Company: MTZ
Filing Date: 2025-02-28
Form Type: 10-K
Source: 0000015615-25-000021
Chunk: 160

Company: MASTEC INC
Filing Date: 2025-02-28
Form: 10-K
Item: Item 4
Chunk 160
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 The Company’s investment and strategic arrangements include equity interests in various business entities and participation in contractual joint ventures, some of which may involve the extension of loans or other types of financing arrangements.Management determines whether each business entity in which it has equity interests, debt, or other investments constitutes a variable interest entity (“VIE”) based on the nature and characteristics of such arrangements.  If an investment arrangement is determined to be a VIE, then management determines if the Company is the VIE’s primary beneficiary by evaluating several factors, including the Company’s: (i) risks and responsibilities; (ii) ownership interests; (iii) decision making powers; and (iv) financial interests, among other factors.  If management determines the Company is the primary beneficiary of a VIE, then that VIE would be consolidated, with the other parties’ interests in the VIE accounted for as non-controlling interests.  The primary beneficiary consolidating a VIE must normally have both (i) the power to direct the primary activities of the VIE and (ii) the obligation to absorb losses of the VIE or the right to receive benefits from the VIE, which, in either case, could be significant to the VIE.  The Company has determined that certain of its investment arrangements are VIEs.  See Note 4 - Fair Value of Financial Instruments for additional information pertaining to the Company’s VIEs.The Company’s investments in entities for which it does not have a controlling interest and is not the primary beneficiary, but for which it has the ability to exert significant influence, are accounted for using the equity method of accounting.  Under the equity method of accounting, the initial investment is recorded at cost and the investment is subsequently adjusted for the Company’s proportionate share of earnings or losses, including consideration of basis differences resulting from the difference between the initial carrying amount of the investment and the underlying equity in net assets.  Equity method investments are recorded as other long-term assets in the Company’s consolidated balance sheets.  Income or loss from these investments is recorded as a separate line item in the consolidated statements of operations.  Intercompany profits or losses associated with the Company’s equity method investments are eliminated until realized by the investee in transactions with third parties.  Distributions received from equity method investees are reflected in the statements of cash flows using the nature of distributions approach, under which distributions are classified based on the nature of the activity that generated them.  For equity investees in which the Company has an undivided interest in