Description of Business, Basis of Presentation and Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2014 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Reclassifications [Policy Text Block] | Reclassifications |
Advertising revenues and other revenues have been combined for all periods into a single advertising and other revenues line on the consolidated statements of comprehensive income, given the immateriality of other revenues to total revenues for all periods presented. |
Basis of Consolidation [Policy Text Block] | Basis of Consolidation |
The consolidated financial statements include 100% of the assets, liabilities, revenues, expenses and cash flows of AOL and all voting interest entities in which AOL has a controlling voting interest (“subsidiaries”) and variable interest entities in which AOL is the primary beneficiary in accordance with the consolidation accounting guidance. Intercompany accounts and transactions between consolidated companies have been eliminated in consolidation. The consolidated balances of the Company’s variable interest entities are not material to the Company’s consolidated financial statements for the periods presented. |
The financial position and operating results of the majority of AOL’s foreign operations are consolidated using the local currency as the functional currency. Local currency assets and liabilities are translated at the rates of exchange on the balance sheet date, and local currency revenues and expenses are translated at average rates of exchange during the period. Resulting translation gains or losses are included on the consolidated balance sheets as a component of accumulated other comprehensive income (loss), net and on the consolidated statements of comprehensive income as a component of other comprehensive income (loss), net of tax. |
Redeemable Noncontrolling Interest [Policy Text Block] | Redeemable Noncontrolling Interest |
The noncontrolling interest in a joint venture between Mitsui & Company Ltd. and AOL (“Ad.com Japan”) is classified outside of permanent equity on the Company’s consolidated balance sheets for the years ended December 31, 2014 and 2013, due to a redemption right available to the noncontrolling interest holder in the future. The noncontrolling interest holder’s right to redeem its stock is exercisable any time between July 1 and July 30 of any year, commencing with July 1, 2014. This right was not exercised during July 2014. Net income on the consolidated statements of comprehensive income reflects 100% of the results of Ad.com Japan for the years ended December 31, 2014, 2013 and 2012 as the Company has a controlling financial interest in the entity. Net income is subsequently adjusted to exclude AOL’s noncontrolling interests to arrive at net income attributable to AOL Inc. |
Use of Estimates [Policy Text Block] | Use of Estimates |
The preparation of the 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 footnotes thereto. Actual results could differ from those estimates. Significant estimates inherent in the preparation of the consolidated financial statements include asset impairments, reserves established for doubtful accounts, equity-based compensation, depreciation and amortization, business combinations, income taxes, litigation matters and contingencies. |
Revenue Recognition, Policy [Policy Text Block] | Revenues |
The Company generates revenue primarily from advertising and from its subscription services. Revenue is recognized when persuasive evidence of an arrangement exists, performance under the contract has begun, the contract price is fixed or determinable and collectability of the related fee is reasonably assured. |
Advertising Revenues |
Advertising revenues are generated on AOL Properties through display advertising (which includes video advertising) and search advertising. Display advertising revenue is generated by the display of graphical advertisements and other performance-based advertising. Agreements for advertising on AOL Properties typically take the forms of impression-based contracts, time-based contracts or performance-based contracts. Search advertising revenue is generated when a consumer clicks on a text-based advertisement on their screen. These text-based advertisements are either generated from a consumer-initiated search query or generated based on the content of the web page the consumer is viewing. In addition to advertising revenues generated on AOL Properties, the Company also generates revenue from its advertising offerings on its Third Party Properties, which consist primarily of the sale of display advertising and also include search advertising. Advertising arrangements for the sale of Third Party Properties inventory typically take the form of impression-based contracts or performance-based contracts. |
Advertising revenues derived from impression-based contracts, in which AOL provides impressions in exchange for a fixed fee (generally stated as cost-per-thousand impressions), are generally recognized as the impressions are delivered. An “impression” is delivered when an advertisement appears in web pages viewed by users. Revenues derived from time-based contracts, in which AOL provides promotion over a specified time period for a fixed fee, are recognized on a straight-line basis over the term of the contract, provided that AOL is meeting and will continue to meet its obligations under the contract (e.g., delivery of impressions over the term of the contract). Advertising revenues derived from contracts where AOL is compensated based on certain performance criteria are recognized as AOL completes the contractually specified performance. Performance is measured in terms of either “click-throughs” when a user clicks on a company’s advertisement or other user actions such as product/customer registrations, survey participation, sales leads, product purchases or other revenue sharing relationships. |
Revenue Recognition Accounting Policy, Gross and Net Revenue Disclosure [Policy Text Block] | Gross versus Net Revenue Recognition |
In the normal course of business, the Company sometimes acts as or uses an intermediary or agent in executing transactions with third parties. The determination of whether revenue should be reported gross or net is based on an assessment of whether the Company is acting as the principal or an agent in the transaction. If the Company is acting as the principal in a transaction, the Company reports revenue on a gross basis. If the Company is acting as an agent in a transaction, the Company reports revenue on a net basis. In determining whether the Company acts as the principal or an agent, the Company follows the accounting guidance for principal-agent considerations and the Company places the most weight on whether or not the Company is the primary obligor in the arrangement. |
Revenue Recognition, Multiple-deliverable Arrangements, Description [Policy Text Block] | Multiple-Element Transactions |
Management analyzes contracts with multiple elements under the accounting guidance for multiple-element arrangements. The Company’s multiple-element arrangements generally include online advertising and non-advertising (i.e., insertion orders and production of a “microsite”) and involve multiple deliverables to customers across AOL Properties and/or the Third Party Properties. The guidance requires that revenue arrangements with multiple deliverables should be divided into separate units of accounting if the deliverables in the arrangement have value to the customer on a standalone basis, and if the delivery of the undelivered items in the arrangement is considered probable and substantially in the control of the vendor. If these criteria are met, then the arrangement consideration is allocated among the separate units of accounting based on their relative estimated selling prices. In such circumstances, the Company uses a selling price hierarchy to determine the selling price to be used for allocating revenue to the deliverables: (i) vendor-specific objective evidence of fair value (“VSOE”), (ii) third-party evidence of selling price, and (iii) best estimate of the selling price (“BESP”). VSOE generally exists only when the Company sells the deliverable separately and VSOE is the price actually charged by the Company for that deliverable. BESPs reflect the Company’s best estimates of what the selling prices of deliverables would be if they were sold regularly on a stand-alone basis. The Company recognizes revenue from the provision of online advertising and non-advertising contracts when the advertising campaigns and the productions are delivered. |
If the deliverables cannot be separated into multiple units of accounting, then the arrangement is accounted for as a combined unit of accounting and recognized into revenue based on the lower of (i) performance or (ii) straight-line as calculated in aggregate for the entire deal. Straight-line revenue recognition is determined by taking the total sold value of all deal components and recognizing that value evenly over the entire deal term. |
Revenue Recognition, Sales of Services [Policy Text Block] | Subscription Revenues |
The Company earns revenue from its subscription services in the form of monthly or annual fees paid by subscribers to its service offerings, and such revenues are recognized on a straight-line basis as the service is provided. |
Revenue Recognition, Customer Acquisitions [Policy Text Block] | Traffic Acquisition Costs |
AOL incurs costs through arrangements in which it acquires third-party online advertising inventory for resale and arrangements whereby partners direct traffic to AOL Properties (e.g., UV acquisitions). AOL considers these costs to be traffic acquisition costs (“TAC”). TAC arrangements have a number of different economic structures, the most common of which are: payments based on a cost per thousand impressions or based on a percentage of the ultimate advertising revenues generated from the advertising inventory acquired for resale and payments for direct traffic delivered to AOL Properties priced on a per click basis (e.g., search engine marketing fees). These arrangements are primarily on a variable basis; however, the arrangements can also be on a fixed-fee basis, which often carry reciprocal performance guarantees by the counterparty, or a combination of fixed and variable fees. TAC agreements with fixed payments are typically expensed ratably over the term of the agreement. TAC agreements with variable payments are typically expensed based on the volume of the underlying activity at the specified contractual rates. TAC agreements with a combination of a fixed fee for a minimum amount of traffic delivered or other underlying activity and variable payments for delivery or performance in excess of the minimum are typically recognized into expense at the greater of straight-line or actual performance, taking into account counterparty performance to date and the projected counterparty performance over the term of the agreement. |
Costs Associated with Exit or Disposal Activities or Restructurings, Policy | Restructuring Costs |
Restructuring costs consist primarily of employee termination benefits and contract termination costs, including lease exit costs. The Company’s restructuring actions include one-time involuntary termination benefits as well as certain contractual termination benefits or employee terminations under ongoing benefit arrangements. One-time involuntary termination benefits are recognized as a liability at estimated fair value when the plan of termination has been communicated to employees and certain other criteria are met. Ongoing termination benefit arrangements are recognized as a liability at estimated fair value when it is probable that amounts will be paid to employees and such amounts are reasonably estimable. Contract termination costs are recognized as a liability at fair value when a contract is terminated in accordance with its terms, or when AOL has otherwise executed a written termination of the contract. When AOL ceases using a facility but does not intend to or is unable to terminate the operating lease, AOL records a liability for the present value of the remaining lease payments, net of estimated sublease income, if any, that could be reasonably obtained for the property (even if the Company does not intend to sublease the facility for the remaining term of the lease). Costs associated with exit or disposal activities, including the related one-time and ongoing involuntary termination benefits, are reflected as restructuring costs on the consolidated statements of comprehensive income. See “Note 9” for additional information about the Company’s restructuring activities. |
Share-based Compensation, Option and Incentive Plans Policy [Policy Text Block] | Equity-Based Compensation |
AOL records compensation expense under AOL’s equity-based compensation incentive plans based on the equity awards granted to employees. |
In accounting for equity-based compensation awards, the Company follows the accounting guidance for equity-based compensation, which requires that a company measure the cost of employee services received in exchange for an award of equity instruments based on the grant-date fair value of the award. The cost associated with stock options is estimated using the Black-Scholes option-pricing model. The cost of equity instruments granted to employees is recognized in the consolidated statements of comprehensive income on a straight-line basis (net of estimated forfeitures) over the period during which an employee is required to provide service in exchange for the award. The Company begins recording equity-based compensation expense related to employee awards with performance conditions when it is considered probable that the performance conditions will be met. See “Note 8” for additional information on equity-based compensation. |
Goodwill and Intangible Assets, Goodwill, Policy [Policy Text Block] | Asset Impairments |
Goodwill |
Goodwill is tested annually for impairment during the fourth quarter or earlier upon the occurrence of certain events or substantive changes in circumstances that indicate goodwill is more likely than not impaired. These indicators include a sustained, significant decline in the Company’s stock price; a decline in its expected future cash flows; significant disposition activity; a significant adverse change in the economic or business environment; and the testing for recoverability of a significant asset group, among others. The occurrence of these indicators could have a significant impact on the recoverability of goodwill and could have a material impact on the Company’s consolidated financial statements. |
The testing of goodwill for impairment is required to be performed at the level referred to as the reporting unit. During 2014, the Company had three reporting units for purposes of the goodwill impairment test; the Brand Group, the Membership Group and AOL Platforms. |
Goodwill impairment is determined using a two-step process. The first step involves a comparison of the estimated fair value of a reporting unit to its carrying amount, including goodwill. If the estimated fair value of a reporting unit exceeds its carrying amount, goodwill of the reporting unit is not impaired and the second step of the impairment test is not necessary. If the carrying amount of a reporting unit exceeds its estimated fair value, then the second step of the goodwill impairment test must be performed. To measure the amount of impairment loss, if any, AOL determines the implied fair value of goodwill in the same manner as the amount of goodwill recognized in a business combination. Specifically, the estimated fair value of the reporting unit is allocated to all of the assets and liabilities of that unit (including any unrecognized intangible assets) as if the reporting unit had been acquired in a business combination and the fair value of the reporting unit was the price paid to acquire the reporting unit. If the carrying amount of the reporting unit’s goodwill exceeds the implied fair value of that goodwill, an impairment loss is recognized in an amount equal to that excess. |
See “Note 3” for more information on the goodwill impairment testing for 2014. |
Impairment or Disposal of Long-Lived Assets, Policy [Policy Text Block] | Long-lived Assets |
Long-lived assets, including finite-lived intangible assets (e.g., acquired technology and customer relationships), do not require that an annual impairment test be performed; instead, long-lived assets are tested for impairment upon the occurrence of an indicator of potential impairment. Once an indicator of potential impairment has occurred, the impairment test is based on whether the intent is to hold the asset for continued use or to hold the asset for sale. If the intent is to hold the asset for continued use, the impairment test first requires a comparison of estimated undiscounted future cash flows generated by the asset group against the carrying value of the asset group. The Company groups long-lived assets for purposes of recognition and measurement of an impairment loss at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. If the carrying value of the asset group exceeds the estimated undiscounted future cash flows, the asset group would be deemed to be potentially impaired. Impairment, if any, would then be measured as the difference between the estimated fair value of the asset and its carrying value. Fair value is generally determined by discounting the future cash flows associated with that asset group. If the intent is to hold the asset group for sale and certain other criteria are met (i.e., the asset group can be disposed of currently, appropriate levels of authority have approved the sale and there is an active program to locate a buyer), the impairment test involves comparing the asset group’s carrying value to its estimated fair value less estimated costs of disposal. To the extent the carrying value is greater than the asset group’s estimated fair value less estimated costs of disposal, an impairment loss is recognized for the difference. |
AOL recorded non-cash asset impairments and write-offs related to long-lived assets held and used and held for sale of $13.6 million, $12.1 million and $4.9 million in 2014, 2013 and 2012, respectively, included in costs of revenues and general and administrative expense on the consolidated statements of comprehensive income. The charge recorded in 2014 related primarily to asset write-offs in connection with capitalized internal-use software projects. The charge recorded in 2013 included a $7.5 million charge related to internal-use software related to Patch. The charge recorded in 2012 related primarily to asset write-offs in connection with facility consolidation, computer retirements and capitalized internal-use software project terminations. |
Income Tax, Policy [Policy Text Block] | Income Taxes |
Income taxes are presented on the consolidated financial statements using the asset and liability method prescribed by the accounting guidance for income taxes. Income taxes (e.g., deferred tax assets, deferred tax liabilities, taxes currently payable/refunds receivable and tax expense) are recorded based on amounts refundable or payable in the current year and include the deferred income tax effects of temporary differences between the carrying amounts of assets and liabilities and their tax bases, stated at enacted tax rates expected to be in effect when the taxes are actually paid or recovered. Deferred income taxes reflect expected future tax benefits (i.e., assets) and future tax costs (i.e., liabilities). The tax effect of net operating loss, capital loss and general business credit carryovers result in deferred tax assets. Valuation allowances are established when management determines it is “more likely than not” that some portion or all of the deferred tax asset may not be realized. The Company considers all positive and negative evidence in evaluating its ability to realize its deferred income tax assets, including its historical operating results, ongoing tax planning, and forecast of future taxable income, on a jurisdiction by jurisdiction basis. |
With respect to uncertain tax positions, AOL recognizes in the consolidated financial statements those tax positions determined to be “more likely than not” of being sustained upon examination, based on the technical merits of the positions. AOL records a liability (or reduces deferred tax assets) for the difference between the benefit recognized and measured pursuant to the accounting guidance for income taxes and the tax position taken on its tax return. The Company adjusts its estimates for uncertain tax positions periodically because of ongoing examinations by, and settlements with, the various taxing authorities, as well as changes in tax laws, regulations and interpretations. The consolidated tax provision for any given year includes adjustments to prior year income tax accruals that are considered appropriate and any related estimated interest. The Company’s policy is to recognize, when applicable, interest and penalties on uncertain tax positions as part of income tax expense. |
Concentration Risk, Credit Risk, Policy [Policy Text Block] | Certain Risks and Concentrations |
The Company’s financial instruments include primarily cash and equivalents, accounts receivable, accounts payable, accrued expenses and other current liabilities. Due to the short-term nature of these assets and liabilities, their carrying amounts approximate their fair value. Financial instruments that potentially subject the Company to concentrations of credit risk are primarily cash and accounts receivable. |
The Company maintains its cash and equivalents balances in the form of money market accounts, U.S. treasury bills and time deposits. The Company maintains cash deposits with banks that at times exceed applicable insurance limits. The Company reduces its exposure to credit risk by maintaining such deposits with high quality financial institutions that management believes are creditworthy. |
The Company is also exposed to counterparty credit risk as a result of the note hedge transactions. Upon default by the option counterparty, the Company may suffer dilution and tax consequences with respect to its common stock. |
The Company’s exposure to customer credit risk relates primarily to advertising customers and individual subscribers to AOL’s subscription services, and is dispersed among many different counterparties, with no single customer having a receivable balance in excess of 10% of total net receivables at December 31, 2014 or 2013. |
For each of the periods presented herein, the Company has had a contractual relationship with Google Inc. (“Google”) whereby Google provides paid text-based search advertising on AOL Properties. For the years ended December 31, 2014, 2013 and 2012, the revenues associated with the Google relationship (substantially all of which were search revenues generated on AOL Properties), were $407.4 million, $373.3 million and $350.9 million, respectively. |
Cash and Cash Equivalents, Policy [Policy Text Block] | Cash and Equivalents |
Cash equivalents primarily consist of highly liquid short-term investments with an original maturity of three months or less, which include money market accounts, U.S. treasury bills and time deposits that are readily convertible into cash. Cash equivalents are carried at cost plus accrued interest, which approximates fair value. These are included within cash and equivalents and fall within level one of the GAAP fair value hierarchy. |
Cash and Cash Equivalents, Restricted Cash and Cash Equivalents, Policy [Policy Text Block] | Restricted Cash |
Restricted cash includes posted cash collateral for letters of credit related to certain of the Company’s lease agreements. The collateral amounts are legally restricted as to withdrawal and use for a period in excess of twelve months. Also included in restricted cash are security deposits held by the Company from lessees that are restricted as to use. The Company had $9.0 million of restricted cash included in prepaid expenses and other current assets and other long-term assets on the consolidated balance sheet as of December 31, 2014. |
Receivables, Trade and Other Accounts Receivable, Allowance for Doubtful Accounts, Policy [Policy Text Block] | Allowance for Doubtful Accounts |
AOL’s receivables consist primarily of two components, receivables from individual subscribers to AOL’s subscription services and receivables from advertising customers. Management performs separate evaluations of these components to determine if the balances will ultimately be fully collected considering management’s views on trends in the overall aging of receivables as well as past collection experience. In addition, for certain advertising receivables, management prepares an analysis of specific risks on a customer-by-customer basis. Using this information, management reserves an amount that is expected to be uncollectible. Receivables are written off when amounts are deemed to be uncollectible and internal collection efforts are closed. |
Property, Plant and Equipment, Policy [Policy Text Block] | Property and Equipment |
Property and equipment are stated at cost. Depreciation, which includes amortization of capitalized software costs and amortization of assets under capital leases, is provided on a straight-line basis over the estimated useful lives of the assets. AOL evaluates the depreciation periods of property and equipment to determine whether events or circumstances warrant revised estimates of useful lives. Depreciation expense, recorded in costs of revenues and general and administrative expense, totaled $134.7 million, $128.9 million and $138.7 million for the years ended December 31, 2014, 2013 and 2012, respectively. Costs related to leasehold improvements are capitalized and amortized on a straight-line basis over the shorter of the economic useful life of the improvements or the remaining lease term. |
Property and equipment, including assets under capital lease, consist of ($ in millions): |
|
| | | | | | | | | |
| December 31, | | Estimated Useful Lives |
| 2014 | | 2013 | |
Land (a) | $ | 38.1 | | | $ | 39.2 | | | N/A |
|
Buildings and building improvements | 207.2 | | | 275.6 | | | 12 to 40 years |
|
Capitalized internal-use software costs | 449.1 | | | 434.6 | | | 1 to 5 years |
|
Leasehold improvements | 106.5 | | | 108.6 | | | Up to 16 years |
|
Furniture, fixtures and other equipment | 577.1 | | | 591.5 | | | 1 to 20 years |
|
| 1,378.00 | | | 1,449.50 | | | |
|
Less accumulated depreciation | (914.1 | ) | | (981.6 | ) | | |
Total | $ | 463.9 | | | $ | 467.9 | | | |
|
| | | | | | | | | |
(a) | Land is not depreciated. | | | | | | | | |
Internal Use Software, Policy [Policy Text Block] | Capitalized Internal-Use Software Costs |
AOL capitalizes certain costs incurred for the purchase and development of internal-use software. These costs, which include the costs associated with coding, software configuration, major upgrades and enhancements and are related to both AOL’s internal systems (such as billing and accounting) and AOL’s user-facing internet offerings, are included in property and equipment, net on the consolidated balance sheets. For the years ended December 31, 2014, 2013 and 2012, AOL capitalized $53.9 million, $43.7 million and $40.5 million, respectively, related to the purchase and development of internal-use software. At December 31, 2014 and 2013, the net book value of capitalized internal-use software was $85.3 million and $68.2 million, respectively. |
Research and Development Expense, Policy [Policy Text Block] | Research and Development |
Research and development costs, which are expensed as incurred, are included in costs of revenues and totaled $37.6 million, $40.6 million and $44.8 million for the years ended December 31, 2014, 2013 and 2012, respectively. These costs consist primarily of personnel and related costs that are incurred related to the development of software and user-facing internet offerings that do not qualify for capitalization. |
Lease, Policy [Policy Text Block] | Leases |
The Company leases operating equipment and office space in various locations worldwide. Lease obligations are classified as operating leases or capital leases, as appropriate. Leased equipment and property that meets the capital lease criteria is capitalized and the present value of the future minimum lease payments is recorded as an asset under capital lease with a related capital lease obligation on the consolidated balance sheets. |
Rent expense under operating leases is recognized on a straight-line basis over the lease term taking into consideration scheduled rent increases and any lease incentives. |
Intangible Assets, Finite-Lived, Policy [Policy Text Block] | Intangible Assets |
AOL has a significant number of intangible assets, including acquired technology, trade names and customer relationships. AOL does not recognize the fair value of internally generated intangible assets. Intangible assets acquired in business combinations are recorded at fair value on the Company’s consolidated balance sheets and are amortized over estimated useful lives on a straight-line basis. Intangible assets subject to amortization are tested for impairment whenever events or changes in circumstances indicate that their carrying amount may not be recoverable. AOL does not have any indefinite lived intangible assets other than goodwill. |
Advertising Cost, Policy, Expensed Advertising Cost [Policy Text Block] | Advertising Costs |
The Company expenses advertising costs as they are incurred. Advertising expense was $49.7 million, $61.6 million and $85.8 million for the years ended December 31, 2014, 2013, and 2012, respectively, and is included in general and administrative expense on the consolidated statements of comprehensive income. |
Contingent Liability Reserve Estimate, Policy [Policy Text Block] | Loss Contingencies |
In the normal course of business, the Company is involved in legal proceedings, tax audits (other than income taxes) and other matters that give rise to potential loss contingencies. The Company accrues a liability for such matters when it is probable that a liability has been incurred and the amount of loss can be reasonably estimated. In situations where the Company can determine a best estimate within the range of potential loss, the Company records the best estimate of the potential loss as a liability. In situations where the Company has determined a range of loss, but no amount within the range is a better estimate than any other amount within the range, the Company records the minimum amount of the range of loss as a liability. |
Comprehensive Income, Policy [Policy Text Block] | Other Comprehensive Income (Loss) |
Other comprehensive income (loss) is included within comprehensive income on the consolidated statements of comprehensive income and stockholders’ equity on 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). |
As of December 31, 2014, the Company's net accumulated other comprehensive income balance substantially consisted of foreign currency translation gains and losses. |
Recently Adopted Accounting Standards [Policy Text Block] | Recently Adopted Accounting Standards |
Accounting for Cumulative Translation Adjustments |
In March 2013, new guidance was issued related to accounting for the cumulative translation adjustment upon derecognition of certain subsidiaries or groups of assets within a foreign entity or of an investment in a foreign entity. The new guidance clarifies that companies are required to apply the guidance in the foreign currency accounting subtopic to release any related cumulative translation adjustment into net income. The guidance also applies to step acquisitions. |
The new guidance became effective for us in January 2014. The new guidance does not have a material impact on the way the Company currently releases cumulative translation adjustments into net income upon disposition or deconsolidation of a subsidiary. |
Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists |
In July 2013, new guidance was issued related to the presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. The objective of the new guidance is to eliminate the diversity in financial statement reporting practices by requiring the netting of unrecognized tax benefits against a deferred tax asset for a loss or other carryforward that would apply in settlement of uncertain tax positions. |
The new guidance became effective for the Company in January 2014 and resulted in the offsetting of approximately $32.5 million of uncertain tax positions against deferred tax assets as of December 31, 2014. |