3,252
)
$
91,116Intangible asset


564


(564
)

LiabilitiesAccrued pension liability


(9,384
)

(2,581
)

(11,965
)Accrued postretirement benefits liability


(15,416
)

5,213


(10,203
)Deferred tax liability


(26,951
)

266


(26,685
)Stockholders' EquityAccumulated other comprehensive income (loss)


(22,307
)

918


(21,389
)


In
December 2007, the FASB issued SFAS No. 141(R),Business Combinationsand SFAS No. 160, Accounting and Reporting of Noncontrolling Interest in Consolidated
Financial Statements, an amendment of ARB No. 51. These new standards will
significantly change the accounting for and reporting of business combination transactions and noncontrolling (minority) interests in consolidated financial statements. SFAS Nos. 141(R) and 160
are required to be adopted simultaneously and are effective for the first annual reporting period beginning on or after December 15, 2008. Thus, we are required to adopt these Standards on
December 1, 2009, the first day of our 2010 fiscal year. Earlier adoption is prohibited. We are currently evaluating the impact of adopting SFAS Nos. 141(R) and SFAS 160 on our
consolidated financial statements.

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Item 7A.    Quantitative and Qualitative Disclosures About Market Risk



Our exposure to changes in interest rates relates primarily to our portfolio of investments. The primary objective of our investment portfolio is to preserve
principal while maximizing yields. This is accomplished by maintaining a well-diversified portfolio of high-quality investment-grade securities, all of which have an effective
maturity within the next twelve months. A hypothetical 50-basis-point increase in interest rates at November 30, 2007, would have had an immaterial impact on the fair value of our
portfolio.

We
also may be exposed from time to time to changes in interest rates that may adversely affect our results of operations and financial position. We were not exposed to this interest
rate risk at November 30, 2007, since we had no outstanding variable-rate debt as of that date.



Our consolidated financial statements are expressed in U.S. dollars, but a portion of our business is conducted in currencies other than U.S. dollars. Changes in
the exchange rates for such currencies into U.S. dollars can affect our revenues, earnings, and the carrying values of our assets and liabilities in our consolidated balance sheet, either positively
or negatively. Fluctuations in foreign currency rates increased our revenues by $15.0 million, $0.1 million, and $2.7 million for the years ended November 30, 2007, 2006,
and 2005, respectively, and increased (decreased) our operating income by $4.4 million, $(3.3) million, and $2.5 million for the same respective periods. The translation effects
of changes in exchange rates in our consolidated balance sheet are recorded within the cumulative translation adjustment component of our stockholders' equity. In 2007, we recorded cumulative
translation gains of $18.0 million, reflecting changes in exchange rates of various currencies compared to the U.S. dollar.

A
10% change in the currencies that we are primarily exposed to would have impacted our 2007 revenue and operating income by approximately $19.3 million and $2.2 million,
respectively.



We are exposed to credit risk associated with cash equivalents, investments, and trade receivables. We do not believe that our cash equivalents, investments, or
foreign currency derivatives present significant credit risks because the counterparties to the instruments consist of major financial institutions and we manage the notional amount of contracts
entered into with any one counterparty. Substantially all trade receivable balances are unsecured. The concentration of credit risk with respect to trade receivables is limited by the large number of
customers in our customer base and their dispersion across various industries and geographic areas. Although we have a large number of customers who are dispersed across different industries and
geographic areas, a prolonged economic downturn could increase our exposure to credit risk on our trade receivables. We perform ongoing credit evaluations of our customers and maintain an allowance
for potential credit losses.

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Item 8.    Financial Statements and Supplementary Data

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS



|Report of Independent Registered Public Accounting Firm                                                         |  | 62
|--------------------------------------------------------------------------------------------------------------- |  | --
|Management's Report on Internal Control Over Financial Reporting                                                |  | 63
|Report of Independent Registered Public Accounting Firm on Internal Control Over Financial Reporting            |  | 64
|Consolidated Financial Statements                                                                               |  |   
|Consolidated Balance Sheets as of November 30, 2007 and 2006                                                    |  | 66
|Consolidated Statements of Operations for the Years Ended November 30, 2007, 2006, and 2005                     |  | 67
|Consolidated Statement of Changes in Stockholders' Equity for the Years Ended November 30, 2007, 2006, and 2005 |  | 68
|Consolidated Statements of Cash Flows for the Years Ended November 30, 2007, 2006, and 2005                     |  | 69
|Notes to Consolidated Financial Statements for the Years Ended November 30, 2007, 2006, and 2005                |  | 70

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The
Board of Directors and Stockholders of IHS Inc.

We
have audited the accompanying consolidated balance sheets of IHS Inc. as of November 30, 2007 and 2006, and the related consolidated statements of operations, changes in
stockholders' equity, and cash flows for each of the three years in the period ended November 30, 2007. These consolidated financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits.

We
conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to
obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our opinion.

In
our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of IHS Inc. at November 30, 2007
and 2006, and the consolidated results of its operations and its cash flows for each of the three years in the period ended November 30, 2007, in conformity with U.S. generally accepted
accounting principles.

We
also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), IHS Inc.'s internal control over financial reporting as of
November 30, 2007, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated
January 21, 2008 expressed an unqualified opinion thereon.

|                                  |  | /s/ Ernst & Young LLP
|--------------------------------- |  | ---------------------
|Denver, Colorado
January 21, 2008 |  |                      

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MANAGEMENT'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING

Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act
Rules 13a-15(f) and 15d-15(f). Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we
conducted an evaluation of the effectiveness of our internal control over financial reporting as of November 30, 2007, based on the framework in Internal ControlIntegrated
Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Based on that evaluation, our management concluded that our internal control over financial reporting
was effective as of November 30, 2007.

Our
management's evaluation did not include assessing the effectiveness of internal control over financial reporting at Jane's Information Group ("Jane's"), which was acquired on
June 12, 2007. Jane's was included in our consolidated financial statements and constituted $239 million and $97 million of total and net assets, respectively, as of
November 30, 2007, and $35 million and $0.5 million of revenues and net loss, respectively, for the year then ended. The net loss incurred by the Jane's business includes
amortization expense related to the acquired intangible assets and interest expense related to an intercompany note payable to IHS.

Because
of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Therefore, even those systems determined to be effective can
provide only reasonable assurance with respect to financial statement preparation and presentation.

|Date: January 21, 2008                                                                         |  | 
|---------------------------------------------------------------------------------------------- |  | 
|/s/JERRE L. STEADJerre L. Stead Chairman and Chief Executive Officer                           |  | 
|/s/MICHAEL J. SULLIVANMichael J. Sullivan Executive Vice President and Chief Financial
Officer |  | 

63

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM  ON INTERNAL CONTROL OVER FINANCIAL REPORTING

The
Board of Directors and Stockholders of IHS Inc.

We
have audited IHS Inc.'s internal control over financial reporting as of November 30, 2007, based on criteria established in Internal ControlIntegrated
Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (the COSO criteria). IHS Inc.'s management is responsible for maintaining effective internal control
over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Management's Report on Internal Control over Financial
Reporting. Our responsibility is to express an opinion on the Company's internal control over financial reporting based on our audit.

We
conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to
obtain
reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over
financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing
such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

A
company's internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of
financial statements for external purposes in accordance with generally accepted accounting principles. A company's internal control over financial reporting includes those policies and procedures
that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide
reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and
expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely
detection of unauthorized acquisition, use, or disposition of the company's assets that could have a material effect on the financial statements.

Because
of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future
periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

As
indicated in the accompanying Management's Report on Internal Control over Financial Reporting, management's assessment of and conclusion on the effectiveness of internal control over
financial reporting did not include the internal controls of Jane's Information Group, which is included in the 2007 consolidated financial statements of IHS Inc. and constituted
$239 million and $97 million of total and net assets, respectively, as of November 30, 2007 and $35 million and $0.5 million of revenues and net loss, respectively,
for the year then ended. Our audit of internal control over financial reporting of IHS Inc. also did not include an evaluation of the internal control over financial reporting of Jane's
Information Group.

In
our opinion, IHS Inc. maintained, in all material respects, effective internal control over financial reporting as of November 30, 2007, based on the COSO criteria.

We
also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheets of IHS Inc. as of
November 30, 2007 and 2006, and the related consolidated statements of operations, changes in stockholders' equity, and

64

---



cash
flows for each of the three years in the period ended November 30, 2007 and our report dated January 21, 2008 expressed an unqualified opinion thereon.

|                                  |  | /s/ Ernst & Young LLP
|--------------------------------- |  | ---------------------
|Denver, Colorado
January 21, 2008 |  |                      

65

---





IHS INC.        CONSOLIDATED BALANCE SHEETS

|                                           |                                                                                                                                                                                                                  | As of November 30,         |          
|------------------------------------------ | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------- | ---------
|
|
|Assets                                     |                                                                                                                                                                                                                  |                            |          
|Current assets:                            |                                                                                                                                                                                                                  |                            |          
|                                           | Cash and cash equivalents                                                                                                                                                                                        |                            | $        
|                                           | Short-term investments                                                                                                                                                                                           |                            |          
|                                           | Accounts receivable, net                                                                                                                                                                                         |                            |          
|                                           | Deferred subscription costs                                                                                                                                                                                      |                            |          
|                                           | Deferred income taxes                                                                                                                                                                                            |                            |          
|                                           | Other                                                                                                                                                                                                            |                            |          
|                                           |                                                                                                                                                                                                                  |                            |          
|Total current assets                       |                                                                                                                                                                                                                  |                            | 402,247  
|Non-current assets:                        |                                                                                                                                                                                                                  |                            |          
|                                           | Property and equipment, net                                                                                                                                                                                      |                            |          
|                                           | Intangible assets, net                                                                                                                                                                                           |                            |          
|                                           | Goodwill, net                                                                                                                                                                                                    |                            |          
|                                           | Prepaid pension asset                                                                                                                                                                                            |                            |          
|                                           | Other                                                                                                                                                                                                            |                            |          
|                                           |                                                                                                                                                                                                                  |                            |          
|Total non-current assets                   |                                                                                                                                                                                                                  |                            | 921,560  
|                                           |                                                                                                                                                                                                                  |                            |          
|Total assets                               |                                                                                                                                                                                                                  | $                          | 1,323,807
|                                           |                                                                                                                                                                                                                  |                            |          
|Liabilities and stockholders' equity       |                                                                                                                                                                                                                  |                            |          
|Current liabilities:                       |                                                                                                                                                                                                                  |                            |          
|                                           | Short-term debt                                                                                                                                                                                                  |                            | $        
|                                           | Accounts payable                                                                                                                                                                                                 |                            |          
|                                           | Accrued compensation                                                                                                                                                                                             |                            |          
|                                           | Accrued royalties                                                                                                                                                                                                |                            |          
|                                           | Other accrued expenses                                                                                                                                                                                           |                            |          
|                                           | Income tax payable                                                                                                                                                                                               |                            |          
|                                           | Deferred subscription revenue                                                                                                                                                                                    |                            |          
|                                           |                                                                                                                                                                                                                  |                            |          
|Total current liabilities                  |                                                                                                                                                                                                                  |                            | 392,395  
|Long-term debt                             |                                                                                                                                                                                                                  |                            | 37       
|Accrued pension liabilities                |                                                                                                                                                                                                                  |                            | 11,965   
|Accrued post-retirement benefits           |                                                                                                                                                                                                                  |                            | 10,203   
|Deferred income taxes                      |                                                                                                                                                                                                                  |                            | 60,461   
|Other liabilities                          |                                                                                                                                                                                                                  |                            | 7,619    
|Minority interests                         |                                                                                                                                                                                                                  |                            | 219      
|Commitments and contingencies              |                                                                                                                                                                                                                  |                            |          
|Stockholders' equity:                      |                                                                                                                                                                                                                  |                            |          
|                                           | Class A common stock, $0.01 par value per share, 80,000,000 shares authorized, 49,831,293 and 45,265,794 shares issued, 48,758,518 and 45,042,232 shares outstanding at November 30, 2007 and 2006,
respectively |                            |          
|                                           | Class B common stock, $0.01 par value per share, 13,750,000 shares authorized, issued and outstanding at November 30, 2007 and 2006                                                                              |                            |          
|                                           | Additional paid in capital                                                                                                                                                                                       |                            |          
|                                           | Treasury stock, at cost; 1,072,775 and 223,562 shares at November 30, 2007 and 2006                                                                                                                              |                            |          
|                                           | Retained earnings                                                                                                                                                                                                |                            |          
|                                           | Accumulated other comprehensive income (loss)                                                                                                                                                                    |                            |          
|                                           |                                                                                                                                                                                                                  |                            |          
|                                           |                                                                                                                                                                                                                  | Total stockholders' equity |          
|                                           |                                                                                                                                                                                                                  |                            |          
|Total liabilities and stockholders' equity |                                                                                                                                                                                                                  | $                          | 1,323,807
|                                           |                                                                                                                                                                                                                  |                            |          

See accompanying notes.

66

---





IHS INC.        CONSOLIDATED STATEMENTS OF OPERATIONS

|                                                                             |                                                                                                                                                                                    | Years Ended November 30,               |                                                                                                                                                                 
|---------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------
|
|
|Revenue:                                                                     |                                                                                                                                                                                    |                                        |                                                                                                                                                                 
|                                                                             | Products                                                                                                                                                                           |                                        | $                                                                                                                                                               
|                                                                             | Services                                                                                                                                                                           |                                        |                                                                                                                                                                 
|                                                                             |                                                                                                                                                                                    |                                        |                                                                                                                                                                 
|                                                                             |                                                                                                                                                                                    | Total revenue                          |                                                                                                                                                                 
|Operating expenses:                                                          |                                                                                                                                                                                    |                                        |                                                                                                                                                                 
|                                                                             | Cost of revenue:                                                                                                                                                                   |                                        |                                                                                                                                                                 
|                                                                             |                                                                                                                                                                                    | Products                               |                                                                                                                                                                 
|                                                                             |                                                                                                                                                                                    | Services                               |                                                                                                                                                                 
|                                                                             |                                                                                                                                                                                    |                                        |                                                                                                                                                                 
|                                                                             |                                                                                                                                                                                    |                                        | Total cost of revenue (includes stock-based compensation expense at $1,142; $2,882; and $551 for the years ended November 30, 2007, 2006 and 2005, respectively)
|                                                                             | Selling, general and administrative (includes stock-based compensation expense of $29,299; $18,820; and $4,721 for the years ended November 30, 2007, 2006 and 2005, respectively) |                                        |                                                                                                                                                                 
|                                                                             | Depreciation and amortization                                                                                                                                                      |                                        |                                                                                                                                                                 
|                                                                             | Restructuring and offering charges (credits)                                                                                                                                       |                                        |                                                                                                                                                                 
|                                                                             | (Gain) loss on sales of assets, net                                                                                                                                                |                                        |                                                                                                                                                                 
|                                                                             | Net periodic pension and post-retirement benefits                                                                                                                                  |                                        |                                                                                                                                                                 
|                                                                             | Earnings in unconsolidated subsidiaries                                                                                                                                            |                                        |                                                                                                                                                                 
|                                                                             | Other (income) expense, net                                                                                                                                                        |                                        |                                                                                                                                                                 
|                                                                             |                                                                                                                                                                                    |                                        |                                                                                                                                                                 
|                                                                             |                                                                                                                                                                                    | Total operating expenses               |                                                                                                                                                                 
|                                                                             |                                                                                                                                                                                    |                                        |                                                                                                                                                                 
|Operating income                                                             |                                                                                                                                                                                    |                                        | 116,602                                                                                                                                                         
|                                                                             | Interest income                                                                                                                                                                    |                                        |                                                                                                                                                                 
|                                                                             | Interest expense                                                                                                                                                                   |                                        |                                                                                                                                                                 
|                                                                             |                                                                                                                                                                                    |                                        |                                                                                                                                                                 
|                                                                             |                                                                                                                                                                                    | Non-operating income, net              |                                                                                                                                                                 
|                                                                             |                                                                                                                                                                                    |                                        |                                                                                                                                                                 
|Income from continuing operations before income taxes and minority interests |                                                                                                                                                                                    |                                        | 122,666                                                                                                                                                         
|Provision for income taxes                                                   |                                                                                                                                                                                    |                                        | (38,827                                                                                                                                                         
|                                                                             |                                                                                                                                                                                    |                                        |                                                                                                                                                                 
|Income from continuing operations before minority interests                  |                                                                                                                                                                                    |                                        | 83,839                                                                                                                                                          
|Minority interests                                                           |                                                                                                                                                                                    |                                        | (64                                                                                                                                                             
|                                                                             |                                                                                                                                                                                    |                                        |                                                                                                                                                                 
|Income from continuing operations                                            |                                                                                                                                                                                    |                                        | 83,775                                                                                                                                                          
|Discontinued operations:                                                     |                                                                                                                                                                                    |                                        |                                                                                                                                                                 
|                                                                             |                                                                                                                                                                                    | Loss from discontinued operations, net |                                                                                                                                                                 
|                                                                             |                                                                                                                                                                                    |                                        |                                                                                                                                                                 
|Net income                                                                   |                                                                                                                                                                                    | $                                      | 83,775                                                                                                                                                          
|                                                                             |                                                                                                                                                                                    |                                        |                                                                                                                                                                 
|Income from continuing operations per share:                                 |                                                                                                                                                                                    |                                        |                                                                                                                                                                 
|                                                                             | Basic (Class A common stock and Class B common stock)                                                                                                                              |                                        | $                                                                                                                                                               
|                                                                             |                                                                                                                                                                                    |                                        |                                                                                                                                                                 
|                                                                             | Diluted (Class A common stock and Class B common stock)                                                                                                                            |                                        | $                                                                                                                                                               
|                                                                             |                                                                                                                                                                                    |                                        |                                                                                                                                                                 
|Loss from discontinued operations per share:                                 |                                                                                                                                                                                    |                                        |                                                                                                                                                                 
|                                                                             | Basic (Class A common stock and Class B common stock)                                                                                                                              |                                        | $                                                                                                                                                               
|                                                                             |                                                                                                                                                                                    |                                        |                                                                                                                                                                 
|                                                                             | Diluted (Class A common stock and Class B common stock)                                                                                                                            |                                        | $                                                                                                                                                               
|                                                                             |                                                                                                                                                                                    |                                        |                                                                                                                                                                 
|Net income per share:                                                        |                                                                                                                                                                                    |                                        |                                                                                                                                                                 
|                                                                             | Basic (Class A common stock and Class B common stock)                                                                                                                              |                                        | $                                                                                                                                                               
|                                                                             |                                                                                                                                                                                    |                                        |                                                                                                                                                                 
|                                                                             | Diluted (Class A common stock and Class B common stock)                                                                                                                            |                                        | $                                                                                                                                                               
|                                                                             |                                                                                                                                                                                    |                                        |                                                                                                                                                                 
|Weighted average shares:                                                     |                                                                                                                                                                                    |                                        |                                                                                                                                                                 
|                                                                             | Basic (Class A common stock)                                                                                                                                                       |                                        |                                                                                                                                                                 
|                                                                             |                                                                                                                                                                                    |                                        |                                                                                                                                                                 
|                                                                             | Basic (Class B common stock)                                                                                                                                                       |                                        |                                                                                                                                                                 
|                                                                             |                                                                                                                                                                                    |                                        |                                                                                                                                                                 
|                                                                             | Diluted (Class A common stock)                                                                                                                                                     |                                        |                                                                                                                                                                 
|                                                                             |                                                                                                                                                                                    |                                        |                                                                                                                                                                 
|                                                                             | Diluted (Class B common stock)                                                                                                                                                     |                                        |                                                                                                                                                                 
|                                                                             |                                                                                                                                                                                    |                                        |                                                                                                                                                                 

See accompanying notes.

67

---





IHS INC.        CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY

|                                                                                     |                                                          | Shares of
Class A
Common
Stock |   | Class A
Common
Stock |     | Shares of
Class B
Common
Stock |        | Class B
Common
Stock |   | Additional
Paid-In
Capital |   | Treasury
Stock |         | Retained
Earnings |   | Accumulated
Other
Comprehensive
Income (Loss) |   | Unearned
Compensation |         | Total |  
|------------------------------------------------------------------------------------ | -------------------------------------------------------- | ------------------------------ | - | -------------------- | --- | ------------------------------ | ------ | -------------------- | - | -------------------------- | - | -------------- | ------- | ----------------- | - | --------------------------------------------- | - | --------------------- | ------- | ----- | -
|
|Balance at November 30, 2004                                                         |                                                          | 41,250                         |   | $                    | 413 |                                | 13,750 |                      | $ | 138                        |   | $              | 122,300 |                   | $ |                                              |   | $                     | 301,887 |       | $
|Restricted stock activity                                                            |                                                          | 791                            |   |                      | 8   |                                |       |                      |   |                           |   |                | 14,213  |                   |   |                                              |   |                       |        |       |  
|Excess tax benefit on vested shares                                                  |                                                          |                               |   |                      |    |                                |       |                      |   |                           |   |                | 295     |                   |   |                                              |   |                       |        |       |  
|Termination of put rights associated with deferred stock units and restricted shares |                                                          | 1,834                          |   |                      | 18  |                                |       |                      |   |                           |   |                | 28,950  |                   |   |                                              |   |                       |        |       |  
|Conversion of debt to equity                                                         |                                                          | 203                            |   |                      | 2   |                                |       |                      |   |                           |   |                | 2,438   |                   |   |                                              |   |                       |        |       |  
|Net income                                                                           |                                                          |                               |   |                      |    |                                |       |                      |   |                           |   |                |        |                   |   |                                              |   |                       | 41,797  |       |  
|Other comprehensive income:                                                          |                                                          |                                |   |                      |     |                                |        |                      |   |                            |   |                |         |                   |   |                                               |   |                       |         |       |  
|                                                                                     | Foreign currency translation adjustments                 |                                |  |                      |     |                               |        |                     |   |                            |  |                |         |                  |   |                                               |  |                       |         |      |  
|                                                                                     | Minimum pension liability adjustment, net of tax         |                                |  |                      |     |                               |        |                     |   |                            |  |                |         |                  |   |                                               |  |                       |         |      |  
|                                                                                     | Unrealized losses on short-term investments, net of tax  |                                |  |                      |     |                               |        |                     |   |                            |  |                |         |                  |   |                                               |  |                       |         |      |  
|                                                                                     | Unrealized losses on foreign-currency hedges, net of tax |                                |  |                      |     |                               |        |                     |   |                            |  |                |         |                  |   |                                               |  |                       |         |      |  
|                                                                                     |                                                          |                                |   |                      |     |                                |        |                      |   |                            |   |                |         |                   |   |                                               |   |                       |         |       |  
|Comprehensive income, net of tax                                                     |                                                          |                                |   |                      |     |                                |        |                      |   |                            |   |                |         |                   |   |                                               |   |                       |         |       |  
|                                                                                     |                                                          |                                |   |                      |     |                                |        |                      |   |                            |   |                |         |                   |   |                                               |   |                       |         |       |  
|Balance at November 30, 2005                                                         |                                                          | 44,078                         |   |                      | 441 |                                | 13,750 |                      |   | 138                        |   |                | 168,196 |                   |   |                                              |   |                       | 343,684 |       |  
|Adoption of SFAS No. 123(R)                                                          |                                                          |                               |   |                      |    |                                |       |                      |   |                           |   |                | (24,793 | )                 |   |                                              |   |                       |        |       |  
|Stock-based award activity                                                           |                                                          | 1,188                          |   |                      | 12  |                                |       |                      |   |                           |   |                | 21,082  |                   |   |                                              |   |                       |        |       |  
|Excess tax benefit on vested shares                                                  |                                                          |                               |   |                      |    |                                |       |                      |   |                           |   |                | 10,542  |                   |   |                                              |   |                       |        |       |  
|Repurchases of common stock                                                          |                                                          | (224                           | ) |                      |    |                                |       |                      |   |                           |   |                |        |                   |   | (7,551                                        | ) |                       |        |       |  
|Net income                                                                           |                                                          |                               |   |                      |    |                                |       |                      |   |                           |   |                |        |                   |   |                                              |   |                       | 56,345  |       |  
|Other comprehensive income:                                                          |                                                          |                                |   |                      |     |                                |        |                      |   |                            |   |                |         |                   |   |                                               |   |                       |         |       |  
|                                                                                     | Foreign currency translation adjustments                 |                                |  |                      |     |                               |        |                     |   |                            |  |                |         |                  |   |                                               |  |                       |         |      |  
|                                                                                     | Minimum pension liability adjustment, net of tax         |                                |  |                      |     |                               |        |                     |   |                            |  |                |         |                  |   |                                               |  |                       |         |      |  
|                                                                                     | Unrealized gains on short-term investments, net of tax   |                                |  |                      |     |                               |        |                     |   |                            |  |                |         |                  |   |                                               |  |                       |         |      |  
|                                                                                     | Unrealized gains on foreign-currency hedges, net of tax  |                                |  |                      |     |                               |        |                     |   |                            |  |                |         |                  |   |                                               |  |                       |         |      |  
|                                                                                     |                                                          |                                |   |                      |     |                                |        |                      |   |                            |   |                |         |                   |   |                                               |   |                       |         |       |  
|Comprehensive income, net of tax                                                     |                                                          |                                |   |                      |     |                                |        |                      |   |                            |   |                |         |                   |   |                                               |   |                       |         |       |  
|                                                                                     |                                                          |                                |   |                      |     |                                |        |                      |   |                            |   |                |         |                   |   |                                               |   |                       |         |       |  
|Balance at November 30, 2006                                                         |                                                          | 45,042                         |   |                      | 453 |                                | 13,750 |                      |   | 138                        |   |                | 175,027 |                   |   | (7,551                                        | ) |                       | 400,029 |       |  
|Stock-based award activity                                                           |                                                          | 102                            |   |                      | 1   |                                |       |                      |   |                           |   |                | 29,941  |                   |   | (9,318                                        | ) |                       |        |       |  
|Excess tax benefit on vested shares                                                  |                                                          |                               |   |                      |    |                                |       |                      |   |                           |   |                | 1,051   |                   |   |                                              |   |                       |        |       |  
|Repurchases of common stock                                                          |                                                          | (849                           | ) |                      |    |                                |       |                      |   |                           |   |                |        |                   |   | (29,176                                       | ) |                       |        |       |  
|Shares issued for acquisitions                                                       |                                                          | 4,464                          |   |                      | 44  |                                |       |                      |   |                           |   |                | 175,105 |                   |   |                                              |   |                       |        |       |  
|Adoption of SFAS No. 158, net of tax                                                 |                                                          |                               |   |                      |    |                                |       |                      |   |                           |   |                |        |                   |   |                                              |   |                       |        |       |  
|Net income                                                                           |                                                          |                               |   |                      |    |                                |       |                      |   |                           |   |                |        |                   |   |                                              |   |                       | 83,775  |       |  
|Other comprehensive income:                                                          |                                                          |                                |   |                      |     |                                |        |                      |   |                            |   |                |         |                   |   |                                               |   |                       |         |       |  
|                                                                                     | Foreign currency translation adjustments                 |                                |  |                      |     |                               |        |                     |   |                            |  |                |         |                  |   |                                               |  |                       |         |      |  
|                                                                                     | Minimum pension liability adjustment, net of tax         |                                |  |                      |     |                               |        |                     |   |                            |  |                |         |                  |   |                                               |  |                       |         |      |  
|                                                                                     |                                                          |                                |   |                      |     |                                |        |                      |   |                            |   |                |         |                   |   |                                               |   |                       |         |       |  
|Comprehensive income, net of tax                                                     |                                                          |                                |   |                      |     |                                |        |                      |   |                            |   |                |         |                   |   |                                               |   |                       |         |       |  
|                                                                                     |                                                          |                                |   |                      |     |                                |        |                      |   |                            |   |                |         |                   |   |                                               |   |                       |         |       |  
|Balance at November 30, 2007                                                         |                                                          | 48,759                         |   | $                    | 498 |                                | 13,750 |                      | $ | 138                        |   | $              | 381,124 |                   | $ | (46,045                                       | ) | $                     | 483,804 |       | $
|                                                                                     |                                                          |                                |   |                      |     |                                |        |                      |   |                            |   |                |         |                   |   |                                               |   |                       |         |       |  

See accompanying notes.

68

---





IHS INC.        CONSOLIDATED STATEMENTS OF CASH FLOWS

|                                                                           |                                                                   | Years Ended November 30,      |         
|-------------------------------------------------------------------------- | ----------------------------------------------------------------- | ----------------------------- | --------
|
|
|Operating activities                                                       |                                                                   |                               |         
|Net income                                                                 |                                                                   | $                             | 83,775  
|Reconciliation of net income to net cash provided by operating activities: |                                                                   |                               |         
|                                                                           | Depreciation and amortization                                     |                               |         
|                                                                           | Stock-based compensation expense                                  |                               |         
|                                                                           | (Gain) loss on sales of assets, net                               |                               |         
|                                                                           | Impairment of assets of discontinued operations                   |                               |         
|                                                                           | Net non-cash periodic pension and post-retirement benefits income |                               |         
|                                                                           | Undistributed earnings of affiliates, net                         |                               |         
|                                                                           | Minority interests                                                |                               |         
|                                                                           | Deferred income taxes                                             |                               |         
|                                                                           | Tax benefit from equity compensation plans                        |                               |         
|                                                                           | Change in assets and liabilities:                                 |                               |         
|                                                                           |                                                                   | Accounts receivable, net      |         
|                                                                           |                                                                   | Other current assets          |         
|                                                                           |                                                                   | Accounts payable              |         
|                                                                           |                                                                   | Accrued expenses              |         
|                                                                           |                                                                   | Income taxes                  |         
|                                                                           |                                                                   | Deferred subscription revenue |         
|                                                                           |                                                                   |                               |         
|Net cash provided by operating activities                                  |                                                                   |                               | 141,737 
|Investing activities                                                       |                                                                   |                               |         
|Capital expenditures on property and equipment                             |                                                                   |                               | (11,890 
|Intangible assets acquired                                                 |                                                                   |                               |        
|Change in other assets and liabilities                                     |                                                                   |                               | (1,285  
|Purchases of investments                                                   |                                                                   |                               | (98,975 
|Sales and maturities of investments                                        |                                                                   |                               | 90,483  
|Acquisitions of businesses, net of cash acquired                           |                                                                   |                               | (114,626
|Proceeds from sales of assets and investment in affiliate                  |                                                                   |                               | 2,461   
|                                                                           |                                                                   |                               |         
|Net cash used in investing activities                                      |                                                                   |                               | (133,832
|Financing activities                                                       |                                                                   |                               |         
|Net payments on debt                                                       |                                                                   |                               | (537    
|Tax benefit from equity compensation plans                                 |                                                                   |                               | 1,051   
|Purchases of treasury stock                                                |                                                                   |                               | (38,494 
|                                                                           |                                                                   |                               |         
|Net cash provided by (used in) financing activities                        |                                                                   |                               | (37,980 
|                                                                           |                                                                   |                               |         
|Foreign exchange impact on cash balance                                    |                                                                   |                               | (1,475  
|                                                                           |                                                                   |                               |         
|Net increase in cash and cash equivalents                                  |                                                                   |                               | (31,550 
|Cash and cash equivalents at the beginning of the year                     |                                                                   |                               | 180,034 
|                                                                           |                                                                   |                               |         
|Cash and cash equivalents at the end of the year                           |                                                                   | $                             | 148,484 
|                                                                           |                                                                   |                               |         

See
accompanying notes.

69

---





IHS INC.        NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. Nature of Business and Organization



IHS Inc. (IHS, the Company, we, our, or us) is a publicly traded Delaware corporation. IHS is a leading provider and comprehensive source of Critical
Information and Insight in a sizable and growing global market. Our customers rely on our products and services to facilitate crucial decision-making, support key processes, and improve productivity.
At the heart of our products and services is data obtained from public sources, third parties, and our own proprietary databases. We transform that data into Critical Information and Insight that is
both useful to our customers and available where and when they make critical business decisions. The data becomes Critical Information when we combine it with our proprietary and third-party
technology to create graphical user interfaces, search and navigation tools, and online delivery systems. We further transform that information into Insight products and services with analysis and
interpretation from our teams of experts.

We
have targeted four specific information "domains"Energy, Product Lifecycle, Security, and Environmental. Since these four information domains represent areas where our
customers have needs for critical information and insight, we use these domains to set priorities and design our business objectives. As we continue to deliver Critical Information and Insight in
those four information domains, we prepare and analyze our financial reports to include each of the four domains in our two reportable segments. Today, our Energy segment includes the Energy
information domain while our Engineering segment includes the Product Lifecycle, Security, and Environmental information domains. However, as discussed earlier, some of our greatest opportunities to
serve our customers occur in the intersection of these information domains. Accordingly, there may be increasing overlap among information domains and between our operating segments. We expect that
overlap, as well as the ongoing evolution of our operating model, to drive changes in the way we manage our business. As those changes continue, the way we discuss our business and report on our
operating segments may change in the future.



Voting and investment decisions with respect to the shares of our company have historically been made by TBG Holdings N.V. (TBG), a Netherlands-Antilles
company through the shares that it holds directly and through its indirect sole ownership of our other principal stockholder, Urvanos Investments Limited (Urvanos), a Cyprus limited liability company.
TBG had not historically held our shares directly and instead held them through its indirect sole ownership of Urvanos and Urpasis Investments Limited (Urpasis), a Cyprus limited liability company. On
September 1, 2006, Urpasis dividended all the shares it held in our company to TBG. TBG is wholly-owned indirectly by The Thyssen-Bornemisza Continuity Trust (Trust), a Bermuda trust, which is
controlled by a Bermudan trustee, Thybo Trustees Limited, and another oversight entity, Tornabuoni Limited, which is a Guernsey company.

On
October 30, 2006, TBG sold a portion of its ownership interests through a secondary public offering. IHS did not receive any proceeds from the sale of the Company's common
stock by TBG, and, consequently, we expensed all related offering costs.

Jerre L.
Stead, our Chief Executive Officer and the Chairman of our board of directors, is also a member of the board of directors of TBG. Christoph v. Grolman, a member of
our board of directors, is also an executive vice president of TBG. In addition, C. Michael Armstrong, Roger Holtback and

70

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IHS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

1. Nature of Business and Organization (Continued)

Michael
Klein, all members of our board of directors, were members of the board of directors and an advisory committee of TBG prior to our initial public offering, discussed below.



On November 16, 2005, our shareholders at that time, Urpasis and Urvanos, sold a portion of their ownership interests through an initial public offering.
IHS did not receive any proceeds from the sale of the Company's common stock by Urpasis and Urvanosand, consequently, we expensed all related offering costs. Simultaneous with the closing of our
initial public offering, Urpasis and Urvanos sold in a private placement an aggregate amount of $75 million of shares of our Class A common stock at the initial offering price to
investment entities affiliated with General Atlantic LLC. We appointed Steven A. Denning, the Chairman and a Managing Director of General Atlantic, to our board of directors in
April 2005.

2. Significant Accounting Policies



Our fiscal years end on November 30 of each year. References herein to individual years mean the year ended November 30. For example, 2007 means the
year ended November 30, 2007.



The consolidated financial statements include the accounts of all wholly owned and majority-owned subsidiaries. All significant intercompany accounts and
transactions have been eliminated.



Certain prior-year amounts have been reclassified to conform to the current-year presentation.



The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses
during the reporting period. Significant estimates have been made in areas that include revenue recognition, useful lives of fixed and intangible assets, allocation of purchase price to acquired
assets and liabilities, the recoverability of intangible assets and goodwill, income and other taxes, pension and post-retirement benefits, and stock-based compensation. Actual results
could differ from those estimates.



We are exposed to credit risk associated with cash equivalents, investments and trade receivables. We don't believe that our cash equivalents or investments
present significant credit risks because the counterparties to the instruments consist of major financial institutions and we manage the notional amount of contracts entered into with any
counterparty. Substantially all trade receivable balances are unsecured. The concentration of credit risk with respect to trade receivables is limited by the large

71

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IHS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

2. Significant Accounting Policies (Continued)

number
of customers in our customer base and their dispersion across various industries and geographic areas. We perform ongoing credit evaluations of our customers and maintain an allowance for
potential credit losses. The allowance is based upon management's assessment of known credit risks as well as general industry conditions. Specific accounts receivable are written off upon
notification of bankruptcy or once it is determined the account is significantly past due beyond the contractual payment terms and collection efforts are unsuccessful.



The carrying value of our financial instruments, including cash, accounts receivable, accounts payable, and long-term debt, approximates their fair
value.



Revenue is recognized when all of the following criteria have been met: (a) persuasive evidence of an arrangement exists, (b) delivery has occurred
or services have been rendered, (c) the price to the customer is fixed or determinable, and (d) collectibility is reasonably assured. Our revenue recognition policies are based on the
guidance in Staff Accounting Bulletin (SAB) No. 104,Revenue Recognition, and, where applicable, Statement of Position
(SOP) 97-2,Software Revenue Recognition.



The majority of our revenue is derived from the sale of subscriptions to our critical information, which is recognized ratably as delivered over the subscription
period.

We
do not defer the revenue for the limited number of sales of subscriptions in which we have no continuing responsibility to maintain and update the underlying database. We recognize
this revenue upon the sale of these subscriptions and delivery of the information and tools. For a limited number of our offerings, we serve as the sales agent for third parties. We recognize revenue
from these sales in accordance with Emerging Issues Task Force Issue 99-19,Reporting Revenue Gross as a Principal versus Net as an
Agent.

Revenue
is recognized upon delivery for non-subscription-based sales.

In
certain locations, we use dealers to distribute our critical information and decision-support tools. Revenue for products sold through dealers is recognized as follows:



We provide our customers with service offerings that are primarily sold on a stand-alone basis and on a significantly more limited basis as part of a
multiple-element arrangement. Our service offerings are generally separately priced in a standard price book. For services that are not in a standard-price book, as the price varies based on the
nature and complexity of the service offering, pricing is based on the estimated amount of time to be incurred at standard billing rates for the estimated underlying

72

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IHS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

2. Significant Accounting Policies (Continued)

effort
for executing the associated deliverable in the contract. Revenue related to services performed under time- and material-based contracts is recognized in the period performed at
standard billing rates. Revenue associated with fixed-price contracts is recognized upon completion of each specified performance obligation under the terms of the contract. See discussion of
"multiple-element arrangements" below. If the contract includes acceptance contingencies, revenue is recognized in the period in which we receive documentation of acceptance from the customer.



Occasionally, we may execute contracts with customers which contain multiple offerings. In our business, multiple-element arrangements refer to contracts with
separate fees for decision-support tools, maintenance, and/or related services. We have established separate units of accounting as each offering is primarily sold on a stand-alone basis. Generally,
if sufficient vendor-specific objective evidence of the fair value of each element of the arrangement exists based on stand-alone sales of these products and services, then the elements of the
contract are unbundled and are recognized as follows:



In
infrequent instances where a multiple-element arrangement includes offerings for which vendor-specific objective evidence is not available, we consider the substance of the whole
arrangement to be a subscription and thus revenue is recognized ratably over the service period.



We consider all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. Cash equivalents are carried at
cost, which approximates fair value.



Deferred subscription costs represent royalties and commissions associated with customer subscriptions. These costs are deferred and amortized to expense over the
period of the subscriptions. Generally, subscription periods are 12 months in duration.

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IHS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

2. Significant Accounting Policies (Continued)



Land, buildings and improvements, machinery and equipment are stated at cost. Depreciation is recorded using the straight-line method over the
estimated useful lives of the assets as follows:

Buildings and improvements

7 to 30 yearsMachinery and equipment

3 to 10 years


Leasehold
improvements are depreciated over their estimated useful life, or the life of the lease, whichever is shorter. Maintenance, repairs and renewals of a minor nature are expensed
as incurred. Betterments and major renewals which extend the useful lives of buildings, improvements, and equipment are capitalized.



We account for our business acquisitions using the purchase method of accounting. We allocate the total cost of an acquisition to the underlying net assets based
on their respective estimated fair values. As part of this allocation process, we must identify and attribute values and estimated lives to the intangible assets acquired.

Identifiable
intangible assets with finite lives are amortized on a straight-line basis over their respective lives.

We
review the carrying values of identifiable intangible assets with indefinite lives and goodwill at least annually to assess impairment because these assets are not amortized.
Additionally, we review the carrying value of any intangible asset or goodwill whenever events or changes in circumstances indicate that its carrying amount may not be recoverable. We assess
impairment by comparing the fair value of an identifiable intangible asset or goodwill with its carrying value. Impairments are expensed when incurred.



We recognize the minority interests' share of net income in an amount equal to the minority interests' allocable portion of the common equity of certain
consolidated subsidiaries. This subsidiary is located in Switzerland and is included in our Engineering segment.



Deferred income taxes are provided using tax rates enacted for periods of expected reversal on all temporary differences. Temporary differences relate to
differences between the book and tax basis of assets and liabilities, principally intangible assets, property and equipment, deferred subscription revenue, pension assets, accruals, and stock-based
compensation. Valuation allowances are established to reduce deferred tax assets to the amount that will more likely than not be realized. To the extent that a determination is made to establish or
adjust a valuation allowance, the expense or benefit is recorded in the period in which the determination is made.

Judgment
is required in determining the worldwide provision for income taxes. Additionally, the income tax provision is based on calculations and assumptions that are subject to
examination by many different tax authorities and to changes in tax law and rates in many jurisdictions. We adjust our

74

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IHS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

2. Significant Accounting Policies (Continued)

income
tax provision in the period in which it becomes probable that actual results will differ from our estimates.



For all IHS stock retention and buyback programs and transactions, we utilize the cost method of accounting. Regarding the inventory costing method for treasury
stock transactions, we employ the weighted-average cost method.



Earnings per common share (EPS) are computed in accordance with SFAS No. 128,Earnings per Share(SFAS
No. 128). Basic EPS is computed by dividing net income by the weighted average number of common shares outstanding during the period. Diluted EPS is computed using the weighted average number
of common shares and dilutive potential common shares outstanding during the period. Diluted EPS reflects the potential dilution that could occur if securities were exercised or converted into common
shares. We use the two-class method for computing basic and diluted EPS amounts.



Absent circumstances to the contrary, the functional currency of each of our foreign subsidiaries is such subsidiary's local currency. Assets and liabilities are
translated at period-end exchange rates. Income and expense items are translated at weighted average rates of exchange prevailing during the year. Any translation adjustments are included
in other comprehensive income. Transactions executed in different currencies resulting in exchange adjustments are translated at spot rates and resulting foreign-exchange-transaction gains and losses
are included in the results of operations.

From
time to time, we utilize forward-contract instruments to manage market risks associated with fluctuations in certain foreign-currency exchange rates as they relate to specific
balances of accounts and notes receivable denominated in foreign currencies. At the end of the reporting period, non-functional foreign-currency-denominated receivable and cash balances
are re-measured into the functional currency of the reporting entities at current market rates. The change in value from this re-measurement is reported as a foreign exchange
gain or loss for that period in other income (expense) in the accompanying consolidated statements of operations. The resulting gains or losses from the forward foreign currency contracts described
above, which are also included in other income (expense), mitigate the exchange rate risk of the associated assets.



Costs of research and development, which are included in cost of revenue, are expensed as incurred and amounted to approximately $5.0 million,
$3.1 million, and $8.2 million for 2007, 2006, and 2005, respectively.



We account for long-lived assets in accordance with SFAS No. 144,Accounting for the Impairment or Disposal of
Long-Lived Assets.We annually review the carrying amounts of long-lived assets to determine whether current events or circumstances warrant adjustment
to such carrying amounts. Any

75

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IHS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

2. Significant Accounting Policies (Continued)

impairment
is measured by the amount that the carrying value of such assets exceeds their fair value, primarily based on estimated discounted cash flows. Considerable management judgment is necessary
to estimate the fair value of assets. Assets to be disposed of are carried at the lower of their financial statement carrying amount or fair value, less cost to sell.



We adopted SFAS No. 123 (revised 2004),Share Based Payment, effective December 1, 2005, the first
day of our 2006 fiscal year. SFAS 123(R) is a revision of SFAS No. 123. SFAS 123(R) supersedes APB Opinion No. 25,Accounting for Stock Issued to
Employees, and amends SFAS No. 95,Statement of Cash Flows. Generally, the approach in SFAS 123(R) is similar to
the approach described in SFAS 123. However, SFAS 123(R) requires all share-based payments to employees, including grants of employee stock options, to be recognized in the income
statement based on their fair values. Pro forma disclosure is no longer an alternative. In March 2005, the Securities and Exchange Commission issued Staff Accounting Bulletin No. 107, Share-Based
Payment, (SAB 107) related to SFAS 123(R). We have applied the provisions of SAB 107 in our adoption of
SFAS 123(R).

We
adopted SFAS 123(R) using the modified prospective transition method, and, consequently, it applies to all of our outstanding nonvested share-based payment awards as of
December 1, 2005, and all prospective awards. Accordingly, the consolidated financial statement amounts for the prior periods have not been restated. At December 1, 2005, we had no stock
options issued or outstanding, only restricted stock and deferred stock units. Prior to adopting SFAS 123(R) on December 1, 2005, the fair value of nonvested awards (restricted stock and
deferred stock units) was recorded to additional paid-in capital with the offsetting entry posted to unearned compensation, also an equity account. The unearned compensation was then
amortized to compensation expense related to equity awards over the vesting period using the straight-line method. With the adoption of SFAS 123(R) on December 1, 2005, we
reclassified $24.8 million of unearned compensation to additional paid-in capital.

SFAS 123(R)
requires forfeitures to be estimated at the grant date. Accordingly, compensation cost is recognized based on the number of awards expected to vest. There may be
adjustments in future periods if actual forfeitures differ from our estimates. Our forfeiture rate is based upon historical experience as well as anticipated employee turnover considering certain
qualitative factors. We amortize the value of nonvested share awards to expense over the vesting period on a straight-line basis. For awards with performance conditions, an evaluation is
made each quarter as to the likelihood of the performance criteria being met. Compensation expense is then adjusted to reflect the number of shares expected to vest and the cumulative vesting period
met to date. For stock options, we estimate the fair value of awards on the date of grant using the Black-Scholes pricing model. We amortize the value of stock options to expense over the vesting
period on a straight-line basis.



In July 2006, the Financial Accounting Standards Board (FASB) issued FASB Interpretation No. 48,Accounting for Uncertainty
in Income Taxesan interpretation of FASB Statement No. 109(FIN 48), which provides clarification related to the process associated with accounting
for uncertain tax positions recognized in consolidated financial statements. FIN 48 prescribes a more-likely-than-not threshold for financial statement
recognition and measurement of a tax position taken, or expected to be taken, in a tax return. FIN 48 also provides guidance related to, among other things, classification,

76

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IHS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

2. Significant Accounting Policies (Continued)

accounting
for interest and penalties associated with tax positions, and disclosure requirements. We are required to adopt FIN 48 on December 1, 2007, the first day of our 2008 fiscal
year. We are currently evaluating the impact of adopting FIN 48 on our consolidated financial statements.

In
September 2006, the FASB issued SFAS No. 157,Fair Value Measurements(SFAS No. 157). Among other requirements,
SFAS No. 157 defines fair value and establishes a framework for measuring fair value and also expands disclosure about the use of fair value to measure assets and liabilities. SFAS
No. 157 is effective beginning the first fiscal year that begins after November 15, 2007. We are required to adopt SFAS No. 157 on December 1, 2007. Subsequent to the
Standard's issuance, the FASB issued an exposure draft that provides for a one-year deferral for the implementation of SFAS 157 for non-financial assets and liabilities.
We do not expect the adoption of SFAS No. 157 to have a material impact our financial statements.

In
September 2006, the FASB issued SFAS No. 158,Employer's Accounting for Defined Benefit Pension and Other Postretirement Plansan
Amendment of FASB Statements No. 87, 88, 106 and 132(R)(SFAS No. 158), and it was effective for our annual fiscal year ending November 30, 2007. The
standard requires an employer to recognize the funded status of any defined benefit pension and/or other postretirement benefit plans as an asset or liability in its statement of financial position.
Funded status is the difference between the projected benefit obligation and the market value of plan assets for defined benefit pension plans and is the difference between the accumulated benefit
obligation and the market value of plan assets (if any) for other post retirement benefit plans. SFAS No. 158 also requires an employer to recognize changes in that funded status in the year in
which the changes occur through other comprehensive income.

As
a result of the adoption of SFAS No. 158, the prepaid asset related to our overfunded U.S. defined benefit pension plan decreased by $3.3 million, liabilities related to
our other defined benefit pension and postretirement plans decreased by $2.1 million, and our accumulated other comprehensive income, net of related deferred income taxes, decreased by
approximately $0.9 million as of November 30, 2007. A portion of the change in accumulated other comprehensive income related to the adoption of SFAS No. 158 will be
recognized in the statement of operations as a component of net periodic pension benefit income in future periods. Such amount is estimated to be approximately $3.5 million before tax in 2008.
See Notes 15 and 16 for a detailed discussion regarding the adoption of SFAS No. 158.

In
addition, this statement requires companies to measure plan assets and obligations at the date of their year-end statement of financial position, with limited exceptions.
This measurement date provision will be effective for our annual 2008 year end and will not have an impact on the Company's financial statements as we currently measure plan assets and obligations as
of our fiscal year-end.

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IHS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

2. Significant Accounting Policies (Continued)

The impact of adopting SFAS 158 is displayed in the table below:

As of November 30, 2007Before
Application of
SFAS No. 158

Adjustments

After
Application of
SFAS No. 158(In thousands)AssetsPrepaid pension asset

$
94,368

$
(3,252
)
$
91,116Intangible asset


564


(564
)

LiabilitiesAccrued pension liability


(9,384
)

(2,581
)

(11,965
)Accrued postretirement benefits liability


(15,416
)

5,213


(10,203
)Deferred tax liability


(26,951
)

266


(26,685
)Stockholders' EquityAccumulated other comprehensive income (loss)


(22,307
)

918


(21,389
)


In
December 2007, the FASB issued SFAS No. 141(R),Business Combinationsand SFAS No. 160, Accounting and Reporting of Noncontrolling Interest in Consolidated
Financial Statements, an amendment of ARB No. 51. These new standards will
significantly change the accounting for and reporting of business combination transactions and noncontrolling (minority) interests in consolidated financial statements. SFAS Nos. 141(R) and 160
are required to be adopted simultaneously and are effective for
the first annual reporting period beginning on or after December 15, 2008. Thus, we are required to adopt these Standards on December 1, 2009, the first day of our 2010 fiscal year.
Earlier adoption is prohibited. We are currently evaluating the impact of adopting SFAS Nos. 141(R) and 160 on our consolidated financial statements.

3. Business Combinations

All acquisitions are accounted for using the purchase method of accounting. The consolidated financial statements include all the assets and liabilities acquired
and the results of operations from the respective dates of acquisition. Pro forma results of the acquired businesses have not been presented as they did not have a material impact on our results of
operations. Notable transactions for the three years ending November 30, 2007, are discussed below.



Exploration Data Services (EDS).In October 2007, we acquired the assets of Livingston, TX-based EDS and
its subsidiary, Geodigit LLC, which collectively maintain and market extensive geological data covering the subsurface Gulf of Mexico for $6.3 million using existing cash on hand. The
acquired assets include EDS' catalog of interpreted formation tops on more than 25,000 offshore wells,www.EDSMaps.com, and Geodigit's MMS offshore well
data, base maps, and other well header data.

78

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IHS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

3. Business Combinations (Continued)

EnvironMax.In October 2007, we acquired EnvironMax, Inc., of Salt Lake City, Utah. EnvironMax is a leading
provider of environmental management information systems (EMIS) solutions sold primarily to government and defense markets. Terms of the purchase included $22.1 million paid from cash on hand
and 65,000 shares of IHS stock issued with a one-year lock up, valued at $3.8 million for a total price of $25.4 million, net of cash acquired.

PCNAlert.In August 2007, we acquired the assets of PCNAlert from SupplyEdge, Inc., of Pasadena, Calif., for
$10 million using existing cash on hand. PCNAlert delivers leading component event management solutions, including product change notifications and end-of-life
notifications for the electronic components industry.

John S. Herold, Inc. (Herold).In August 2007, we acquired Norwalk, CT-based John S.
Herold, an independent research firm that provides in-depth analyses and key financial and operational data on more than 400 global oil and gas companies. We acquired John S. Herold
for approximately $47.2 million, net of acquired cash, using existing cash on hand.

Strategic Decision Group Corporation's Oil & Gas Consulting Practice (SDG).In July 2007, we acquired the
assets of SDG's oil & gas consulting practice ("SDG"), a provider of strategic consulting services to leading enterprises in the global oil and gas industry, for $8.2 million using
$5.1 million of existing cash on hand and by issuing a $3.1 million note payable.

Jane's Information Group (Jane's).In June 2007, we executed an agreement with Woodbridge International
Holdings S.A. (Woodbridge) for the purchase of Jane's, a leading provider of information to the defense industry and governments. The parties completed the transaction on the same date. Terms
of the transaction included delivery of 4,399,000 shares of our Class A Common Stock valued at $171.5 million and less than $0.1 million in cash in exchange for all of the
outstanding equity and debt of Jane's. Woodbridge has agreed to a three-year lock-up agreement that restricts its ability to sell any IHS shares.

Geological Consulting Services (GCS).In June 2007, we acquired the inventory and assets of GCS of
Houstona provider of formation tops data files in electronic and other media covering South Texas, East Texas, North Louisiana, South Arkansas, Mississippi, Alabama, and
Floridafor $8.2 million using existing cash on hand.

RapiData.In March 2007, we acquired certain assets including the RapiData product, well known for its
comprehensive well test, pressure, and completions data for the Western Canadian Sedimentary Basin. IHS purchased RapiData and other assets from Rapid Technology Corporation of Calgary, Alberta,
Canada, for approximately $6.3 million using existing cash on hand.

Geological Data Services Inc. (GDS).In January 2007, we acquired the majority of the assets of GDS of Addison,
Texas, a provider of interpreted subsurface data "formation-tops" covering the Permian Basin, U.S. mid-continent, and Rocky Mountain regions. We acquired GDS for
$8.0 million using existing cash on hand.

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IHS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

3. Business Combinations (Continued)

The
purchase prices for these 2007 acquisitions, excluding acquired cash and including acquisition-related costs, were initially allocated as follows (in thousands):

Jane's

Herold

All others

TotalAssets:Current assets

$
18,444

$
2,680

$
3,615

$
24,739Property and equipment


4,683


292


489


5,464Intangible assets


93,423


28,100


27,129


148,652Goodwill


115,631


32,752


47,680


196,063Other long-term assets


292








292Total assets


232,473


63,824


78,913


375,210Liabilities:Current liabilities


33,756


6,906


4,116


44,778Deferred taxes


25,278


9,701


2,437


37,416Other long-term liabilities


1,841


44





1,885Total liabilities


60,875


16,651


6,553


84,079Purchase price

$
171,598

$
47,173

$
72,360

$
291,131




Canadian Hydrodynamics Ltd. (CHD).During July 2006, we acquired the assets of Calgary, Canada-based CHD for
approximately $3.5 million using existing cash on hand. CHD is a leading provider of comprehensive drillstem test information for the Western Canadian Sedimentary Basin. The CHD database has
been available exclusively through IHS AccuMap, one of our Energy product offerings, as a partner dataset since 1995.

GeoPLUS.During June 2006, we acquired the assets of GeoPLUS of Tulsa, Oklahoma, for approximately
$42.1 million using existing cash on hand. GeoPLUS has a PC-based software family, PETRA®, which is a popular platform used by oil and gas companies to analyze
subsurface data from existing oil and gas wells.

Construction Research Communications Limited (CRC).During June 2006, we acquired CRC Limited, of London, U.K., for
approximately $5.8 million, net of acquired cash, using existing cash on hand. CRC was created by the Building Research Establishment (BRE) and Emap Construct to deliver a wide range of BRE
products relating to the construction industry, ranging from environmental issues to fire safety.

CDS.During December 2005, we acquired the assets of a content-and-data-services
(CDS) business for approximately $33.0 million that serves several of the industries targeted by our Engineering segment. The core product of this business is an extensive database that
includes technical attributes and alternatives for, and obsolescence and environmental data on, electronic component parts.

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IHS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

3. Business Combinations (Continued)

The
purchase prices for these 2006 acquisitions, excluding acquired cash, were initially allocated as follows (in thousands):

CHD

GeoPLUS

CRC

CDS

TotalAssets:Current assets

$
317

$
2,052

$
591

$


$
2,960Property and equipment





25





250


275Intangible assets


1,949


19,380


1,844


15,420


38,593Goodwill


1,586


23,576


3,635


21,685


50,482Deferred tax assets








2





2Total assets


3,852


45,033


6,072


37,355


92,312Liabilities:Current liabilities


317


2,919


243


4,379


7,858Long-term liabilities














Total liabilities


317


2,919


243


4,379


7,858Purchase price

$
3,535

$
42,114

$
5,829

$
32,976

$
84,454




We made three acquisitions during 2005 for an aggregate purchase price of approximately $3.5 million.

4. Restructuring and Offering Charges (Credits)

A summary of the restructuring and offering charges (credits) follows (in thousands):

Years Ended November 30,2007

2006

2005Restructuring charges (credits)

$
(154
)
$
2,325

$
8,244Offering costs





778


5,459Total

$
(154
)
$
3,103

$
13,703




During the fourth quarter of 2006, we executed a restructuring initiative principally affecting our Engineering segment. This initiative was undertaken to
facilitate continued growth through the focus on a narrower group of products and services, exit non-core legacy applications, and improve our operational effectiveness. During the course
of the restructuring, we reduced our aggregate workforce by approximately 40 employees.

The
restructuring charge was incurred in its entirety during the fourth quarter of 2006. Approximately $1.9 million of the charge related to our Engineering segment,
$0.4 million pertained to our Energy segment, and $0.1 million related to unallocated corporate costs. The restructuring charge was comprised entirely of employee severance and other
termination benefits costs.

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IHS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

4. Restructuring and Offering Charges (Credits) (Continued)

A
reconciliation of the related accrued restructuring liability as of November 30, 2007 was as follows:

Employee
Severance
and Other
Termination
Benefits(In thousands)Beginning balance

$
2,046Add: Restructuring costs incurred


Less: Amount paid during the year ended November 30, 2007


(1,892
)Less: Amount reversed during the year ended November 30, 2007


(154
)Ending balance

$





During the third quarter of 2005, we executed a restructuring initiative affecting our Engineering segment and certain unallocated corporate costs. This
initiative was undertaken to reduce costs, further the integration of operations from previous acquisitions, streamline our data delivery processes, and realign the marketing function to support core
product initiatives. During the course of the restructuring, we reduced our aggregate workforce by over 100 employees and closed certain offices.

The
restructuring charge was incurred in its entirety during the third quarter of 2005. Approximately $4.4 million and $3.8 million of the restructuring charge related to
our Engineering segment and certain unallocated corporate costs, respectively. Our Energy segment did not have a restructuring charge. The restructuring charge was comprised of the following (in
thousands):

Employee severance and other termination benefits

$
5,947Accelerated vesting of restricted stock


2,130Contract-termination costs


167Total

$
8,244


5. Discontinued Operations

During the third quarter of 2005, a business in our Energy segment was classified as being held for sale. The business held for sale was a manufacturing
operation, which was not a part of our core operations. We continually evaluate opportunities to align our business activities within core operations.

During
the first quarter of 2006, we revised our estimate and wrote down the value of the assets of the discontinued operation $1.0 million based on what we had experienced to
date in the sales process. During the third quarter of 2006, we sold the business to an unrelated third party for approximately $0.3 million and recognized a loss of less than
$0.1 million on the sale of the business. The loss on sale of discontinued operations is included in the loss on discontinued operations, net line item on our consolidated statement of
operations.

82

---



IHS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

5. Discontinued Operations (Continued)

For
all of the periods presented, the related results of operations are shown as a discontinued operation, net of tax, in our consolidated statements of operations and cash flows.

Operating
results of the discontinued operations for the years ended November 30, 2007, 2006 and 2005 were as follows:

Years Ended November 30,2007

2006

2005(In thousands)Revenue

$


$
399

$
342Loss from discontinued operations

$


$
(2,766
)
$
(3,490
)Tax benefit





846


1,240Loss from discontinued operations, net

$


$
(1,920
)
$
(2,250
)


6. Marketable Securities

At November 30, 2007, we owned the following short-term investments which were classified as available-for-sale
securities and reported at fair value:

Gross
Amortized
Cost

Unrealized
Holding
Loss

Estimated
Fair
Value(In thousands)Municipal securities

$
10,518

$


$
10,518


At
November 30, 2006, we owned the following short-term investments which were classified as available-for-sale securities and reported at fair
value:

Gross
Amortized
Cost

Unrealized
Holding
Loss

Estimated
Fair
Value(In thousands)Municipal securities

$
2,054

$


$
2,054Other


22





22Total

$
2,076

$


$
2,076


We
use the specific identification method to account for gains and losses on securities. Realized gains on sales of marketable securities included within other income (expense) were
immaterial for the years ended November 30, 2007, 2006 and 2005.

We
review all marketable securities to determine if any decline in value is other than temporary.

83

---



IHS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

7. Accounts Receivable

Our accounts receivable balance consists of the following as of November 30:

2007

2006(In thousands)Accounts receivable

$
180,948

$
155,851Lessaccounts receivable allowance


(5,406
)

(4,551
)Accounts receivable, net

$
175,542

$
151,300


The
activity in our accounts receivable allowance consists of the following as of November 30:

2007

2006

2005(In thousands)Balance at beginning of year

$
4,551

$
4,847

$
5,204Provision for bad debts


2,178


1,188


1,149Recoveries and other additions


191


297


9Write-offs and other deductions


(1,514
)

(1,781
)

(1,515
)Balance at end of year

$
5,406

$
4,551

$
4,847


8. Property and Equipment

Property and equipment consists of the following at November 30:

2007

2006(In thousands)Land, buildings and improvements

$
67,591

$
57,351Machinery and equipment


59,858


56,374127,449


113,725Less: accumulated depreciation


(68,693
)

(60,629
)$
58,756

$
53,096


Depreciation
expense was approximately $11.4 million, $6.9 million and $7.2 million in 2007, 2006, and 2005, respectively.

84

---



IHS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

9. Goodwill and Intangible Assets

The following table presents details of our intangible assets, other than goodwill, as of November 30, 2007:

|                                               |                             | Useful Life             |        | Gross |   | Accumulated Amortization |         | Net
|---------------------------------------------- | --------------------------- | ----------------------- | ------ | ----- | - | ------------------------ | ------- | ---
|
|Intangible assets subject to amortization:     |                             |                         |        |       |   |                          |         |    
|                                               | Information databases       |                         | 5 - 15 |       | $ | 137,317                  |         | $  
|                                               | Customer relationships      |                         | 2 - 15 |       |   | 45,650                   |         |    
|                                               | Non-compete agreements      |                         | 5      |       |   | 5,514                    |         |    
|                                               | Developed computer software |                         | 5      |       |   | 15,036                   |         |    
|                                               | Other                       |                         | 3 - 11 |       |   | 1,009                    |         |    
|                                               |                             |                         |        |       |   |                          |         |    
|                                               |                             | Total                   |        |       |   |                          | 204,526 |    
|Intangible assets not subject to amortization: |                             |                         |        |       |   |                          |         |    
|                                               | Trademarks                  |                         |        |       |   | 29,602                   |         |    
|                                               | Perpetual licenses          |                         |        |       |   | 1,538                    |         |    
|                                               |                             |                         |        |       |   |                          |         |    
|                                               |                             | Total intangible assets |        |       |   | $                        | 235,666 |    
|                                               |                             |                         |        |       |   |                          |         |    

The
following table presents details of our intangible assets, other than goodwill, as of November 30, 2006:

|                                               |                             | Useful Life             |        | Gross |   | Accumulated Amortization |        | Net
|---------------------------------------------- | --------------------------- | ----------------------- | ------ | ----- | - | ------------------------ | ------ | ---
|
|Intangible assets subject to amortization:     |                             |                         |        |       |   |                          |        |    
|                                               | Information databases       |                         | 5 - 15 |       | $ | 24,600                   |        | $  
|                                               | Customer relationships      |                         | 2 - 15 |       |   | 28,664                   |        |    
|                                               | Non-compete agreements      |                         | 5      |       |   | 3,844                    |        |    
|                                               | Developed computer software |                         | 5      |       |   | 6,824                    |        |    
|                                               | Other                       |                         | 3 - 11 |       |   | 2,042                    |        |    
|                                               |                             |                         |        |       |   |                          |        |    
|                                               |                             | Total                   |        |       |   |                          | 65,974 |    
|Intangible assets not subject to amortization: |                             |                         |        |       |   |                          |        |    
|                                               | Trademarks                  |                         |        |       |   | 9,509                    |        |    
|                                               | Perpetual licenses          |                         |        |       |   | 1,470                    |        |    
|                                               |                             |                         |        |       |   |                          |        |    
|                                               |                             | Total intangible assets |        |       |   | $                        | 76,953 |    
|                                               |                             |                         |        |       |   |                          |        |    

The
estimated future amortization expense of intangible assets is as follows:

Year

Amount(In thousands)2008

$
21,9142009


20,1712010


17,8032011


16,4122012


14,960


85

---



IHS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

9. Goodwill and Intangible Assets (Continued)

Amortization
expense of intangible assets was $14.1 million, $8.7 million and $4.4 million for the years ended November 30, 2007, 2006 and 2005, respectively.

Changes
in our goodwill from November 30, 2006 to November 30, 2007 and from November 30, 2005 to November 30, 2006 were the result of acquisitions (see
Note 3) and foreign-currency exchange-rate fluctuations.

10. Debt

On September 7, 2007, we entered into an amended and restated credit agreement (the Revolver). The $385 million unsecured revolving credit agreement
allows us, under certain conditions, to increase the facility to a maximum of $500 million. The agreement expires in September 2012.

The
interest rates for borrowing under the Revolver are based upon our Leverage Ratio, which is the ratio of Consolidated Funded Indebtedness to rolling four quarter Consolidated
Earnings Before Interest Expense, Taxes, Depreciation and Amortization (EBITDA), as defined in the Revolver. The rate ranges from the applicable LIBOR plus 50 basis points to 125 basis points or the
agent bank's base rate. A commitment fee is payable periodically and ranges from 10 to 25 basis points based upon our Leverage Ratio. The Revolver contains certain financial and other covenants,
including limitations on capital lease obligations and maximum Leverage and Interest Coverage Ratios, as defined in the Revolver.

As
of November 30, 2007, we were in compliance with all of the covenants in the agreement and had no outstanding borrowings. However, we had outstanding letters of credit totaling
approximately $1.8 million as of November 30, 2007, that served to reduce the amount available for borrowing to $383.2 million.

11. Indemnifications

In the normal course of business, we are party to a variety of agreements under which we may be obligated to indemnify the other party for certain matters. These
obligations typically arise in contracts where we customarily agree to hold the other party harmless against losses arising from a breach of representations or covenants for certain matters such as
title to assets and intellectual property rights associated with the sale of products. We also have indemnification obligations to our officers and directors. The duration of these indemnifications
varies, and in certain cases, is indefinite. In each of these circumstances, payment by us depends upon the other party making an adverse claim according to the procedures outlined in the particular
agreement, which procedures generally allow us to challenge the other party's claims. In certain instances, we may have recourse against third parties for payments that we make.

We
are unable to reasonably estimate the maximum potential amount of future payments under these or similar agreements due to the unique facts and circumstances of each agreement and the
fact that certain indemnifications provide for no limitation to the maximum potential future payments under the indemnification. We have not recorded any liability for these indemnifications in the
accompanying consolidated balance sheets; however, we accrue losses for any known contingent liability, including those that may arise from indemnification provisions, when the obligation is both
probable and reasonably estimable.

86

---



IHS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

12. Taxes on Income

The amounts of income from continuing operations before income taxes and minority interests by U.S. and foreign jurisdictions follow for the years ended
November 30:

2007

2006

2005(In thousands)U.S.

$
24,422

$
10,948

$
2,292Foreign


98,244


74,364


62,277$
122,666

$
85,312

$
64,569


The
provision for income tax expense (benefit) from continuing operations, for the years ended November 30 was as follows:

2007

2006

2005(In thousands)Current:U.S.

$
6,010

$
8,666

$
1,670Foreign


28,628


23,961


13,565State


2,575


1,818


475Total current


37,213


34,445


15,710Deferred:U.S.


2,943


(9,602
)

3,427Foreign


(420
)

1,479


876State


(909
)

557


363Total deferred


1,614


(7,566
)

4,666Provision for income taxes

$
38,827

$
26,879

$
20,376


87

---



IHS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

12. Taxes on Income (Continued)

The
provision for income taxes from continuing operations recorded within the consolidated statements of operations differs from the provision determined by applying the U.S. statutory
tax rate to pretax earnings as a result of the following for the years ended November 30:

2007

2006

2005(In thousands)Statutory U.S. federal income tax

$
42,933

$
29,858

$
22,599State income tax, net of federal benefit


765


1,245


672Foreign rate differential


(8,702
)

(4,167
)

(7,228
)U.S. tax on dividends from foreign affiliates, net of foreign tax credits (FTCs)


8,304


3,348


3,882Valuation allowance


(2,004
)

1,211


(574
)Tax-exempt interest


(1,414
)

(1,011
)

Change in reserves


(1,225
)

(917
)

1,371Other


170


(2,688
)

(346
)Income tax expense

$
38,827

$
26,879

$
20,376Effective tax rate expressed as a percentage of pretax earnings


31.7
%

31.5
%

31.6
%


Undistributed
earnings of our foreign subsidiaries were approximately $81.4 million at November 30, 2007. Those earnings are considered to be indefinitely reinvested;
accordingly, no provision for U.S. federal and state income taxes has been provided thereon. Upon repatriation of those earnings, in the form of dividends or otherwise, we would be subject to both
U.S. income taxes (subject to an adjustment for foreign tax credits) and withholding taxes payable to the various foreign countries. Determination of the amount of unrecognized deferred U.S. income
tax liability is not practicable due to the complexities associated with its hypothetical calculation. Withholding taxes of approximately $3.6 million would be payable upon remittance of all
previously unremitted earnings at November 30, 2007.

88

---



IHS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

12. Taxes on Income (Continued)

The
significant components of deferred tax assets and liabilities at November 30 were:

2007

2006(In thousands)Deferred tax assets:Accruals and reserves

$
3,475

$
4,584Deferred revenue


463


768Depreciation


1,389


884Tax credits


22,755


35,719Deferred loss on stock investment





2,847Deferred equity compensation


13,245


1,975Net operating losses


6,383


3,979Other


396


212Gross deferred tax assets


48,106


50,968Valuation allowance


(5,216
)

(8,051
)Realizable deferred tax assets


42,890


42,917Deferred tax liabilities:Pension and post-retirement benefits


(26,288
)

(21,858
)Intangibles


(59,382
)

(16,089
)Gross deferred tax liabilities


(85,670
)

(37,947
)Net deferred tax asset (liability)

$
(42,780
)
$
4,970


As
of November 30, 2007, we had net-operating-loss carryforwards totaling approximately $16.9 million, comprised of $2.4 million of
U.S.-net-operating-loss carryforwards, $5 million U.S.-capital-loss carryforwards, and $9.5 million of
foreign-loss carryforwards for tax purposes, which will be available to offset future taxable income. If not used, the U.S.-net-operating-loss
carryforwards will expire in 2015, the U.S.-capital-loss carryforwards will expire in 2012, and the foreign-tax-loss carryforwards generally may be
carried forward indefinitely. The U.S. capital loss was incurred during 2007 as the previously deferred loss on stock investment was realized. We believe the realization of substantially the entire
deferred tax assets related to the U.S. capital loss and to foreign net operating losses is not more likely than not to occur, and, accordingly, have placed a valuation allowance on these assets.

As
of November 30, 2007, we had foreign tax credit (FTC) carryforwards of approximately $16.5 million, research and development (R&D) credit carryforwards of approximately
$3.2 million, and Alternative Minimum Tax (AMT) credit carryforwards of approximately $3.1 million, which will be available to offset future U.S. tax liabilities. If not used, the FTC
carryforwards will expire between 2011 and 2016, and the R&D credit carryforwards will expire between 2007 and 2027. The AMT credit carryforwards may be carried forward indefinitely. We believe that
it is more likely than not that we will realize our FTC and AMT tax credit assets. As a result, during 2007 we released the valuation allowance of $1.2 million on the FTC deferred tax asset. We
believe that a portion of the R&D tax credits will expire unused. In 2005, we placed a valuation allowance of $0.5 million against this deferred tax asset.

89

---



IHS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

12. Taxes on Income (Continued)

The
valuation allowance for deferred tax assets decreased by $2.8 million in 2007. The decrease in this allowance was primarily due to the decrease in the allowance on FTC
carryforwards of $1.2 million, the decrease on capital loss valuation allowance released as a result of capital gains of $0.8 million, and a decrease on the allowance of foreign
subsidiary deferred tax assets of $0.8 million.

We
have provided what we believe to be an appropriate amount of tax for items that involve interpretation of the tax law. However, events may occur in the future that will cause us to
reevaluate our current reserves and may result in an adjustment to the reserve for taxes.

90

---



IHS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

13. Other Comprehensive Income (Loss)

|                            |                                                          | Foreign currency translation adjustments |        | Pension and postretirement liability adjustment |   | Unrealized losses on foreign-currency hedges |        | Unrealized losses on short-term investments |        | Accumulated other comprehensive income (loss) |  
|--------------------------- | -------------------------------------------------------- | ---------------------------------------- | ------ | ----------------------------------------------- | - | -------------------------------------------- | ------ | ------------------------------------------- | ------ | --------------------------------------------- | -
|
|Balances, November 30, 2004 |                                                          | $                                        | 2,283  |                                                 | $ | (5,970                                       | )      | $                                           |       |                                               | $
|                            | Foreign currency translation adjustments                 |                                          |        | (3,694                                          | ) |                                              |       |                                             |        |                                              |  
|                            | Changes in unrealized losses on foreign- currency hedges |                                          |        |                                                |   |                                              |       |                                             |        | (3,619                                        | )
|                            | Changes in unrealized losses on short-term investments   |                                          |        |                                                |   |                                              |       |                                             |        |                                              |  
|                            | Minimum pension liability adjustment                     |                                          |        |                                                |   |                                              | (208   | )                                           |        |                                              |  
|                            | Foreign currency effect on pension                       |                                          |        | (858                                            | ) |                                              | 858    |                                             |        |                                              |  
|                            | Tax benefit on pension                                   |                                          |        |                                                |   |                                              | 135    |                                             |        | 615                                           |  
|                            | Foreign currency effect on tax benefit                   |                                          |        | 258                                             |   |                                              | (258   | )                                           |        |                                              |  
|                            |                                                          |                                          |        |                                                 |   |                                              |        |                                             |        |                                               |  
|Balances, November 30, 2005 |                                                          | $                                        | (2,011 | )                                               | $ | (5,443                                       | )      | $                                           | (3,004 | )                                             | $
|                            | Foreign currency translation adjustments                 |                                          |        | 7,442                                           |   |                                              |       |                                             |        |                                              |  
|                            | Changes in unrealized losses on foreign- currency hedges |                                          |        |                                                |   |                                              |       |                                             |        | 3,931                                         |  
|                            | Changes in unrealized losses on short-term investments   |                                          |        |                                                |   |                                              |       |                                             |        |                                              |  
|                            | Minimum pension liability adjustment                     |                                          |        |                                                |   |                                              | (4,596 | )                                           |        |                                              |  
|                            | Foreign currency effect on pension                       |                                          |        | 951                                             |   |                                              | (951   | )                                           |        |                                              |  
|                            | Foreign currency effect on foreign- currency hedges      |                                          |        | 312                                             |   |                                              |       |                                             |        | (312                                          | )
|                            | Tax benefit on pension                                   |                                          |        |                                                |   |                                              | 1,444  |                                             |        | (668                                          | )
|                            | Foreign currency effect on tax benefit                   |                                          |        | (338                                            | ) |                                              | 285    |                                             |        | 53                                            |  
|                            |                                                          |                                          |        |                                                 |   |                                              |        |                                             |        |                                               |  
|Balances, November 30, 2006 |                                                          | $                                        | 6,356  |                                                 | $ | (9,261                                       | )      | $                                           |       |                                               | $
|                            | Foreign currency translation adjustments                 |                                          |        | 18,047                                          |   |                                              |       |                                             |        |                                              |  
|                            | Minimum pension liability adjustment                     |                                          |        |                                                |   |                                              | 10,243 |                                             |        |                                              |  
|                            | Adoption of SFAS No. 158                                 |                                          |        |                                                |   |                                              | (1,184 | )                                           |        |                                              |  
|                            | Foreign currency effect on pension                       |                                          |        | 546                                             |   |                                              | (546   | )                                           |        |                                              |  
|                            | Tax provision on pension                                 |                                          |        |                                                |   |                                              | (2,812 | )                                           |        |                                              |  
|                            | Foreign currency effect on tax benefit                   |                                          |        | (164                                            | ) |                                              | 164    |                                             |        |                                              |  
|                            |                                                          |                                          |        |                                                 |   |                                              |        |                                             |        |                                               |  
|Balances, November 30, 2007 |                                                          | $                                        | 24,785 |                                                 | $ | (3,396                                       | )      | $                                           |       |                                               | $
|                            |                                                          |                                          |        |                                                 |   |                                              |        |                                             |        |                                               |  

91

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IHS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

14. Stock-Based Compensation

As of November 30, 2007, we had one share-based compensation plan: the Amended and Restated IHS Inc. 2004 Long-Term Incentive Plan,
which is described further below.

Stock-based
compensation expense for the three years ended November 30 was as follows:

2007

2006

2005(In thousands)Cost of revenue

$
1,142

$
2,882

$
551Selling, general and administrative expenses


29,299


18,820


4,721Discontinued operations





254


Total stock-based compensation expense

$
30,441

$
21,956

$
5,272


Total
income tax benefit recognized in the income statement for share-based compensation arrangements for the three years ended November 30 was as follows:

2007

2006

2005(In thousands)Income tax benefit

$
11,263

$
8,124

$
1,957


No
compensation cost was capitalized during the years ended November 30, 2007, 2006 and 2005.



The Amended and Restated 2004 Long-Term Incentive Plan provides for the grant of non-qualified stock options, incentive stock options,
stock appreciation rights, restricted stock, restricted stock units, performance units and performance shares, cash-based awards, other stock based awards and covered employee annual
incentive awards. The 2004 Directors Stock Plan, a sub-plan under our Amended and Restated 2004 Long-Term Incentive Plan, provides for the grant of restricted stock and
restricted stock units to non-employee directors as defined in that plan. We believe that such awards better align the interests of our employees and non-employee directors
with those of our shareholders. We have authorized a maximum of 7 million shares, minus the number of shares relating to any award granted and outstanding as of, or subsequent to, the effective
date under any other of our equity compensation plans, unless shares used to satisfy such award are shares repurchased from the open market.

Total
compensation expense related to nonvested awards, both share awards and stock options, not yet recognized was $54.4 million as of November 30, 2007, with a
weighted-average recognition period of approximately one and three-quarter years.

Nonvested Stock.Share awards vest from six months to five years. Share awards are generally subject to graded vesting but we
do have a limited number of share awards subject to cliff vesting. The fair value of nonvested stock is based on the fair value of our common stock on the date of grant. We amortize the value of share
awards to expense over the vesting period on a straight-line basis. For awards with performance conditions, an evaluation is made each quarter as to the likelihood of the performance
criteria being met. Compensation expense is then adjusted to reflect the number of shares expected to vest and the cumulative vesting period met to date.

92

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IHS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

14. Stock-Based Compensation (Continued)

A
summary of the status of our nonvested shares as of November 30, 2007, and changes during the year ended November 30, 2007 was as follows:

Shares

Weighted-Average Grant Date Fair Value(in thousands)Balances, November 30, 2006

1,721

$
18.57Granted

1,532

$
39.42Vested

(680
)
$
14.90Forfeited

(144
)
$
28.40Balances, November 30, 2007

2,429

$
32.16


The
total fair value of nonvested stock that vested during the year ended November 30, 2007, was $38.1 million based on the weighted-average fair value on the vesting date
and $10.1 million based on the weighted-average fair value on the date of grant.

During
the year ended November 30, 2006, we granted 0.8 million nonvested shares with a weighted-average grant-date fair value of $28.19. The total fair value
of nonvested stock that vested during the year ended November 30, 2006, was $67.1 million based on the weighted-average fair value on the vesting date and $24.9 million based on
the weighted-average fair value on the date of grant.

Stock Options.Option awards are generally granted with an exercise price equal to the fair market value of our stock at the
date of grant. Options outstanding as of November 30, 2007, either cliff vest after 4 years of continuous service or vest in a graded fashion over three years of continuous service and
have 8-year contractual terms. Certain option and share awards provide for accelerated vesting if there is a change in control (as defined in the plan).

The
fair value of each option award is estimated on the date of grant using the Black-Scholes pricing model that uses the assumptions noted in the following table:

Year Ended November 30,2007

2006Dividend yield


0.0
%

0.0
%Expected volatility


30.66
%

27.83
%Risk-free interest rate


4.92
%

5.00
%Expected term (in years)


5.0


6.0Weighted average fair value of stock options granted

$
13.57

$
11.77


Our
dividend yield is 0.0% since we have no history of paying dividends and currently have no plan to do so. Our expected volatility is determined annually using a basket of peer company
historical volatility rates until such time our stock history is equal to our contractual terms. Our risk-free interest rate is the treasury-bill rate for the period equal to
the expected term based on the Treasury note strip principal rates as reported in well-known and widely used financial sources. Our expected term is the average of the contractual term of
the option and the vesting period (i.e., the "shortcut method").

93

---



IHS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

14. Stock-Based Compensation (Continued)

The
following table summarizes changes in outstanding stock options during the year ended November 30, 2007, as well as options that are vested and expected to vest and stock
options exercisable at November 30, 2007:

|                                                 |           | Shares |     | Weighted-Average Exercise Price |       | Weighted-Average Remaining Contractual Term |     | Aggregate Intrinsic Value
|------------------------------------------------ | --------- | ------ | --- | ------------------------------- | ----- | ------------------------------------------- | --- | -------------------------
|
|Outstanding at November 30, 2006                 |           | 99     |     | $                               | 30.80 |                                             |     |                          
|                                                 | Granted   |        | 193 |                                 | $     | 37.65                                       |     |                          
|                                                 | Exercised |        |    |                                 |       |                                            |     |                          
|                                                 | Forfeited |        | (5  | )                               | $     | 37.65                                       |     |                          
|                                                 |           |        |     |                                 |       |                                             |     |                          
|Outstanding at November 30, 2007                 |           | 287    |     | $                               | 35.29 |                                             | 2.4 |                          
|Vested and expected to vest at November 30, 2007 |           | 285    |     | $                               | 35.29 |                                             | 2.4 |                          
|Exercisable at November 30, 2007                 |           |       |     |                                 |      |                                             |    |                          

The
aggregate intrinsic value amounts in the table above represent the difference between the closing price of our common stock on November 30, 2007, which was $70.14, and the
exercise price, multiplied by the number of in-the-money stock options as of the same date. This represents the amount that would have been received by the stock option holders
if they had all exercised their stock options on November 30, 2007. In future periods, this amount will change depending on fluctuations in our stock price. The total intrinsic value of stock
options exercised during the year ended November 30, 2007, was $0.

During
the year ended November 30, 2006, we granted 0.1 million stock options with a weighted-average grant-date fair value of $11.77.

15. Employee Retirement Benefits



We sponsor a non-contributory, defined-benefit retirement plan (the US RIP) for all of our U.S. employees with at least one year of service. We also
have a defined-benefit pension plan (the UK RIP) that covers certain employees of a subsidiary of our Engineering segment based in the United Kingdom. We also have a Supplemental Income Plan (SIP),
which is a non-qualified pension plan, for certain company executives. Benefits for all three plans are generally based on years of service and average base compensation. Plan funding
strategies are influenced by employee benefit laws and tax laws. The UK RIP includes a provision for employee contributions and inflation-based benefit increases for retirees.

We
adopted SFAS No. 158 for our annual fiscal 2007 year ending November 30, 2007. The standard, which is an amendment to SFAS Nos. 87, 88, 106, and 132(R), requires
an employer to recognize the funded status of any defined benefit pension and/or other postretirement benefit plans as an asset or liability in its statement of financial position. The incremental
impact of adopting SFAS No. 158 on individual line items of the Consolidated Balance Sheet as of November 30, 2007, is shown in Note 2. The additional disclosures required by SFAS
No. 158 are included in this footnote.

94

---



IHS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

15. Employee Retirement Benefits (Continued)

Total
defined-benefit pension-plan (income) expense was $1.3 million, $(1.6) million and $(5.7) million for the years ending November 30, 2007,
2006, and 2005, respectively. The aggregate funded position of the Company's plans resulted in the recognition of an additional minimum liability through other comprehensive income in the years ending
November 30, 2006 and 2005.

Both
the US RIP and UK RIP plan assets consist primarily of equity securities with smaller holdings of bonds and alternative assets. Equity assets are diversified between international
and domestic investments, with additional diversification in the domestic category through allocations to large-cap, mid-cap, and growth and value investments.

The
US RIP's established investment policy seeks to balance the need to maintain a viable and productive capital base and yet achieve investment results superior to the actuarial rate
consistent with our funds' investment objectives. The UK RIP's established investment policy is to match the liabilities for active and deferred members with equity investments and match the
liabilities for pensioner members with fixed-income investments. Asset allocations are subject to ongoing analysis and possible modification as basic capital market conditions change over time
(interest rates, inflation, etc.).

The
following compares target asset allocation percentages as of the beginning of 2007 with actual asset allocations at the end of the 2007:

US RIP Assets

UK RIP AssetsTarget Allocations

Actual Allocations

Target Allocations

Actual AllocationsEquities

50 - 70
%
65
%
70
%
62
%Fixed Income

20 - 30

20

30

25Alternatives/Other

0 - 20

15



13


Investment
return assumptions for both plans have been determined by obtaining independent estimates of expected long-term rates of return by asset class and applying the
returns to assets on a weighted-average basis.

We
do not expect any required contributions to the U.S. RIP during 2008. However, we expect to contribute approximately $2.7 million to the UK RIP during 2008. We also expect to
contribute approximately $0.3 million to the SIP during 2008.

The
following table provides the expected benefit payments from our trustees for our pension plans:

US RIP

UK RIP

SIP

Total(In thousands)2008

$
12,660

$
1,076

$
263

$
13,9992009


12,869


1,109


260


14,2382010


13,498


1,142


257


14,8972011


15,086


1,177


254


16,5172012


15,255


1,210


250


16,7152013 - 2017


89,133


6,615


1,192


96,940


95

---



IHS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

15. Employee Retirement Benefits (Continued)

The
following represents our net periodic pension expense (income):

|                                                |  | Year Ended November 30, 2007 |        
|----------------------------------------------- |  | ---------------------------- | -------
|
|
|Service costs incurred                          |  | $                            | 6,276  
|Interest costs on projected benefit obligation  |  |                              | 10,879 
|Expected return on plan assets                  |  |                              | (20,310
|Amortization of prior service cost (benefit)    |  |                              | (473   
|Amortization of actuarial loss                  |  |                              | 1,499  
|Amortization of transitional obligation/(asset) |  |                              | (568   
|SFAS No. 88(settlement) expense                 |  |                              |       
|                                                |  |                              |        
|Net periodic pension benefit (income) expense   |  | $                            | (2,697 
|                                                |  |                              |        

|
|

|                                                |  | Year Ended November 30, 2006 |        
|----------------------------------------------- |  | ---------------------------- | -------
|
|
|Service costs incurred                          |  | $                            | 4,752  
|Interest costs on projected benefit obligation  |  |                              | 10,664 
|Expected return on plan assets                  |  |                              | (20,253
|Amortization of prior service cost (benefit)    |  |                              | (380   
|Amortization of actuarial loss                  |  |                              | 923    
|Amortization of transitional obligation/(asset) |  |                              | (568   
|SFAS No. 88(settlement) expense                 |  |                              |       
|                                                |  |                              |        
|Net periodic pension benefit (income) expense   |  | $                            | (4,862 
|                                                |  |                              |        

|
|

|                                                |  | Year Ended November 30, 2005 |        
|----------------------------------------------- |  | ---------------------------- | -------
|
|
|Service costs incurred                          |  | $                            | 2,768  
|Interest costs on projected benefit obligation  |  |                              | 10,927 
|Expected return on plan assets                  |  |                              | (21,329
|Amortization of prior service cost (benefit)    |  |                              | 87     
|Amortization of actuarial loss                  |  |                              |       
|Amortization of transitional obligation/(asset) |  |                              | (568   
|                                                |  |                              |        
|Net periodic pension benefit (income) expense   |  | $                            | (8,115 
|                                                |  |                              |        

96

---



IHS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

15. Employee Retirement Benefits (Continued)

The changes in the projected benefit obligation, plan assets and the funded status of the pension plans were as follows:

|                                                                                                                                     |  | November 30, 2007 |         
|------------------------------------------------------------------------------------------------------------------------------------ |  | ----------------- | --------
|
|
|
|Actuarial present value of accumulated benefit obligation                                                                            |  | $                 | 182,120 
|                                                                                                                                     |  |                   |         
|Change in projected benefit obligation:                                                                                              |  |                   |         
|Net benefit obligation at November 30, 2006                                                                                          |  | $                 | 196,262 
|Service costs incurred                                                                                                               |  |                   | 6,276   
|Employee contributions                                                                                                               |  |                   |        
|Interest costs on projected benefit obligation                                                                                       |  |                   | 10,879  
|Actuarial loss (gain)                                                                                                                |  |                   | (10,123 
|Gross benefits paid                                                                                                                  |  |                   | (12,396 
|Settlements                                                                                                                          |  |                   |        
|Foreign currency exchange rate change                                                                                                |  |                   |        
|                                                                                                                                     |  |                   |         
|Net benefit obligation at November 30, 2007                                                                                          |  | $                 | 190,898 
|                                                                                                                                     |  |                   |         
|Change in plan assets:                                                                                                               |  |                   |         
|Fair value of plan assets at November 30, 2006                                                                                       |  | $                 | 267,266 
|Actual return on plan assets                                                                                                         |  |                   | 27,960  
|Employer contributions (distributions)                                                                                               |  |                   | (816    
|Employee contributions                                                                                                               |  |                   |        
|Gross benefits and settlements paid                                                                                                  |  |                   | (12,396 
|Foreign currency exchange rate change                                                                                                |  |                   |        
|                                                                                                                                     |  |                   |         
|Fair value of plan assets at November 30, 2007                                                                                       |  | $                 | 282,014 
|                                                                                                                                     |  |                   |         
|Funded status:                                                                                                                       |  |                   |         
|Projected benefit obligation at November 30, 2007                                                                                    |  | $                 | (190,898
|Fair value of plan assets at November 30, 2007                                                                                       |  |                   | 282,014 
|                                                                                                                                     |  |                   |         
|Funded statusOverfunded/(Underfunded)                                                                                               |  | $                 | 91,116  
|                                                                                                                                     |  |                   |         
|Amounts recognized in the Consolidated Balance Sheets:                                                                               |  |                   |         
|Prepaid asset                                                                                                                        |  | $                 | 91,116  
|Accrued liability                                                                                                                    |  |                   |        
|                                                                                                                                     |  |                   |         
|Net amount recognized at November 30, 2007                                                                                           |  | $                 | 91,116  
|                                                                                                                                     |  |                   |         
|Amounts in Accumulated Other Comprehensive Income not yet recognized as components of net periodic pension (income) expense, pretax: |  |                   |         
|Net prior service cost (benefit)                                                                                                     |  | $                 | (4,313  
|Net actuarial loss                                                                                                                   |  |                   | 8,361   
|Net transitional obligation (asset)                                                                                                  |  |                   | (796    
|                                                                                                                                     |  |                   |         
|Total not yet recognized                                                                                                             |  | $                 | 3,252   
|                                                                                                                                     |  |                   |         

97

---



IHS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

15. Employee Retirement Benefits (Continued)

Amortization Amounts Expected to be Recognized in Net Periodic Pension (Income) Expense during Fiscal Year Ending November 30, 2008, pretax:

US RIP

UK RIP

SIP

Total(In thousands)Amortization of net actuarial loss

$


$


$
190

$
190Amortization of transitional obligation/(asset)

$
(568
)
$


$
40

$
(528
)Amortization of net prior service cost (benefit)

$
(473
)
$


$
44

$
(429
)


98

---



IHS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

15. Employee Retirement Benefits (Continued)

|
|

|                                                          |  | November 30, 2006 |        
|--------------------------------------------------------- |  | ----------------- | -------
|
|
|Actuarial present value of accumulated benefit obligation |  | $                 | 186,717
|                                                          |  |                   |        
|Change in projected benefit obligation:                   |  |                   |        
|Net benefit obligation at November 30, 2005               |  | $                 | 195,988
|Service costs incurred                                    |  |                   | 4,752  
|Employee contributions                                    |  |                   |       
|Interest costs on projected benefit obligation            |  |                   | 10,664 
|Actuarial loss                                            |  |                   | 1,657  
|Gross benefits paid                                       |  |                   | (11,072
|Plan amendment(1)                                         |  |                   | (5,727 
|Special termination benefits                              |  |                   |       
|Foreign currency exchange rate change                     |  |                   |       
|                                                          |  |                   |        
|Net benefit obligation at November 30, 2006               |  | $                 | 196,262
|                                                          |  |                   |        
|Change in plan assets                                     |  |                   |        
|Fair value of plan assets at November 30, 2005            |  | $                 | 249,940
|Actual return on plan assets                              |  |                   | 29,289 
|Employer contributions (distributions)                    |  |                   | (891   
|Employee contributions                                    |  |                   |       
|Gross benefits paid                                       |  |                   | (11,072
|Foreign currency exchange rate change                     |  |                   |       
|                                                          |  |                   |        
|Fair value of plan assets at November 30, 2006            |  | $                 | 267,266
|                                                          |  |                   |        
|Reconciliation of funded status:                          |  |                   |        
|Over/(under)funded status                                 |  | $                 | 71,004 
|Unrecognized net transition asset                         |  |                   | (1,363 
|Unrecognized prior service cost (benefit)(1)              |  |                   | (4,786 
|Unrecognized net loss                                     |  |                   | 27,633 
|                                                          |  |                   |        
|Net amount recognized at November 30, 2006                |  | $                 | 92,488 
|                                                          |  |                   |        
|Amounts recognized in the Consolidated Balance Sheets:    |  |                   |        
|Prepaid asset (accrued liability)                         |  | $                 | 92,488 
|Intangible asset                                          |  |                   |       
|Accumulated other comprehensive loss                      |  |                   |       
|                                                          |  |                   |        
|Net amount recognized at November 30, 2006                |  | $                 | 92,488 
|                                                          |  |                   |        

---

99

---



IHS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

15. Employee Retirement Benefits (Continued)



Pension
income is actuarially calculated annually based on data available at the beginning of each year. Assumptions used in the actuarial calculation include the discount rate selected
and disclosed at the end of the previous year as well as other assumptions detailed in the table below, for the years ended November 30:

|                                            |  | US RIP |   | UK RIP |   | SIP  |  
|------------------------------------------- |  | ------ | - | ------ | - | ---- | -
|
|Weighted-average assumptions as of year-end |  |        |   |        |   |      |  
|Discount rate                               |  | 6.50   | % | 5.75   | % | 6.00 | %
|Average salary increase rate                |  | 4.50   |   | 4.50   |   | 4.90 |  
|Expected long-term rate of return on assets |  | 8.25   |   | 8.25   |   | 7.00 |  



Employees of certain subsidiaries of both the Energy and Engineering segments may participate in defined contribution plans. Benefit expense relating to these
plans was approximately $4.0 million, $3.0 million, and $2.7 million for 2007, 2006 and 2005, respectively.

16. Post-retirement Benefits

We sponsor a contributory post-retirement medical plan. The plan grants access to group rates for retiree-medical coverage for all U.S. employees who
leave IHS after age 55 with at least 10 years of service. Additionally, IHS subsidizes the cost of coverage for retiree-medical coverage for certain grandfathered employees. The IHS
subsidy is capped at different rates per month depending on individual retirees' Medicare eligibility.

We
adopted SFAS No. 158 for our annual fiscal 2007 year ending November 30, 2007. The standard, which is an amendment to SFAS Nos. 87, 88, 106, and 132(R),
requires an employer to recognize the funded status of any defined benefit pension and/or other postretirement benefit plans as an asset or liability in its statement of financial position. The
incremental impact of adopting SFAS No. 158 on individual line items of the Consolidated Balance Sheet as of November 30, 2007, is shown in Note 2. The additional disclosures
required by SFAS No. 158 are included in this footnote.

The
obligation under our plan was determined by the application of the terms of medical and life insurance plans together with relevant actuarial assumptions and
health-care-cost-trend rates ranging ratably from 9.75% in 2008 to 5.00% in 2012. Effective 2006, IHS does not provide prescription drug coverage for Medicare-
eligible retirees except through a Medicare Advantage fully insured option; therefore our liability does not reflect any impact of the Medicare Modernization Act Part D subsidy. The discount
rate used in determining the accumulated post-retirement benefit obligation was 6.5%, 5.75% and 5.75% at November 30, 2007, 2006, and 2005, respectively.

100

---



IHS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

16. Post-retirement Benefits (Continued)

Our
net periodic post-retirement benefit (income) expense and changes in the related projected benefit obligation were as follows:

2007

2006

2005(In thousands)Service costs incurred

$
137

$
294

$
888Interest costs


592


728


1,353Amortization of prior service cost(1)


(3,229
)

(2,655
)

Amortization of net actuarial loss


551


484


137Net periodic post-retirement benefit (income) expense

$
(1,949
)
$
(1,149
)
$
2,378


|
|

Year Ended November 30, 2007(In thousands)Change in projected postretirement benefit obligation:Post-retirement benefit obligation at beginning of year

$
10,763Service costs


137Interest costs


592Actuarial gain


(454
)Benefits paid(2)


(835
)Post-retirement benefit obligation at end of year

$
10,203Funded statusUnfunded:

$
(10,203
)Amounts recognized in the Consolidated Balance Sheets:Accrued liability

$
(10,203
)Amounts in Accumulated Other Comprehensive Income not yet recognized as components of net periodic pension (income) expense, pretax:Net prior service benefit

$
(10,012
)Net actuarial loss


4,800Net transitional obligation (assets)


Total not yet recognized

$
(5,212
)Amortization Amounts Expected to be Recognized in Net Periodic Pension (Income) Expense during Fiscal Year Ending November 30, 2008, pretax:Amortization of net actuarial loss

$
472Amortization of transitional obligation


Amortization of net prior service benefit


(3,229
)


101

---



IHS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

16. Post-retirement Benefits (Continued)

|
|

Year Ended November 30, 2006(In thousands)Change in projected postretirement benefit obligation:Post-retirement benefit obligation at beginning of year

$
26,145Service costs


294Interest costs


728Actuarial loss


418Benefits paid(2)


(890
)Plan amendment(1)


(15,932
)Post-retirement benefit obligation at end of year

$
10,763Funded statusUnfunded:Under-funded status

$
(10,763
)Unrecognized prior service costs(1)


(13,242
)Unrecognized net actuarial loss


5,805Accrued post-retirement benefit liability at end of year

$
(18,200
)




Employer
contributions to the post-retirement benefit plan expected to be paid during the year ending November 30, 2008, are approximately $0.9 million.

The
following table provides the expected cash out-flows for our post-retirement benefit plan (in thousands):

2008

$
8862009


8712010


8712011


8582012


8602013 - 2017


4,210


102

---



IHS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

16. Post-retirement Benefits (Continued)

A
one-percentage-point change in assumed health-care-cost-trend rates would have the following effects:

One-percentage-point increase

One-percentage-point decrease(In thousands)Increase/(decrease) on total of service and interest cost for the year ended November 30, 2007

$
1

$
(1
)Increase/(decrease) on post-retirement benefit obligation as of November 30, 2007


10


(12
)


17. Common Stock and Earnings per Share

Our authorized capital stock consists of 80,000,000 shares of Class A common stock and 13,750,000 shares of Class B common stock. These classes have
equal dividend rights and liquidation rights. However, the holders of our Class A common stock are entitled to one vote per share and holders of our Class B common stock are entitled to
ten votes per share on all matters to be voted upon by the stockholders. Each share of Class B common stock is convertible at any time at the option of the holder into one share of
Class A common stock and will automatically convert, without any action by the holder, upon the earlier of the occurrence of specified events or November 16, 2009.

We
use the two-class method for computing basic and diluted EPS amounts. We calculated undistributed earnings as follows:

Years Ended November 30,2007

2006

2005(In thousands)Net income

$
83,775

$
56,345

$
41,797Less: dividends








Undistributed earnings

$
83,775

$
56,345

$
41,797


Weighted
average common shares outstanding are calculated as follows:

|                                             |                                            | Years Ended November 30,
|-------------------------------------------- | ------------------------------------------ | ------------------------
|
|
|
|Weighted average common shares outstanding:  |                                            |                         
|                                             | Shares used in basic per-share calculation |                         
|Effect of dilutive securities:               |                                            |                         
|                                             | Deferred stock units                       |                         
|                                             | Restricted shares                          |                         
|                                             | Options                                    |                         
|                                             | Assumed conversion of Class B shares       |                         
|                                             |                                            |                         
|Shares used in diluted per-share calculation |                                            | 60,426                  
|                                             |                                            |                         

103

---



IHS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

17. Common Stock and Earnings per Share (Continued)

Undistributed
earnings and calculated basic and diluted EPS amounts are calculated as follows:

|                                                                            |  | Years Ended November 30,
|--------------------------------------------------------------------------- |  | ------------------------
|
|
|
|Basic                                                                       |  |                         
|Weighted average shares outstanding                                         |  |                         
|Divided by: Total weighted average shares outstanding (Class A and Class B) |  |                         
|Multiplied by: Undistributed earnings                                       |  | $                       
|                                                                            |  |                         
|Subtotal                                                                    |  | $                       
|Divided by: Weighted average shares outstanding                             |  |                         
|                                                                            |  |                         
|Earnings per share                                                          |  | $                       
|                                                                            |  |                         
|Diluted                                                                     |  |                         
|Weighted average shares outstanding                                         |  |                         
|Divided by: Total weighted average shares outstanding (Class A and Class B) |  |                         
|Multiplied by: Undistributed earnings                                       |  | $                       
|                                                                            |  |                         
|Subtotal                                                                    |  | $                       
|Divided by: Weighted average shares outstanding                             |  |                         
|                                                                            |  |                         
|Earnings per share                                                          |  | $                       
|                                                                            |  |                         



During 2006, our board of directors approved a program to reduce the dilutive effects of employee equity grants, by allowing employees to surrender shares back to
the company for a value equal to their statutory tax liability. IHS then pays the statutory tax on behalf of the employee. Later in 2006, our board of directors approved an additional
programa stock buyback programwhereby IHS acquires up to one million shares per year in the open market to more fully offset the dilutive effect of our employee equity
programs. This program was renewed by the board of directors in late 2007. During 2007, we repurchased 689,962 shares of our Class A common stock for approximately $29.2 million, or
$42.29 per share, pursuant to the stock buyback program and 159,251 shares for approximately $9.3 million, or $58.51 per share, related to shares withheld for taxes.

104

---



IHS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

18. Long-Term Leases, Commitments and Contingencies

Rental charges in 2007, 2006, and 2005 approximated $18.0 million, $15.7 million, and $14.5 million, respectively. Minimum rental commitments
under non-cancelable operating leases in effect at November 30, 2007, are as follows (in thousands):

2008

$
15,8372009


13,5132010


10,6292011


9,1752012


8,4672013 and thereafter


31,079Total

$
88,700


We
had outstanding letters of credit in the aggregate amount of approximately $1.8 million and $1.6 million at November 30, 2007 and 2006, respectively.

From
time to time, we are involved in litigation, most of which is incidental to our business. In our opinion, no litigation to which we currently are a party is likely to have a
material adverse effect on our results of operations or financial condition.

19. Supplemental Cash Flow Information

Net cash provided by operating activities reflects cash payments for interest and income taxes as shown below, for the years ended November 30:

2007

2006

2005(In thousands)Interest paid

$
869

$
298

$
755Income tax payments, net

$
28,369

$
19,384

$
12,833


Cash
and cash equivalents amounting to approximately $148.5 million and $180.0 million reflected on the consolidated balance sheets at November 30, 2007 and 2006,
respectively, are maintained primarily in U.S. Dollars, Canadian Dollars, British Pound Sterling, and Swiss Francs, and were subject to fluctuation in the current exchange rate.

20. Segment Information

We have two reportable segments: Energy and Engineering. Our Energy segment serves the Energy information domain where it develops and delivers critical oil and
gas industry data on exploration, development, production, and transportation activities to major global energy producers and national and independent oil companies. Our Energy segment also provides
operational, research, and strategic advisory services to these customers, as well as to utilities and transportation, petrochemical, coal, and power companies. Our Engineering segment is focused
primarily on the Product Lifecycle, Security, and Environmental information domains where it provides solutions incorporating technical specifications and standards, regulations, parts data, design
guides, security, environmental, and other information to customers in its targeted industries. Both segments primarily derive their revenue from subscriptions.

105

---



IHS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

20. Segment Information (Continued)

Information
as to the operations of our two segments is set forth below based on the nature of the offerings. Our Chairman and Chief Executive Officer and his direct reports represent
our chief operating decision maker, and they evaluate segment performance based primarily on revenue and operating profit. The accounting policies of our segments are the same as those described in
the summary of significant accounting policies (see Note 2).

No
single customer accounted for 10% or more of our total revenue for 2007, 2006, or 2005. There are no material inter-segment revenues for any period presented.

We
are in the process of consolidating back-office functions and moving to a shared-services model. Consequently, we are changing our internal structure causing the
composition of our internal segments to change. Previously, we allocated certain shared costs, such as general and administrative expenses and depreciation and amortization expense, to our two
segments. Starting in the first quarter of 2007, we no longer allocate shared costs to our two segments. Accordingly, the following prior-year amounts have been reclassified to conform to
the current-year presentation.

As
shown below, certain corporate transactions are not allocated to the reportable segments. Amounts not allocated include, but are not limited to, such items as, corporate-level
restructuring and offering charges, stock-based compensation expense, net periodic pension and post-retirement benefits income, corporate-level impairments, and gain (loss) on sales of
corporate assets.

|                              |  | Energy |         | Engineering |   | Segment Totals |  | Amounts not Allocated |           | Consolidated Total
|----------------------------- |  | ------ | ------- | ----------- | - | -------------- |  | --------------------- | --------- | ------------------
|
|2007                          |  |        |         |             |   |                |  |                       |           |                   
|Revenue                       |  | $      | 373,518 |             | $ | 314,874        |  | $                     | 688,392   |                   
|Operating income              |  |        | 121,932 |             |   | 59,978         |  |                       | 181,910   |                   
|Depreciation and amortization |  |        | 12,891  |             |   | 10,280         |  |                       | 23,171    |                   
|Assets                        |  |        | 519,421 |             |   | 559,456        |  |                       | 1,078,877 |                   
|Goodwill                      |  |        | 308,369 |             |   | 256,213        |  |                       | 564,582   |                   
|2006                          |  |        |         |             |   |                |  |                       |           |                   
|Revenue                       |  | $      | 294,277 |             | $ | 256,493        |  | $                     | 550,770   |                   
|Operating income              |  |        | 82,873  |             |   | 46,808         |  |                       | 129,681   |                   
|Depreciation and amortization |  |        | 9,488   |             |   | 6,226          |  |                       | 15,714    |                   
|Assets                        |  |        | 378,821 |             |   | 283,270        |  |                       | 662,091   |                   
|Goodwill                      |  |        | 241,442 |             |   | 109,454        |  |                       | 350,896   |                   
|2005                          |  |        |         |             |   |                |  |                       |           |                   
|Revenue                       |  | $      | 242,312 |             | $ | 233,805        |  | $                     | 476,117   |                   
|Operating income              |  |        | 63,376  |             |   | 28,365         |  |                       | 91,741    |                   
|Depreciation and amortization |  |        | 6,909   |             |   | 4,510          |  |                       | 11,419    |                   
|Assets                        |  |        | 329,365 |             |   | 235,287        |  |                       | 564,652   |                   
|Goodwill                      |  |        | 213,941 |             |   | 82,453         |  |                       | 296,394   |                   

106

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IHS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

20. Segment Information (Continued)

The
following is a schedule of revenue by major product and service offering:

2007

2006

2005(In thousands)Critical information

$
464,045

$
374,532

$
339,815Decision-support tools


108,990


83,942


56,015Services


115,357


92,296


80,287Total revenue

$
688,392

$
550,770

$
476,117


The
following is a schedule of revenue and long-lived assets by geographic location:

|               |  | 2007 |         | 2006 |   | 2005   
|-------------- |  | ---- | ------- | ---- | - | -------
|
|
|United States  |  | $    | 355,474 |      | $ | 434,312
|United Kingdom |  |      | 125,514 |      |   | 251,954
|Canada         |  |      | 67,272  |      |   | 93,142 
|Switzerland    |  |      | 95,257  |      |   | 40,515 
|Rest of world  |  |      | 44,875  |      |   | 9,774  
|               |  |      |         |      |   |        
|Total          |  | $    | 688,392 |      | $ | 829,697
|               |  |      |         |      |   |        

Revenue
by geographic area is generally based on the location of our subsidiary that receives credit for the sale (which may not correspond to either the billing address of the customer
to which it was shipped or the foreign currency in which it was billed). Long-lived assets include property and equipment, net; intangible assets, net; and goodwill.

107

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IHS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

21. Quarterly Results of Operations (Unaudited)

The following summarizes certain quarterly results of operations:

|                                          |         | Three Months Ended
|----------------------------------------- | ------- | ------------------
|
|
|2007                                      |         |                   
|Revenue                                   |         | $                 
|Income from continuing operations         |         |                   
|Net income                                |         |                   
|Earnings per share (Class A and Class B): |         |                   
|                                          | Basic   |                   
|                                          | Diluted |                   
|2006                                      |         |                   
|Revenue                                   |         | $                 
|Income from continuing operations         |         |                   
|Net income                                |         |                   
|Earnings per share (Class A and Class B): |         |                   
|                                          | Basic   |                   
|                                          | Diluted |                   

108

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Item 9.    Changes in and Disagreements With Accountants on Accounting and Financial Disclosure

Not applicable.

Item 9A.    Controls and Procedures



We have established disclosure controls and procedures to ensure that information required to be disclosed in the reports that the Company files or submits under
the Securities Exchange Act of 1934 is recorded, processed, summarized, and reported within the time periods specified in SEC rules and forms. The Company's disclosure controls and procedures have
also been designed to ensure that information required to be disclosed in the reports that the Company files or submits under the Securities Exchange Act of 1934 is accumulated and communicated to the
Company's management, including the principal executive officer and principal financial officer, to allow timely decisions regarding required disclosure.



Pursuant to Section 404 of the Sarbanes-Oxley Act of 2002, the Company has included a report on management's assessment of the design and effectiveness of
its internal control over financial reporting as part of this Annual Report on Form 10-K for the fiscal year ended November 30, 2007. The Company's independent registered
public accounting firm also audited, and reported on, the effectiveness of internal control over financial reporting. Management's report and the independent registered public accounting firm's report
are included under the captions entitled "Management's Report on Internal Control Over Financial Reporting" and "Report of Independent Registered Public Accounting Firm on Internal Control Over
Financial Reporting" in Item 8 of this Annual Report on Form 10-K and are incorporated herein by reference.

Based
on their evaluation as of November 30, 2007, the principal executive officer and principal financial officer of the Company have concluded that the Company's disclosure
controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934) are effective.



There were no changes in our internal control over financial reporting that occurred during the period covered by this Annual Report on
Form 10-K that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Item 9B.    Other Information

None.

109

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PART III

Item 10.    Directors, Executive Officers and Corporate Governance

The information required by this item concerning our executive officers, directors, compliance with Section 16 of the Securities and Exchange Act of 1934
and our code of ethics that applies to our principal executive officer, principal financial officer and principal accounting officer is incorporated by reference to the information set forth in the
sections entitled "Election of Directors," "Section 16(a) Beneficial Ownership Reporting Compliance" and "Election of DirectorsCorporate Governance MattersCode of
Conduct" in our Proxy Statement for our 2008 Annual Meeting of Stockholders to be filed with the Securities and Exchange Commission not later than March 30, 2007, which is 120 days after
the fiscal year ended November 30, 2007.

Item 11.    Executive Compensation

The information required by this item is incorporated by reference to the information set forth in the sections entitled "Election of
DirectorsDirector Compensation" and "Executive Compensation" in the Proxy Statement.

Item 12.    Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

The information required by this item is incorporated by reference to the information set forth in the sections entitled "Security Ownership of Certain Beneficial
Owners and Management" and "Equity Compensation Plan Information" in the Proxy Statement.

Item 13.    Certain Relationships and Related Transactions, and Director Independence

The information required by this item is incorporated by reference to the information set forth in the section entitled "Certain Transactions" in the Proxy
Statement.

Item 14.    Principal Accountant Fees and Services

The information required by this item is incorporated by reference to the information set forth in the section entitled "Ratification of Appointment of
Independent Registered Public Accounting FirmAccounting Fees" in the Proxy Statement.

110

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PART IV

Item 15.    Exhibits and Financial Statement Schedules





|Exhibit
Number |  | Description                                                                                                                                                                                                                                                                                                                                                                            
|-------------- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|3.1*           |  | Form of Amended and Restated Certificate of Incorporation                                                                                                                                                                                                                                                                                                                              
|3.2*           |  | Form of Amended and Restated By-Laws                                                                                                                                                                                                                                                                                                                                                   
|4.1*           |  | Form of Class A Common Stock Certificate                                                                                                                                                                                                                                                                                                                                               
|4.2*           |  | Form of Registration Rights Agreement among IHS Inc. and Urvanos Investments Limited and Urpasis Investments Limited                                                                                                                                                                                                                                                                   
|4.3*           |  | Form of Rights Agreement between IHS Inc. and Computershare Trust Company, Inc., as Rights Agent                                                                                                                                                                                                                                                                                       
|10.1*          |  | Amended and Restated Credit Agreement among IHS Inc., Information Handling Services Group Inc., Information Handling Services Inc., IHS Energy Group Inc., IHS Engineering Group UK Ltd., Petroconsultants S.A., KeyBank
National Association, U.S. Bank National Association, Wells Fargo Bank, National Association, and the other lenders party thereto, dated as of January 7, 2005
|10.2*          |  | Amended and Restated Stock Purchase Agreement by and among Urpasis Investments Limited, Urvanos Investments Limited, IHS Inc., General Atlantic Partners 82, L.P., GAP Coinvestments III, LLC and GAP Coinvestments IV,
 LLC, dated as of October 6, 2005                                                                                                                              
|10.3*          |  | Employment Agreement by and between IHS Inc. and Michael J. Sullivan, dated as of November 1, 2004                                                                                                                                                                                                                                                                                     
|10.4*          |  | Amended and Restated IHS Inc. 2004 Long-Term Incentive Plan                                                                                                                                                                                                                                                                                                                            
|10.5**         |  | Amended and Restated IHS Inc. 2004 Directors Stock Plan                                                                                                                                                                                                                                                                                                                                
|10.6*          |  | IHS Inc. 2004 Long-Term Incentive Plan, Form of 2004 Restricted Stock Award                                                                                                                                                                                                                                                                                                            
|10.7*          |  | IHS Inc. 2004 Long-Term Incentive Plan, 2004 Restricted Stock Award for Charles A. Picasso, dated as of December 23, 2004                                                                                                                                                                                                                                                              
|10.8*          |  | IHS Inc. 2004 Long-Term Incentive Plan, 2004 Restricted Stock Award for Jerre L. Stead, dated as of December 23, 2004                                                                                                                                                                                                                                                                  
|10.9*          |  | IHS Inc. 2004 Long-Term Incentive Plan, 2004 Restricted Stock Award for H. John Oechsle, dated as of December 23, 2004                                                                                                                                                                                                                                                                 
|10.10*         |  | IHS Inc. 2004 Long-Term Incentive Plan, Form of 2005 Performance Share AwardIPOSenior Executive                                                                                                                                                                                                                                                                                      
|10.11*         |  | IHS Inc. 2004 Long-Term Incentive Plan, Form of 2005 Performance Share AwardIPOVice President and Senior Vice President Groups                                                                                                                                                                                                                                                       

111

---



|10.12*  |  | IHS Inc. 2004 Long-Term Incentive Plan, Form of 2005 Performance Unit AwardIPOVice President and Senior Vice President Groups                 
|------- |  | ------------------------------------------------------------------------------------------------------------------------------------------------
|10.13*  |  | IHS Inc. 2004 Long-Term Incentive Plan, Form of 2005 Restricted Stock AwardIPOVice President and Senior Vice President Groups                 
|10.14*  |  | IHS Inc. 2004 Long-Term Incentive Plan, Form of 2005 Restricted Stock Unit AwardIPOVice President and Senior Vice President Groups            
|10.15*  |  | IHS Inc. 2004 Long-Term Incentive Plan, Form of 2005 Restricted Stock AwardIPOSenior Director and Director Groups                             
|10.16*  |  | IHS Inc. 2004 Long-Term Incentive Plan, Form of 2005 Restricted Stock Unit AwardIPOSenior Director and Director Groups                        
|10.17*  |  | IHS Inc. 2004 Long-Term Incentive Plan, Form of 2005 Restricted Stock AwardIPOAll-Employee Award                                              
|10.18*  |  | IHS Inc. 2004 Long-Term Incentive Plan, Form of 2005 Restricted Stock Unit AwardIPOAll-Employee Award                                         
|10.19*  |  | IHS Inc. Employee Stock Purchase Plan                                                                                                           
|10.20*  |  | IHS Supplemental Income Plan                                                                                                                    
|10.21** |  | Summary of Non-Employee Director Compensation                                                                                                   
|10.22*  |  | Form of Indemnification Agreement between the Company and its Directors                                                                         
|10.23*  |  | IHS Executive Relocation Policy (2004)                                                                                                          
|10.24*  |  | Letter to Charles Picasso regarding IHS' Cherry Creek Country Club membership, dated February 16, 2005                                          
|10.25*  |  | Indemnification Agreement by and between TBG Holdings N.V. and IHS Inc., dated as of March 8, 2005                                              
|10.26*  |  | Amendment No. 1, dated as of May 17, 2005, to Indemnification Agreement by and between TBG Holdings N.V. and IHS Inc., dated as of March 8, 2005
|10.27*  |  | Contribution Agreement by and between Holland America Investment Corporation and HAIC, Inc., dated as of November 10, 2004                      
|10.28  |  | Employment Agreement by and between IHS Inc. and Jeffrey R. Tarr, dated as of December 1, 2004                                                  
|10.29  |  | Employment Agreement by and between IHS Inc. and Rohinton Mobed, dated as of November 1, 2004                                                   
|10.30** |  | Employment Agreement by and between IHS Energy Group Inc. and Daniel H. Yergin, dated as of September 1, 2004                                   
|10.31** |  | Non-Competition Agreement by and between IHS Energy Group Inc. and Daniel H. Yergin, dated as of September 1, 2004                              
|10.32** |  | IHS Inc. 2004 Long-Term Incentive Plan, Form of 2007 Stock Option AwardSenior Executive Level                                                  
|10.33** |  | IHS Inc. 2004 Long-Term Incentive Plan, Form of 2007 Stock Option AwardExecutive Level                                                         

112

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|10.34** |  | IHS Inc. 2004 Long-Term Incentive Plan, Form of 2007 Restricted Stock Unit AwardSenior Executive Level                                                                                            
|------- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|10.35** |  | IHS Inc. 2004 Long-Term Incentive Plan, Form of 2007 Restricted Stock Unit AwardTime-Based                                                                                                        
|10.36** |  | IHS Inc. 2004 Long-Term Incentive Plan, Form of 2007 Restricted Stock Unit AwardPerformance-Based                                                                                                 
|10.37 |  | Retirement Agreement by and between IHS Inc. and Charles Picasso, dated as of September 20, 2006                                                                                                   
|21     |  | List of Subsidiaries of the Registrant                                                                                                                                                             
|23.1   |  | Consent of Ernst & Young LLP                                                                                                                                                                       
|24     |  | Power of Attorney                                                                                                                                                                                  
|31.1   |  | Certification of the Chief Executive Officer Pursuant to Rules 13a-14(a) and 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|31.2   |  | Certification of the Chief Financial Officer Pursuant to Rules 13a-14(a) and 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|32.1   |  | Certification of the Chief Executive Officer and Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002                  

---

All
schedules for the Registrant have been omitted since the required information is not present or because the information is included in the financial statements or notes thereto.

113

---





SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized, on January 23, 2008.

| |  | IHS INC.
| |  | --------
| |  | By:     

Pursuant
to the requirements of the Securities Act of 1933, as amended, this report has been signed by the following persons on behalf of the registrant and in the capacities indicated
on the 23rd day of January, 2008.

|Signature                                     |  | Title                                                                             
|--------------------------------------------- |  | ----------------------------------------------------------------------------------
|                                              |  |                                                                                   
|/s/JERRE L. STEADJerre L. Stead               |  | Chairman and Chief Executive Officer (Principal Executive Officer)                
|/s/MICHAEL J. SULLIVANMichael J. Sullivan     |  | Executive Vice President and Chief Financial Officer (Principal Financial Officer)
|/s/HEATHER MATZKE-HAMLINHeather Matzke-Hamlin |  | Senior Vice President and Chief Accounting Officer (Principal Accounting Officer) 
|*C. Michael Armstrong                         |  | Director                                                                          
|*Steven A. Denning                            |  | Director                                                                          
|*Ruann F. Ernst                               |  | Director                                                                          
|*Roger Holtback                               |  | Director                                                                          

114

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|*Balakrishnan S. Iyer |  | Director                                      
|--------------------- |  | ----------------------------------------------
|*Michael Klein        |  | Director                                      
|*Richard W. Roedel    |  | Director                                      
|*Christoph v. Grolman |  | Director                                      
|*By:                  |  | /s/STEPHEN GREENStephen Green Attorney-in-Fact

115

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EXHIBIT INDEX

|Exhibit Number |  | Description                                                                                                                                                                                                                                                                                                                                                                            
|-------------- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|3.1*           |  | Form of Amended and Restated Certificate of Incorporation                                                                                                                                                                                                                                                                                                                              
|3.2*           |  | Form of Amended and Restated By-Laws                                                                                                                                                                                                                                                                                                                                                   
|4.1*           |  | Form of Class A Common Stock Certificate                                                                                                                                                                                                                                                                                                                                               
|4.2*           |  | Form of Registration Rights Agreement among IHS Inc. and Urvanos Investments Limited and Urpasis Investments Limited                                                                                                                                                                                                                                                                   
|4.3*           |  | Form of Rights Agreement between IHS Inc. and Computershare Trust Company, Inc., as Rights Agent                                                                                                                                                                                                                                                                                       
|10.1*          |  | Amended and Restated Credit Agreement among IHS Inc., Information Handling Services Group Inc., Information Handling Services Inc., IHS Energy Group Inc., IHS Engineering Group UK Ltd., Petroconsultants S.A., KeyBank
National Association, U.S. Bank National Association, Wells Fargo Bank, National Association, and the other lenders party thereto, dated as of January 7, 2005
|10.2*          |  | Amended and Restated Stock Purchase Agreement by and among Urpasis Investments Limited, Urvanos Investments Limited, IHS Inc., General Atlantic Partners 82, L.P., GAP Coinvestments III, LLC and GAP Coinvestments IV, LLC,
dated as of October 6, 2005                                                                                                                               
|10.3*          |  | Employment Agreement by and between IHS Inc. and Michael J. Sullivan, dated as of November 1, 2004                                                                                                                                                                                                                                                                                     
|10.4*          |  | Amended and Restated IHS Inc. 2004 Long-Term Incentive Plan                                                                                                                                                                                                                                                                                                                            
|10.5**         |  | Amended and Restated IHS Inc. 2004 Directors Stock Plan                                                                                                                                                                                                                                                                                                                                
|10.6*          |  | IHS Inc. 2004 Long-Term Incentive Plan, Form of 2004 Restricted Stock Award                                                                                                                                                                                                                                                                                                            
|10.7*          |  | IHS Inc. 2004 Long-Term Incentive Plan, 2004 Restricted Stock Award for Charles A. Picasso, dated as of December 23, 2004                                                                                                                                                                                                                                                              
|10.8*          |  | IHS Inc. 2004 Long-Term Incentive Plan, 2004 Restricted Stock Award for Jerre L. Stead, dated as of December 23, 2004                                                                                                                                                                                                                                                                  
|10.9*          |  | IHS Inc. 2004 Long-Term Incentive Plan, 2004 Restricted Stock Award for H. John Oechsle, dated as of December 23, 2004                                                                                                                                                                                                                                                                 
|10.10*         |  | IHS Inc. 2004 Long-Term Incentive Plan, Form of 2005 Performance Share AwardIPOSenior Executive                                                                                                                                                                                                                                                                                      
|10.11*         |  | IHS Inc. 2004 Long-Term Incentive Plan, Form of 2005 Performance Share AwardIPOVice President and Senior Vice President Groups                                                                                                                                                                                                                                                       
|10.12*         |  | IHS Inc. 2004 Long-Term Incentive Plan, Form of 2005 Performance Unit AwardIPOVice President and Senior Vice President Groups                                                                                                                                                                                                                                                        
|10.13*         |  | IHS Inc. 2004 Long-Term Incentive Plan, Form of 2005 Restricted Stock AwardIPOVice President and Senior Vice President Groups                                                                                                                                                                                                                                                        
|10.14*         |  | IHS Inc. 2004 Long-Term Incentive Plan, Form of 2005 Restricted Stock Unit AwardIPOVice President and Senior Vice President Groups                                                                                                                                                                                                                                                   
|10.15*         |  | IHS Inc. 2004 Long-Term Incentive Plan, Form of 2005 Restricted Stock AwardIPOSenior Director and Director Groups                                                                                                                                                                                                                                                                    
|10.16*         |  | IHS Inc. 2004 Long-Term Incentive Plan, Form of 2005 Restricted Stock Unit AwardIPOSenior Director and Director Groups                                                                                                                                                                                                                                                               

---



|10.17*  |  | IHS Inc. 2004 Long-Term Incentive Plan, Form of 2005 Restricted Stock AwardIPOAll-Employee Award                                              
|------- |  | ------------------------------------------------------------------------------------------------------------------------------------------------
|10.18*  |  | IHS Inc. 2004 Long-Term Incentive Plan, Form of 2005 Restricted Stock Unit AwardIPOAll-Employee Award                                         
|10.19*  |  | IHS Inc. Employee Stock Purchase Plan                                                                                                           
|10.20*  |  | IHS Supplemental Income Plan                                                                                                                    
|10.21** |  | Summary of Non-Employee Director Compensation                                                                                                   
|10.22*  |  | Form of Indemnification Agreement between the Company and its Directors                                                                         
|10.23*  |  | IHS Executive Relocation Policy (2004)                                                                                                          
|10.24*  |  | Letter to Charles Picasso regarding IHS' Cherry Creek Country Club membership, dated February 16, 2005                                          
|10.25*  |  | Indemnification Agreement by and between TBG Holdings N.V. and IHS Inc., dated as of March 8, 2005                                              
|10.26*  |  | Amendment No. 1, dated as of May 17, 2005, to Indemnification Agreement by and between TBG Holdings N.V. and IHS Inc., dated as of March 8, 2005
|10.27*  |  | Contribution Agreement by and between Holland America Investment Corporation and HAIC, Inc., dated as of November 10, 2004                      
|10.28  |  | Employment Agreement by and between IHS Inc. and Jeffrey R. Tarr, dated as of December 1, 2004                                                  
|10.29  |  | Employment Agreement by and between IHS Inc. and Rohinton Mobed, dated as of November 1, 2004                                                   
|10.30** |  | Employment Agreement by and between IHS Energy Group Inc. and Daniel H. Yergin, dated as of September 1, 2004                                   
|10.31** |  | Non-Competition Agreement by and between IHS Energy Group Inc. and Daniel H. Yergin, dated as of September 1, 2004                              
|10.32** |  | IHS Inc. 2004 Long-Term Incentive Plan, Form of 2007 Stock Option AwardSenior Executive Level                                                  
|10.33** |  | IHS Inc. 2004 Long-Term Incentive Plan, Form of 2007 Stock Option AwardExecutive Level                                                         
|10.34** |  | IHS Inc. 2004 Long-Term Incentive Plan, Form of 2007 Restricted Stock Unit AwardSenior Executive Level                                         
|10.35** |  | IHS Inc. 2004 Long-Term Incentive Plan, Form of 2007 Restricted Stock Unit AwardTime-Based                                                     
|10.36** |  | IHS Inc. 2004 Long-Term Incentive Plan, Form of 2007 Restricted Stock Unit AwardPerformance-Based                                              
|10.37 |  | Retirement Agreement by and between IHS Inc. and Charles Picasso, dated as of September 20, 2006                                                
|21     |  | List of Subsidiaries of the Registrant                                                                                                          
|23.1   |  | Consent of Ernst & Young LLP                                                                                                                    
|24     |  | Power of Attorney                                                                                                                               

---



|31.1 |  | Certification of the Chief Executive Officer Pursuant to Rules 13a-14(a) and 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|----- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|31.2 |  | Certification of the Chief Financial Officer Pursuant to Rules 13a-14(a) and 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|32.1 |  | Certification of the Chief Executive Officer and Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002                  

---

---