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CLEAR CHANNEL CAPITAL I, LLC AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
As permitted by the rules and regulations of the Securities and Exchange Commission (the “SEC”), the financial statements and
related footnotes included in Item 8 of Part II of this Annual Report on Form 10-K are those of Clear Channel Capital I, LLC (the
“Company” or the “Parent Company”), the direct parent of Clear Channel Communications, Inc., a Texas corporation (“Clear
Channel” or “Subsidiary Issuer”), and contain certain footnote disclosures regarding the financial information of Clear Channel and
Clear Channel’s domestic wholly-owned subsidiaries that guarantee certain of Clear Channel’s outstanding indebtedness.
Nature of Business
The Company is a limited liability company organized under Delaware law, with all of its interests being held by Clear Channel
Capital II, LLC, a direct, wholly owned subsidiary of CC Media Holdings, Inc. (“CCMH”). CCMH was formed in May 2007 by
private equity funds sponsored by Bain Capital Partners, LLC and Thomas H. Lee Partners, L.P. (together, the “Sponsors”) for the
purpose of acquiring the business of Clear Channel. The acquisition was completed on July 30, 2008 pursuant to the Agreement and
Plan of Merger, dated November 16, 2006, as amended on April 18, 2007, May 17, 2007 and May 13, 2008 (the “Merger
Agreement”).
Clear Channel is a wholly-owned subsidiary of the Company. Upon the consummation of the merger, CCMH became a public
company and Clear Channel was no longer a public company. Prior to the acquisition, the Company had not conducted any activities,
other than activities incident to its formation and in connection with the acquisition, and did not have any assets or liabilities, other
than as related to the acquisition. Subsequent to the acquisition, Clear Channel became a direct, wholly-owned subsidiary of the
Company and the business of the Company became that of Clear Channel and its subsidiaries. As a result, all of the operations of the
Company are conducted by Clear Channel.
The Company’s reportable operating segments are Media and Entertainment (“CCME”, formerly known as the Radio segment),
Americas outdoor advertising (“Americas outdoor” or “Americas outdoor advertising”), and International outdoor advertising
(“International outdoor” or “International outdoor advertising”). The CCME segment provides media and entertainment services via
broadcast and digital delivery. The Americas outdoor and International outdoor segments provide outdoor advertising services in their
respective geographic regions using various digital and traditional display types. Included in the “Other” segment are the Company’s
media representation business, Katz Media Group, as well as other general support services and initiatives, which are ancillary to its
other businesses.
Use of Estimates
The preparation of the consolidated financial statements in conformity with U.S. generally accepted accounting principles (“GAAP”)
requires management to make estimates, judgments, and assumptions that affect the amounts reported in the consolidated financial
statements and accompanying notes including, but not limited to, legal, tax and insurance accruals. The Company bases its estimates
on historical experience and on various other assumptions that are believed to be reasonable under the circumstances. Actual results
could differ from those estimates.
Principles of Consolidation
The consolidated financial statements include the accounts of the Company and its subsidiaries. Also included in the consolidated
financial statements are entities for which the Company has a controlling financial interest or is the primary beneficiary. Investments
in companies in which the Company owns 20 percent to 50 percent of the voting common stock or otherwise exercises significant
influence over operating and financial policies of the Company are accounted for using the equity method of accounting. All
significant intercompany accounts have been eliminated in consolidation.
Certain prior period amounts have been reclassified to conform to the 2011 presentation.
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