NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES
Zapata Corporate's increase in net cash provided by operating activities
during 2001 as compared to 2000 was primarily due to the termination of
operations at Charged Productions during December 2000, partially offset by a
reduction in interest income during 2001.
Zapata Corporate's cash used in operating activities decreased during 2000
as compared to 1999 primarily due to an increase in interest income during 2000
as compared to 1999, and a decrease in funding of Charged Productions during
2000 as compared to 1999.
NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES
Zapata Corporate's net cash provided by investing activities increased
during 2001 as compared to 2000 primarily due to the reduction in purchases of
short-term investments, the increase in proceeds from maturities of short-term
investments, and the lack of purchases of non-investment grade securities during
2001 as compared to 2000.
Zapata Corporate's net cash used in investing activities decreased during
2000 as compared to 1999 primarily due to the lack of proceeds from the
maturities of short-term investments during 1999 as compared to 2000, partially
offset by the purchase of long-term investments during 2000.
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES
Zapata Corporate had no cash provided by (used in) financing activities
during 2001 or 2000.
Zapata Corporate's net cash used in financing activities during 1999 was
primarily due to its capital contribution to Zap.Com.
RECENT ACCOUNTING PRONOUNCEMENTS
In June 2001, the Financial Accounting Standards Board ("FASB") issued
Statement of Financial Accounting Standards ("SFAS") No. 141 "Business
Combinations" and No. 142 "Goodwill and Other Intangible Assets." SFAS No. 141
requires that all business combinations be accounted for under the purchase
method only and that certain acquired intangible assets in a business
combination be recognized as assets apart from goodwill. SFAS No. 142 requires
that ratable amortization of goodwill be replaced with periodic tests of the
goodwill's impairment and that intangible assets other than goodwill be
amortized over their useful lives. SFAS No. 141 is effective for all business
combinations initiated after June 30, 2001, and the provisions of SFAS No. 142
are effective for all years beginning after December 15, 2001. The Company does
not believe that the adoption of SFAS No. 141 and 142 will have a material
impact on the Company's financial position or its results of operations.
The Company adopted the provisions of Staff Accounting Bulletin ("SAB") No.
101, "Revenue Recognized in Financial Statements," on January 1, 2001. The
implementation of the provisions of SAB No. 101 did not have an impact on the
Company's financial position or results of operations.
In June 1998, the FASB issued SFAS No. 133, "Accounting for Derivative
Instruments and Hedging Activities," which, as amended, is effective for fiscal
years beginning after June 15, 2000. SFAS 133 establishes accounting and
reporting standards for derivative instruments, including certain derivative
instruments embedded in other contracts (collectively referred to as
derivatives) and for hedging activities. SFAS No. 133 requires the recognition
of all derivatives as either assets or liabilities in the statement of financial
position and the measurement of those instruments at fair value. The adoption of
SFAS No. 133 did not have a material impact on the Company's financial position
or its results of operations.
In June 2001, the FASB issued SFAS No. 143, "Accounting for Asset
Retirement Obligations." SFAS No. 143 requires that obligations associated with
the retirement of a tangible long-lived asset to be recorded as a liability when
those obligations are incurred, with the amount of the liability initially
measured at fair value. Upon initially recognizing a liability for an asset
retirement obligation, an entity must capitalize the cost by recognizing an
increase in the carrying amount of the related long-lived asset. Over time, the