Washington Post 2002 Annual Report Download - page 47

retired employees. The expected cost of providing these postre- Accounts payable and accrued liabilities at December 29,
tirement benefits is accrued over the years that employees render 2002 and December 30, 2001 consist of the following (in
services. thousands):
Income Taxes. The provision for income taxes is determined 2002 2001
using the asset and liability approach. Under this approach, Accounts payable and accrued expenses** $ 175,174 $158,744
deferred income taxes represent the expected future tax conse- Accrued compensation and related
quences of temporary differences between the carrying amounts benefits ******************************* 154,666 89,061
and tax bases of assets and liabilities. Due to affiliates (newsprint)*************** 6,742 5,541
$ 336,582 $253,346
Foreign Currency Translation. Gains and losses on foreign cur-
rency transactions and the translation of the accounts of the
C. INVESTMENTS
Company’s foreign operations where the U.S. dollar is the func-
tional currency are recognized currently in the Consolidated Investments in Marketable Equity Securities. Investments in mar-
Statements of Income. Gains and losses on translation of the ketable equity securities at December 29, 2002 and Decem-
accounts of the Company’s foreign operations, where the local ber 30, 2001 consist of the following (in thousands):
currency is the functional currency, and the Company’s equity
investments in its foreign affiliates are accumulated and reported 2002 2001
as a separate component of equity and comprehensive income. Total cost **************************** $ 187,169 $195,661
Net unrealized gains***************** 29,364 39,744
Stock Options. Effective the first day of the Company’s 2002
Total fair value*********************** $ 216,533 $235,405
fiscal year, the Company adopted the fair-value-based method
of accounting for Company stock options as outlined in State- At December 29, 2002 and December 30, 2001, the Compa-
ment of Financial Accounting Standards No. 123 (SFAS 123), ny’s ownership of 2,634 shares of Berkshire Hathaway Inc.
‘‘Accounting for Stock-Based Compensation.’’ This change in (‘‘Berkshire’’) Class A common stock and 9,845 shares of Berk-
accounting method was applied prospectively to all awards shire Class B common stock accounted for $214.8 million or 99
granted from the beginning of the Company’s fiscal year 2002 percent and $219.0 million or 93 percent, respectively, of the
and thereafter. Stock options awarded prior to fiscal year 2002 total fair value of the Company’s investments in marketable equi-
will continue to be accounted for under the intrinsic value method ty securities. The remaining investments in marketable equity
under Accounting Principles Board Opinion No. 25, ‘‘Account- securities at December 29, 2002 and December 30, 2001
ing for Stock Issued to Employees.’’ consisted of common stock investments in various publicly traded
Sale of Subsidiary/Affiliate Securities. The Company records companies, most of which have concentrations in Internet busi-
investment basis gains arising from the sale of equity interests in ness activities. In most cases, the Company obtained ownership
subsidiaries and affiliates that are in the early stages of develop- of these common stocks as a result of merger or acquisition
ment as capital in excess of par value, net of taxes. transactions in which these companies merged or acquired vari-
ous small Internet-related companies in which the Company held
B. ACCOUNTS RECEIVABLE AND ACCOUNTS PAYABLE AND minor investments.
ACCRUED LIABILITIES
Berkshire is a holding company owning subsidiaries engaged in
Accounts receivable at December 29, 2002 and December 30, a number of diverse business activities, the most significant of
2001 consist of the following (in thousands): which consist of property and casualty insurance business con-
ducted on both a direct and reinsurance basis. Berkshire also
2002 2001 owns approximately 18 percent of the common stock of the
Trade accounts receivable, Company. The chairman, chief executive officer and largest
less estimated returns, doubtful shareholder of Berkshire, Mr. Warren Buffett, is a member of the
accounts and allowances of Company’s Board of Directors. Neither Berkshire nor Mr. Buffett
$65,396 and $73,248************ $ 266,319 $261,898 participated in the Company’s evaluation, approval or execu-
Other accounts receivable ************ 19,055 17,430 tion of its decision to invest in Berkshire common stock. The
$ 285,374 $279,328 Company’s investment in Berkshire common stock is less than
1 percent of the consolidated equity of Berkshire. At Decem-
ber 29, 2002 and December 30, 2001, the unrealized gain
related to the Company’s Berkshire stock investment totaled
$29.9 million and $34.1 million, respectively. The Company
presently intends to hold the Berkshire common stock investment
long term, thus the investment has been classified as a non-
current asset in the Consolidated Balance Sheets.
2002 FORM 10-K 45