Overview of Content Accounting

Content accounting in our financials. Balance sheet Total cost of titles is recorded as assets in the content library Total unpaid cost of titles is recorded as a liability Income statement The asset is amortized over the shorter of the title's window of availability or useful life Amortization expense is recorded in cost of revenue Cash Flow Statement - Additions to streaming content library = total gross additions (not cash paid) Change in streaming content liabilities = net change in liabilities resulting from payments and library additions, both current and non-current Amortization of content library = adjusts for the non-cash expense included in net income NETFLIX

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