FairPoint Communications 2009 Annual Report Download - page 123

Table of Contents
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An additional transfer of $33.3 million was received from Verizon's defined benefit plans' trusts on February 5, 2010, and an additional transfer
estimated to be $0.2 million, will be made from Verizon's defined benefit plans' trusts upon final validation by actuaries and the Company of the census
information and related actuarial calculations in accordance with relevant statutory and regulatory guidelines and the Employee Matters Agreement. The
assets transferred from the Verizon benefit plans' trusts to the Company's benefit plans' trusts have been invested by the plans' trustee in various equity
and fixed income securities. The final asset transfer will include investment return or loss on the final transfer amount from March 31, 2008 until the
date of the final asset transfer equivalent to the rate of return in the Verizon pension trusts.
The Company accounts for pensions and other post-retirement benefit plans in accordance with the Compensation-Retirement Benefits Topic of the
ASC. This Topic requires the recognition of a defined benefit post-retirement plan's funded status as either an asset or liability on the balance sheet. This
Topic also requires the immediate recognition of the unrecognized actuarial gains and losses and prior service costs and credits that arise during the
period as a component of other accumulated comprehensive income, net of applicable income taxes. Additionally, a company must determine the fair
value of plan assets as of the company's year end.
In addition, the Company and its subsidiaries sponsor four voluntary 401(k) savings plans that, in the aggregate, cover substantially all eligible
Legacy FairPoint employees, and two voluntary 401(k) savings plans that cover in the aggregate substantially all eligible Northern New England
operations employees. Each 401(k) plan year, the Company contributes to the 401(k) plans an amount of matching contributions determined by the
Company at its discretion or as otherwise negotiated with respect to collectively bargained employees.
(r) Business Segments
Management views its business of providing video, data and voice communication services to residential and business customers as one business
segment as defined in Segment Reporting Topic of the ASC. The Company consists of retail and wholesale telecommunications services, including
local telephone, high speed Internet, long distance and other services in 18 states. The Company's chief operating decision maker assesses operating
performance and allocates resources based on the consolidated results.
(s) Purchase Accounting
Prior to the adoption of the Business Combinations Topic of the ASC, the Company recognized the acquisition of companies in accordance with
SFAS No. 141,  ("SFAS 141"). The cost of an acquisition was allocated to the assets acquired and liabilities
assumed based on their fair values as of the close of the acquisition, with amounts exceeding the fair value being recorded as goodwill. All future
business combinations will be recognized in accordance with the Business Combinations Topic of the ASC.
(t) New Accounting Pronouncements
On July 1, 2009, the Company adopted the FASB ASC. The FASB has established the ASC as the source of authoritative principles and
standards recognized by the FASB to be applied by
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