Additional Financial Information

12 Months Ended

Dec. 31, 2020

Supplemental Financial Statement Elements [Abstract]

Note 20 – Additional Financial Information

Accounts Payable and Accrued Liabilities

Accounts payable and accrued liabilities are summarized as follows:


(in millions)	December 31, 2020		December 31, 2019
Accounts payable	$	5,564	$	4,322
Payroll and related benefits	1,163		802
Property and other taxes, including payroll	1,540		682
Interest	771		227
Commissions	399		251

Toll and interconnect	217		156
Advertising	135		127
Other	407		179
Accounts payable and accrued liabilities	$	10,196	$	6,746

Book overdrafts included in accounts payable and accrued liabilities were $628 million and $463 million as of December 31, 2020 and 2019, respectively.

Related Party Transactions

Deutsche Telekom

We have related party transactions associated with DT or its affiliates in the ordinary course of business, which are included in the consolidated financial statements.

On April 1, 2020, in connection with the closing of the Merger, we:

•Repaid our $4.0 billion Incremental Term Loan Facility with DT, consisting of a $2.0 billion Incremental Term Loan Facility due 2022 and a $2.0 billion Incremental Term Loan Facility due 2024;

•Terminated our revolving credit facility with DT;

•Repurchased from DT $4.0 billion of indebtedness to affiliates, consisting of $2.0 billion of 5.300% Senior Notes due 2021 and $2.0 billion of 6.000% Senior Notes due 2024;

•Amended the $1.25 billion of 5.125% Senior Notes due 2025 and $1.25 billion of 5.375% Senior Notes due 2027, which represent indebtedness to affiliates, to change the maturity dates thereof to April 15, 2021 and April 15, 2022, respectively (the “2025 and 2027 Amendments”); and

•Made an additional payment for requisite consents to DT of $13 million. These payments were recognized as a reduction to Long-term debt to affiliates in our Consolidated Balance Sheets.

On July 4, 2020, we redeemed $1.25 billion aggregate principal amount of our 5.125% Senior Notes to affiliates due 2021.

Amounts associated with the debt owed to DT are reflected as Short-term debt to affiliates and Long-term debt to affiliates in our Consolidated Balance Sheets. Interest related to this debt is reflected as Interest expense to affiliates in our Consolidated Statements of Comprehensive Income.

The following table summarizes the impact of significant transactions with DT or its affiliates included in Operating expenses in the Consolidated Statements of Comprehensive Income:


	Year Ended December 31,
(in millions)		2020		2019		2018
Discount related to roaming expenses		$	(5)	$	(9)	$	—
Fees incurred for use of the T-Mobile brand		83		88		84

International long distance agreement		47		39		36

We have an agreement with DT in which we receive reimbursement of certain administrative expenses, which was $6 million for the year ended December 31, 2020 and $11 million for each of the years ended December 31, 2019 and 2018. Amounts due

from and to DT related to these agreements are included in the Consolidated Balance Sheets as “Accounts Receivables from affiliates” and “Payables to affiliates,” respectively.

SoftBank

On June 22, 2020, we entered into a Master Framework Agreement and related transactions with SoftBank related to the SoftBank Monetization as described in Note 14 - SoftBank Equity Transaction. On July 27, 2020, in connection with the SoftBank Monetization, the Rights Offering exercise period closed, and on August 3, 2020, the Rights Offering closed, resulting in the sale of 19,750,000 shares of our common stock. On August 3, 2020, upon completion of the SoftBank Monetization, DT and SoftBank held, directly or indirectly, approximately 43.4% and 8.6%, respectively, of the outstanding T-Mobile common stock, with the remaining approximately 48.0% of the outstanding T-Mobile common stock held by other stockholders. As a result of the Proxy Agreements, DT has voting control as of August 3, 2020 over approximately 52.4% of the outstanding T-Mobile common stock. In addition, as provided for in the Master Framework Agreement, DT also holds certain call options over approximately 101.5 million shares of our common stock held by SBGC.

On October 6, 2020, we assigned our rights under the T-Mobile Fixed-Price Call Option to DT and DT terminated its right to purchase shares from us under the DT Fixed-Price Call Option, resulting in derecognition of the related derivative asset and liability in equal and offsetting amounts such that there was no net impact to our Consolidated Statements of Comprehensive Income.

Brightstar

We had arrangements with Brightstar, a subsidiary of SoftBank, whereby Brightstar provided supply chain and inventory management services to us in our indirect channels. We have terminated or restructured most of our arrangements with Brightstar, except for reverse logistics and trade-in services. Revenue resulting from sale of devices distributed by Brightstar is generally recognized when sold to an end customer (commonly referred to as recognized on a sell-through basis). Amounts included in our consolidated financial statements associated with these supply chain and inventory management arrangements with Brightstar were not material.

For more information regarding our related party transactions with SoftBank, see Note 2 - Business Combination and Note 14 - SoftBank Equity Transaction of the Notes to the Consolidated Financial Statements.

Supplemental Consolidated Statements of Cash Flows Information

The following table summarizes T-Mobile’s supplemental cash flow information:


	Year Ended December 31,
(in millions)		2020		2019		2018
Interest payments, net of amounts capitalized		$	2,733	$	1,128	$	1,525
Operating lease payments		4,619		2,783		—
Income tax payments		218		88		51
Non-cash investing and financing activities

Non-cash beneficial interest obtained in exchange for securitized receivables		6,194		6,509		4,972
Non-cash consideration for the acquisition of Sprint		33,533		—		—
Change in accounts payable and accrued liabilities for purchases of property and equipment		589		(935)		65
Leased devices transferred from inventory to property and equipment		2,795		1,006		1,011
Returned leased devices transferred from property and equipment to inventory		(1,460)		(267)		(326)
Short-term debt assumed for financing of property and equipment		38		800		291
Operating lease right-of-use assets obtained in exchange for lease obligations		14,129		3,621		—
Financing lease right-of-use assets obtained in exchange for lease obligations		1,273		1,041		885