Time Warner Cable 2014 Annual Report Download - page 80

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TIME WARNER CABLE INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION
Description of Business
Time Warner Cable Inc. (together with its subsidiaries, “TWC” or the “Company”) is among the largest providers of
video, high-speed data and voice services in the U.S., with technologically advanced, well-clustered cable systems located
mainly in five geographic areas – New York State (including New York City), the Carolinas, the Midwest (including
Ohio, Kentucky and Wisconsin), Southern California (including Los Angeles) and Texas. TWC’s mission is to connect its
customers to the world—simply, reliably and with superior service. TWC offers video, high-speed data and voice services
to residential and business services customers. TWC’s residential services also include security and home management
services, and TWC’s business services also include networking and transport services (including cell tower backhaul
services) and enterprise-class, cloud-enabled hosting, managed applications and services. TWC also sells video and online
advertising inventory to a variety of local, regional and national customers.
On February 12, 2014, the Company entered into an Agreement and Plan of Merger with Comcast Corporation
(“Comcast”) whereby the Company agreed to merge with and into a 100% owned subsidiary of Comcast. Refer to Note 4
for further details regarding the merger with Comcast.
On April 25, 2014, Comcast entered into a binding agreement with Charter Communications, Inc. (“Charter”), which
contemplates three transactions: (1) a contribution, spin-off and merger transaction, (2) an asset exchange and (3) a sale of
assets, all of which are subject to a number of conditions. Refer to Note 4 for further details regarding Comcast’s
transactions with Charter.
Basis of Presentation
Basis of Consolidation
The consolidated financial statements include all of the assets, liabilities, revenue, expenses and cash flows of TWC
and all entities in which TWC has a controlling voting interest. The consolidated financial statements include the results
of the Time Warner Entertainment-Advance/Newhouse Partnership (“TWE-A/N”) only for the TWE-A/N cable systems
that are controlled by TWC and for which TWC holds an economic interest. Intercompany accounts and transactions
between consolidated companies have been eliminated in consolidation.
Use of Estimates
The preparation of financial statements in conformity with U.S. generally accepted accounting principles (“GAAP”)
requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial
statements and footnotes thereto. Actual results could differ from those estimates. Significant estimates inherent in the
preparation of the consolidated financial statements include accounting for allowances for doubtful accounts, depreciation
and amortization, business combinations, derivative financial instruments, pension benefits, equity-based compensation,
income taxes, loss contingencies, certain programming arrangements and asset impairments. Allocation methodologies
used to prepare the consolidated financial statements are based on estimates and have been described in the notes, where
appropriate.
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