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In April 2008, the FASB issued FASB Staff Position No. 142-3, Determination of the Useful Life of Intangible
Assets (“FSP 142-3”). FSP 142-3 amends the factors that should be considered in developing assumptions about
renewal or extension used in estimating the useful life of a recognized intangible asset under SFAS No. 142,
Goodwill and Other Intangible Assets (“SFAS 142”). This standard is intended to improve the consistency between
the useful life of a recognized intangible asset under SFAS 142 and the period of expected cash flows used to
measure the fair value of the asset under SFAS No. 141 (revised 2007), Business Combinations (“SFAS 141(R)”)
and other GAAP. FSP 142-3 is effective for financial statements issued for fiscal years beginning after December 15,
2008. The measurement provisions of this standard will apply only to intangible assets acquired after the effective
date.
In March 2008, the FASB issued SFAS 161. SFAS 161 changes the disclosure requirements for derivative
instruments and hedging activities, requiring enhanced disclosures about how and why an entity uses derivative
instruments, how derivative instruments and related hedged items are accounted for under SFAS No. 133,
Accounting for Derivative Instruments and Hedging Activities, as amended (“SFAS 133”), and how derivative
instruments and related hedged items affect an entity’s financial position, financial performance and cash flows.
SFAS 161 is effective for fiscal years and interim periods beginning after November 15, 2008. The Company will
provide the required disclosures for all its filings for periods subsequent to the effective date.
In December 2007, the FASB issued SFAS 141(R). SFAS 141(R) changes how business acquisitions are
accounted for and will impact financial statements both on the acquisition date and in subsequent periods. Some of
the changes, such as the accounting for contingent consideration, will introduce more volatility into earnings.
SFAS 141(R) is effective for the Company beginning January 1, 2009, and the Company will apply SFAS 141(R)
prospectively to all business combinations subsequent to the effective date.
In December 2007, the FASB issued SFAS No. 160, Noncontrolling Interests in Consolidated Financial
Statements — an amendment of Accounting Research Bulletin No. 51 (“SFAS 160”). SFAS 160 establishes
accounting and reporting standards for the noncontrolling interest in a subsidiary and the deconsolidation of a
subsidiary and also establishes disclosure requirements that clearly identify and distinguish between the controlling
and noncontrolling interests and requires the separate disclosure of income attributable to the controlling and
noncontrolling interests. SFAS 160 is effective for fiscal years beginning after December 15, 2008. The Company
will apply SFAS 160 prospectively to all applicable transactions subsequent to the effective date.
Recently Adopted Accounting Standards
In October 2008, FASB issued FASB Staff Position No. 157-3, Determining the Fair Value of a Financial Asset
When the Market for That Asset is Not Active (“FSP 157-3”). FSP 157-3 clarifies the application of SFAS 157, in a
market that is not active and provides an example to illustrate key considerations in determining the fair value of a
financial asset when the market for that financial asset is not active. FSP 157-3 was effective for the Company on
December 31, 2008, for all financial assets and liabilities recognized or disclosed at fair value in its consolidated
financial statements on a recurring basis. The adoption of this provision did not have a material impact on the
Company’s consolidated financial statements.
In February 2007, the FASB issued SFAS No. 159, The Fair Value Option for Financial Assets and Financial
Liabilities Including an amendment to FASB Statement No. 115 (“SFAS 159”). SFAS 159 permits entities to choose
to measure many financial instruments and certain other items at fair value. Unrealized gains and losses on items for
which the fair value of option has been elected will be recognized in earnings at each subsequent reporting date.
SFAS 159 was effective for the Company on January 1, 2008. The adoption of SFAS 159 did not have a material
impact on the Company’s consolidated financial statements.
In September 2006, the FASB issued SFAS 157 which defines fair value, establishes a framework for
measuring fair value and expands disclosure requirements about fair value measurements. SFAS 157 is effective for
the Company January 1, 2008. However, in February 2008, the FASB released FASB Staff Position FAS 157-2,
65
DR PEPPER SNAPPLE GROUP, INC.
NOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)