AT&T Wireless 2008 Annual Report Download - page 76

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| AT&T Annual Report 2008
Notes to Consolidated Financial Statements (continued)
Dollars in millions except per share amounts
Statements of Stockholders’ Equity 2008 2007 2006
Accumulated other comprehensive
income (loss) is comprised of
the following components, net
of taxes, at December 31:
Foreign currency
translation adjustment $ (912) $(469) $ (488)
Unrealized gains on
securities 100 375 345
Unrealized (losses) on
cash flow hedges (483) (226) (172)
Defined benefit
postretirement plan (15,761) (59) (4,999)
Other (1) (1) —
Accumulated other
comprehensive (loss) $(17,057) $(380) $(5,314)
No customer accounted for more than 10% of consolidated
revenues in 2008, 2007 or 2006.
A majority of our employees are represented by labor
unions as of year-end 2008. Labor contracts with these
employees will expire during 2009.
NOTE 15. TRANSACTIONS WITH AT&T MOBILITY
Prior to our December 29, 2006 acquisition of BellSouth
(see Note 2), we and BellSouth, the two owners of AT&T
Mobility, each made a subordinated loan to AT&T Mobility
(shareholder loans) and entered into a revolving credit
agreement with AT&T Mobility to provide short-term financing
for operations. Following the BellSouth acquisition, both
our shareholder loan and revolving credit agreement with
AT&T Mobility were consolidated and do not appear on our
consolidated balance sheets. The shareholder loan carries
an annual 6.0% interest rate and we earned interest income
on this loan of $246 during 2006.
Prior to our BellSouth acquisition, we generated revenues
of $1,466 in 2006 for services sold to AT&T Mobility.
These revenues were primarily from access and long-distance
services sold to AT&T Mobility on a wholesale basis and
commissions revenue related to customers added through
AT&T sales sources.
NOTE 16. CONTINGENT LIABILITIES
In addition to issues specifically discussed elsewhere, we
are party to numerous lawsuits, regulatory proceedings and
other matters arising in the ordinary course of business.
In accordance with Statement of Financial Accounting
Standards No. 5, “Accounting for Contingencies,” in evaluating
these matters on an ongoing basis, we take into account
amounts already accrued on the balance sheet. In our opinion,
although the outcomes of these proceedings are uncertain,
they should not have a material adverse effect on our
financial position, results of operations or cash flows.
We have contractual obligations to purchase certain goods
or services from various other parties. Our purchase obligations
are expected to be approximately $3,112 in 2009, $4,398 in
total for 2010 and 2011, $1,885 in total for 2012 and 2013
and $516 in total for years thereafter.
NOTE 13. STOCKHOLDERS’ EQUITY
From time to time, we repurchase shares of common stock
for distribution through our employee benefit plans or in
connection with certain acquisitions. In December 2007,
the Board of Directors authorized the repurchase of up to
400million shares of our common stock. This authorization
replaced previous authorizations and will expire on
December 31, 2009. As of December 31, 2008, we had
repurchased approximately 164 million shares under
this program.
NOTE 14. ADDITIONAL FINANCIAL INFORMATION
December 31,
Balance Sheets 2008 2007
Accounts payable and accrued liabilities:
Accounts payable $ 6,921 $ 7,059
Accrued rents and other 4,437 4,321
Accrued payroll and commissions 2,401 3,419
Deferred directory revenue 1,984 2,348
Accrued interest 1,471 1,149
Compensated future absences 609 637
Current portion of employee
benefit obligation 729 249
Other 1,480 2,217
Total accounts payable and
accrued liabilities $20,032 $21,399
Deferred compensation (included in
Other noncurrent liabilities) $ 1,648 $ 2,141
Statements of Income 2008 2007 2006
Advertising expense $3,073 $3,430 $1,530
Interest expense incurred $4,049 $3,678 $1,916
Capitalized interest (659) (171) (73)
Total interest expense $3,390 $3,507 $1,843
Statements of Cash Flows 2008 2007 2006
Cash paid during the year for:
Interest $3,727 $3,445 $1,666
Income taxes, net of refunds 5,307 4,013 2,777