Basis of Presentation and Summary of Significant Accounting Policies (Tables)

3 Months Ended

Mar. 31, 2018

Organization, Consolidation and Presentation of Financial Statements [Abstract]

The following table sets forth the gross carrying amount and accumulated depreciation of the Company’s subscriber system assets as of March 31, 2018 and December 31, 2017.



(in thousands)	March 31, 2018			December 31, 2017
Gross carrying amount	$	3,891,719		$	3,762,905
Accumulated depreciation	(1,001,074		)	(870,222		)
Subscriber system assets, net	$	2,890,645		$	2,892,683

Schedule of Accrued Liabilities

Accrued expenses and other current liabilities as of March 31, 2018 and December 31, 2017 consisted of the following:



(in thousands)	March 31, 2018		December 31, 2017
Accrued interest	$	144,905	$	91,592
Payroll-related accruals	63,972		94,501
Other accrued liabilities	201,769		165,247
Total accrued expenses and other current liabilities	$	410,646	$	351,340

Schedule of Carrying Values and Estimated Fair Values of Debt Instruments and Securities

The carrying values and fair values of the Company’s debt and Koch Preferred Securities that are subject to fair value disclosures as of March 31, 2018 and December 31, 2017 were as follows:



	March 31, 2018				December 31, 2017
(in thousands)	Carrying Value		Fair Value		Carrying Value		Fair Value
Debt instruments, excluding capital lease obligations	$	9,537,663	$	9,914,144	$	10,128,020	$	10,868,626
Koch Preferred Securities	$	708,111	$	942,500	$	682,449	$	924,700

Impact of New Accounting Pronouncements on Financial Statements

The impact to the lines items in the Condensed Consolidated Balance Sheet were as follows:



	Balance at			Revenue Standard Adoption Adjustment		Balance at
(in thousands)	December 31, 2017			Revenue Standard Adoption Adjustment		January 1, 2018
Assets
Prepaid expenses and other current assets	$	73,358		$	6,615	$	79,973
Deferred subscriber acquisition costs, net	282,478			33,380		315,858
Other assets	123,967			6,321		130,288

Liabilities
Deferred tax liabilities	1,376,708			11,886		1,388,594

Stockholders' Equity
Accumulated deficit	(998,212		)	34,430		(963,782		)

The impact from the adoption of the new revenue standard on the Company’s condensed consolidated financial statements as of and for the three months ended March 31, 2018 was as follows:



				Balances without			Effect of Adoption
Statement of Operations (in thousands)	As Reported			Adoption of Standard			Increase / (Decrease)
Monitoring and related services	$	1,017,292		$	1,018,650		$	(1,358	)
Installation and other	99,156			97,277			1,879
Total revenue	1,116,448			1,115,927			521
Cost of revenue (exclusive of depreciation and amortization shown separately below)	248,394			248,394			—
Selling, general and administrative expenses⁽¹⁾	304,970			311,211			(6,241		)
Depreciation and intangible asset amortization	483,676			483,676			—
Merger, restructuring, integration, and other costs	8,023			8,023			—
Operating income	71,385			64,623			6,762
Interest expense, net	(174,333		)	(174,333		)	—
Loss on extinguishment of debt	(61,597		)	(61,597		)	—
Other (expense) income	(460		)	(460		)	—
Loss before income taxes	(165,005		)	(171,767		)	6,762
Income tax benefit	7,568			9,225			(1,657		)
Net loss	$	(157,437	)	$	(162,542	)	$	5,105

_________________


(1)	Included in the effect of adoption is approximately $5 million associated with non-cash amortization expense of deferred subscriber acquisition costs.



				Balances without			Effect of Adoption
Balance Sheet (in thousands)	As Reported			Adoption of Standard			Increase / (Decrease)
Assets
Prepaid expenses and other current assets	$	102,349		$	95,108		$	7,241
Deferred subscriber acquisition costs, net	342,913			302,947			39,966
Other assets	131,988			126,117			5,871

Liabilities
Deferred tax liabilities	1,381,723			1,368,180			13,543

Stockholders' Equity
Accumulated deficit	(1,148,059		)	(1,187,594		)	39,535

Schedule of Cash and Cash Equivalents

The following table provides a reconciliation of the amount of cash, cash equivalents, and restricted cash reported within the Condensed Consolidated Balance Sheets to the total of the same such amounts shown in the Condensed Consolidated Statements of Cash Flows:



(in thousands)	March 31, 2018		December 31, 2017
Cash and cash equivalents	$	258,195	$	122,899
Current portion of restricted cash and cash equivalents	3,883		3,883
Noncurrent restricted cash and cash equivalents	750,000		—
Total cash, cash equivalents, and restricted cash at the end of period	$	1,012,078	$	126,782