Comcast 2013 Annual Report Download - page 76

Table of Contents
Off-Balance Sheet Arrangements
As of December 31, 2013, we did not have any material off-
balance sheet arrangements that are reasonably likely to have a current
or future effect on our financial condition, results of operations, liquidity, capital expenditures or capital resources.
Critical Accounting Judgments and Estimates
The preparation of our consolidated financial statements requires us to make estimates that affect the reported amounts of assets,
liabilities, revenue and expenses, and the related disclosure of contingent assets and contingent liabilities. We base our judgments
on our historical experience and on various other assumptions that we believe are reasonable under the circumstances, the results
of which form the basis for making estimates about the carrying values of assets and liabilities that are not readily apparent from
other sources. Actual results may differ from these estimates under different assumptions or conditions.
We believe our judgments and related estimates associated with the valuation and impairment testing of our cable franchise rights,
the accounting for film and television costs, and the accounting for income taxes are critical in the preparation of our consolidated
financial statements. Management has discussed the development and selection of these critical accounting judgments and
estimates with the Audit Committee of our Board of Directors, and the Audit Committee has reviewed our disclosures relating to
them, which are presented below. See Notes 8, 5 and 15 to Comcast’
s consolidated financial statements for a discussion of our
accounting policies with respect to these items.
Valuation and Impairment Testing of Cable Franchise Rights
Our largest asset, our cable franchise rights, results from agreements we have with state and local governments that allow us to
construct and operate a cable business within a specified geographic area. The value of a franchise is derived from the economic
benefits we receive from the right to solicit new customers and to market new services, such as advanced video services and high-
speed Internet and voice services, in a particular service area. The amounts we record for cable franchise rights are primarily a
result of cable system acquisitions. Typically when we acquire a cable system, the most significant asset we record is the value of
the cable franchise rights. Often these cable system acquisitions include multiple franchise areas. We currently serve approximately
6,400 franchise areas in the United States.
the number of subscribers receiving the programming. Our purchase obligations related to our NBCUniversal segments consist primarily of commitments to acquire film
and television programming, including U.S. television rights to future Olympic Games through 2020, Sunday Night Football on NBC through the 2022-
23 season, including
the Super Bowl in 2015, 2018 and 2021, NHL games through the 2020-21 season, Spanish-
language U.S. television rights to FIFA World Cup games through 2022, U.S
television rights to English Premier League soccer games through the 2015-
16 season, certain PGA TOUR golf events through 2021 and certain NASCAR events through
2024, as well as obligations under various creative talent and employment agreements, including obligations to actors, producers, television personalities and executives,
and various other television commitments. Purchase obligations do not include contracts with immaterial future commitments.
(c)
Other long-
term liabilities reflected on the balance sheet consist primarily of prepaid forward sale agreements of equity securities we hold; subsidiary preferred shares;
deferred compensation obligations; pension, postretirement and postemployment benefit obligations; contingent consideration obligation related to the NBCUniversal
transaction; and a contractual obligation acquired in connection with the Universal Orlando transaction. This contractual obligation involves financial interests held by a
third party in certain NBCUniversal businesses and is based on a percentage of future revenue of the specified businesses. This contractual obligation provides the third
party with the option, beginning in 2017, to require NBCUniversal to purchase the interest for cash in an amount equal to the fair value of the estimated future payments.
Reserves for uncertain tax positions of $1.7 billion are not included in the table above because it is uncertain if and when these reserves will become payable. Payments
of $1.6 billion of participations and residuals are also not included in the table above because we cannot make a reliable estimate of the period in which these obligations
will be settled.
(d)
Total contractual obligations are made up of the following components.
(in millions)
Liabilities recorded on the balance sheet
$
59,410
Commitments not recorded on the balance sheet
47,632
Total
$
107,042
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Comcast 2013 Annual Report on Form 10
-
K