FairPoint Communications 2002 Annual Report Download - page 502

affiliate of MC for contract labor, interest, and other services in
2002, 2001, and 2000, respectively.
Certain cellular equipment sold to subscribers by the Partnership is
provided to the Partnership by a related entity at cost. Cost of goods
sold is recorded by the Partnership at the time of sale.
The Partnership has an arrangement with Illinois Valley Cellular RSA
2, Inc. (Switching Company) to provide switching services to the
Partnership. The stockholders of the Switching Company own 53% of the
Partnership. In 2002, switching and toll roaming services of $546,600
and $1,716,618, respectively, were provided to the Partnership. These
services in 2001 were $455,250 and $1,592,348, respectively, and in
2000 were $423,525 and $1,004,834, respectively. The Switching Company
received $511,669, $334,881, and $293,108 of access and billing and
collecting services from the Partnership in 2002, 2001, and 2000,
respectively.
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ILLINOIS VALLEY CELLULAR RSA 2-I PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
NOTE 8. CONCENTRATIONS OF CREDIT RISK
Financial instruments that potentially subject the Partnership to
concentrations of credit risk consist principally of cash equivalents
and accounts receivable. The Partnership grants credit to cellular
customers located primarily within its portion of the Illinois RSA 2
cellular geographic service area, to other cellular carriers, and to
other telecommunications carriers.
The Partnership maintains its cash in bank deposit accounts which, at
times, may exceed federally insured limits. The Partnership has not
experienced any losses in such accounts. The Partnership believes it
is not exposed to any significant credit risk on cash and cash
equivalents.
Retail service revenues are derived from customers located primarily
within the Partnership's portion of the Illinois RSA 2 cellular
geographic service area. The Partnership grants credit to these
customers, substantially all of whom are local residents of this
geographic area.
Roamer cellular revenues are derived under arrangements with other
wireless carriers (roaming partners) whose customers use the
Partnership's network to place or complete calls. Roaming revenues
from Verizon Wireless accounted for 21%, 31%, and 22% of total
operating revenues in 2002, 2001, and 2000, respectively.
NOTE 9. LEASE COMMITMENTS
Future minimum rental payments under leases for facilities have
initial non-cancelable lease terms at December 31, 2002 as follows:
Capitalized Operating
Leases Leases
------------- -------------
2003 $ 32,612 $ 154,200
2004 30,103 145,200
2005 30,104 130,400
2006 30,104 113,180