Comcast 2007 Annual Report Download - page 51

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ownership interest and (iv) the valuation of retained noncontrolling
equity investments when a subsidiary is deconsolidated. SFAS
No. 160 is effective for us beginning January 1, 2009. We are
currently assessing the potential impact that the adoption of SFAS
No. 160 will have on our consolidated financial statements.
EITF Issue No. 06-10
In March 2007, the EITF reached a consensus on EITF Issue
No. 06-10, “Accounting for Deferred Compensation and Post-
retirement Benefit Aspects of Collateral Assignment Split-Dollar
Life Insurance Arrangements” (“EITF 06-10”). EITF 06-10 provides
that an employer should recognize a liability for the postretirement
benefit related to collateral assignment split-dollar life insurance
arrangements in accordance with either SFAS No. 106, “Employ-
ers’ Accounting for Postretirement Benefits Other Than
Pensions,” or APB No. 12, “Omnibus Opinion.” We expect to
record a liability of approximately $130 million related to the adop-
tion of EITF 06-10 as of January 1, 2008, by an adjustment to
retained earnings.
Note 4: Earnings Per Share
Basic earnings per common share (“Basic EPS”) is computed by
dividing net income from continuing operations by the weighted-
average number of common shares outstanding during the period.
Our potentially dilutive securities include potential common shares
related to our stock options and RSUs. Diluted earnings per
common share (“Diluted EPS”) considers the impact of potentially
dilutive securities except in periods in which there is a loss be-
cause the inclusion of the potential common shares would have an
antidilutive effect. Diluted EPS excludes the impact of potential
common shares related to our stock options in periods in which
the option exercise price is greater than the average market price
of our Class A common stock and our Class A Special common
stock (see Note 11).
Diluted EPS for 2007, 2006 and 2005 excludes approximately
61 million, 116 million and 126 million, respectively, of potential
common shares related to our share-based compensation plans,
because the inclusion of the potential common shares would have
an antidilutive effect.
The following table reconciles the numerator and denominator of the computations of Diluted EPS from continuing operations for the
years presented:
2007 2006 2005
Year ended December 31 (in millions, except per share data) Income Shares
Per
Share
Amount Income Shares
Per
Share
Amount Income Shares
Per
Share
Amount
Basic EPS $ 2,587 3,098 $ 0.84 $ 2,235 3,160 $ 0.71 $ 828 3,295 $ 0.25
Effect of dilutive securities:
Assumed exercise or issuance of shares
relating to stock plans 31 20 17
Diluted EPS $ 2,587 3,129 $ 0.83 $ 2,235 3,180 $ 0.70 $ 828 3,312 $ 0.25
49 Comcast 2007 Annual Report on Form 10-K