from existing clients, an inability to attract new clients and grow internationally, loss of a major customer or other significant client, loss of a major supplier, an inability to grow through acquisitions or successfully integrate acquisitions, an inability to control expenses, technology changes, the impact of the application of and/or changes in accounting principles, financial services con- solidation, changes in regulatory requirements, a decline in the use of cards as a payment mechanism, disruption of the Compa- ny’s international operations, breach of the Company’s security systems, a decline in the financial stability of the Company’s clients and uncertain economic conditions. Negative develop- ments in these or other risk factors could have a material adverse effect on the Company’s financial position, results of operations and cash flows. 

The Company has prepared the accompanying consolidated finan- cial statements in conformity with accounting principles generally accepted in the United States of America. The preparation of the consolidated financial statements requires management of the Com- pany to make a number of estimates and assumptions relating to the reported amounts of assets and liabilities at the date of the consol- idated financial statements and the reported amounts of revenues and expenses during the period. These estimates and assumptions are developed based upon all information available. Actual results could differ from estimated amounts. 

CASH EQUIVALENTS: Investments with a maturity of three months or less when purchased are considered to be cash equivalents. 

RESTRICTED CASH: Restricted cash balances relate to cash balances collected on behalf of customers and held in escrow. TSYS records a corresponding liability for the obligation to the customer which is reflected in other current liabilities in the accompanying consolidated balance sheets. In 2010, TSYS began shifting the responsibility for funds management for its clients to the client’s issuer bank. Therefore, client funds are no longer maintained in a TSYS bank account. 

ACCOUNTS RECEIVABLE: Accounts receivable balances are stated net of allowances for doubtful accounts and billing adjust- ments of $4.5 million and $6.3 million at December 31, 2010 and December 31, 2009, respectively. 

TSYS records an allowance for doubtful accounts when it is prob- able that the accounts receivable balance will not be collected. When estimating the allowance for doubtful accounts, the Com- pany takes into consideration such factors as its day-to-day knowl- edge of the financial position of specific clients, the industry and size of its clients, the overall composition of its accounts receiv- able aging, prior history with specific customers of accounts receivable write-offs and prior experience of allowances in pro- portion to the overall receivable balance. This analysis includes an ongoing and continuous communication with its largest clients 

and those clients with past due balances. A financial decline of any one of the Company’s large clients could have a material adverse effect on collectability of receivables and thus the adequacy of the allowance for doubtful accounts. 

Increases in the allowance for doubtful accounts are recorded as charges to bad debt expense and are reflected in selling, general and administrative expenses in the Company’s consolidated statements of income. Write-offs of uncollectible accounts are charged against the allowance for doubtful accounts. 

TSYS records an allowance for billing adjustments for actual and potential billing discrepancies. When estimating the allowance for billing adjustments, the Company considers its overall history of billing adjustments, as well as its history with specific clients and known disputes. Increases in the allowance for billing adjustments are recorded as a reduction of revenues in the Company’s con- solidated statements of income and actual adjustments to invoices are charged against the allowance for billing adjustments. 

PROPERTY AND EQUIPMENT: Property and equipment are stated at cost less accumulated depreciation and amortization. Depreciation and amortization are computed using the straight- line method over the estimated useful lives of the assets. Buildings and improvements are depreciated over estimated useful lives of 5-40 years, computer and other equipment over estimated useful lives of 2-5 years, and furniture and other equipment over esti- mated useful lives of 3-15 years. The Company evaluates impair- ment losses on long-lived assets used in operations in accordance with the provisions of ASC 205, “Presentation of Financial Statements.” 

All ordinary repairs and maintenance costs are expensed as incurred. Maintenance costs that extend the asset life are capi- talized and amortized over the remaining estimated life of the asset. 

LICENSED COMPUTER SOFTWARE: The Company licenses software that is used in providing services to clients. Licensed software is obtained through perpetual licenses and site licenses and through agreements based on processing capacity (called “MIPS agreements”). Perpetual and site licenses are amortized using the straight-line method over their estimated useful lives which range from three to ten years. Software licensed under MIPS agreements is amortized using a units-of-production basis over the estimated useful life of the software, generally not to exceed ten years. At each balance sheet date, the Company evaluates impairment losses on long-lived assets used in operations in accordance with ASC 205. 

ACQUISITION TECHNOLOGY INTANGIBLES: These identifi- able intangible assets are software technology assets resulting from acquisitions. These assets are amortized using the straight- line method over periods not exceeding their estimated useful 

