Yahoo 2015 Annual Report Download - page 131

September 30,
2014 2015
Balance sheet data:
Current assets $6,095,559 $6,150,688
Long-term assets $1,973,946 $2,430,699
Current liabilities $1,948,540 $2,003,960
Long-term liabilities $ 35,418 $ 245,834
Noncontrolling interests $ 66,998 $ 165,601
Since acquiring its equity interest in Yahoo Japan, the Company has recorded cumulative earnings in
equity interests, net of dividends received and related taxes on dividends, of $3.3 billion and $3.7
billion as of December 31, 2014 and 2015, respectively.
Under technology and trademark license and other commercial arrangements with Yahoo Japan, the
Company records revenue from Yahoo Japan based on a percentage of advertising revenue earned
by Yahoo Japan. The Company recorded revenue from Yahoo Japan of approximately $264 million,
$253 million, and $228 million, respectively, for the years ended December 31, 2013, 2014, and 2015.
As of December 31, 2014 and 2015, the Company had net receivable balances from Yahoo Japan of
approximately $47 million and $37 million, respectively.
Alibaba Group
Equity Investment in Alibaba Group. Prior to the closing of the Alibaba Group IPO in September
2014, the Company’s investment in Alibaba Group was accounted for using the equity method, and
the total investment, including net tangible assets, identifiable intangible assets, and goodwill, was
classified as part of investments in equity interests balance on the Company’s consolidated balance
sheets. Prior to the Alibaba Group IPO, the Company recorded its share of the results of Alibaba
Group one quarter in arrears within earnings in equity interests in the consolidated statements of
operations, including any related tax impacts related to the earnings in equity interest.
Technology and Intellectual Property License Agreement. As a result of the Alibaba Group IPO,
Alibaba Group’s obligation to make royalty payments under the TIPLA ceased on September 24, 2014
and the Company’s recognition of the remaining TIPLA deferred revenue was completed on
September 18, 2015. The Company recognized approximately $259 million, $281 million and $199
million for the years ended December 31, 2013, 2014 and 2015, respectively, related to the TIPLA.
Note 9 Foreign Currency Derivative Financial Instruments
The Company uses derivative financial instruments, primarily forward contracts and option contracts,
to mitigate risk associated with adverse movements in foreign currency exchange rates.
The Company records all derivatives in the consolidated balance sheets at fair value, with assets
included in prepaid expenses and other current assets or other long-term assets, and liabilities
included in accrued expenses and other current liabilities or other long-term liabilities. The
Company’s accounting treatment for these instruments is based on whether or not the instruments
are designated as a hedging instrument. The effective portions of net investment hedges are
recorded in other comprehensive income as a part of the cumulative translation adjustment. The
effective portions of cash flow hedges are recorded in accumulated other comprehensive income
until the hedged item is recognized in revenue on the consolidated statements of operations when
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