Windstream 2012 Annual Report Download - page 57

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Annex A to Windstream 2012 Proxy Statement
Reconciliation of non-GAAP to GAAP financial measures
In addition to financial results reported in accordance with generally accepted accounting principles (“GAAP”), we
sometimes utilize non-GAAP financial results to aid in determining payout under the short term incentive
compensation plan. Adjusted revenue was used as one of the components of the short term incentive plan for 2012.
Adjusted Revenue was chosen as the performance metric for this purpose in lieu of total revenue because service
revenue was over 90% of Windstream’s total revenue during 2012 and due to the uncertainty surrounding the FCC’s
inter-carrier compensation reform adopted in December 2011, it was very difficult to accurately estimate target
amounts for wholesale, switched access and USF revenue for the 2012 fiscal year. Management considers this
information in conjunction with GAAP amounts in evaluating business performance. These non-GAAP financial
measures should not be considered as a substitute for, or superior to, the measures of financial performance prepared
in accordance with GAAP.
($ in millions)
Total revenues and sales (As reported-GAAP) $ 6,156
Less:
Wholesale (As reported-GAAP) 708
Other Service (As reported-GAAP) 266
Product sales (As reported-GAAP) 231
Adjusted Revenue $ 4,951