FairPoint Communications 2002 Annual Report Download - page 509

McNabb Cellular, Inc. 6-2/3
Tonica Cellular, Inc. 6-2/3
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100.00%
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Marscilles Cellular, Inc. (MC) was elected by the Partnership to serve
as the operating and network partner of the Partnership.
The partners make capital contributions, share in the operating
results, and receive distributions from the Partnership in accordance
with their respective ownership percentages.
NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF PRESENTATION
The accounting policies of the Partnership conform to accounting
principles generally accepted in the United States of America.
Management uses estimates and assumptions in preparing its financial
statements. Those estimates and assumptions affect the reported
amounts of assets, liabilities, revenues and expenses, and the
disclosure of contingent assets and liabilities. Actual results may
differ from those estimates.
PROPERTY AND EQUIPMENT
The Partnership's property and equipment is stated at cost, including
labor and overheads associated with construction and capitalized
interest.
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ILLINOIS VALLEY CELLULAR RSA 2-III PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
PROPERTY AND EQUIPMENT (CONTINUED)
Depreciation is computed by applying the straight-line method. The
estimated service lives for depreciable plant and equipment are: 15
years for buildings; 7 to 15 years for cell site towers; 7 to 10 years
for electronic mobile exchange and base site controller equipment; 7
years for furniture and fixtures; and 5 years for computer equipment.
When depreciable properties are sold, or otherwise disposed of, any
resulting gains or losses are included in the determination of income.
LONG-LIVED ASSETS
The Partnership recognizes impairment losses on long-lived assets used
in operations when indicators of impairment are present and the
undiscounted cash flows estimated to be generated by those assets are
less than the assets' carrying amount.
REVENUE RECOGNITION
The Partnership earns revenue by providing access to the cellular
network (access revenue) and for usage of the cellular network
(airtime and toll revenue). Access revenue is billed one month in
advance and is recognized when earned. Airtime (including roaming) and
toll revenues are recognized when the services are rendered. Other
revenues are recognized when services are performed and include,
primarily, connection revenues. Equipment sales are recognized upon