Virgin Media 2006 Annual Report Download - page 157

VIRGIN MEDIA INVESTMENT HOLDINGS LIMITED AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
3. Recent Accounting Pronouncements (Continued)
expanded information about the extent to which companies measure assets and liabilities at fair value, the information used to measure
fair value, and the effect of fair value measurements on earnings. SFAS 157 applies whenever other standards require (or permit)
assets or liabilities to be measured at fair value, and does not expand the use of fair value in any new circumstances. SFAS 157 is
effective for financial statements issued for fiscal years beginning after November 15, 2007 and is required to be adopted by us in the
first quarter of 2008. We are currently evaluating the effect that the adoption of SFAS 157 will have on our consolidated results of
operations and financial condition and are not yet in a position to determine such effects.
In September 2006, the SEC issued SAB No.108, Considering the Effects of Prior Year Misstatements when Quantifying
Misstatements in Current Year Financial Statements. SAB 108 provides guidance on the consideration of the effects of prior year
misstatements in quantifying current year misstatements for the purpose of a materiality assessment. SAB 108 establishes an approach
that requires quantification of financial statement errors based on the effects of each of a company’s balance sheet and statement of
operations and the related financial statement disclosures. SAB 108 is effective for fiscal years ending after December 15, 2006. The
adoption of SAB 108 did not have a material impact on our consolidated financial statements.
4. Discontinued Operations
On December 1, 2004, we reached an agreement to sell our Broadcast operations, a provider of commercial television and radio
transmission services, to a consortium led by Macquarie Communications Infrastructure Group. The sale completed on January 31,
2005. Accordingly, as of December 31, 2004, we accounted for the Broadcast operations as discontinued operations. The results of
operations of the Broadcast operations have been removed from our results of continuing operations and cash flows for all periods
presented. Revenue of the Broadcast operations, reported in discontinued operations, for the years ended December 31, 2006, 2005
and 2004 was £nil, £21.4 million and £277.8 million, respectively. Broadcast’s pre−tax income, reported within discontinued
operations, for the years ended December 31, 2006, 2005 and 2004 was £nil, £3.2 million and £11.2 million, respectively. Upon the
sale, we recorded a gain on disposal of £513.6 million.
On May 9, 2005, we sold our operations in the Republic of Ireland to MS Irish Cable Holdings B.V., an affiliate of Morgan
Stanley & Co. International Limited, for an aggregate purchase price of €333.4 million, or £225.5 million. The results of operations
and cash flows of the Ireland operations have been removed from our results of continuing operations and cash flows for all periods
presented. Revenue of the Ireland operations, reported in discontinued operations, for the years ended December 31, 2006, 2005 and
2004 was £nil, £25.6 million and £72.6 million, respectively. Ireland’s pre−tax income, reported within discontinued operations, for
the years ended December 31, 2006, 2005 and 2004 was £nil million, £2.5 million and £14.0 million respectively. Upon the sale, we
recorded a gain on disposal of £145.5 million.
F−78
Source: VIRGIN MEDIA INVESTM, 10−K, March 01, 2007