Waste Management 2008 Annual Report Download - page 97
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Please find page 97 of the 2008 Waste Management annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.With the adoption of SFAS No. 158 on December 31, 2006, we recorded a liability and a corresponding
deferred loss adjustment to “Accumulated other comprehensive income” of $2 million related to the previously
unaccrued liability balance associated with unfunded benefit obligations in our defined benefit pension and other
post-retirement plans. The December 31, 2006 net increase of $1 million in “Accumulated other comprehensive
income” attributable to the underfunded status of our post-retirement plans is associated with the net impact of
adjustments to increase deferred tax assets by $3 million, partially offset by the additional $2 million related to
liabilities recorded.
SFAS No. 158 also requires companies to measure the funded status of defined benefit pension and other post-
retirement plans as of their year-end reporting date. The measurement date provisions of SFAS No. 158 were
effective for us as of December 31, 2008. We applied the measurement provisions by measuring our benefit
obligations as of September 30, 2007, our prior measurement date, and recognizing a pro-rata share of net benefit
costs for the transition period from October 1, 2007 to December 31, 2008 as a cumulative effect of change in
accounting principle in retained earnings as of December 31, 2008. The adoption of the measurement date
provisions of SFAS No. 158 did not have a material impact on our financial position or results of operations for the
periods presented.
FIN 48 — Accounting for Uncertainty in Income Taxes
In June 2006, the Financial Accounting Standards Board issued Interpretation No. 48, Accounting for
Uncertainty in Income Taxes (an interpretation of FASB Statement No. 109). FIN 48 prescribes a recognition
threshold and measurement attribute for financial statement recognition and measurement of tax positions taken or
expected to be taken in tax returns. In addition, FIN 48 provides guidance on the de-recognition, classification and
disclosure of tax positions, as well as the accounting for related interest and penalties. On May 2, 2007, the FASB
issued FSP No. FIN 48-1, Definition of Settlement in FASB Interpretation No. 48, to provide guidance associated
with the criteria that must be evaluated in determining if a tax position has been effectively settled and should be
recognized as a tax benefit.
Our adoption of FIN 48 and FSP No. 48-1 effective January 1, 2007 resulted in the recognition of a $28 million
increase in our liabilities for unrecognized tax benefits, a $32 million increase in our non-current deferred tax assets
and a $4 million increase in our beginning retained earnings as a cumulative effect of change in accounting
principle.
Refer to Note 8 for additional information about our unrecognized tax benefits.
Reclassifications
Statements of Cash Flows — As a result of an increase in the significance of certain non-cash expenses, we
have elected to separately identify the effects of “Interest accretion on landfill liabilities,” “Interest accretion on and
discount rate adjustments to environmental remediation liabilities and recovery assets” and “Equity-based com-
pensation expense” within the “Cash flows from operating activities” section of our Consolidated Statements of
Cash Flows. We have made reclassifications in our 2007 and 2006 Consolidated Statements of Cash Flows to
conform prior year information with our current period presentation.
Segments — During the second quarter of 2008, we moved certain Canadian business operations from the
Western Group to the Midwest Group to facilitate improved business execution. We have reflected the impact of this
change for all periods presented to provide financial information that consistently reflects our current approach to
managing our operations. Refer to Note 20 for further discussion about our reportable segments.
Certain other minor reclassifications have been made to our prior period consolidated financial information in
order to conform to the current year presentation.
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WASTE MANAGEMENT, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)