Time Magazine 2013 Annual Report Download - page 98

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TIME WARNER INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
Cost-Method Investments
The Company’s cost-method investments include its investment in the Series B convertible redeemable
preferred shares of CME as well as its investments in entities such as start-up companies and investment funds.
The Company uses available qualitative and quantitative information to evaluate all cost-method investments for
impairment at least quarterly.
Gain on Sale of Investments
For the years ended December 31, 2013, the Company recognized net gains of $76 million, primarily related
to a gain on the sale of the Company’s investment in a theater venture in Japan and for the years ended
December 31, 2012 and 2011, the Company recognized net gains of $11 million and $14 million, respectively,
related to the sale of various investments.
Investment Writedowns
For the years ended December 31, 2013, 2012 and 2011, the Company incurred writedowns to reduce the
carrying value of certain investments that experienced other-than-temporary impairments, as set forth below
(millions):
December 31,
2013 2012 2011
Equity-method investments .....................................$5$25$142
Cost-method investments ...................................... 5 14 6
Available-for-sale securities ....................................77—
Total ....................................................... $ 17 $ 46 $ 148
The impairment of equity-method investments incurred during the year ended December 31, 2012 is
primarily related to the shutdown of TNT television operations in Turkey. The impairments of equity-method
investments incurred during the year ended December 31, 2011 are primarily related to the Company’s
investment in CME. For more information on these investments, see Note 3. While Time Warner has recognized
all declines that are believed to be other-than-temporary as of December 31, 2013, it is reasonably possible that
individual investments in the Company’s portfolio may experience other-than-temporary declines in value in the
future if the underlying investees experience poor operating results or the U.S. or certain foreign equity markets
experience further declines in value.
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