iHeartMedia 2009 Annual Report Download - page 114

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The Company’s available-for-sale security, Independent News & Media PLC (“INM”), was in an unrealized loss position for an
extended period of time in 2008 and 2009. As a result, the Company considered the guidance in ASC 320-10-S99 and reviewed the
length of the time and the extent to which the market value was less than cost and the financial condition and near-term prospects of
the issuer. After this assessment, the Company concluded that the impairment was other than temporary and recorded a non-cash
impairment charge of $11.3 million and $59.8 million in “Gain (loss) on marketable securities” for the year ended December 31, 2009
and 2008, respectively.
In addition, the fair value of the Company’s available-for-sale security, Sirius XM Radio, Inc., was below its cost for an extended
period of time in 2008. After considering ASC 320-10-S99 guidance, the Company concluded that the impairment was other than
temporary and recorded a non-cash impairment charge of $56.7 million in “Gain (loss) on marketable securities” for the year ended
December 31, 2008.
Clear Channel sold its American Tower Corporation securities in the second quarter of 2008 and recorded a gain of $30.4 million on
the statement of operations in “Gain (loss) on marketable securities”.
Other cost investments include various investments in companies for which there is no readily determinable market value.
NOTE F - ASSET RETIREMENT OBLIGATION
The Company’s asset retirement obligation is reported in “Other long-term liabilities” and relates to its obligation to dismantle and
remove outdoor advertising displays from leased land and to reclaim the site to its original condition upon the termination or non-
renewal of a lease. When the liability is recorded, the cost is capitalized as part of the related long-lived assets’ carrying value. Due to
the high rate of lease renewals over a long period of time, the calculation assumes that all related assets will be removed at some
period over the next 50 years. An estimate of third-party cost information is used with respect to the dismantling of the structures and
the reclamation of the site. The interest rate used to calculate the present value of such costs over the retirement period is based on an
estimated risk adjusted credit rate for the same period.
The following table presents the activity related to the Company’s asset retirement obligation:
109
(In thousands)
Post-Merger
Year ended
December 31, 2009
Post-Merger
Period ended
December 31, 2008
Pre-Merger
Period ended
July 30, 2008
Beginning balance
$ 55,592
$ 59,278
$ 70,497
Adjustment due to change in estimate of related costs
(6,721) (3,123)
1,853
Accretion of liability
5,209
2,233
3,084
Liabilities settled
(2,779)
(2,796)
(2,558)
Ending balance
$ 51,301
$ 55,592
$ 72,876