Time Warner Cable 2006 Annual Report Download - page 59

On July 31, 2006, immediately after the consummation of the Redemptions but prior to the consummation of
the Adelphia Acquisition, TWC paid a stock dividend to WCI, a wholly owned subsidiary of Time Warner and the
only holder of record of TWC’s outstanding Class A and Class B common stock at that time, of 999,999 shares of
Class A or Class B common stock, as applicable, per share of Class A or Class B common stock. An aggregate of
745,999,254 shares of Class A common stock and 74,999,925 shares of Class B common stock were issued to WCI
in connection with the stock dividend. The stock dividend was declared and paid in anticipation of TWC becoming a
public company.
Item 6. Selected Financial Data.
The selected financial information of the Company for the five years ended December 31, 2006 is set forth at
pages 149 through 150 herein and is incorporated herein by reference.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
The information set forth under the caption “Management’s Discussion and Analysis” at pages 59 through 99
herein is incorporated herein by reference.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk.
The information set forth under the caption “Market Risk Management” at page 92 herein is incorporated
herein by reference.
Item 8. Financial Statements and Supplementary Data.
The consolidated financial statements of the Company and the report of independent auditors thereon set forth
at pages 100 through 145 and 147 herein are incorporated herein by reference.
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.
Not Applicable.
Item 9A. Controls and Procedures.
Evaluation of Disclosure Controls and Procedures
TWC, under the supervision and with the participation of its management, including the Chief Executive
Officer and Chief Financial Officer, evaluated the effectiveness of the design and operation of TWC’s “disclosure
controls and procedures” (as such term is defined in Rule 13a-15(e) under the Exchange Act) as of the end of the
period covered by this report. Based on that evaluation, the Chief Executive Officer and the Chief Financial Officer
concluded that TWC’s disclosure controls and procedures are effective in timely making known to them material
information relating to TWC and its consolidated subsidiaries required to be disclosed in TWC’s reports filed or
submitted under the Exchange Act.
Management’s Report on Internal Control Over Financial Reporting
Management’s report on internal control over financial reporting and the report of the independent auditors
thereon set forth at pages 146 and 148 incorporated herein by reference.
Changes in Internal Control Over Financial Reporting
On July 31, 2006, TWC acquired certain cable systems from Adelphia and Comcast and, as a result, is
integrating the processes, systems and controls relating to the acquired cable systems into TWC’s existing system of
internal control over financial reporting. TWC has continued to integrate into its control structure many of the
processes, systems and controls relating to the acquired cable systems in accordance with its integration plans. In
addition, various transitional controls designed to supplement existing internal controls have been implemented
with respect to the acquired systems. Except for the processes, systems and controls relating to the integration of the
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