Twenty-First Century Fox 2014 Annual Report Download - page 69

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Other commitments and contractual obligations
Primarily includes obligations relating to distribution agreements, marketing agreements and television rating
services.
Hulu indemnity
See Note 16 – Commitments and Contingencies to the accompanying Consolidated Financial Statements of
Twenty-First Century Fox.
Pension and other postretirement benefits and unrecognized tax benefits
The table excludes the Company’s pension, other postretirement benefits (“OPEB”) obligations and the gross
unrecognized tax benefits for uncertain tax positions as the Company is unable to reasonably predict the ultimate
amount and timing. The Company made contributions of $100 million and $95 million to its pension plans in fiscal
2014 and 2013, respectively. The majority of these contributions were voluntarily made to improve the funding
status of the plans. Future plan contributions are dependent upon actual plan asset returns, interest rates and statutory
requirements. Assuming that actual plan asset returns are consistent with the Company’s expected plan returns in
fiscal 2015 and beyond, and that interest rates remain constant, the Company would not be required to make any
material contributions to its U.S. pension plans for the immediate future. Required pension plan contributions for the
next fiscal year are not expected to be material but the Company may make voluntary contributions in future
periods. Payments due to participants under the Company’s pension plans are primarily paid out of underlying
trusts. Payments due under the Company’s OPEB plans are not required to be funded in advance, but are paid as
medical costs are incurred by covered retiree populations, and are principally dependent upon the future cost of
retiree medical benefits under the Company’s pension plans. The Company does not expect its net OPEB payments
to be material in fiscal 2015. (See Note 17 – Pension and Other Postretirement Benefits to the accompanying
Consolidated Financial Statements of Twenty-First Century Fox for further discussion of the Company’s pension
and OPEB plans)
Contingencies
Other than as disclosed in the notes to the accompanying Consolidated Financial Statements of Twenty-First
Century Fox, the Company is party to several other purchase and sale arrangements which become exercisable by
the Company or the counter-party to the agreement. None of these arrangements that become or are exercisable in
the next twelve months are material. Equity purchase arrangements that are exercisable by the counter-party to the
agreement, and that are outside the sole control of the Company, are accounted for in accordance with ASC 480-10-
S99-3A, “Distinguishing Liabilities from Equity.” Accordingly, the fair values of such equity purchase
arrangements are classified in redeemable noncontrolling interests.
U.S. regulators and governmental authorities continue to conduct investigations initiated in 2011 with respect
to the U.K. Newspaper Matters. The Company is cooperating with these investigations. It is not possible at this time
to estimate the liability, if any, of the Company relating to these investigations.
In connection with the Separation, the Company and News Corp agreed in the Separation and Distribution
Agreement that the Company will indemnify News Corp, on an after-tax basis, for payments made after the
Separation arising out of civil claims and investigations relating to the U.K. Newspaper Matters, as well as legal and
professional fees and expenses paid in connection with the related criminal matters, other than fees, expenses and
costs relating to employees who are not (i) directors, officers or certain designated employees or (ii) with respect to
civil matters, co-defendants with News Corp (the “Indemnity”) (See Note 16 – Commitments and Contingencies to
the accompanying Consolidated Financial Statements of Twenty-First Century Fox). If additional information
becomes available and as payments are made, the Company will update the liability provision for the Indemnity.
Any changes to the liability provision for the Indemnity in the future will impact the results of operations for that
period.
The Company establishes an accrued liability for legal claims when the Company determines that a loss is
both probable and the amount of the loss can be reasonably estimated. Once established, accruals are adjusted from