US Cellular 2011 Annual Report Download - page 27

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Contractual and Other Obligations
At December 31, 2011, the resources required for contractual obligations were as follows:
Payments Due by Period
Less Than 2 - 3 4 - 5 More Than
(Dollars in millions) Total 1 Year Years Years 5 Years
Long-term debt obligations(1) ................. $ 886.0 $ — $ — $ — $ 886.0
Interest payments on long-term debt obligations . . . 1,966.5 60.2 120.4 120.4 1,665.5
Operating leases(2) ........................ 1,207.0 144.7 223.6 142.8 695.9
Capital leases ............................ 8.2 0.5 1.2 1.2 5.3
Purchase obligations(3) ..................... 776.6 448.6 216.6 65.4 46.0
$4,844.3 $654.0 $561.8 $329.8 $3,298.7
(1) Includes current and long-term portions of debt obligations. The total long-term debt obligation
differs from Long-term debt in the Consolidated Balance Sheet due to the $9.9 million unamortized
discount related to U.S. Cellular’s 6.7% Senior Notes and capital leases. See Note 13—Debt in the
Notes to Consolidated Financial Statements for additional information.
(2) Includes future lease costs related to office space, retail sites, cell sites and equipment. See
Note 14—Commitments and Contingencies in the Notes to Consolidated Financial Statements for
additional information.
(3) Includes obligations payable under non-cancellable contracts, commitments for network facilities and
transport services, agreements for software licensing and long-term marketing programs.
The table above excludes liabilities related to ‘‘unrecognized tax benefits’’ as defined by GAAP because
U.S. Cellular is unable to predict the period of settlement of such liabilities. Such unrecognized tax
benefits were $28.7 million at December 31, 2011. See Note 5—Income Taxes in the Notes to
Consolidated Financial Statements for additional information on unrecognized tax benefits.
Off-Balance Sheet Arrangements
U.S. Cellular has no transactions, agreements or other contractual arrangements with unconsolidated
entities involving ‘‘off-balance sheet arrangements,’’ as defined by Securities and Exchange Commission
rules, that had or are reasonably likely to have a material current or future effect on its financial
condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital
expenditures or capital resources.
APPLICATION OF CRITICAL ACCOUNTING POLICIES AND ESTIMATES
U.S. Cellular prepares its consolidated financial statements in accordance with GAAP. U.S. Cellular’s
significant accounting policies are discussed in detail in Note 1—Summary of Significant Accounting
Policies and Recent Accounting Pronouncements in the Notes to Consolidated Financial Statements.
Management believes the application of the following critical accounting policies and the estimates
required by such application reflect its most significant judgments and estimates used in the preparation
of U.S. Cellular’s consolidated financial statements. Management has discussed the development and
selection of each of the following accounting policies and related estimates and disclosures with the
Audit Committee of U.S. Cellular’s Board of Directors.
Goodwill and Licenses
See the Goodwill and Licenses Impairment Assessment section of Note 1—Summary of Significant
Accounting Policies and Recent Accounting Pronouncements in the Notes to Consolidated Financial
Statements for information on goodwill and licenses impairment testing policies and methods.
See Note 9—Licenses and Goodwill in the Notes to Consolidated Financial Statements for additional
information related to goodwill and licenses activity in 2011 and 2010.
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