Dish Network 2009 Annual Report Download - page 103

DISH NETWORK CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
F-13
Other Investment Securities
Generally, we account for our unconsolidated equity investments under either the equity method or cost method of
accounting. Because these equity securities are generally not publicly traded, it is not practical to regularly estimate the
fair value of the investments; however, these investments are subject to an evaluation for other-than-temporary
impairment on a quarterly basis. This quarterly evaluation consists of reviewing, among other things, company
business plans and current financial statements, if available, for factors that may indicate an impairment of our
investment. Such factors may include, but are not limited to, cash flow concerns, material litigation, violations of debt
covenants and changes in business strategy. The fair value of these equity investments is not estimated unless there are
identified changes in circumstances that may indicate an impairment exists and these changes are likely to have a
significant adverse effect on the fair value of the investment. When impairments occur related to our foreign
investments, any “Cumulative translation adjustment” associated with these investments will remain in “Accumulated
other comprehensive income (loss)” within “Total stockholders’ equity (deficit)” on our Consolidated Balance Sheets
until the investments are sold or otherwise liquidated; at which time, they will be released into our Consolidated
Statements of Operations and Comprehensive Income (Loss).
Long-Term Deferred Revenue, Distribution and Carriage Payments
Certain programmers provide us up-front payments. Such amounts are deferred and recognized as reductions to
“Subscriber-related expenses” on a straight-line basis over the relevant remaining contract term (up to 10 years).
The current and long-term portions of these deferred credits are recorded in the Consolidated Balance Sheets in
“Deferred revenue and other” and “Long-term deferred revenue, distribution and carriage payments and other long-
term liabilities,” respectively.
Sales Taxes
We account for sales taxes imposed on our goods and services on a net basis in our “Consolidated Statements of
Operations and Comprehensive Income (Loss).” Since we primarily act as an agent for the governmental
authorities, the amount charged to the customer is collected and remitted directly to the appropriate jurisdictional
entity.
Income Taxes
We establish a provision for income taxes currently payable or receivable and for income tax amounts deferred to
future periods. Deferred tax assets and liabilities are recorded for the estimated future tax effects of differences that
exist between the book and tax basis of assets and liabilities. Deferred tax assets are offset by valuation allowances
when we believe it is more likely than not that such net deferred tax assets will not be realized.
Accounting for Uncertainty in Income Taxes
From time to time, we engage in transactions where the tax consequences may be subject to uncertainty. We record
a liability when, in management’s judgment, a tax filing position does not meet the more likely than not threshold.
For tax positions that meet the more likely than not threshold, we may record a liability depending on management’s
assessment of how the tax position will ultimately be settled. We adjust our estimates periodically for ongoing
examinations by and settlements with various taxing authorities, as well as changes in tax laws, regulations and
precedent. We classify interest and penalties, if any, associated with our uncertain tax positions as a component of
“Interest expense, net of amounts capitalized” and “Other, net,” respectively.