InterDigital Inc (IDCC)

[rmarchma]

Davids re accounting for possible Nokia settlement

IF Nokia settles before IDCC's 2004 Financial Statements are published, then I believe that IDCC could report any settlement amount that pertains to 2004 and prior, as Revenues in the 2004 Income Statement. They would not need to restate the revenues and income for the earlier years of 2002 and 2003, it would all fall into the 2004 Income Statement. However, there should be extensive footnote disclosures as to the settlement breakout between 2004 and the earlier years.

If Nokia settles or an arbitration award is rendered after IDCC's 2004 Financial Statements are published, then the settlement or award would be shown as Revenues in the 2005 Income Statement. Any settlement or award amounts associated with 2004 and prior years should be clearly disclosed in footnotes. Once again there would be no reinstatement of the previous years' Income Statements.