Comcast 2014 Annual Report Download - page 81

Table of Contents
Off-Balance Sheet Arrangements
As of December 31, 2014, 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.
Recent Accounting Pronouncements
See Note 3 to each of Comcast’s and NBCUniversal’
s consolidated financial statements for additional information related to recent
accounting pronouncements.
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 value 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 9, 6 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.
We have concluded that our cable franchise rights have an indefinite useful life since there are no legal, regulatory, contractual,
competitive, economic or other factors which limit the period over which these rights will contribute to our cash flows. Accordingly,
we do not amortize our cable franchise rights but assess the carrying value of our cable franchise rights annually, or more
frequently whenever events or changes in circumstances indicate that the carrying amount may exceed the fair value (“
impairment
testing”).
For the purpose of our impairment testing, we have grouped the recorded values of our various cable franchise rights into our three
Cable Communications divisions or units of account. We evaluate the unit of account periodically to ensure our impairment testing
is performed at an appropriate level.
The annual impairment test for indefinite-
lived intangibles allows for the option to first assess qualitative factors to determine
whether it is more likely than not that the fair value of an indefinite
-
lived intangible is less than its carrying amount. An entity may
choose to perform the qualitative assessment or an entity may
Comcast 2014 Annual Report on Form 10
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