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Table of Contents
AOL INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
being disposed of (as well as any gain or loss on the disposal transaction) are aggregated for separate presentation apart from continuing operating results of
the Company in the consolidated financial statements. See "Note 4" for additional information.
Other Comprehensive Income (Loss)
Other comprehensive income (loss) is included within stockholders' equity in the consolidated balance sheets and consists of net income (loss) and
other gains and losses affecting equity that, under GAAP, are excluded from net income (loss). For AOL, such items consist primarily of foreign currency
translation gains (losses). The following table sets forth other comprehensive income (loss), net of tax, accumulated in stockholders' equity (in millions):
Foreign currency
translation gains
(losses)
Net derivative
financial
instrument
gains (losses)
Net accumulated
other
comprehensive
income (loss)
Balance at December 31, 2008 $ (303.1) $ 0.7 $ (302.4)
2009 activity 28.0 (0.7) 27.3
Balance at December 31, 2009 (275.1) — (275.1)
2010 activity (12.8) — (12.8)
Balance at December 31, 2010 (287.9) — (287.9)
2011 activity 0.4 — 0.4
Balance at December 31, 2011 $ (287.5) $ — $ (287.5)
Recent Accounting Standards
Multiple-Deliverable Revenue Arrangements
In October 2009, new guidance was issued related to the accounting for multiple-deliverable revenue arrangements. This new guidance amends the
existing guidance for allocating consideration in multiple-deliverable arrangements and establishes a selling price hierarchy for determining the selling price
of a deliverable. This new guidance was effective prospectively for revenue arrangements entered into or materially modified beginning on January 1, 2011.
The Company reviewed its revenue arrangements and determined the types of arrangements that could be impacted by this new guidance. The
Company concluded that performance-method arrangements, which are the substantial majority of its arrangements, do not have multiple deliverables as the
Company is providing a single online advertising deliverable. The revenue arrangements impacted by the guidance generally consist of arrangements where
the Company is providing online advertising as well as non-advertising elements (i.e., production of a "micro-site"). However, the Company currently does
not enter into a significant number of these arrangements. The adoption did not have material impact on the Company's financial statements for the year ended
December 31, 2011.
NOTE 2—INCOME (LOSS) PER COMMON SHARE
Basic income per common share is calculated by dividing net income by the weighted average number of shares of common stock issued and
outstanding during the reporting period. Diluted income per common share is calculated to give effect to all potentially dilutive common shares that were
outstanding during the reporting period. The dilutive effect of outstanding equity-based compensation awards is reflected in diluted income per common share
by application of the treasury stock method, only in periods in which such effect would have been dilutive for the period.
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