Business and Basis of Presentation (Policies)

6 Months Ended

Jun. 30, 2013

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Basis of Presentation [Policy Text Block]

Basis of Presentation

The consolidated financial statements of the Company present the financial position, results of operations and cash flows of DreamWorks Animation and its wholly-owned subsidiaries. The Company uses the equity method of accounting for investments in companies in which it has a 50% or less ownership interest and has the ability to exercise significant influence. Such investments are presented as investments in unconsolidated entities on the Company's consolidated balance sheets (refer to Note 7 for further information of such investments). Prior to recording its share of net income or losses from equity method investees, investee financial statements are converted to U.S. generally accepted accounting principles ("U.S. GAAP"). All significant intercompany accounts and transactions have been eliminated. Intra-entity profit related to transactions with equity method investees is eliminated until the amounts are ultimately realized.

Contingent Consideration [Policy Text Block]

Contingent Consideration

Pursuant to the Merger Agreement that the Company entered into in connection with the acquisition of ATV, the Company may be required to make future cash payments as part of the total purchase price to acquire ATV. The estimated liability recorded as of June 30, 2013 was based on a fair value analysis performed in conjunction with determining the purchase price allocation related to the ATV acquisition. The fair value measurement was determined using significant unobservable inputs (see Note 3 for a description of this contingent consideration arrangement and the key assumptions used to derive the estimated value). The estimate of the liability may fluctuate if there are changes in the forecast of ATV's future earnings or as a result of actual earnings levels achieved. Any changes in estimate of the contingent consideration liability will be reflected in the Company's results of operations in the period that the change occurs.

Other Operating Income Related to Oriental DreamWorks Contributions [Policy Text Block]

Other Operating Income Related to Oriental DreamWorks Contributions

Other operating income related to Oriental DreamWorks contributions consists of income recognized in connection with the Company's contributions to ODW in the form of consulting and training services and the license of technology. Costs incurred to fulfill the Company's obligations related to these contributions are included in selling, general and administrative expenses in its consolidated statements of income. Income related to the Company's contributions in the form of intellectual property licenses are included in revenues. The Company only recognizes the proportion of gains on contributions to equity method investees that is attributable to other investors' equity ownership interest in the investee.

As part of the Company's contribution commitments to ODW, it has committed to licensing certain of its internally developed animation technology to ODW, including preparing the software in a format that can be delivered to ODW and providing ongoing maintenance. The Company determined, due to the level of preparation involved, that this constitutes significant modification and customization of the existing software, and accordingly, it uses the percentage-of-completion method for recognition of the income associated with this contribution. Under the percentage-of-completion method, the Company uses costs incurred to measure progress towards completion. In addition, the Company makes certain estimates of the overall gross profit of the license granted and any changes in such estimates will be recorded in the period in which the change occurs. As the Company's investment in ODW is accounted for under the equity method of accounting, it only recognizes gross profit margin to the extent that control has transferred through the equity ownership interests (i.e. only 54.55% of the gross margin is recognized, which represents the portion of ODW that the Company does not own). This amount is classified as other operating income in the consolidated statements of income.

Variable Interest Entity [Policy Text Block]

Variable Interest Entities

The Company reviews its relationships with other entities to identify whether they are variable interest entities ("VIE") as defined by the Financial Accounting Standards Board ("FASB"), and to assess whether the Company is the primary beneficiary of such entity. If the determination is made that the Company is the primary beneficiary, then the entity is consolidated.

Use of Estimates [Policy Text Block]

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. The most significant estimates made by management in the preparation of the financial statements relate to the following:

• ultimate revenues and ultimate costs of film, television product and live performance productions;

• relative selling price of the Company's products for purposes of revenue allocation in multi-property licenses and other multiple deliverable arrangements;

• determination of fair value of assets and liabilities for the allocation of the purchase price in an acquisition;

• determination of fair value of non-cash contributions to investments in unconsolidated entities;

• useful lives of intangible assets;

• product sales that will be returned and the amount of receivables that ultimately will be collected;

• the potential outcome of future tax consequences of events that have been recognized in the Company's financial statements;

• loss contingencies and contingent consideration arrangements; and

• assumptions used in the determination of the fair value of equity-based awards for stock-based compensation or their probability of vesting.

Actual results could differ from those estimates. To the extent that there are material differences between these estimates and actual results, the Company's financial condition or results of operations will be affected. Estimates are based on past experience, third-party valuations (as deemed necessary) and other assumptions that management believes are reasonable under the circumstances, and management evaluates these estimates on an ongoing basis.

Fair Value of Financial Instruments [Policy Text Block]

The fair value of cash and cash equivalents, accounts payable, advances and amounts outstanding under the revolving credit facility approximates carrying value due to the short-term maturity of such instruments and floating interest rates.