DIRECTV 2010 Annual Report Download - page 73

Download and view the complete annual report

Please find page 73 of the 2010 DIRECTV annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 142

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132
  • 133
  • 134
  • 135
  • 136
  • 137
  • 138
  • 139
  • 140
  • 141
  • 142

DIRECTV
December 31, 2010. The timing and amount of any future payments is not reasonably
CONTRACTUAL OBLIGATIONS
estimable, as such payments are dependent on the completion and resolution of
The following table sets forth our contractual obligations as of December 31, examinations with tax authorities. We do not expect a significant payment related to
2010, including the future periods in which payments are expected. Additional these obligations within the next twelve months.
details regarding these obligations are provided in the Notes to the Consolidated
Financial Statements in Part II, Item 8 referenced in the table. OFF-BALANCE SHEET ARRANGEMENTS
Payments Due By Period As of December 31, 2010, we were contingently liable under standby letters of
Less than More than credit and bonds in the aggregate amount of $85 million primarily related to
Contractual Obligations Total 1 year 1-3 years 3-5 years 5 years insurance deductibles.
(Dollars in Millions)
Long-term debt obligations (Note 9) (a) . $16,788 $ 613 $1,154 $2,053 $12,968 CONTINGENCIES
Purchase obligations (Note 19) (b) .... 9,001 2,029 3,780 2,182 1,010
Operating lease obligations (Note 19) (c) 434 77 123 82 152 For a discussion of ‘‘Contingencies’’, see Note 19 of the Notes to the
Capital lease obligations (Note 11) . . . . 877 95 183 164 435 Consolidated Financial Statements in Part II, Item 8 of this Annual Report, which
Other long-term liabilities reflected on we incorporate herein by reference.
the Consolidated Balance Sheets under
GAAP (Note 19) (d) ........... 136 136 — — — CERTAIN RELATIONSHIPS AND RELATED-PARTY TRANSACTIONS
Total ....................... $27,236 $2,950 $5,240 $4,481 $14,565 For a discussion of ‘‘Certain Relationships and Related-Party Transactions,’’ see
Note 17 of the Notes to the Consolidated Financial Statements in Part II, Item 8
(a) Long-term debt obligations include interest calculated based on the rates in effect at of this Annual Report, which we incorporate herein by reference.
December 31, 2010, however, the obligations do not reflect potential prepayments
required under its indentures. CRITICAL ACCOUNTING ESTIMATES
(b) Purchase obligations consist primarily of broadcast programming commitments, regional The preparation of the consolidated financial statements in conformity with
professional team rights agreements, service contract commitments and satellite launch accounting principles generally accepted in the United States requires management
contracts. Broadcast programming commitments include guaranteed minimum to make estimates, judgments and assumptions that affect amounts reported.
contractual commitments that are typically based on a flat fee or a minimum number
Management bases its estimates, judgments and assumptions on historical
of required subscribers subscribing to the related programming. Actual payments may
exceed the minimum payment requirements if the actual number of subscribers experience and on various other factors that are believed to be reasonable under the
subscribing to the related programming exceeds the minimum amounts. Service circumstances. Due to the inherent uncertainty involved in making estimates, actual
contract commitments include minimum commitments for the purchase of services that results reported for future periods may be affected by changes in those estimates.
have been outsourced to third parties, such as billing services, telemetry, tracking and The following represents what we believe are the critical accounting policies that
control services and broadcast center services. In most cases, actual payments, which are may involve a higher degree of estimation, judgment and complexity. For a
typically based on volume, usually exceed these minimum amounts. summary of our significant accounting policies, including those discussed below, see
(c) Certain of the operating leases contain escalation clauses and renewal or purchase Note 2 of the Notes to the Consolidated Financial Statements in Part II, Item 8 of
options, which we do not consider in the amounts disclosed. this Annual Report.
(d) Payments due by period for other long-term liabilities reflected on the Consolidated Income Taxes. We must make certain estimates and judgments in determining
Balance Sheet under GAAP do not include payments that could be made related to our provisions for income taxes. These estimates and judgments occur in the calculation
net unrecognized tax benefits liability, which amounted to $362 million as of of tax credits, tax benefits and deductions, and in the calculation of certain tax
51