Clearwire 2008 Annual Report Download - page 95

deferred the adoption of SFAS No. 157 for our nonfinancial assets and nonfinancial liabilities, except those items
r
ecogn
i
ze
d
or
di
sc
l
ose
d
at
f
a
i
rva
l
ue on an annua
l
or more
f
requent
l
y recurr
i
ng
b
as
i
s, unt
il
January 1, 2009
.
See Note 12, Fair Value Measurements, for information regarding our use of fair value measurements and ou
r
adoption of the provisions of SFAS No. 157.
Accounts Recei
v
abl
e
—
Accounts receivables are stated at amounts due from customers net of an allowance
f
or
d
ou
b
t
f
u
l
accounts. We spec
ifi
ca
ll
y prov
id
ea
ll
owances
f
or customers w
i
t
hk
nown
di
sputes or co
ll
ecta
bili
t
y
i
ssues. T
h
e rema
i
n
i
n
g
reserve recor
d
e
di
nt
h
ea
ll
owance
f
or
d
ou
b
t
f
u
l
accounts
i
s our
b
est est
i
mate o
f
t
h
e amount o
f
p
robable losses in the remainin
g
accounts receivable based upon an evaluation of the a
g
e of receivables and
hi
stor
i
ca
l
exper
i
ence.
I
nventory — Inventor
y
primaril
y
consists of customer premise equipment, which we refer to as CPE, and othe
r
accessories sold to customers and is stated at the lower of cost or net realizable value. Cost is determined under the
avera
g
e cost met
h
o
d
. We recor
di
nventor
y
wr
i
te-
d
owns
f
or o
b
so
l
ete an
d
s
l
ow-mov
i
n
gi
tems
b
ase
d
on
i
nventor
y
turnover tren
d
san
dhi
stor
i
ca
l
ex
p
er
i
ence
.
P
roperty, P
l
ant an
d
E
q
uipmen
t
— Propert
y
,p
l
ant an
d
equ
i
pment are state
d
at cost, net o
f
accumu
l
ate
d
depreciation. Depreciation is calculated on a strai
g
ht-line basis over the estimated useful lives of the assets. We
c
apitalize costs of additions and improvements, includin
g
direct costs of constructin
g
propert
y
, plant and equipment
an
di
nterest costs re
l
ate
d
to construct
i
on. T
h
e est
i
mate
d
use
f
u
l lif
eo
f
equ
i
pment
i
s
d
eterm
i
ne
db
ase
d
on
hi
stor
i
ca
l
usa
g
e of identical or similar equipment, with consideration
g
iven to technolo
g
ical chan
g
es and industr
y
trends tha
t
c
ould im
p
act the network architecture and asset utilization. Leasehold im
p
rovements are recorded at cost an
d
amort
i
ze
d
over t
h
e
l
esser o
f
t
h
e
i
r est
i
mate
d
use
f
u
lli
ves or t
h
ere
l
ate
dl
ease term,
i
nc
l
u
di
ng renewa
l
st
h
at are
r
easonabl
y
assured. Maintenance and repairs are expensed as incurred.
Property, plant and equipment are assessed for impairment whenever events or changes in circumstance
s
i
n
di
cate t
h
at t
h
e carr
yi
n
g
amount o
f
an asset ma
y
not
b
e recovera
bl
e, as requ
i
re
dby
SFAS No. 144, Accounting fo
r
t
h
e Impairment or Disposa
l
of Long-Live
d
Assets
,
w
hi
c
h
we re
f
er to as SFAS No. 144. T
h
e
d
ec
li
ne
i
nt
h
e stoc
kp
r
i
c
e
from the Closing to December 31, 2008, coupled with our stock price at December 31, 2008 being below our boo
k
va
l
ue per s
h
are at t
h
eC
l
os
i
ng, was
d
eeme
d
to
b
eatr
i
gger
i
ng event, requ
i
r
i
ng us to per
f
orm an
i
mpa
i
rment test
.
A
ccordin
g
to SFAS No. 144, if the total of the expected undiscounted future cash flows is less than the carr
y
in
g
amount of the asset, a loss is reco
g
nized for the difference between the fair value and carr
y
in
g
value of the assets
.
Impa
i
rment ana
l
yses, w
h
en per
f
orme
d
, are
b
ase
d
on
f
orecaste
d
cas
hfl
ows t
h
at cons
id
er our
b
us
i
ness an
d
technolo
gy
strate
gy
, mana
g
ement’s views of
g
rowth rates for the business, anticipated future economic and
r
e
g
ulator
y
conditions and expected technolo
g
ical availabilit
y
. For purposes of reco
g
nition and measurement, w
e
group our
l
ong-
li
ve
d
assets at t
h
e
l
owest
l
eve
lf
or w
hi
c
h
t
h
ere are
id
ent
ifi
a
bl
e cas
hfl
ows w
hi
c
h
are
l
arge
ly
i
n
d
epen
d
ent o
f
ot
h
er assets an
dli
a
bili
t
i
es. T
h
ere were no propert
y
,p
l
ant an
d
equ
i
pment
i
mpa
i
rment
l
osses recor
d
e
d
i
n the
y
ears ended December 31, 2008 and 2007.
I
nterna
ll
y Deve
l
ope
d
Software — We cap
i
ta
li
ze costs re
l
ate
d
to computer so
f
tware
d
eve
l
ope
d
or o
b
ta
i
ne
df
or
i
nterna
l
use
i
n accor
d
ance w
i
t
h
Statement o
f
Pos
i
t
i
on, w
hi
c
h
we re
f
er to as SOP, No. 98-1
,
Accounting for t
h
e Costs
of
Computer So
f
tware Developed or Obtained
f
or Internal Use
.
Software obtained for internal use has generally
b
een enterpr
i
se-
l
eve
lb
us
i
ness an
dfi
nance so
f
tware custom
i
ze
d
to meet spec
ifi
c operat
i
ona
l
nee
d
s. Costs
i
ncurre
d
i
n the a
pp
lication develo
p
ment
p
hase are ca
p
italized and amortized over the useful life of the software, which is
g
enerall
y
three
y
ears. Costs reco
g
nized in the preliminar
y
pro
j
ect phase and the post-implementation phase are
e
xpense
d
as
i
ncurre
d.
S
pectrum Licenses — Spectrum licenses primaril
y
include owned spectrum licenses with indefinite lives
,
owne
d
spectrum
li
censes w
i
t
hd
e
fi
n
i
te
li
ves, an
df
avora
bl
e spectrum
l
eases. T
h
e cost o
fi
n
d
e
fi
n
i
te
li
ve
d
spectrum
li
censes ac
q
u
i
re
d
are
f
a
i
rva
l
ue
d
at t
h
e
d
ate o
f
ac
q
u
i
s
i
t
i
on. We account
f
or our s
p
ectrum
li
censes w
i
t
hi
n
d
e
fi
n
i
te
li
ve
s
i
n accordance with the
p
rovisions of SFAS No. 142, Goodwill and Other Intangible Assets
,
which we refer to as
S
FAS No. 142. The impairment test for intangible assets with indefinite useful lives consists of a comparison of th
e
83
CLEARWIRE CORPORATION AND
S
UB
S
IDIARIE
S
N
OTES TO CONSOLIDATED FINANCIAL STATEMENTS —
(
Continued
)