Time Warner Cable 2007 Annual Report Download - page 87

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TIME WARNER CABLE INC.
CONSOLIDATED STATEMENT OF SHAREHOLDERS’ EQUITY
Common
Stock
Paid-in-
Capital
Retained
Earnings Total
(in millions)
BALANCE AS OF DECEMBER 31, 2004 . . . . . . . . . . . . . . . . . . . . . . . $10 $17,827 $1,137 $18,974
Net income
(a)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — 1,253 1,253
Change in pension benefit obligation, net of $2 million income tax benefit . . — — (3) (3)
Comprehensive income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — 1,250 1,250
Reclassification of mandatorily redeemable Class A common stock
(b)
...... — 81 — 81
Allocations from Time Warner Inc. and other, net
(c)
.................. — 42 — 42
BALANCE AS OF DECEMBER 31, 2005 . . . . . . . . . . . . . . . . . . . . . . . 10 17,950 2,387 20,347
Net income
(a)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — 1,976 1,976
Change in pension benefit obligation, net of $1 million income tax impact . . — — 1 1
Comprehensive income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — 1,977 1,977
Change in unfunded accumulated benefit obligation upon adoption of
FAS 158, net of $84 million tax benefit . . . . . . . . . . . . . . . . . . . . . . . . . — — (124) (124)
Shares of Class A common stock issued in the Adelphia acquisition . . . . . . . 2 5,498 — 5,500
Reclassification of mandatorily redeemable Class A common stock
(b)
. . . . . . — 984 — 984
Redemption of Comcast’s interest in TWC . . . . . . . . . . . . . . . . . . . . . . . . (2) (4,325) — (4,327)
Adjustment to goodwill resulting from the pushdown of Time Warner Inc.’s
basis in TWC . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — (719) — (719)
Allocations from Time Warner Inc. and other, net
(c)
.................. — (74) — (74)
BALANCE AS OF DECEMBER 31, 2006 . . . . . . . . . . . . . . . . . . . . . . . 10 19,314 4,240 23,564
Net income
(a)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — 1,123 1,123
Change in pension benefit obligation, net of $29 million income tax
benefit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — (43) (43)
Change in realized and unrealized losses on derivative financial instruments,
net of $1 million income tax benefit . . . . . . . . . . . . . . . . . . . . . . . . . . . — — (1) (1)
Comprehensive income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — 1,079 1,079
Impact of adopting new accounting pronouncements
(d)
. . . . . . . . . . . . . . . . — — (34) (34)
Allocations from Time Warner Inc. and other, net
(c)
.................. — 97 — 97
BALANCE AS OF DECEMBER 31, 2007 . . . . . . . . . . . . . . . . . . . . . . . $10 $19,411 $5,285 $24,706
(a)
Net income included income from discontinued operations of $1.038 billion and $104 million for the years ended December 31, 2006 and
2005, respectively (none for the year ended December 31, 2007).
(b)
The mandatorily redeemable Class A common stock represents shares of TWC’s Class A common stock that were held by Comcast
Corporation (“Comcast”) until July 31, 2006. During 2004, these shares were classified as mandatorily redeemable as a result of an
agreement with Comcast that under certain circumstances would have required TWC to redeem such shares. During 2006, this requirement
terminated upon the closing of the redemption of Comcast’s interest in TWC and Time Warner Entertainment Company, L.P., and as a
result, these shares were reclassified to shareholders’ equity (Class A common stock and paid-in-capital) before ultimately being redeemed
on July 31, 2006.
(c)
The amounts primarily represent the change in TWC’s accrued liability payable to Time Warner Inc. for vested employee stock options, as
well as other amounts pursuant to accounting for equity-based compensation plans.
(d)
Relates to the impact of adopting the provisions of Emerging Issues Task Force Issue No. 06-2, Accounting for Sabbatical Leave and Other
Similar Benefits, of $37 million, partially offset by the impact of adopting the provisions of Financial Accounting Standards Board
Interpretation No. 48, Accounting for Uncertainty in Income Taxes—an interpretation of FASB Statement No. 109, of $3 million. Refer to
Note 2 for further details.
See accompanying notes.
82