Charter 2009 Annual Report Download - page 78

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CCH II, LLC AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2009, 2008, AND 2007
(dollars in millions, except where indicated)
F-30
The Company’ s long-term debt was adjusted to fair value on the Effective Date. Debt instruments with a fair value
of $9.8 billion were classified as level 1 within the fair value hierarchy and debt instruments with a fair value of $3.5
billion were classified as level 2 in the fair value hierarchy.
Nonfinancial Assets and Liabilities
The Company adopted new accounting guidance effective January 1, 2009 with respect to its nonfinancial assets and
liabilities including fair value measurements of franchises, property, plant, and equipment, and other intangible
assets. These assets are not measured at fair value on a recurring basis; however they are subject to fair value
adjustments in certain circumstances, such as when there is evidence that an impairment may exist. During 2009,
the Company recorded an impairment on its franchise assets of $2.2 billion and reflected its franchises, property,
plant and equipment, customer relationships and goodwill at fair value based on applying fresh start accounting.
The fair value of these assets was determined utilizing an income approach or cost approach that makes use of
significant unobservable inputs. Such fair values are classified as level 3 in the fair value hierarchy. See Note 6 for
additional information.
15. Other Operating (Income) Expenses, Net
Other operating (income) expenses, net consist of the following for the years presented:
Successor Predecessor
One Month
Ended
December 31,
Eleven Months
Ended
November 30,
Year Ended
December 31,
2009 2009 2008 2007
(Gain) loss on sale of assets, net $ 1 $ 6 $ 13 $ (3)
Special charges, net 3 (44) 56 (14)
$ 4 $ (38) $ 69 $ (17)
(Gain) loss on sale of assets, net
(Gain) loss on sale of assets represents the (gain) loss recognized on the sale of fixed assets and cable systems.
Special charges, net
Special charges, net for one month ended December 31, 2009 primarily includes severance charges. Special
charges, net for the eleven months ended November 30, 2009 primarily includes gains related to favorable litigation
settlements. Special charges, net for the year ended December 31, 2008 includes severance charges and settlement
costs associated with certain litigation, offset by favorable insurance settlements. Special charges, net for the year
ended December 31, 2007, primarily represents favorable litigation settlements offset by severance associated with
the closing of call centers and divisional restructuring.
16. Reorganization Items, Net
Reorganization items, net is presented separately in the condensed consolidated statements of operations and represents
items of income, expense, gain or loss that are realized or incurred by the Company because it was in reorganization
under Chapter 11 of the U.S. Bankruptcy Code.