UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

(Mark One)

x	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~June~~September 30, 2013

¨	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number 333-142546-29

The Nielsen Company B.V.

(Exact name of registrant as specified in its charter)

The Netherlands		98-0366864
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

85 Broad Street New York, New York 10004 (646) 654-5000		Diemerhof 2 1112 XL Diemen The Netherlands +31(0) 20 398 87 77
(Address of principal executive offices) (Zip Code) (Registrant’s telephone numbers including area code)

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definition of “accelerated filer”, “large accelerated filer”, and “smaller reporting company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer ¨	Accelerated filer ¨	Non-accelerated filer x	Smaller reporting company ¨
		(Do not check if a smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ No x

There were 258,463,857 shares of the registrant’s Common Stock outstanding as of ~~June~~September 30, 2013.

The registrant meets the conditions set forth in General Instructions (H)(1)(a) and (b) of Form 10-Q and is therefore filing this report with the reduced disclosure format.

Table of Contents

Contents

		PAGE
PART I.	FINANCIAL INFORMATION		3
Item 1.	Condensed Consolidated Financial Statements		3
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		2829
Item 3.	Quantitative and Qualitative Disclosures About Market Risk		4044
Item 4.	Controls and Procedures		4044
PART II.	OTHER INFORMATION		4145
Item 1.	Legal Proceedings		4145
Item 1A.	Risk Factors		4145
Item 5.	Other Information		4145
Item 6.	Exhibits		4346
	Signatures		4447

PART I. FINANCIAL INFORMATION

Item 1. Condensed Consolidated Financial Statements

The Nielsen Company B.V.

Condensed Consolidated Statements of Operations (Unaudited)

	Three Months Ended June 30,						Six Months Ended June 30,
	Three Months Ended September 30,						Nine Months Ended September 30,
(IN MILLIONS)	2013			2012			2013			2012
Revenues	$	1,~~386~~387		$	1,~~342~~351		$	24,~~705~~092		$	23,~~615~~966
Cost of revenues, exclusive of depreciation and amortization shown separately below		~~580~~573			~~549~~550			1,~~159~~732			1,~~099~~649
Selling, general and administrative expenses, exclusive of depreciation and amortization shown separately below		~~432~~433			428			~~874~~1,307			~~865~~1,293
Depreciation and amortization		~~126~~117			~~120~~124			~~247~~364			~~243~~367
Restructuring charges		820			164			4363			5357
Operating income		~~240~~244			~~229~~245			~~382~~626			~~355~~600
Interest income		—1			1			12			23
Interest expense		(7378	)		(95	)		(~~149~~227	)		(~~189~~284	)
Foreign currency exchange transaction losses, net		(4	)		(3	)		(16	)		(13	)
Foreign currency exchange transaction (losses)/gains, net		(7	)		1			(23	)		(12	)
Other income/(expense), net		—12			10(1	)		~~(12~~—	)		43
Income from continuing operations before income taxes and equity in net income of affiliates		163			142			206			159
Income from continuing operations before income taxes and equity in net (loss)/income of affiliates		172			151			378			310
Provision for income taxes		(4640	)		(3758	)		(64104	)		(3896	)
Equity in net income of affiliates		4			4			3			2
Equity in net (loss)/income of affiliates		—			(1	)		3			1
Income from continuing operations		~~121~~132			~~109~~92			~~145~~277			~~123~~215
Income from discontinued operations, net of tax		~~307~~—			320			319			1737
Net income		~~428~~132			112			~~464~~596			~~140~~252
Net income/(loss) attributable to noncontrolling interests		—			1			(1	)		1
Net (loss)/income attributable to noncontrolling interests		(3	)		1			(4	)		2
Net income attributable to The Nielsen Company B.V.	$	~~428~~135		$	111		$	~~465~~600		$	~~139~~250

The accompanying notes are an integral part of these condensed consolidated financial statements.

The Nielsen Company B.V.

Condensed Consolidated Statements of Comprehensive Income (Unaudited)

	Three Months Ended June 30,						Six Months Ended June 30,
	Three Months Ended September 30,						Nine Months Ended September 30,
(IN MILLIONS)	2013			2012			2013			2012
Net income	$	~~428~~132		$	112		$	~~464~~596		$	~~140~~252
Other comprehensive (loss)/income, net of tax
Other comprehensive income/(loss), net of tax
Foreign currency translation adjustments (1)		~~(107~~51	)		~~(85~~64	)		(~~134~~83	)		266
Available for sale securities (2)		3			(41	)		69			(45	)
Changes in the fair value of cash flow hedges (3)		6(2	)		—			86			(1	)
Defined benefit pension plan adjustments (4)		163			—2			2023			24
Total other comprehensive loss		(82	)		(89	)		(100	)		(1	)
Total other comprehensive income/(loss)		55			65			(45	)		64
Total comprehensive income		~~346~~187			23177			~~364~~551			~~139~~316
Less comprehensive (loss)/income attributable to noncontrolling interests		(31	)		1			(23	)		12
Total comprehensive income attributable to The Nielsen Company B.V.	$	~~349~~188		$	22176		$	~~366~~554		$	~~138~~314

	(1)	Net of tax of $(2) million ~~and zero~~ for the three months ended ~~June~~September 30, 2013 and 2012, respectively, and $97 million and ~~zero~~$2 million for the ~~six~~nine months ended ~~June~~September 30, 2013 and 2012, respectively.
	(2)	Net of tax of $(42) million and zero for the three months ended ~~June~~September 30, 2013 and 2012, respectively, and $(46) million and zero for the ~~six~~nine months ended ~~June~~September 30, 2013 and 2012, respectively
	(3)	Net of tax of $~~(3)~~1 million and zero for the three months ended ~~June~~September 30, 2013 and 2012, respectively and $(54) million and $1 million for the ~~six~~nine months ended ~~June~~September 30, 2013 and 2012, respectively.
	(4)	Net of tax of ~~$(6)~~zero million and ~~zero~~$(1) for the three months ended ~~June~~September 30, 2013 and 2012, respectively, and $(16) million and $(12) million for the ~~six~~nine months ended ~~June~~September 30, 2013 and 2012, respectively.

The accompanying notes are an integral part of these condensed consolidated financial statements.

The Nielsen Company B.V.

Condensed Consolidated Balance Sheets

(IN MILLIONS, EXCEPT SHARE AND PER SHARE DATA)	~~June~~September 30, 2013 (Unaudited)			December 31, 2012
Assets:
Current assets
Cash and cash equivalents	$	~~1,154~~725		$	287
Trade and other receivables, net of allowances for doubtful accounts and sales returns of $ 39 and $ 38 as of June 30, 2013 and December 31, 2012, respectively		1,104			1,110
Trade and other receivables, net of allowances for doubtful accounts and sales returns of $45 and $38 as of September 30, 2013 and December 31, 2012, respectively		1,138			1,110
Prepaid expenses and other current assets		~~280~~336			278
Total current assets		2,~~538~~199			1,675
Non-current assets
Property, plant and equipment, net		~~535~~555			560
Goodwill		67,~~691~~686			7,352
Other intangible assets, net		4,~~330~~855			4,555
Deferred tax assets		~~167~~166			169
Other non-current assets		~~276~~242			272
Total assets	$	1415,~~537~~703		$	14,583
Liabilities and equity:
Current liabilities
Accounts payable and other current liabilities	$	~~836~~996		$	971
Deferred revenues		~~281~~324			373
Income tax liabilities		8999			56
Current portion of long-term debt, capital lease obligations and short-term borrowings		~~363~~388			362
Total current liabilities		1,~~569~~807			1,762
Non-current liabilities
Long-term debt and capital lease obligations		56,~~920~~521			5,941
Deferred tax liabilities		~~951~~1,136			1,006
Other non-current liabilities		~~550~~567			616
Total liabilities		810,~~990~~031			9,325
Commitments and contingencies (Note 11)
Equity:
Stockholders’ equity
7% preferred stock, 8.00 par value, 150,000 shares authorized, issued and outstanding		1			1
7% preferred stock, €8.00 par value, 150,000 shares authorized, issued and outstanding at September 30, 2013 and December 31, 2012		1			1
Common stock, 0.20 par value, 550,000,000 shares authorized and 258,463,857 shares issued at June 30, 2013 and December 31, 2012		58			58
Common stock, €0.20 par value, 550,000,000 shares authorized and 258,463,857 shares issued at September 30, 2013 and December 31, 2012		58			58
Additional paid-in capital		6,~~457~~395			6,533
Accumulated deficit		(~~594~~459	)		(1,059	)
Accumulated other comprehensive loss, net of income taxes		(~~422~~369	)		(323	)
Total Nielsen stockholders’ equity		5,~~500~~626			5,210
Noncontrolling interests		4746			48
Total equity		5,~~547~~672			5,258
Total liabilities and equity	$	1415,~~537~~703		$	14,583

The accompanying notes are an integral part of these condensed consolidated financial statements.

The Nielsen Company B.V.

Condensed Consolidated Statements of Cash Flows (Unaudited)

	Six Months Ended June 30,
	Nine Months Ended September 30,
(IN MILLIONS)	2013			2012
Operating Activities
Net income	$	~~464~~596		$	~~140~~252
Adjustments to reconcile net income to net cash provided by operating activities:
Stock-based compensation expense		2132			1423
Gain on sale of discontinued operations		(303	)		—
Currency exchange rate differences on financial transactions and other losses		3429			7
Equity in net income of affiliates, net of dividends received		(1	)		36
Depreciation and amortization		~~258~~375			~~258~~388
Changes in operating assets and liabilities, net of effect of businesses acquired and divested:
Trade and other receivables, net		(6523	)		(13	)
Prepaid expenses and other current assets		(3237	)		(2731	)
Accounts payable and other current liabilities and deferred revenues		(~~117~~127	)		(~~253~~268	)
Other non-current liabilities		(4	)		(2	)
Interest payable		839			942
Income taxes		712			~~(14~~29	)
Net cash provided by operating activities		~~270~~590			~~122~~459
Investing Activities
Acquisition of subsidiaries and affiliates, net of cash acquired		(191,202	)		(74136	)
Proceeds from sale of subsidiaries and affiliates, net		934			—(1	)
Additions to property, plant and equipment and other assets		(5579	)		(5072	)
Additions to intangible assets		(~~115~~176	)		(~~102~~153	)
Net cash provided by/(used in) investing activities		745			(226	)
Net cash used in investing activities		(523	)		(362	)
Financing Activities
Net borrowings under revolving credit facility		—			~~215~~65
Proceeds from issuances of debt, net of issuance costs		12,~~890~~505			1,209
Repayment of debt		(1,~~911~~933	)		(1,~~359~~381	)
Increase in other short-term borrowings		212			810
Capital contributions (to)/from parent		(90163	)		411
Activity under stock plans		(7	)		(1—	)
Other financing activities		(1024	)		(911	)
Net cash (used in)/provided by financing activities		(126	)		67
Net cash provided by/(used in) financing activities		390			(97	)
Effect of exchange-rate changes on cash and cash equivalents		(2219	)		—4
Net increase/(decrease) in cash and cash equivalents		867			(37	)
Net increase in cash and cash equivalents		438			4
Cash and cash equivalents at beginning of period		287			318
Cash and cash equivalents at end of period	$	~~1,154~~725		$	~~281~~322
Supplemental Cash Flow Information
Cash paid for income taxes	$	(66101	)	$	(6288	)
Cash paid for interest, net of amounts capitalized	$	(~~149~~196	)	$	(~~192~~259	)

The accompanying notes are an integral part of these condensed consolidated financial statements.

The Nielsen Company B.V.

Notes to Condensed Consolidated Financial Statements (continued)

1. Background and Basis of Presentation

Background

The Nielsen Company B.V. (“Nielsen” or the “Company”), together with its subsidiaries, is a leading global information and measurement company that provides clients with a comprehensive understanding of consumers and consumer behavior. Nielsen is aligned into two reporting segments: what consumers buy (“Buy”) and what consumers watch (“Watch”). In June 2013, Nielsen completed the sale of its Expositions operating segment (see Note 4, Discontinued Operations, for more information). The Company’s condensed consolidated statements of operations reflect the Expositions operating segment as a discontinued operation. Nielsen has a presence in ~~approximately~~more than 100 countries, with its headquarters located in Diemen, the Netherlands and New York, USA. Nielsen’s parent company, Valcon Acquisition B.V. (“Valcon”), is a wholly-owned subsidiary of Nielsen Holdings N.V. (“Holdings”).

Basis of Presentation

The accompanying condensed consolidated financial statements are unaudited but, in the opinion of management, contain all the adjustments (consisting of those of a normal recurring nature) considered necessary to present fairly the Company’s financial position and the results of operations and cash flows for the periods presented in conformity with accounting principles generally accepted in the U.S. (“U.S. GAAP”) applicable to interim periods. For a more complete discussion of significant accounting policies, commitments and contingencies and certain other information, refer to the consolidated financial statements included in the Company’s Current Report on Form 8-K filed with the ~~Security~~Securities and Exchange Commission on ~~June~~August 1912, 2013. All amounts are presented in U.S. Dollars (“$”), except for share data or where expressly stated as being in other currencies, e.g., Euros (“€”). The condensed consolidated financial statements include the accounts of Nielsen and all subsidiaries and other controlled entities. The Company has evaluated events occurring subsequent to ~~June~~September 30, 2013 for potential recognition or disclosure in the condensed consolidated financial statements and concluded there were no subsequent events that required recognition or disclosure other than those provided.

Devaluation of Venezuelan Currency

Nielsen has operations in both the Buy and Watch segments in Venezuela and the functional currency for these operations was the Venezuelan ~~bolivares~~Bolivares ~~fuertes~~Fuertes. Venezuela’s currency was considered hyperinflationary as of January 1, 2010 and further, in January 2010, Venezuela’s currency was devalued and a new currency exchange rate system was announced. In 2010, Nielsen evaluated the new exchange rate system and concluded that the local currency transactions will be denominated in U.S. dollars effective as of January 1, 2010 and until Venezuela’s currency is deemed to be non-hyperinflationary.

In February 2013, the Venezuelan government devalued its currency by 32%. The official exchange rate moved from 4.30 to 6.30 and the regulated System of Transactions with Securities in Foreign Currency market was suspended. As a result of this change Nielsen recorded a charge of $12 million during the first quarter of 2013 in ~~the~~ foreign currency exchange transaction (losses)/gains, net line in the condensed consolidated statement of operations primarily reflecting the write-down of monetary assets and liabilities.

2. Summary of Recent Accounting Pronouncements

Reclassification from accumulated other comprehensive income

In February 2013, the FASB issued an accounting update “Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income”, to improve the transparency of reporting reclassifications out of accumulated other comprehensive income. The Company has presented the significant amounts reclassified from each component of accumulated other comprehensive income and the income statement line items affected by the reclassification in Note 6 to these condensed consolidated financial statements. This amended guidance does not have any other impact on the Company’s condensed consolidated financial statements.

Foreign Currency Matters

In March 2013, the FASB issued an accounting update, “Parent’s Accounting for the Cumulative Translation Adjustment upon Derecognition of Certain Subsidiaries or Groups of Assets within a Foreign Entity or of an Investment in a Foreign Entity”, to resolve the diversity in practice regarding the release into net income of the cumulative translation adjustment upon derecognition of a subsidiary or group of assets within a foreign entity. The amendment requires an entity that ceases to have a controlling financial interest in a subsidiary or group of assets within a foreign entity to release any related cumulative translation adjustment into net income. Accordingly, the cumulative translation adjustment should be released into net income only if the sale or transfer results in the complete or substantially complete liquidation of the foreign entity in which the subsidiary or group of assets had resided. This guidance is effective for Nielsen interim and annual reporting periods in 2014. The adoption of this update is not expected to have a significant impact on the Company’s condensed consolidated financial statements.

Income Taxes

In July 2013, the FASB issued an accounting update, “Income Taxes: Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists ”. The update provides guidance on the financial statement presentation of an unrecognized tax benefit, as either a reduction of a deferred tax asset or as a liability, when a net operating loss carryforward, similar tax loss, or a tax credit carryforward exists. The update will be effective for interim and annual periods beginning after December 15, 2013 and may be applied on a retrospective basis. Early adoption is permitted. The Company does not expect the adoption of this update to have a significant impact on the Company’s condensed consolidated financial statements.

3. Business Acquisitions

~~For~~ ~~the~~Arbitron ~~six months ended June 30, 2013, Nielsen paid cash consideration of $19 million associated with both current period and previously executed acquisitions, net of cash acquired~~Inc. ~~Had the current period acquisitions occurred as of January 1, 2013, the impact on Nielsen’s consolidated results of operations would not have been material.~~

~~For~~On ~~the~~September 30, ~~six~~2013 ~~months~~(the ~~ended~~“Acquisition ~~June 30~~Date”), ~~2012,~~ Nielsen ~~paid~~completed ~~cash~~the ~~consideration~~acquisition of ~~$74~~Arbitron ~~million~~Inc., ~~associated~~an ~~with~~international ~~both~~media ~~current period~~ and ~~previously~~marketing ~~executed~~research ~~acquisitions~~firm (“Arbitron”), ~~net~~through the purchase of 100% of Arbitron’s outstanding common stock for a total cash ~~acquired~~purchase price of $1.3 ~~Had~~billion (the ~~current~~“Acquisition”). Arbitron ~~period~~is ~~acquisitions~~expected ~~occurred~~to ashelp Nielsen better address client needs in unmeasured areas of ~~January 1,~~media ~~2012~~consumption, ~~the~~including ~~impact~~streaming onaudio and out-of-home and Nielsen’s ~~consolidated~~global ~~results~~distribution footprint can help expand Arbitron’s capabilities outside of ~~operations~~the ~~would~~U.S. ~~not~~With ~~have~~Arbitron’s assets, Nielsen intends to further expand its “Watch” segment’s audience measurement across screens and forms of listening. Arbitron has been ~~material~~rebranded Nielsen Audio.

As a part of the Acquisition, Nielsen acquired the remaining 49.5% interest in Scarborough Research, a joint venture between Nielsen and Arbitron (“Scarborough”) that Nielsen historically accounted for under the equity method of accounting. Nielsen accounted for this transaction as a step-acquisition and calculated the fair value of its investment immediately before the acquisition to be $75 million. As a result, during the third quarter of 2013, Nielsen recorded a $24 million gain on its investment in Scarborough to other income/(expense), net in the condensed consolidated statement of operations. Effective October 1, 2013, the financial results of Scarborough will be included within the consolidated financial statements of Nielsen.

The Acquisition was accounted for using the acquisition method of accounting which requires, among other things, the assets acquired and the liabilities assumed be recognized at their fair values as of the acquisition date. Since the date of the acquisition occurred on the last day of the quarter, the results of Arbitron will be included within Company's consolidated financial statements commencing October 1, 2013.

The purchase price was preliminarily allocated based upon the fair value of the assets acquired and liabilities assumed at the date of acquisition using available information and certain assumptions management believed reasonable.

The following table summarizes the preliminary purchase price allocation:

(IN MILLIONS)

Fair value of business combination:
Cash paid for Arbitron common stock	$	1,296
Accrued payment for directors’ and employees’ equity awards pertaining to pre-merger service		42
Accrued dividend payment on Arbitron common stock		3
Fair value of previously held equity interest in Scarborough		75
Total	$	1,416

Identifiable assets acquired and liabilities assumed:
Cash	$	136
Other current assets		115
Property and equipment		32
Goodwill		931
Amortizable intangible assets		517
Other long term assets		3
Deferred revenue		(47	)
Other current liabilities		(53	)
Deferred tax liabilities		(200	)
Other long term liabilities		(18	)
Total	$	1,416

As of the Acquisition Date, the expected fair value of accounts receivable approximated historical cost. The gross contractual receivable was $64 million, of which $4 million was deemed uncollectible. The estimated fair values assigned to amortizable intangible assets, goodwill and uncertain tax positions are provisional and subject to adjustment primarily based upon additional information the Company is in process of obtaining.

The provisional allocation of the purchase price to goodwill and identified intangible assets was $931 million and $517 million, respectively. All of the Arbitron related goodwill and intangible assets are attributable to Nielsen’s Watch segment.

Intangible assets and their estimated useful lives consist of the following:



(IN MILLIONS)
Description	Amount		Useful Life
Customer –related intangibles	$	323		10 - 20 years
Computer software		150		5 – 10 years
Trade names and trademarks		33		5 years
Covenants-not-to-compete		11		1-2 years
Total	$	517

Goodwill is calculated as the excess of the consideration transferred over the net assets recognized and represents expected synergies and the going concern nature of Arbitron.

The Company incurred acquisition related expenses of $4 million and $18 million for the three and nine months ended September 30, 2013, respectively, which primarily consisted of transaction fees, legal, accounting and other professional services that are included in selling, general and administrative expense in the condensed consolidated statement of operations.

The following unaudited pro forma information presents the consolidated results of operations of the Company and Arbitron for the three and nine months ended September 30, 2013 and 2012, as if the acquisition had occurred on January 1, 2012, with pro forma adjustments to give effect to amortization of intangible assets, an increase in interest expense from acquisition financing, and certain other adjustments:

	Three Months Ended September 30,				Nine Months Ended September 30,
(IN MILLIONS)	2013		2012		2013		2012
Revenues	$	1,510	$	1,464	$	4,447	$	4,302
Income from continuing operations	$	152	$	106	$	306	$	241

The unaudited pro forma results do not reflect any synergies and are not necessarily indicative of the results that the Company would have attained had the acquisition of Arbitron been completed as of the beginning of the reporting period.

Other Acquisitions

For the nine months ended September 30, 2013, excluding Arbitron, Nielsen paid cash consideration of $42 million associated with both current period and previously executed acquisitions, net of cash acquired. Had these current period acquisitions occurred as of January 1, 2013, the impact on Nielsen’s consolidated results of operations would not have been material.

For the nine months ended September 30, 2012, Nielsen paid cash consideration of $136 million associated with both current period and previously executed acquisitions, net of cash acquired. Had these current period acquisitions occurred as of January 1, 2012, the impact on Nielsen’s consolidated results of operations would not have been material.

4. Discontinued Operations

In June 2013, the Company completed the sale of its ~~expositions~~Expositions business, which operates one of the largest portfolios of business-to-business trade shows and conference events in the United States, for total cash consideration of $950 million and recorded a gain of $303 million. The condensed consolidated statements of operations reflect the operating results of this business as a discontinued operation.

In March 2013, Nielsen completed the exit and shut down of one of its legacy online businesses and recorded a net loss of $3 million associated with this divestiture. The condensed consolidated statements of operations reflect the operating results of this business as a discontinued operation.

Summarized results of operations for discontinued operations are as follows:

	Three Months Ended June 30,						Six Months Ended June 30,
	Three Months Ended September 30,						Nine Months Ended September 30,
(IN MILLIONS)	2013			2012			2013			2012
Revenue	$	43—		$	4372		$	103		$	~~110~~182
Operating income		11—			837			35			3774
Interest expense		(3—	)		(6	)		(8	)		(1218	)
Income from operations before income taxes		8—			231			27			2556
Provision for income taxes		(4—	)		—(11	)		(11	)		(1021	)
Income from operations		4—			220			16			1535
Net income attributable to noncontrolling interests		—			1—			—			2
Gain on sale, net of tax		~~303~~—			—			303			—
Income from discontinued operations	$	~~307~~—		$	320		$	319		$	1737

Nielsen allocated a portion of its consolidated interest expense to discontinued operations based upon the ratio of net assets sold as a proportion of consolidated net assets. For the three and six months ended June ~~30, 2013 and 2012, interest expense of $3 million and $6 million, respectively and $8 million and $12 million, respectively, was allocated to discontinued operations.~~ 10

Nielsen allocated a portion of its consolidated interest expense to discontinued operations based upon the ratio of net assets sold as a proportion of consolidated net assets. For the three and nine months ended September 30, 2013 and 2012, interest expense of zero and $8 million, respectively and $6 million and $18 million, respectively, was allocated to discontinued operations.

Following are the major categories of cash flows from discontinued operations, as included in Nielsen’s condensed consolidated statements of cash flows:

	Six Months Ended June 30,
	Nine Months Ended September 30,
(IN MILLIONS)	2013		2012
Net cash provided by operating activities	$	36	$	4052
Net cash provided by investing activities		—		—
Net cash provided by financing activities		—		—
	$	36	$	4052

5. Goodwill and Other Intangible Assets

Goodwill

The table below summarizes the changes in the carrying amount of goodwill by reportable segment for the ~~six~~nine months ended ~~June~~September 30, 2013.

(IN MILLIONS)	Buy			Watch			Expositions			Total
Balance, December 31, 2012	$	3,126		$	3,661		$	565		$	~~7,352~~	7,352
Acquisitions, divestitures and other adjustments		616			2933			~~(565~~—	)		~~(557~~	)949
Effect of foreign currency translation		(103	)		(1	)		—			(104	)
Dispositions		—			—			(565	)			(565	)
Balance, June 30, 2013	$	3,029		$	3,662		$	—		$	6,691
Effect of foreign currency translation		(53	)		3			—				(50	)
Balance, September 30, 2013	$	3,089		$	4,597		$	—		$	7,686

At ~~June~~September 30, 2013, $71108 million of the goodwill is expected to be deductible for income tax purposes.

Other Intangible Assets

(IN MILLIONS)	Gross Amounts				Accumulated Amortization
	June 30, 2013		December 31, 2012		June 30, 2013			December 31, 2012
	September 30, 2013		December 31, 2012		September 30, 2013			December 31, 2012
Indefinite-lived intangibles:
Trade names and trademarks	$	1,921	$	1,921	$	—		$	—
Amortized intangibles:
Trade names and trademarks	$	~~126~~161	$	128	$	(5052	)	$	(46	)
Customer-related intangibles		2,~~599~~940		2,882		(~~835~~865	)		(886	)
Covenants-not-to-compete		2435		36		(1516	)		(25	)
Computer software		1,~~393~~604		1,316		(~~866~~904	)		(804	)
Patents and other		95		90		(6264	)		(57	)
Total	$	4,~~237~~835	$	4,452	$	(1,~~828~~901	)	$	(1,818	)

Amortization expense associated with the above intangible assets was $7974 million and $7173 million for the three months ended ~~June~~September 30, 2013 and 2012, respectively. These amounts included amortization expense associated with computer software of $4338 million and $3638 million for the three months ended ~~June~~September 30, 2013 and 2012, respectively.

The amortization expense for the ~~six~~nine months ended ~~June~~September 30, 2013 and 2012 was $~~154~~228 million and $~~144~~217 million, respectively. These amounts included amortization expense associated with computer software of $82120 million and $73111 million for the ~~six~~nine months ended ~~June~~September 30, 2013 and 2012, respectively.

1011

6. Changes in and Reclassification out of Accumulated Other Comprehensive Loss by Component

The table below summarizes the changes in accumulated other comprehensive loss, net of tax, by component for the ~~six~~nine months ended ~~June~~September 30, 2013.

	Currency Translation Adjustments			Available- for-Sale Securities		Cash Flow Hedges			Post Employment Benefits			Total
(IN MILLIONS)
Balance December 31, 2012	$	(13	)	$	—	$	(13	)	$	(297	)	$	(323	)
Other comprehensive (loss)/income before reclassifications		(~~134~~83	)		69		3(2	)		1312			(~~112~~64	)
Amounts reclassified from accumulated other comprehensive (loss)/income		—			—		58			711			1219
Net current period other comprehensive (loss)/income		(~~134~~83	)		69		86			2023			(~~100~~45	)
Net current period other comprehensive loss attributable to noncontrolling interest		(1	)		—		—			—			(1	)
Net current period other comprehensive (loss)/income attributable to Nielsen stockholders		(~~133~~84	)		69		86			2023			(9946	)
Balance June 30, 2013	$	(146	)	$	6	$	(5	)	$	(277	)	$	(422	)
Balance September 30, 2013	$	(97	)	$	9	$	(7	)	$	(274	)	$	(369	)

The table below summarizes the reclassification of accumulated other comprehensive loss by component for the three and ~~six~~nine months ended ~~June~~September 30, 2013.

(IN MILLIONS)	Amount Reclassified from Accumulated Other Comprehensive Loss	~~Amount Reclassified from Accumulated Other Comprehensive Loss~~
Details about Accumulated Other Comprehensive Income components	Three Months Ended September 30, 2013	~~Three Months Ended June 30, 2013~~	Nine Months Ended September 30, 2013	~~Six Months Ended June 30, 2013~~	Affected Line Item in the Condensed Consolidated Statement of Operations
Cash flow hedges
Interest rate contracts	$	4	$	812	Interest expense
		1		34	Provision for income taxes
	$	3	$	58	Total, net of tax
Amortization of Post Employment Benefits
Actuarial loss	$	5	$	914	(a)
		1		23	Provision for income taxes
	$	4	$	711	Total, net of tax
Total reclassification for the period	$	7	$	1219	Net of tax

(a) This accumulated other comprehensive loss component is included in the computation of net periodic pension cost.

1112

7. Restructuring Activities

A summary of the changes in the liabilities for restructuring activities is provided below:

(IN MILLIONS)	Total Initiatives
Balance at December 31, 2012	$	64
Charges		4363
Payments		(4359	)
Effect of foreign currency translation and reclassification adjustments		(4	)
Balance at June 30, 2013	$	60
Balance at September 30, 2013	$	64

Nielsen recorded $820 million and $164 million in restructuring charges, primarily relating to severance cost, for the three months ended ~~June~~September 30, 2013 and 2012, respectively. Nielsen recorded $4363 million and $5357 million in restructuring charges for the ~~six~~nine months ended ~~June~~September 30, 2013 and 2012, respectively, primarily relating to severance and contract termination costs.

Of the $6064 million in remaining liabilities for restructuring actions, $4853 million is expected to be paid within one year and is classified as a current liability within the condensed consolidated balance sheet as of ~~June~~September 30, 2013.

8. Fair Value Measurements

Fair value is defined as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining fair value, the Company considers the principal or most advantageous market in which the Company would transact, and also considers assumptions that market participants would use when pricing the asset or liability, such as inherent risk, transfer restrictions, and risk of non-performance.

There are three levels of inputs that may be used to measure fair value:

Level 1:		Quoted market prices available in active markets for identical assets or liabilities as of the reporting date.
Level 2:		Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date.
Level 3:		Pricing inputs that are generally unobservable and may not be corroborated by market data.

Level 3: Pricing inputs that are generally unobservable and may not be corroborated by market data.

Financial Assets and Liabilities Measured on a Recurring Basis

The Company’s financial assets and liabilities are measured and recorded at fair value, except for equity method investments, cost method investments, and long-term debt. Financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurements. The Company’s assessment of the significance of a particular input to the fair value measurements requires judgment, and may affect the valuation of the assets and liabilities being measured and their placement within the fair value hierarchy.

~~The following table summarizes the valuation of the Company’s material financial assets and liabilities measured at fair value on a recurring basis as of June~~ ~~30, 2013 and December 31, 2012:~~ 13

(IN MILLIONS)	June 30, 2013		Level 1		Level 2		Level 3
Assets:
Investments in equity securities(1)	$	24	$	24	$	—	$	—
Plan assets for deferred compensation(2)		24		24		—		—
Investment in mutual funds(3)		2		2		—		—
Total	$	50	$	50	$	—	$	—
Liabilities:
Interest rate swap arrangements(4)	$	9	$	—	$	9	$	—
Deferred compensation liabilities(5)		24		24		—		—
Total	$	33	$	24	$	9	$	—

The following table summarizes the valuation of the Company’s material financial assets and liabilities measured at fair value on a recurring basis as of September 30, 2013 and December 31, 2012:


(IN MILLIONS)	September 30, 2013		Level 1		Level 2		Level 3
Assets:
Investments in equity securities⁽¹⁾	$	28	$	28	$	—	$	—
Plan assets for deferred compensation⁽²⁾		23		23		—		—
Investment in mutual funds⁽³⁾		2		2		—		—
Total	$	54	$	54	$	—	$	—
Liabilities:
Interest rate swap arrangements⁽⁴⁾	$	13	$	—	$	13	$	—
Deferred compensation liabilities⁽⁵⁾		23		23		—		—
Total	$	36	$	23	$	13	$	—


	December 31, 2012		Level 1		Level 2		Level 3
Assets:
Investments in equity securities⁽¹⁾	$	13	$	13	$	—	$	—
Plan assets for deferred compensation⁽²⁾		22		22		—		—
Investment in mutual funds⁽³⁾		2		2		—		—
Total	$	37	$	37	$	—	$	—
Liabilities:
Interest rate swap arrangements⁽⁴⁾	$	22	$	—	$	22	$	—
Deferred compensation liabilities⁽⁵⁾		22		22		—		—
Total	$	44	$	22	$	22	$	—

(1)

Investments in equity securities are carried at fair value, which is based on the quoted market price at period end in an active market. These investments are classified as available-for-sale with any unrealized gains or losses resulting from changes in fair value recorded, net of tax, as a component of accumulated other comprehensive income/(loss) until realized.

(2)

Plan assets are comprised of investments in mutual funds, which are intended to fund liabilities arising from deferred compensation plans. These investments are carried at fair value, which is based on quoted market prices at period end in active markets. These investments are classified as trading securities with any gains or losses resulting from changes in fair value recorded in other income/(expense), net.

(3)	Investments in mutual funds are money-market accounts held with the intention of funding certain specific retirement plans.

(4)	Derivative financial instruments include interest rate swap arrangements recorded at fair value based on externally-developed valuation models that use readily observable market parameters and the consideration of counterparty risk.

(5)

The Company offers certain employees the opportunity to participate in a deferred compensation plan. A participant’s deferrals are invested in a variety of participant directed stock and bond mutual funds and are classified as trading securities. Changes in the fair value of these securities are measured using quoted prices in active markets based on the market price per unit multiplied by the number of units held exclusive of any transaction costs. A corresponding adjustment for changes in fair value of the trading securities is also reflected in the changes in fair value of the deferred compensation obligation.

Derivative Financial Instruments

Nielsen uses interest rate swap derivative instruments principally to manage the risk that changes in interest rates will affect the cash flows of its underlying debt obligations.

To qualify for hedge accounting, the hedging relationship must meet several conditions with respect to documentation, probability of occurrence, hedge effectiveness and reliability of measurement. Nielsen documents the relationship between hedging instruments and hedged items, as well as its risk management objective and strategy for undertaking various hedge transactions as well as the hedge effectiveness assessment, both at the hedge inception and on an ongoing basis. Nielsen recognizes all derivatives at fair value either as assets or liabilities in the consolidated balance sheets and changes in the fair values of such instruments are recognized currently in earnings unless specific hedge accounting criteria are met. If specific cash flow hedge accounting criteria are met, Nielsen recognizes the changes in fair value of these instruments in accumulated other comprehensive income/(loss).

Nielsen manages exposure to possible defaults on derivative financial instruments by monitoring the concentration of risk that Nielsen has with any individual bank and through the use of minimum credit quality standards for all counterparties. Nielsen does not require collateral or other security in relation to derivative financial instruments. A derivative contract entered into between Nielsen or certain of its subsidiaries and a counterparty that was also a lender under Nielsen’s senior secured credit facilities at the time the derivative contract was entered into is guaranteed under the senior secured credit facilities by Nielsen and certain of its subsidiaries (see Note 9—Long-term Debt and Other Financing Arrangements for more information). Since it is Nielsen’s policy to only enter into derivative contracts with banks of internationally acknowledged standing, Nielsen considers the counterparty risk to be remote.

It is Nielsen’s policy to have an International Swaps and Derivatives Association (“ISDA”) Master Agreement established with every bank with which it has entered into any derivative contract. Under each of these ISDA Master Agreements, Nielsen agrees to settle only the net amount of the combined market values of all derivative contracts outstanding with any one counterparty should that counterparty default. Certain of the ISDA Master Agreements contain cross-default provisions where if the Company either defaults in payment obligations under its credit facility or if such obligations are accelerated by the lenders, then the Company could also be declared in default on its derivative obligations. At June ~~30, 2013, Nielsen had no material exposure to potential economic losses due to counterparty credit default risk or cross-default risk on its derivative financial instruments.~~ 14

require collateral or other security in relation to derivative financial instruments. A derivative contract entered into between Nielsen or certain of its subsidiaries and a counterparty that was also a lender under Nielsen’s senior secured credit facilities at the time the derivative contract was entered into is guaranteed under the senior secured credit facilities by Nielsen and certain of its subsidiaries (see Note 9—Long-term Debt and Other Financing Arrangements for more information). Since it is Nielsen’s policy to only enter into derivative contracts with banks of internationally acknowledged standing, Nielsen considers the counterparty risk to be remote.

It is Nielsen’s policy to have an International Swaps and Derivatives Association (“ISDA”) Master Agreement established with every bank with which it has entered into any derivative contract. Under each of these ISDA Master Agreements, Nielsen agrees to settle only the net amount of the combined market values of all derivative contracts outstanding with any one counterparty should that counterparty default. Certain of the ISDA Master Agreements contain cross-default provisions where if the Company either defaults in payment obligations under its credit facility or if such obligations are accelerated by the lenders, then the Company could also be declared in default on its derivative obligations. At September 30, 2013, Nielsen had no material exposure to potential economic losses due to counterparty credit default risk or cross-default risk on its derivative financial instruments.

Interest Rate Risk

Nielsen is exposed to cash flow interest rate risk on the floating-rate U.S. Dollar and Euro Term Loans, and uses floating-to-fixed interest rate swaps to hedge this exposure. For these derivatives, Nielsen reports the after-tax gain or loss from the effective portion of the hedge as a component of accumulated other comprehensive income/(loss) and reclassifies it into earnings in the same period or periods in which the hedged transaction affects earnings, and within the same income statement line item as the impact of the hedged transaction.

As of ~~June~~September 30, 2013 the Company had the following outstanding interest rate swaps utilized in the management of its interest rate risk:

	Notional Amount		Maturity Date		Currency
Interest rate swaps designated as hedging instruments
US Dollar term loan floating-to-fixed rate swaps	$	1,000,000,000		November 2013		US Dollar
US Dollar term loan floating-to-fixed rate swaps	$	250,000,000		November 2014		US Dollar
US Dollar term loan floating-to-fixed rate swaps	$	250,000,000		September 2015		US Dollar
US Dollar term loan floating-to-fixed rate swaps	$	125,000,000		November 2015		US Dollar
Euro term loan floating-to-fixed rate swaps	€	125,000,000		November 2015		Euro
US Dollar term loan floating-to-fixed rate swaps	$	575,000,000		May 2016		US Dollar
US Dollar term loan floating-to-fixed rate swaps	$	500,000,000		November 2016		US Dollar

Nielsen expects to recognize approximately $1012 million of net pre-tax losses from accumulated other comprehensive loss to interest expense in the next 12 months associated with its interest-related derivative financial instruments.

1415

Fair Values of Derivative Instruments in the Consolidated Balance Sheets

The fair values of the Company’s derivative instruments as of ~~June~~September 30, 2013 and December 31, 2012 were as follows:

	June 30, 2013				December 31, 2012
	September 30, 2013				December 31, 2012
Derivatives Designated as Hedging Instruments (IN MILLIONS)	Accounts Payable and Other Current Liabilities		Other Non- Current Liabilities		Accounts Payable and Other Current Liabilities		Other Non- Current Liabilities
Interest rate swaps	$	21	$	712	$	6	$	16

Derivatives in Cash Flow Hedging Relationships

The pre-tax effect of derivative instruments in cash flow hedging relationships for the three months ended ~~June~~September 30, 2013 and 2012 was as follows:

Derivatives in Cash Flow Hedging Relationships (IN MILLIONS)	Amount of ~~(Gain)/~~ Loss Recognized in OCI (Effective Portion) Three Months Ended ~~June~~September 30,					Location of Loss Reclassified from OCI into Income (Effective Portion)	Amount of Loss Reclassified from OCI into Income (Effective Portion) Three Months Ended ~~June~~September 30,
	2013			2012			2013		2012
Interest rate swaps	$	(57	)	$	76	Interest expense	$	4	$	76

The pre-tax effect of derivative instruments in cash flow hedging relationships for the ~~six~~nine months ended ~~June~~September 30, 2013 and 2012 was as follows:

Derivatives in Cash Flow Hedging Relationships (IN MILLIONS)	Amount of ~~(Gain)/~~ Loss Recognized in OCI (Effective Portion) ~~Six~~Nine Months Ended ~~June~~September 30,					Location of Loss Reclassified from OCI into Income (Effective Portion)	Amount of Loss Reclassified from OCI into Income (Effective Portion) ~~Six~~Nine Months Ended ~~June~~September 30,
	2013			2012			2013		2012
Interest rate swaps	$	(52	)	$	1521	Interest expense	$	812	$	1319

Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis

The Company is required, on a nonrecurring basis, to adjust the carrying value or provide valuation allowances for certain assets using fair value measurements. The Company’s equity method investments, cost method investments, and non-financial assets, such as goodwill, intangible assets, and property, plant and equipment, are measured at fair value when there is an indicator of impairment and recorded at fair value only when an impairment charge is recognized.

The Company did not measure any material non-financial assets or liabilities at fair value during the three or ~~six~~nine months ended ~~June~~September 30, 2013.

1516

9. Long-term Debt and Other Financing Arrangements

Unless otherwise stated, interest rates are as of ~~June~~September 30, 2013.

	June 30, 2013							December 31, 2012
	September 30, 2013							December 31, 2012
(IN MILLIONS)	Weighted Interest Rate			Carrying Amount		Fair Value		Weighted Interest Rate			Carrying Amount		Fair Value
$1,610 million Senior secured term loan due 2013				$	—	$	—				$	218	$	218
$2,386 million Senior secured term loan due 2016					—		—					2,315		2,324
$2,532 million Senior secured term loan (LIBOR based variable rate of 2.94%) due 2016					2,520		2,522					—		—
$2,532 million Senior secured term loan (LIBOR based variable rate of 2.93%) due 2016					2,513		2,513					—		—
$1,222 million Senior secured term loan (LIBOR based variable rate of 2.19%) due 2017					1,146		1,146					1,176		1,173
$1,222 million Senior secured term loan (LIBOR based variable rate of 2.18%) due 2017					1,131		1,130					1,176		1,173
227 million Senior secured term loan due 2013					—		—					34		34
€227 million Senior secured term loan due 2013					—		—					34		34
273 million Senior secured term loan due 2016					—		—					347		347
€273 million Senior secured term loan due 2016					—		—					347		347
289 million Senior secured term loan (Euro LIBOR based variable rate of 3.06%) due 2016					375		378					—		—
€289 million Senior secured term loan (Euro LIBOR based variable rate of 3.09%) due 2016					389		390					—		—
$635 million senior secured revolving credit facility (Euro LIBOR or LIBOR based variable rate) due 2016					—		—					—		—
Total senior secured credit facilities (with weighted-average interest rate)		2.9089	%		4,~~041~~033		4,~~046~~033		3.46	%		4,090		4,096
$215 million 11.625% senior debenture loan due 2014					~~212~~213		~~223~~220					209		232
$1,080 million 7.75% senior debenture loan due 2018					1,083		1,~~166~~174					1,084		1,211
$800 million 4.50% senior debenture loan due 2020					800		~~778~~767					800		794
Total debenture loans (with weighted-average interest rate)		7.65	%		2,095		2,167		7.60	%		2,093		2,237
$625 million 5.50% senior debenture loan due 2021					625		626					—		—
Total debenture loans (with weighted-average interest rate)		7.23	%		2,721		2,787		7.60	%		2,093		2,237
Other loans					4		4					1		1
Total long-term debt		4.5264	%		6,~~140~~758		6,~~217~~824		4.86	%		6,184		6,334
Capital lease and other financing obligations					~~108~~107							107
Short-term debt					2827							7
Bank overdrafts					717							5
Total debt and other financing arrangements					6,~~283~~909							6,303
Less: Current portion of long-term debt, capital lease and other financing obligations and other short-term borrowings					~~363~~388							362
Non-current portion of long-term debt and capital lease and other financing obligations				$	56,~~920~~521						$	5,941

The fair value of the Company’s long-term debt instruments was based on the yield on public debt where available or current borrowing rates available for financings with similar terms and maturities and such fair value measurements are considered Level 1 or Level 2 in nature, respectively.

Annual maturities of Nielsen’s long-term debt are as follows:

(IN MILLIONS)
For July 1, 2013 to December 31, 2013	$	46
For October 1, 2013 to December 31, 2013	$	23
2014		~~352~~354
2015		151
2016		2,~~975~~989
2017		733
2018		1,083
Thereafter		~~800~~1,425
	$	6,~~140~~758

In ~~December~~September ~~2012~~2013, the Company ~~signed~~issued a$625 ~~definitive~~million ~~agreement~~aggregate toprincipal ~~acquire~~amount ~~Arbitron~~of ~~Inc~~5.50% ~~(NYSE:~~Senior ~~ARB),~~Notes andue ~~international~~2021 ~~media~~at ~~and~~par, ~~marketing~~receiving ~~research~~cash ~~firm,~~proceeds ~~for~~of approximately $48616 ~~per~~million, ~~share~~net inof ~~cash~~fees ~~(the~~and ~~“Transaction”)~~expenses. InConcurrent ~~addition,~~with this issuance the Company ~~entered~~called ~~into~~for redemption of all of its 11.625% Senior Notes due 2014 effective October 23, 2013, at a ~~commitment~~redemption ~~for~~price anequal ~~unsecured~~to ~~note~~100% orof ~~unsecured~~the ~~loan~~principal amount of upsuch to2014 ~~$1,300~~notes ~~million~~redeemed (plus accrued and unpaid interest to the redemption date and an “~~Commitment~~applicable ~~Letter~~premium”) toas ~~fund~~described in the ~~closing~~indenture ofrelated to the ~~Transaction~~2014 notes. As The redemption of ~~June 30,~~the ~~2013,~~11.625 ~~there~~Senior ~~were~~Note nodue ~~borrowings~~2014 ~~outstanding~~will ~~under~~result in a pre-tax charge of $8 million in the ~~Commitment~~fourth ~~Letter~~quarter of 2013.

In April 2013, Arbitron’s shareholders voted to approve the Transaction, which remains subject to customary closing conditions, including regulatory review.

Amendment to Senior Secured Credit Facility

In February 2013, the Second Amended and Restated Senior Secured Credit Agreement was amended and restated to provide for a new class of term loans (the “Class E Term Loans”) in an aggregate principal amount of $2,532 million and €289 million, the proceeds of which were used to repay or replace in full a like amount of our existing Class A Term Loans maturing August 9, 2013, Class B Term Loans maturing May 1, 2016 and Class C Term Loans maturing May 1, 2016. As a result of this transaction, the Company recorded a charge of $12 million primarily related to the write-off of previously capitalized deferred financing fees associated with the Class A, B and C term loans to other expense, net in the condensed consolidated statement of operations.

The Class E Term Loans will mature in full on May 1, 2016 and are required to be repaid in equal quarterly installments in aggregate annual amounts equal to 1.00% of the original principal amount of Class E Term Loans, with the balance payable on May 1, 2016. Class E Term Loans denominated in dollars bear interest equal to, at our election, a base rate or eurocurrency rate, in each case plus an applicable margin, which is equal to 1.75% (in the case of base rate loans) or 2.75% (in the case of eurocurrency rate loans). Class E Term Loan denominated in Euros bear interest equal to the eurocurrency rate plus an applicable margin of 3.00%. The newly Amended and Restated Senior Secured Credit Agreement contains substantially the same affirmative and negative covenants as those of the Existing Credit Agreement, other than certain amendments to the limitation on the ability of Nielsen and certain of its subsidiaries and affiliates to incur indebtedness and make investments.

10. Income Taxes

The effective tax rates for the three months ended ~~June~~September 30, 2013 and 2012 were 2823% and 2638%, respectively. The tax rate for the three months ended ~~June~~September 30, 2013 was ~~higher~~lower than the statutory rate as a result of the ~~tax impact of the accrual for future audit settlements offset by the~~ favorable impact of ~~2012~~ return to provision adjustments as well as the favorable impact of certain financing activities. The tax rate for the three months ended ~~June~~September 30, 2012 was higher than the statutory rate as the favorable impact of certain financing activities was ~~offset~~more ~~slightly~~than offset by the tax rate and other differences in other jurisdictions where the Company files tax returns.

The effective tax ~~rate~~rates for the ~~six~~nine months ended ~~June~~September 30, 2013 and 2012 were 3127% and 2431%, respectively. The tax ~~rates~~rate for the ~~six~~nine months ended ~~June~~September 30, 2013 was higher than the statutory rate as a result of the tax impact of ~~the~~ Venezuela currency revaluation and accrual for future audit settlements offset by ~~the favorable 2012~~ return to provision adjustments as well as the favorable impact of certain financing activities and release of tax contingencies. The tax rate for the ~~six~~nine months ended ~~June~~September 30, 2012 was ~~lower~~higher than the statutory ~~expense~~ rate as the favorable impact of certain financing activities was ~~offset~~more ~~slightly~~than offset by the tax rate and other differences in other jurisdictions where the Company files tax returns.

Liabilities for unrecognized income tax benefits totaled $93232 million and $236 million as of September 30, 2013 and December 31, 2012, respectively. The net liabilities for unrecognized tax benefits not reduced by net operating losses, tax credits and other deferred tax assets totaled $90 million and $94 million as of ~~June~~September 30, 2013 and December 31, 2012, respectively. If the Company’s tax positions are favorably sustained by the taxing authorities, the reversal of the underlying liabilities would reduce the Company’s effective tax rate in future periods.

The Company files numerous consolidated and separate income tax returns in the U.S. Federal jurisdiction and in many state and foreign jurisdictions. With few exceptions, the Company is no longer subject to U.S. Federal income tax examinations for 2006 and prior periods. In addition, the Company has subsidiaries in various states, provinces and countries that are currently under audit for years ranging from 2010 through 2011. 18

The Company files numerous consolidated and separate income tax returns in the U.S. federal jurisdictions and in many state and foreign jurisdictions. With few exceptions, the Company is no longer subject to U.S. federal income tax examinations for 2006 and prior periods. In addition, the Company has subsidiaries in various states, provinces and countries that are currently under audit for years ranging from 2010 through 2011.

The Canadian Tax Authorities recently completed the tax examination for tax year 2007 and, it is anticipated that the examination for tax years 2008, 2009 and 2010 will be concluded within the next twelve to eighteen months. To date, the Company is not aware of any material adjustments not already accrued related to any of the current Federal, state or foreign audits under examination.

11. Commitments and Contingencies

Legal Proceedings and Contingencies

Sunbeam Television Corp. (“Sunbeam”) filed a lawsuit in Federal District Court in Miami, Florida in April 2009. The lawsuit alleged that weNielsen violated Federal and Florida state antitrust laws and Florida’s unfair trade practices laws by attempting to maintain a monopoly and abuse ~~our~~the Company’s position in the market, and breached our contract with Sunbeam by producing defective ratings data through our sampling methodology. The complaint did not specify the amount of damages sought and also sought declaratory and equitable relief. In January 2011, the U.S. District Court in the Southern District of Florida dismissed all federal and state antitrust claims brought against Nielsen by Sunbeam stating that Sunbeam failed to show that any competitor was “willing and able” to enter the local television ratings market in Miami and was excluded from that market by the Company. The Court also determined that Sunbeam could not prove that the current ratings for Sunbeam’s local station WSVN are less accurate than they would be under a prospective competitor’s methodology. The Court deferred ruling on the remaining ancillary claims, including breach of contract and violation of Florida’s Deceptive and Unfair Trade Practices Act. Subsequent to the court’s decision, Sunbeam voluntarily dismissed with prejudice the remaining claims in the case so that all claims have been dismissed. Sunbeam appealed the court’s dismissal of the antitrust claims. On March 4, 2013, the U.S. Court of Appeals for the Eleventh Judicial Circuit affirmed the lower court’s decision to dismiss the claims. On March 22, 2013, Sunbeam filed a petition for rehearing the case. The petition was denied on May 13, 2012.

brought against us by Sunbeam stating that Sunbeam failed to show that any competitor was “willing and able” to enter the local television ratings market in Miami and was excluded from that market by us. The Court also determined that Sunbeam could not prove that the current ratings for Sunbeam’s local station WSVN are less accurate than they would be under a prospective competitor’s methodology. The Court deferred ruling on the remaining ancillary claims, including breach of contract and violation of Florida’s Deceptive and Unfair Trade Practices Act. Subsequent to the court’s decision, Sunbeam voluntarily dismissed with prejudice the remaining claims in the case so that all claims have been dismissed. Sunbeam appealed the court’s dismissal of the antitrust claims. On March 4, 2013, the U.S. Court of Appeals for the Eleventh Judicial Circuit affirmed the lower court’s decision to dismiss the claims. On March 22, 2013, Sunbeam filed a petition for rehearing the case. The petition was denied on May 13, 2012.

Nielsen is subject to litigation and other claims in the ordinary course of business, some of which include claims for substantial sums. Accruals have been recorded when the outcome is probable and can be reasonably estimated. While the ultimate results of claims and litigation cannot be determined, the Company does expect that the ultimate disposition of these matters will not have a material adverse effect on its operations or financial condition. However, depending on the amount and the timing, an unfavorable resolution of some or all of these matters could materially affect the Company’s future results of operations or cash flows in a particular period.

Other Contractual Arrangements

In February 2013, the Company amended its Amended and Restated Master Services Agreement (the “MSA”), dated as of October 1, 2007 with Tata America International Corporation and Tata Consultancy Services Limited (jointly, “TCS”). The term of the MSA has been extended for an additional three years, so as to expire on December 31, 2020, with a one-year renewal option granted to Nielsen. In addition, the Company has increased its commitment to purchase services from TCS (the “Minimum Commitment”) from $1.0 billion to $2.5 billion over the life of the contract (from October 1, 2007), including a commitment to purchase at least $100 million in services per year (the “Annual Commitment”). TCS’ charges under the separate Global Infrastructure Services Agreement between the parties will be credited against the Minimum Commitment and the Annual Commitment. TCS will continue to globally provide the Company with professional services relating to information technology (including application development and maintenance), business process outsourcing, client service knowledge process outsourcing, management sciences, analytics, and financial planning and analytics. As Nielsen orders specific services under the Agreement, the parties will execute Statements of Work (“SOWs”) describing the specific scope of the services to be performed by TCS. The amount of the Minimum Commitment and the Annual Commitment may be reduced on the occurrence of certain events, some of which also provide the Company with the right to terminate the Agreement or SOWs, as applicable.

Cyprus Agreement

On March 25, 2013, Cyprus and certain members of the European Union reached an agreement on measures intended to restore the viability of the financial sector of Cyprus. As part of these measures Cyprus has agreed to downsize its local financial sector including:

(1)	The immediate dissolution of Cyprus Popular Bank under which equity shareholders, bondholders and uninsured depositors (defined as those with deposits in excess of €100 thousand) will contribute to make up the losses of the bank; and

(2)

The recapitalization of the Bank of Cyprus (“BoC”) through a deposit/equity conversion of uninsured deposits, with full contribution of equity shareholders and bondholders. Currently 37.5% of uninsured deposits of BoC have been converted into Class A shares with voting and dividend rights. An additional 22.5% have been “frozen” and may also be partially or fully used to issue new Class A shares, as necessary.

As a result of this agreement, the Company recorded a charge of $4 million during the first quarter of 2013 in Selling, General and Administrative expenses in the statement of operations representing the uninsured deposits either contributed to make up losses of Cyprus Popular Bank or converted into Class A shares of BoC, as described above. The Company does not expect this agreement to significantly impact future operating results

12. Segments

The Company aligns its operating segments in order to conform to management’s internal reporting structure, which is reflective of service offerings by industry. Management aggregates such operating segments into two reporting segments: what consumers buy (“Buy”), consisting principally of market research information and analytical services; and what consumers watch (“Watch”), consisting principally of television, radio, online and mobile audience and advertising measurement and corresponding analytics. In June 2013, Nielsen completed the sale of its Expositions reporting segment (see Note 4, Discontinued Operations, for more information). The Company’s condensed consolidated statements of operations reflect the Expositions reporting segment as a discontinued operation.

2013, Nielsen completed the sale of its Expositions reporting segment (see Note 4, Discontinued Operations, for more information). The Company’s condensed consolidated statements of operations reflect the Expositions reporting segment as a discontinued operation.

Corporate consists principally of unallocated items such as certain facilities and infrastructure costs as well as intersegment eliminations. Certain corporate costs, other than those described above, including those related to selling, finance, legal, human resources, and information technology systems, are considered operating costs and are allocated to the Company’s segments based on either the actual amount of costs incurred or on a basis consistent with the operations of the underlying segment. Information with respect to the operations of each of Nielsen’s business segments is set forth below based on the nature of the services offered and geographic areas of operations.

Business Segment Information

(IN MILLIONS)	Buy		Watch		Expositions		Corporate			Total
Three Months Ended June 30, 2013
Three Months Ended September 30, 2013
Revenues	$	~~867~~871	$	~~519~~516	$	—	$	—		$	1,~~386~~387
Depreciation and amortization	$	5451	$	7064	$	—	$	2		$	~~126~~117
Restructuring charges	$	610	$	47	$	—	$	(23	)	$	820
Stock-based compensation	$	43	$	23	$	—	$	5		$	11
Operating income/(loss)	$	~~107~~110	$	~~157~~160	$	—	$	(2326	)	$	~~240~~244
Total assets as of June 30, 2013	$	6,739	$	6,699	$	—	$	1,099		$	14,537
Total assets as of September 30, 2013	$	6,808	$	8,419	$	—	$	476		$	15,703
(IN MILLIONS)	Buy		Watch		Expositions		Corporate			Total
Three Months Ended June 30, 2012
Three Months Ended September 30, 2012
Revenues	$	~~849~~852	$	~~493~~499	$	—	$	—		$	1,~~342~~351
Depreciation and amortization	$	4952	$	68	$	—	$	34		$	~~120~~124
Restructuring charges	$	82	$	72	$	—	$	1—		$	164
Stock-based compensation	$	23	$	12	$	—	$	35		$	610
Operating income/(loss)	$	~~110~~118	$	~~137~~141	$	—	$	(1814	)	$	~~229~~245
Total assets as of December 31, 2012	$	6,885	$	6,706	$	758	$	234		$	14,583

(IN MILLIONS)	Buy		Watch		Corporate			Total
Six Months Ended June 30, 2013
Revenues	$	1,692	$	1,013	$	—		$	2,705
Depreciation and amortization	$	105	$	138	$	4		$	247
Restructuring charges	$	18	$	11	$	14		$	43
Stock-based compensation	$	7	$	4	$	10		$	21
Operating income/(loss)	$	160	$	279	$	(57	)	$	382
(IN MILLIONS)	Buy		Watch		Corporate			Total
Six Months Ended June 30, 2012
Revenues	$	1,648	$	967	$	—		$	2,615
Depreciation and amortization	$	102	$	136	$	5		$	243
Restructuring charges	$	39	$	12	$	2		$	53
Stock-based compensation	$	4	$	3	$	7		$	14
Operating income/(loss)	$	145	$	248	$	(38	)	$	355

(IN MILLIONS)	Buy		Watch		Corporate			Total
Nine Months Ended September 30, 2013
Revenues	$	2,563	$	1,529	$	—		$	4,092
Depreciation and amortization	$	156	$	202	$	6		$	364
Restructuring charges	$	28	$	18	$	17		$	63
Stock-based compensation	$	10	$	7	$	15		$	32
Operating income/(loss)	$	270	$	439	$	(83	)	$	626

(IN MILLIONS)	Buy		Watch		Corporate			Total
Nine Months Ended September 30, 2012
Revenues	$	2,500	$	1,466	$	—		$	3,966
Depreciation and amortization	$	154	$	204	$	9		$	367
Restructuring charges	$	41	$	14	$	2		$	57
Stock-based compensation	$	7	$	5	$	11		$	23
Operating income/(loss)	$	263	$	389	$	(52	)	$	600

13. Guarantor Financial Information

The following supplemental financial information sets forth for the Company, its subsidiaries that have issued certain debt securities (the “Issuers”) and its guarantor and non-guarantor subsidiaries, all as defined in the credit agreements, the condensed consolidating balance sheet as of ~~June~~September 30, 2013 and December 31, 2012, condensed consolidating statements of operations for three and ~~six~~nine months ended ~~June~~September 30, 2013 and 2012 and condensed consolidating statement cash flows for months ended ~~June~~September 30, 2013 and 2012. The Senior Notes are jointly and severally guaranteed on an unconditional basis by Nielsen and subject to certain exceptions, each of the direct and indirect wholly-owned subsidiaries of Nielsen, including VNU Intermediate Holding B.V., Nielsen Holding and Finance B.V., VNU International B.V., TNC (US) Holdings, Inc., VNU Marketing Information, Inc. and ACN Holdings, Inc., and the wholly-owned subsidiaries thereof, including the wholly-owned U.S. subsidiaries of ACN Holdings, Inc., in each case to the extent that such entities provide a guarantee under the senior secured credit facilities. The issuers are Nielsen Finance LLC and Nielsen Finance Co., both wholly-owned subsidiaries of ACN Holdings, Inc. and subsidiary guarantors and The Nielsen Company (Luxembourg) S ar l., a wholly owned subsidiary of Nielsen Holding and Finance B.V. The historical financial information has been updated to reflect The Nielsen Company (Luxembourg) S ar l. as an issuer.

provide a guarantee under the senior secured credit facilities. The issuers are the Nielsen Finance LLC and Nielsen Finance Co., both wholly-owned subsidiaries of ACN Holdings, Inc. and subsidiary guarantors of the debt issued by Nielsen.

Nielsen is a holding company and does not have any material assets or operations other than ownership of the capital stock of its direct and indirect subsidiaries. All of Nielsen’s operations are conducted through its subsidiaries, and, therefore, Nielsen is expected to continue to be dependent upon the cash flows of its subsidiaries to meet its obligations.

The Nielsen Company B.V.

Condensed Consolidating Statement of Comprehensive Income (Unaudited)

For the three months ended ~~June~~September 30, 2013

(IN MILLIONS)	Parent			Issuers			Guarantor			Non- Guarantor			Elimination			Consolidated
Revenues	$	—		$	—		$	~~681~~675		$	~~705~~712		$	—		$	1,~~386~~387
Cost of revenues, exclusive of depreciation and amortization shown separately below		—			—			~~250~~251			~~330~~322			—			~~580~~573
Selling, general and administrative expenses, exclusive of depreciation and amortization shown separately below		—			—			~~207~~212			~~225~~221			—			~~432~~433
Depreciation and amortization		—			—			9389			3328			—			~~126~~117
Restructuring charges		—			—			—12			8			—			820
Operating income		—			—			~~131~~111			~~109~~133			—			~~240~~244
Interest income		—			~~151~~170			1124			54			(~~167~~197	)		—1
Interest expense		—			(7374	)		(~~154~~189	)		(1312	)		~~167~~197			(7378	)
Foreign currency exchange transaction income/(expense), net		—			—			—2			(49	)		—			(47	)
Other income/(expense), net		—			—			4534			(4522	)		—			—12
Income from continuing operations before income taxes and equity in net income of subsidiaries and affiliates		—			7896			33(18	)		5294			—			~~163~~172
Provision for income taxes		—			(2815	)		~~(13~~30	)		(555	)		—			(4640	)
Equity in net income of subsidiaries		~~428~~135			—56			97123			—			(~~525~~314	)		—
Equity in net income of affiliates		—			—			3(1	)		1			—			4—
Income from continuing operations		~~428~~135			50137			~~120~~134			4840			(~~525~~314	)		~~121~~132
Income/(loss) from discontinued operations, net of tax		—			—			~~308~~1			(1	)		—			~~307~~—
Net income		~~428~~135			50137			~~428~~135			4739			(~~525~~314	)		~~428~~132
Total other comprehensive (loss)/income		(82	)		3			(82	)		(73	)		152			(82	)
Less net loss attributable to noncontrolling interests		—			—			—			(3	)		—			(3	)
Total comprehensive income/(loss)		346			53			346			(26	)		(373	)		346
Net income attributable to controlling interest		135			137			135			42			(314	)		135
Comprehensive loss attributable to noncontrolling interests		—			—			—			(3	)		—			(3	)
Total other comprehensive income		53			61			53			110			(222	)		55
Total comprehensive income/(loss) attributable to controlling interest	$	346		$	53		$	346		$	(23	)	$	(373	)	$	349
Total other comprehensive income attributable to noncontrolling interest		—			—			—			2			—			2
Total other comprehensive income attributable to controlling interest		53			61			53			108			(222	)		53
Total comprehensive loss		188			198			188			149			(536	)		187
Comprehensive loss attributable to noncontrolling interests		—			—			—			(1	)		—			(1	)
Total comprehensive income attributable to controlling interest	$	188		$	198		$	188		$	150		$	(536	)	$	188

2022

The Nielsen Company B.V.

Condensed Consolidated Statement of Comprehensive Income (Unaudited)

For the three months ended ~~June~~September 30, 2012

(IN MILLIONS)	Parent			Issuer			Guarantor			Non- Guarantor			Elimination			Consolidated
Revenues	$	—		$	—		$	~~659~~661		$	~~683~~690		$	—		$	1,~~342~~351
Cost of revenues, exclusive of depreciation and amortization shown separately below		—			—			~~240~~243			~~309~~307			—			~~549~~550
Selling, general and administrative expenses, exclusive of depreciation and amortization shown separately below		—			—			~~204~~207			~~224~~221			—			428
Depreciation and amortization		—			—			9195			29			—			~~120~~124
Restructuring charges		—			—			52			112			—			164
Operating income		—			—			~~119~~114			~~110~~131			—			~~229~~245
Interest income		1—			~~138~~174			15			7			(~~160~~195	)		1
Interest expense		—			(9495	)		(~~144~~180	)		(1715	)		~~160~~195			(95	)
Foreign currency exchange transaction losses, net		—			—			—			(31	)		—			(31
Other income/(expense), net		—			—			9430			(8431	)		—			10(1	)
Income from continuing operations before income taxes and equity in net income of subsidiaries and affiliates		1			44			84			13			—			142
Income/(loss) from continuing operations before income taxes and equity in net income/(loss) of subsidiaries and affiliates		—			79			(21	)		93			—			151
Provision for income taxes		—			(915	)		(2210	)		(633	)		—			(3758	)
Equity in net income of subsidiaries		~~110~~111			—54			42123			—			(~~152~~288	)		—
Equity in net income of affiliates		—			—			3			1			—			4
Equity in net (loss)/income of affiliates		—			—			(2	)		1			—			(1	)
Income from continuing operations		111			35118			~~107~~90			861			(~~152~~288	)		~~109~~92
Income from discontinued operations, net of tax		—			—			3			—			—			3
Income/(loss) from discontinued operations, net of tax		—			—			21			(1	)		—			20
Net income		111			35118			~~110~~111			860			(~~152~~288	)		112
Less net income attributable to noncontrolling interests		—			—			—			1			—			1
Net income attributable to controlling interest		111			35118			~~110~~111			759			(~~152~~288	)		111
Total other comprehensive (loss)/income		(89	)		12			(72	)		(148	)		208			(89	)
Total other comprehensive income/(loss)		65			67			57			72			(196	)		65
Total comprehensive income/(loss)		22176			47185			38168			~~(140~~132	)		56(484	)		23177
Comprehensive income attributable to noncontrolling interests		—			—			—			1			—			1
Total comprehensive income/(loss) attributable to controlling interests	$	22		$	47		$	38		$	(141	)	$	56		$	22
Total comprehensive income attributable to controlling interests	$	176		$	185		$	168		$	131		$	(484	)	$	176

2123

The Nielsen Company B.V.

Condensed Consolidating Statement of Comprehensive Income (Unaudited)

For the ~~six~~nine months ended ~~June~~September 30, 2013

(IN MILLIONS)	Parent			Issuers			Guarantor			Non- Guarantor			Elimination			Consolidated
Revenues	$	—		$	—		$	12,~~338~~013		$	12,~~367~~079		$	—		$	24,~~705~~092
Cost of revenues, exclusive of depreciation and amortization shown separately below		—			—			~~508~~759			~~651~~973			—			1,~~159~~732
Selling, general and administrative expenses, exclusive of depreciation and amortization shown separately below		—			—			~~417~~628			~~457~~679			—			~~874~~1,307
Depreciation and amortization		—			—			~~185~~274			6290			—			~~247~~364
Restructuring charges		—			—			1931			2432			—			4363
Operating income		—			—			~~209~~321			~~173~~305			—			~~382~~626
Interest income		—			~~298~~530			2448			913			(~~330~~589	)		12
Interest expense		—			(~~150~~224	)		(~~304~~555	)		(2537	)		~~330~~589			(~~149~~227	)
Foreign currency exchange transaction losses, net		—			—			—			(16	)		—			(16	)
Foreign currency exchange transaction gains/(losses), net		—			—			2			(25	)		—			(23	)
Other (expense)/income, net		—			(12	)		6498			(6486	)		—			~~(12~~—	)
Income from continuing operations before income taxes and equity in net income of subsidiaries and affiliates		—			~~136~~294			(786	)		77170			—			~~206~~378
Provision for income taxes		—			(48	)		—			(16	)		—			(64	)
(Provision)/benefit for income taxes		—			(63	)		30			(71	)		—			(104	)
Equity in net income of subsidiaries		~~465~~600			—372			~~148~~332			—			(~~613~~1,304	)		—
Equity in net income of affiliates		—			—			1—			23			—			3
Income from continuing operations		~~465~~600			88603			~~142~~276			63102			(~~613~~1,304	)		~~145~~277
Income from discontinued operations, net of tax		—			—			323			(4	)		—			319
Income/(loss) from discontinued operations, net of tax		—			—			324			(5	)		—			319
Net income		~~465~~600			88603			~~465~~600			5997			(~~613~~1,304	)		~~464~~596
Net loss attributable to noncontrolling interest		—			—			—			(14	)		—			(14	)
Net income attributable to controlling interest		~~465~~600			88603			~~465~~600			60101			(~~613~~1,304	)		~~465~~600
Total other comprehensive (loss)/income		(99	)		11			(99	)		(136	)		223			(100	)
Total other comprehensive loss		(46	)		(43	)		(45	)		(25	)		114			(45	)
Total other comprehensive loss attributable to noncontrolling interest		—			—			—			(1	)		—			(1	)
Total other comprehensive income attributable to noncontrolling interest		—			—			—			1			—			1
Total other comprehensive (loss)/income attributable to controlling interest		(99	)		11			(99	)		(135			223			(99	)
Total other comprehensive loss attributable to controlling interest		(46	)		(43	)		(45	)		(26	)		114			(46	)
Total comprehensive income/(loss)		366			99			366			(77	)		(390	)		364
Total comprehensive income		554			560			555			72			(1,190	)		551
Total comprehensive loss attributable to noncontrolling interest		—			—			—			(23	)		—			(23	)
Total comprehensive income/(loss) attributable to controlling interest	$	366		$	99		$	366		$	(75	)	$	(390	)	$	366
Total comprehensive income attributable to controlling interest	$	554			560			555		$	75		$	(1,190	)	$	554

2224

The Nielsen Company B.V.

Condensed Consolidated Statement of Comprehensive Income (Unaudited)

For the ~~six~~nine months ended ~~June~~September 30, 2012

(IN MILLIONS)	Parent			Issuers			Guarantor			Non- Guarantor			Elimination			Consolidated
Revenues	$	—		$	—		$	1,~~280~~941		$	12,~~335~~025		$	—		$	23,~~615~~966
Cost of revenues, exclusive of depreciation and amortization shown separately below		—			—			~~479~~722			~~620~~927			—			1,~~099~~649
Selling, general and administrative expenses, exclusive of depreciation and amortization shown separately below		—			—			~~414~~621			~~451~~672			—			~~865~~1,293
Depreciation and amortization		—			—			~~187~~282			5685			—			~~243~~367
Restructuring charges		—			—			1416			3941			—			5357
Operating income		—			—			~~186~~300			~~169~~300			—			~~355~~600
Interest income		2			~~277~~513			3247			1522			(~~324~~581	)		23
Interest expense		(1	)		(~~189~~284	)		(~~290~~532	)		(3348	)		~~324~~581			(~~189~~284	)
Foreign currency exchange transaction losses, net		—			—			(1	)		(1211	)		—			(1312	)
Other (expense)/income, net		—			(6	)		~~113~~143			(~~103~~134	)		—			43
Income from continuing operations before income taxes and equity in net income of subsidiaries and affiliates		1			82			40			36			—			159
Income from continuing operations before income taxes and equity in net (loss)/income of subsidiaries and affiliates		1			223			(43	)		129			—			310
Provision for income taxes		—			(2338	)		(515	)		(1043	)		—			(3896	)
Equity in net income of subsidiaries		~~138~~249			—80			83268			—			(~~221~~597	)		—
Equity in net income of affiliates		—			—			1			1			—			2
Equity in net (loss)/income of affiliates		—			—			(1	)		2			—			1
Income from continuing operations		~~139~~0			59265			~~119~~209			2788			(~~221~~597	)		~~123~~215
Income from discontinued operations, net of tax		—			—			19			(2	)		—			17
Income/(loss) from discontinued operations, net of tax		—			—			40			(3	)		—			37
Net income		~~139~~250			59265			~~138~~249			2585			(~~221~~597	)		~~140~~252
Less net income attributable to noncontrolling interest		—			—			—			12			—			12
Net income attributable to controlling interest		~~139~~250			59265			~~138~~249			2483			(~~221~~597	)		~~139~~250
Total other comprehensive (loss)/income		(1	)		4			5			(32	)		23			(1	)
Total other comprehensive income		64			68			62			40			(170	)		64
Total comprehensive income/(loss)		138			63			143			(7	)		(198	)		139
Total comprehensive income		314			333			311			125			(767	)		316
Comprehensive income attributable to noncontrolling interest		—			—			—			12			—			12
Total comprehensive income/(loss) attributable to controlling interests	$	~~138~~314		$	63333		$	~~143~~311		$	(8123	)	$	(~~198~~767	)	$	~~138~~314

2325

The Nielsen Company B.V.

Condensed Consolidating Balance Sheet (Unaudited)

~~June~~September 30, 2013

(IN MILLIONS)	Parent		Issuers		Guarantor		Non- Guarantor		Elimination			Consolidated
Assets:
Current assets
Cash and cash equivalents	$	—	$	—	$	~~876~~368	$	~~278~~357	$	—		$	~~1,154~~725
Trade and other receivables, net		—		—		~~383~~440		~~721~~698		—			1,~~104~~138
Prepaid expenses and other current assets		—		1112		~~142~~193		~~127~~131		—			~~280~~336
Intercompany receivables		—		~~187~~203		~~199~~235		~~117~~150		(~~503~~588	)		—
Total current assets		—		~~198~~215		1,~~600~~236		1,~~243~~336		(~~503~~588	)		2,~~538~~199
Non-current assets
Property, plant and equipment, net		—		—		~~308~~322		~~227~~233		—			~~535~~555
Goodwill		—		—		45,~~549~~487		2,~~142~~199		—			67,~~691~~686
Other intangible assets, net		—		—		34,~~904~~426		~~426~~429		—			4,~~330~~855
Deferred tax assets		10		—		8180		76		—			~~167~~166
Other non-current assets		—		3541		~~173~~116		6885		—			~~276~~242
Equity investment in subsidiaries		5,~~492~~618		—2,091		47,~~958~~434		—		(1015,~~450~~143	)		—
Intercompany loans		—		710,~~409~~434		~~542~~569		1,~~234~~265		(912,~~185~~268	)		—
Total assets	$	5,~~502~~628	$	712,~~642~~781	$	1619,~~115~~670	$	5,~~416~~623	$	(2027,~~138~~999	)	$	1415,~~537~~703
Liabilities and equity:
Current liabilities
Accounts payable and other current liabilities	$	—	$	4771	$	~~263~~395	$	~~526~~530	$	—		$	~~836~~996
Deferred revenues		—		—		~~139~~184		~~142~~140		—			~~281~~324
Income tax liabilities		—		—		6542		2457		—			8999
Current portion of long-term debt, capital lease obligations and short-term borrowings		—		~~317~~334		3836		818		—			~~363~~388
Intercompany payables		—		—		~~317~~366		~~186~~222		(~~503~~588	)		—
Total current liabilities		—		~~364~~405		~~822~~1,023		~~886~~967		(~~503~~588	)		1,~~569~~807
Non-current liabilities
Long-term debt and capital lease obligations		—		56,~~819~~420		84		17		—			56,~~920~~521
Deferred tax liabilities		—		71		~~799~~973		8192		—			~~951~~1,136
Intercompany loans		—		—		811,~~672~~726		~~513~~542		(912,~~185~~268	)		—
Other non-current liabilities		2		611		246		~~296~~308		—			~~550~~567
Total liabilities		2		6,~~260~~907		1014,~~623~~052		1,~~793~~926		(912,~~688~~856	)		~~8.990~~10,031
Total stockholders’ equity		5,~~500~~626		15,~~382~~874		5,~~492~~618		3,~~576~~651		(1015,~~450~~143	)		5,~~500~~626
Noncontrolling interests		—		—		—		4746		—			4746
Total equity		5,~~500~~626		15,~~382~~874		5,~~492~~618		3,~~623~~697		(1015,~~450~~143	)		5,~~547~~672
Total liabilities and equity	$	5,~~502~~628	$	712,~~642~~781	$	1619,~~115~~670	$	5,~~416~~623	$	(2027,~~138~~999	)	$	1415,~~537~~703

2426

The Nielsen Company B.V.

Condensed Consolidating Balance Sheet

December 31, 2012

(IN MILLIONS)	Parent		Issuers		Guarantor		Non- Guarantor		Elimination			Consolidated
Assets:
Current assets
Cash and cash equivalents	$	—	$	—	$	24	$	263	$	—		$	287
Trade and other receivables, net		—		—		404		706		—			1,110
Prepaid expenses and other current assets		—		14		132		132		—			278
Intercompany receivables		—		270		177		134		(581	)		—
Total current assets		—		284		737		1,235		(581	)		1,675
Non-current assets
Property, plant and equipment, net		—		—		303		257		—			560
Goodwill		—		—		5,046		2,306		—			7,352
Other intangible assets, net		—		—		4,088		467		—			4,555
Deferred tax assets		10		3		77		79		—			169
Other non-current assets		—		46		165		61		—			272
Equity investment in subsidiaries		5,157		—1,965		57,~~663~~163		—		(1014,~~820~~285	)		—
Intercompany loans		45		79,~~944~~444		555		1,300		(911,~~844~~344	)		—
Total assets	$	5,212	$	811,~~277~~742	$	1618,~~634~~134	$	5,705	$	(2126,~~245~~210	)	$	14,583
Liabilities and equity:
Current liabilities
Accounts payable and other current liabilities	$	—	$	52	$	347	$	572	$	—		$	971
Deferred revenues		—		—		217		156		—			373
Income tax liabilities		—		—		12		44		—			56
Current portion of long-term debt, capital lease obligations and short-term borrowings		—		340		15		7		—			362
Intercompany payables		—		14		414		153		(581	)		—
Total current liabilities		—		406		1,005		932		(581	)		1,762
Non-current liabilities
Long-term debt and capital lease obligations		—		5,843		81		17		—			5,941
Deferred tax liabilities		—		71		838		97		—			1006
Intercompany loans		—		—		910,~~295~~795		549		(911,~~844~~344	)		—
Other non-current liabilities		2		16		258		340		—			616
Total liabilities		2		6,336		1112,~~477~~977		1,935		(1011,~~425~~925	)		9,325
Total stockholders’ equity		5,210		15,~~941~~406		5,157		3,722		(1014,~~820~~285	)		5,210
Noncontrolling interests		—		—		—		48		—			48
Total equity		5,210		15,~~941~~406		5,157		3,770		(1014,~~820~~285	)		5,258
Total liabilities and equity	$	5,212	$	811,~~277~~742	$	1618,~~634~~134	$	5,705	$	(2126,~~245~~210	)	$	14,583

2527

The Nielsen Company B.V.

Condensed Consolidating Statement of Cash Flows (Unaudited)

For the ~~six~~nine months ended ~~June~~September 30, 2013

(IN MILLIONS)	Parent			Issuers			Guarantor			Non- Guarantor			Consolidated
Net cash provided by operating activities	$	—		$	~~219~~409		$	413		$	47168		$	~~270~~590
Investing activities:
Acquisition of subsidiaries and affiliates, net of cash acquired		—			—			(121,195	)		(7	)		(191,202	)
Proceeds from sale of subsidiaries and affiliates, net		—			—			934			—			934
Additions to property, plant and equipment and other assets		—			—			(3034	)		(2545	)		(5579	)
Additions to intangible assets		—			—			(~~105~~161	)		(1015	)		(~~115~~176	)
Net cash provided by/(used in) investing activities		—			—			787			(42	)		745
Net cash used in investing activities		—			—			(456	)		(67	)		(523	)
Financing activities:
Proceeds from the issuance of debt, net of issuance costs		—			12,~~866~~481			2120			34			12,~~890~~505
Repayments of debt		—			(1,~~911~~933	)		—			—			(1,~~911~~933	)
Increase in other short-term borrowings		—			—			—			212			212
Capital contributions to parent		(90163	)		—			—			—			(90163	)
Activity under stock plans		—			—			(34	)		(43	)		(7	)
Settlement of intercompany and other financing activities		90163			(~~174~~957	)		43773			31(3	)		(1024	)
Net cash (used in)/provided by financing activities		—			(~~219~~409	)		61789			3210			~~(126~~390	)
Net increase in cash and cash equivalents		—			—			852			15			867
Effect of exchange-rate changes on cash and cash equivalents		—			—			(2	)		(17	)		(19	)
Net increase in cash and cash equivalents		—			—			344			94			438
Cash and cash equivalents at beginning of period		—			—			24			263			287
Cash and cash equivalents at end of period	$	—		$	—		$	~~876~~368		$	~~278~~357		$	~~1,154~~725

The Nielsen Company B.V.

Condensed Consolidated Statement of Cash Flows (Unaudited)

For the ~~six~~nine months ended ~~June~~September 30, 2012

(IN MILLIONS)	Parent			Issuers			Guarantor			Non- Guarantor			Consolidated
Net cash provided by operating activities	$	1		$	46229		$	4981		$	26148		$	~~122~~459
Investing activities:
Acquisition of subsidiaries and affiliates, net of cash acquired		—			—			(70131	)		(45	)		(74136	)
Proceeds from sale of subsidiaries and affiliates, net		—			—			—(1	)		—			—(1	)
Additions to property, plant and equipment and other assets		—			—			(2231	)		(2841	)		(5072	)
Additions to intangible assets		—			—			(93137	)		(916	)		(~~102~~153	)
Net cash used in investing activities		—			—			(~~185~~300	)		(4162	)		(~~226~~362	)
Financing activities:
Net borrowings under revolving credit facility		—			—			~~215~~65			—			~~215~~65
Proceeds from the issuance of debt, net of issuance costs		—			1,209			—			—			1,209
Repayments of debt		(106	)		(1,~~251~~273	)		(2	)		—			(1,~~359~~381	)
Increase in other short-term borrowings		—			—			—			810			810
Capital contributions from parent		411			—			—			—			411
Activity under stock plans		—0			—0			(10	)		—0			(10	)
Settlement of intercompany and other financing activities		~~104~~94			(4165	)		~~(89~~156	)		(2096	)		(911	)
Net cash provided by/(used in) financing activities		2(1	)		(46229	)		~~123~~219			(1286	)		67(97	)
Net increase/(decrease) in cash and cash equivalents		3			—			(13	)		(27	)		(37	)
Effect of exchange-rate changes on cash and cash equivalents		—			—			—			4			4
Net increase/(decrease) in cash and cash equivalents		—			—			—			4			4
Cash and cash equivalents at beginning of period		—			—			33			285			318
Cash and cash equivalents at end of period	$	3—		$	—		$	2033		$	~~258~~289		$	~~281~~322

2628

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Introduction

The following discussion and analysis supplements management’s discussion and analysis of The Nielsen Company B.V. (“the Company” or “Nielsen”) for the year ended December 31, 2012 as contained in the Current Report on Form 8-K filed by the Company with the Securities and Exchange Commission on ~~June~~August 1912, 2013, and presumes that readers have read or have access to such discussion and analysis. The following discussion and analysis should also be read together with the accompanying Condensed Consolidated Financial Statements and related notes thereto. Further, this report may contain material that includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that reflect, when made, Nielsen’s current views with respect to current events and financial performance. Statements, other than those based on historical facts, which address activities, events or developments that we expect or anticipate may occur in the future are forward-looking statements. Such forward-looking statements are subject to many risks, uncertainties and factors relating to Nielsen’s operations and business environment that may cause actual results to be materially different from any future results, express or implied, by such forward-looking statements, including but not limited to, those set forth in this Item 2 and Part II, Item 1A, if any, and those noted in our 2012 Annual Report on Form 10-K under “Risk Factors.” Forward-looking statements speak only as of the date of this report or as of the date they were made. We disclaim any intention to update the current expectations or forward-looking statements contained in this report. Unless required by context, references to “we”, “us”, and “our” refer to Nielsen and each of its consolidated subsidiaries.

From time to time, Nielsen may use its website and social media outlets as channels of distribution of material company information. Financial and other material information regarding the company is routinely posted and accessible on our website at http://www.nielsen.com/investors, our Twitter account at http://twitter.com/NielsenIR and our iPad App, NielsenIR, available on the App Store.

Background and Executive Summary

We are a global information and measurement company that provides clients with a comprehensive understanding of consumers and consumer behavior. We deliver critical media and marketing information, analytics and industry expertise about what consumers buy (referred to herein as “Buy”) and what consumers watch and listen to on a global and local basis (consumer interaction across the television, radio, online and mobile viewing platforms referred to herein as “Watch”). Our information, insights and solutions help our clients maintain and strengthen their market positions and identify opportunities for profitable growth. We have a presence in ~~approximately~~more than 100 countries, including many developing and emerging markets, and hold leading market positions in many of our services and geographies.

We believe that important measures of our results of operations include revenue and operating income. Our long-term financial objectives include consistent revenue growth and expanding operating margins. Accordingly, we are focused on geographic market and service offering expansion to drive revenue growth and improving operating efficiencies including effective resource utilization, information technology leverage and overhead cost management.

Our business strategy is built upon a model that has traditionally yielded consistent revenue performance. Typically, before the start of each year, nearly 70% of our annual revenue has been committed under contracts in our combined Buy and Watch segments, which provides us with a high degree of stability to our revenue and allows us to effectively manage our profitability and cash flows. We continue to look for growth opportunities through global expansion, specifically within developing markets, as well as through the cross-platform expansion of our insights services and measurement services.

Our restructuring and other productivity initiatives have been focused on a combination of improving operating leverage through targeted cost-reduction programs, business process improvements and portfolio restructuring actions, while at the same time investing in key programs to enhance future growth opportunities.

Achieving our business objectives requires us to manage a number of key risk areas. Our growth objective of geographic market and service expansion requires us to maintain the consistency and integrity of our information and underlying processes on a global scale, and to invest effectively our capital in technology and infrastructure to keep pace with our clients’ demands and our competitors. Our operating footprint across approximately 100 countries requires disciplined global and local resource management of internal and third party providers to ensure success. In addition, our high level of indebtedness requires active management of our debt profile, with a focus on underlying maturities, interest rate risk, liquidity and operating cash flows.

Business Segment Overview

We align our business into two reporting segments: what consumers buy (consumer purchasing measurement and analytics) and what consumers watch and listen to (media audience measurement and analytics). Our Buy and Watch segments are built on a foundation of proprietary data assets that are designed to yield essential insights for our clients to successfully measure, analyze and grow their businesses.

2729

proprietary data assets that are designed to yield essential insights for our clients to successfully measure, analyze and grow their businesses.

Our Buy segment provides Information services, which include our core tracking and scan data (primarily transactional measurement data and consumer behavior information), and Insights services (primarily comprised of our analytical solutions) to businesses in the consumer packaged goods industry. Our services also enable our clients to better manage their brands, uncover new sources of demand, launch and grow new products, analyze their sales, improve their marketing mix and establish more effective consumer relationships. Our data is used by our clients to measure their market share, tracking billions of sales transactions per month in retail outlets around the world. Our extensive database of retail and consumer information, combined with our advanced analytical capabilities, helps generate strategic insights that influence our clients’ key business decisions. Within our Buy segment, we have two primary geographic groups, developed and developing markets. Developed markets primarily include the United States, Canada, Western Europe, Japan and Australia while developing markets include Africa, Latin America, Eastern Europe, Russia, China, India and Southeast Asia.

Our Watch segment provides viewership and listening data and analytics primarily to the media and advertising industries for television, radio, online and mobile screens. Our Watch data is used by our media clients to understand their audiences, establish the value of their advertising inventory and maximize the value of their content, and by our advertising clients to plan and optimize their spending.

In June 2013, we completed the sale of our Expositions reporting segment (see “Discontinued Operations” discussion included in “Factors Affecting Our Financial Results” for more information). Our condensed consolidated statements of operations reflect the Expositions reporting segment as a discontinued operation.

Certain corporate costs, other than those described above, including those related to selling, finance, legal, human resources, and information technology systems, are considered operating costs and are allocated to our segments based on either the actual amount of costs incurred or on a basis consistent with the operations of the underlying segment.

Factors Affecting Our Financial Results

Acquisitions and Investments in Affiliates

~~For~~Arbitron ~~the six months ended June 30, 2013, we paid cash consideration of $19 million associated with both current period and previously executed acquisitions, net of cash acquired~~Inc. ~~Had the current period acquisitions occurred as of January 1, 2013, the impact on our consolidated results of operations would not have been material.~~

~~For~~On September 30, 2013 (the ~~six~~“Acquisition ~~months~~Date”), ~~ended~~we ~~June 30~~completed the acquisition of Arbitron Inc., ~~2012~~an international media and marketing research firm (“Arbitron”), wethrough ~~paid~~the purchase of 100% of Arbitron’s outstanding common stock for a total cash ~~consideration~~purchase price of $741.3 ~~million~~billion ~~associated~~(the ~~with~~“Acquisition”). Arbitron ~~both~~is ~~current~~expected ~~period~~to ~~and~~help ~~previously~~us ~~executed~~better ~~acquisitions~~address client needs in unmeasured areas of media consumption, ~~net~~including streaming audio and out-of-home ~~cash~~and ~~acquired.~~our ~~Had~~global ~~the~~distribution ~~current~~footprint ~~period~~can ~~acquisitions~~help ~~occurred~~expand asArbitron’s capabilities outside of ~~January 1,~~the ~~2012~~U.S.. With Arbitron’s assets, ~~the~~we ~~impact~~intend onto further expand our ~~consolidated~~“Watch” ~~results~~segment’s ofaudience ~~operations~~measurement ~~would~~across ~~not~~screens ~~have~~and forms of listening. Arbitron has been ~~material~~rebranded Nielsen Audio.

As a part of the Acquisition, we acquired the remaining 49.5% interest in Scarborough Research, a joint venture between us and Arbitron (“Scarborough”) historically accounted for under the equity method of accounting. We accounted for this transaction as a step-acquisition and calculated the fair value of our investment immediately before the acquisition to be $75 million. As a result, during the third quarter of 2013, we recorded a $24 million gain on our investment in Scarborough to other income/(expense), net in the condensed consolidated statement of operations. Effective October 1, 2013, the financial results of Scarborough will be consolidated within our consolidated financial statements.

The Acquisition was accounted for using the acquisition method of accounting which requires, among other things, the assets acquired and the liabilities assumed be recognized at their fair values as of the acquisition date. Since the date of the acquisition occurred on the last day of the quarter, the results of Arbitron will be included within our consolidated financial statements commencing October 1, 2013.


(IN MILLIONS)
Fair value of business combination:
Cash paid for Arbitron common stock	$	1,296
Accrued payment for directors’ and employees’ equity awards pertaining to pre-merger service		42
Accrued dividend payment on Arbitron common stock		3
Fair value of previously held equity interest in Scarborough		75
Total	$	1,416

Identifiable assets acquired and liabilities assumed:
Cash	$	136
Other current assets		115
Property and equipment		32
Goodwill		931
Amortizable intangible assets		517
Other long term assets		3
Deferred revenue		(47	)
Other current liabilities		(53	)
Deferred tax liabilities		(200	)
Other long term liabilities		(18	)
Total	$	1,416

Intangible assets and their estimated useful lives consist of the following:


(IN MILLIONS)
Description		Amount	Useful Life
Customer –related intangibles	$	323	10 - 20 years
Computer software		150	5 – 10 years
Trade names and trademarks		33	5 years
Covenants-not-to-compete		11	1-2 years
Total	$	517

Goodwill is calculated as the excess of the consideration transferred over the net assets recognized and represents expected synergies and the going concern nature of Arbitron.

We incurred acquisition related expenses of $4 million and $18 million for the three and nine months ended September 30, 2013, respectively, which primarily consisted of transaction fees, legal, accounting and other professional services that are included in selling, general and administrative expense in the condensed consolidated statement of operations.

The following unaudited pro forma information presents the consolidated results of operations of us and Arbitron for the three and nine months ended September 30, 2013 and 2012, as if the acquisition had occurred on January 1, 2012, respectively, with pro forma adjustments to give effect to amortization of intangible assets, an increase in interest expense from acquisition financing, and certain other adjustments:

	Three Months Ended September 30,				Nine Months Ended September 30,
(IN MILLIONS)	2013		2012		2013		2012
Revenues	$	1,510	$	1,464	$	4,447	$	4,302
Net Income	$	152	$	106	$	306	$	241

The unaudited pro forma results do not reflect any synergies and are not necessarily indicative of the results that we would have attained had the acquisition of Arbitron been completed as of the beginning of the reporting period.

Other Acquisitions

For the nine months ended September 30, 2013, excluding Arbitron, we paid cash consideration of $42 million associated with both current period and previously executed acquisitions, net of cash acquired. Had such current period acquisitions occurred as of January 1, 2013, the impact on our consolidated results of operations would not have been material.

For the nine months ended September 30, 2012, we paid cash consideration of $136 million associated with both current period and previously executed acquisitions, net of cash acquired. Had such current period acquisitions occurred as of January 1, 2012, the impact on our consolidated results of operations would not have been material.

Discontinued Operations

In June 2013, we completed the sale of our ~~expositions~~Expositions business, which operates one of the largest portfolios of business-to-business trade shows and conference events in the United States, for total cash consideration of $950 million and recorded a gain of $303 million. The condensed consolidated statements of operations reflect the operating results of this business as a discontinued operation.

In March 2013, we completed the exit and shut down of one of our legacy online businesses and recorded a net loss of $3 million associated with this divestiture. The condensed consolidated statements of operations reflect the operating results of this business as a discontinued operation.

Summarized results of operations for discontinued operations are as follows:

	Three Months Ended June 30,						Six Months Ended June 30,
	Three Months Ended September 30,						Nine Months Ended September 30,
(IN MILLIONS)	~~2013~~	2013			2012			2013			2012
Revenue	$	43—		$	4372		$	103		$	~~110~~182
Operating income		11—			837			35			3774
Interest expense		(3—	)		(6	)		(8	)		(1218	)
Income from operations before income taxes		8—			231			27			2556
Provision for income taxes		(4—	)		—(11	)		(11	)		(1021	)
Income from operations		4—			220			16			1535
Net income attributable to noncontrolling interests		—			1—			—			2
Gain on sale, net of tax		~~303~~—			—			303			—
Income from discontinued operations	$	~~307~~—		$	320		$	319		$	1737

We allocated a portion of our consolidated interest expense to discontinued operations based upon the ratio of net assets sold as a proportion of consolidated net assets. For the three and ~~six~~nine months ended ~~June~~September 30, 2013 and 2012 interest expense of $3zero ~~million~~ and $68 million, respectively, and $86 million and $1218 million, respectively, was allocated to discontinued operations.

Following are the major categories of cash flows from discontinued operations, as included in our condensed consolidated statements of cash flows:

	Six Months Ended June 30,
			Nine Months Ended September 30,
(IN MILLIONS)	~~2013~~			2013	~~2012~~		2012
Net cash provided by operating activities	$	36	$	$36	40	$	52
Net cash provided by investing activities		—		—	—		—
Net cash provided by financing activities		—			—
Net cash used in financing activities				—			—
	$	36	$	$36	40	$	52

Foreign Currency

Our financial results are reported in U.S. dollars and are therefore subject to the impact of movements in exchange rates on the translation of the financial information of individual businesses whose functional currencies are other than U.S. dollars. Our principal foreign exchange revenue exposure is spread across several currencies, primarily the Euro. The table below sets forth the profile of our revenue by principal currency.

	Six Months Ended June 30, 2013				Six Months Ended June 30, 2012
		Nine Months Ended September 30,
U.S. Dollar		51	%			52	%
		2013				2012
Euro		12	%			12	%
U.S. Dollar			51	%			52	%
Other Currencies		37	%			36	%
Euro			12	%			12	%
Total		100	%			100	%
Other Currencies			37	%			36	%
Total			100	%			100	%

As a result, fluctuations in the value of foreign currencies relative to the U.S. dollar impact our operating results. Impacts associated with fluctuations in foreign currency are discussed in more detail under “Item 3.—Quantitative and Qualitative Disclosures about Market Risk.” In countries with currencies other than the U.S. dollar, assets and liabilities are translated into U.S. dollars using end-of-period exchange rates; revenues, expenses and cash flows are translated using average rates of exchange. The average U.S. dollar to Euro exchange rate was $1.3132 to €1.00 and $1.3028 to €1.00 for the ~~six~~nine months ended ~~June~~September 30, 2013 and 2012, respectively. Constant currency growth rates used in the following discussion of results of operations eliminate the impact of year-over-year foreign currency fluctuations.

We have operations in both our Buy and Watch segments in Venezuela and the functional currency for these operations was the Venezuelan Bolivares Fuertes. Venezuela’s currency was considered hyperinflationary as of January 29 1, 2010 and further, in January 2010, Venezuela’s currency was devalued and a new currency exchange rate system was announced. In 2010, we evaluated the new exchange rate system and concluded that the local currency transactions will be denominated in U.S. dollars effective as of January 1, 2010 and until Venezuela’s currency is deemed to be non-hyperinflationary.

WeIn ~~have~~February ~~operations~~2013, inthe ~~both~~Venezuelan ~~our~~government ~~Buy~~devalued ~~and~~its ~~Watch segments in Venezuela and the functional~~ currency ~~for~~by ~~these~~32%. The ~~operations~~official ~~was~~exchange ~~the~~rate ~~Venezuelan~~moved ~~bolivares~~from ~~fuertes~~4.30 ~~Venezuela’s~~to ~~currency~~6.30 ~~was~~and ~~considered~~the ~~hyperinflationary~~regulated asSystem of ~~January 1,~~Transactions ~~2010~~with ~~and~~Securities ~~further,~~ in ~~January~~Foreign ~~2010,~~Currency ~~Venezuela’s~~market ~~currency~~ was ~~devalued~~suspended. As ~~and~~ a ~~new~~result ~~currency~~of ~~exchange~~this ~~rate system was announced. In 2010~~change, we ~~evaluated~~recorded ~~the~~a ~~new~~charge ~~exchange~~of ~~rate~~$12 ~~system~~million ~~and~~in ~~concluded~~2013 ~~that~~in ~~the~~foreign ~~local~~ currency ~~transactions~~exchange ~~will~~transaction be(losses)/gains, ~~denominated~~net in ~~U.S.~~the ~~dollars~~condensed ~~effective~~consolidated asstatement of ~~January 1,~~operations ~~2010~~primarily ~~and~~reflecting ~~until~~the ~~Venezuela’s~~write-down ~~currency~~of ismonetary ~~deemed~~assets toand ~~be non-hyperinflationary~~liabilities.

In February 2013, the Venezuelan government devalued its currency by 32%. The official exchange rate moved from 4.30 to 6.30 and the regulated System of Transactions with Securities in Foreign Currency market was suspended. As a result of this change, we recorded a charge of $12 million in 2013 in the foreign currency exchange transaction losses, net line in the condensed consolidated statement of operations primarily reflecting the write-down of monetary assets and liabilities.

We evaluate our results of operations on both an as reported and a constant currency basis. The constant currency presentation is a non-GAAP financial measure, which excludes the impact of fluctuations in foreign currency exchange rates. We believe providing constant currency information provides valuable supplemental information regarding our results of operations, consistent with how we evaluate our performance. We calculate constant currency percentages by converting our prior-period local currency financial results using the current period foreign currency exchange rates and comparing these adjusted amounts to our current period reported results. This calculation may differ from similarly-titled measures used by others and, accordingly, the constant currency presentation is not meant to be a substitution for recorded amounts presented in conformity with GAAP nor should such amounts be considered in isolation.

~~Results of Operations—Three Months Ended June~~ ~~30, 2013 Compared to the Three Months Ended June 30, 2012~~ 33

Results of Operations—Three Months Ended September 30, 2013 Compared to the Three Months Ended September 30, 2012

The following table sets forth, for the periods indicated, the amounts included in our Condensed Consolidated Statements of Operations:

	Three Months Ended June 30,
	Three Months Ended September 30,
(IN MILLIONS)	2013			2012
Revenues	$	1,~~386~~387		$	1,~~342~~351
Cost of revenues, exclusive of depreciation and amortization shown separately below		~~580~~573			~~549~~550
Selling, general and administrative expenses, exclusive of depreciation and amortization shown separately below		~~432~~433			428
Depreciation and amortization		~~126~~117			~~120~~124
Restructuring charges		820			164
Operating income		~~240~~244			~~229~~245
Interest income		—1			1
Interest expense		(7378	)		(95	)
Foreign currency exchange transaction losses, net		(4	)		(3	)
Foreign currency exchange transaction (losses)/gains, net		(7	)		1
Other income, net		—			10
Other income/(expense), net		12			(1	)
Income from continuing operations before income taxes and equity in net income of affiliates		163			142
Income from continuing operations before income taxes and equity in net loss of affiliates		172			151
Provision for income taxes		(4640	)		(3758	)
Equity in net income of affiliates		4			4
Equity in net loss of affiliates		—			(1	)
Income from continuing operations		~~121~~132			~~109~~92
Income from discontinued operations, net of tax		~~307~~—			320
Net income	$	~~428~~132		$	112

Consolidated Results for the Three Months Ended ~~June~~September 30, 2013 Compared to the Three Months Ended ~~June~~September 30, 2012

Revenues

Revenues increased 32.37% to $1,~~386~~387 million for the three months ended ~~June~~September 30, 2013 from $1,~~342~~351 million for the three months ended ~~June~~September 30, 2012, or an increase of 3.7% on a constant currency basis, excluding a 01.40% unfavorable impact of changes in foreign currency exchange rates. The increase was driven by a 2.12% increase within our Buy segment (23.63% on a constant currency basis), as well as a 5.3.4% increase within our Watch segment (54.52% on a constant currency basis).

Cost of Revenues, Exclusive of Depreciation and Amortization

Cost of revenues increased 54.62% to $~~580~~573 million for the three months ended ~~June~~September 30, 2013 from $~~549~~550 million for the three months ended ~~June~~September 30, 2012, or an increase of 54.89% on a constant currency basis, excluding a 0.27% favorable impact of changes in foreign currency exchange rates. Costs within our Buy segment increased 64.9% (75.8% on a constant currency basis) due primarily to the continued global expansion of our services as well as investment in our footprint in the emerging markets and an increase in retail measurement costs. Costs within our Watch segment increased 2.7% (3.3% on a constant currency basis) due primarily to spending on product portfolio management initiatives.

the continued global expansion of our services and an increase in retail measurement cost. Costs within our Watch segment increased 3.8% (4.4% on a constant currency basis) due primarily to spending on product portfolio management initiatives.

Selling, General and Administrative Expenses, Exclusive of Depreciation and Amortization

Selling, general and administrative expenses increased 01.92% to $~~432~~433 million for the three months ended ~~June~~September 30, 2013 from $428 million for the three months ended ~~June~~September 30, 2012, or an increase of 12.61% on a constant currency basis, excluding a 0.79% favorable impact of changes in foreign currency exchange rates. Costs within our Buy segment ~~decreased~~increased 21.50% (1.6% on a constant currency basis) due primarily to the ~~impact~~increases ofin ~~productivity~~client ~~initiatives~~services costs and ~~the~~other ~~favorable~~investments ~~impact~~associated ofwith ~~changes~~the inglobal ~~foreign~~expansion ~~currency~~of ~~exchange~~our ~~rates~~services. Costs within our Watch segment ~~increased~~decreased 27.06% (3a decrease of 7.16% on a constant currency basis) due primarily to ~~increased investment in product development initiatives, partially offset by~~ the ~~favorable~~ impact of ~~changes~~productivity ~~in foreign currency exchange rates~~initiatives. Corporate costs increased $1011 million as a result of higher spending on transaction-related costs.

Depreciation and Amortization

Depreciation and amortization expense was $~~126~~117 million for the three months ended ~~June~~September 30, 2013 as compared to $~~120~~124 million for the three months ended ~~June~~September 30, 2012. This decrease was primarily due to ~~higher~~certain ~~capital~~assets ~~expenditures~~becoming asfully ~~well~~amortized asduring anthe ~~increase~~period inpartially offset by higher depreciation and amortization expense associated with ~~assets~~capital ~~acquired in business combinations~~expenditures.

~~For the three months ended June~~ 30, 2013 and 2012, depreciation and amortization expense included charges for the depreciation and amortization of tangible and intangible assets acquired in business combinations of $38 million and $35 million, respectively. 34

For the three months ended September 30, 2013 and 2012, depreciation and amortization expense included charges for the depreciation and amortization of tangible and intangible assets acquired in business combinations of $35 million and $36 million, respectively.

Restructuring Charges

We recorded $820 million ~~and $16 million~~ in restructuring charges relating to employee severance associated with productivity initiatives ~~during~~for the three months ended ~~June~~September 30, 2013 ~~and 2012, respectively~~.

We recorded $4 million in restructuring charges relating to employee severance associated with productivity initiatives during the three months ended September 30, 2012.

Operating Income

Operating income for the three months ended ~~June~~September 30, 2013 was $~~240~~244 million as compared to $~~229~~245 million for the three months ended ~~June~~September 30, 2012. Operating income within our Buy segment was $~~107~~110 million for the three months ended ~~June~~September 30, 2013 as compared to $~~110~~118 million for the three months ended ~~June~~September 30, 2012. Operating income within our Watch segment was $~~157~~160 million for the three months ended ~~June~~September 30, 2013 as compared to $~~137~~141 million for the three months ended ~~June~~September 30, 2012. Corporate operating expenses were $2426 million for the three months ended ~~June~~September 30, 2013 as compared to $1814 million for the three months ended ~~June~~September 30, 2012.

Interest Expense

Interest expense was $7378 million for the three months ended ~~June~~September 30, 2013 as compared to $95 million for the three months ended ~~June~~September 30, 2012. This decline is due to our refinancing of the 11.5% senior notes and our 8.5% senior secured term loan in the fourth quarter of 2012, and the impact of our refinancing of the Class A, B, and C senior secured term loans in February 2013.

Foreign Currency Exchange Transaction (Losses)/Gains, Net

Foreign currency exchange transaction (losses)/gains, net, represent the net gain or loss on revaluation of external debt, intercompany loans and other receivables and payables denominated in currencies other than the respective entity’s functional currency. Fluctuations in the value of foreign currencies relative to the U.S. Dollar have a significant effect on our operating results, primarily the Euro. The average U.S. Dollar to Euro exchange rate was $1.3133 to €1.00 for the three months ended ~~June~~September 30, 2013 as compared to $1.2825 to €1.00 for the three months ended ~~June~~September 30, 2012.

We incurred losses of $47 million ~~and $3 million~~ for the three months ended ~~June~~September 30, 2013 ~~and 2012~~, ~~respectively,~~ resulting primarily from the fluctuations in certain foreign currencies associated with intercompany transactions.

~~Other~~Foreign ~~Income~~currency exchange transactions resulted in a gain of $1 million for the three months ended September 30, ~~Net~~2012, resulting primarily from the fluctuations in certain foreign currencies associated with intercompany transactions.

Other ~~income~~Income/(Expense), ~~net~~Net ~~amount of $10 million for the three months ended June 30, 2012, primarily relates to gains associated with acquisitions of previously nonconsolidated subsidiaries.~~

The $12 million other income, net amount for the three months ended September 31 30, 2013, primarily relates to the $24 million gain from the step acquisition of Scarborough partially offset by charges of $12 million associated with the unused bridge loan terminated as part of the Arbitron acquisition.

Income Taxes

The effective tax rates for the three months ended ~~June~~September 30, 2013 and 2012 were 2823% and 2638%, respectively. The tax rate for the three months ended ~~June~~September 30, 2013 was ~~higher~~lower than ~~the~~ statutory rate as a result of the ~~tax impact of the accrual for future audit settlements offset by the~~ favorable impact of ~~2012~~ return to provision adjustments as well as the favorable impact of certain financing activities. The tax rate for the three months ended ~~June~~September 30, 2012 was higher than the statutory rate as the favorable impact of certain financing activities was ~~offset~~more ~~slightly~~than offset by the tax rate and other differences in other jurisdictions where wethe ~~file~~Company files tax returns.

Liabilities for unrecognized income tax benefits totaled $93232 million and $94236 million as of ~~June~~September 30, 2013 and December 31, 2012, respectively. IfThe ~~our~~net ~~tax~~liabilities ~~positions~~for ~~are~~unrecognized ~~favorably~~tax ~~sustained~~benefits not reduced by ~~the~~net ~~taxing~~operating ~~authorities~~losses, ~~the~~tax ~~reversal~~credits ofand ~~the~~other ~~underlying~~deferred ~~liabilities~~tax ~~would~~assets ~~reduce~~totaled ~~our~~$90 ~~effective~~million ~~tax~~and ~~rate~~$94 inmillion ~~future~~as ~~periods~~of September 30, 2013 and December 31, 2012, respectively. If the

~~Business Segment Results for the Three Months Ended June~~ ~~30, 2013 Compared to the Three Months Ended June 30, 2012~~ 35

Company’s tax positions are favorably sustained by the taxing authorities, the reversal of the underlying liabilities would reduce the Company’s effective tax rate in future periods.

Business Segment Results for the Three Months Ended September 30, 2013 Compared to the Three Months Ended September 30, 2012

Revenues

The table below sets forth our segment revenue performance data for the three months ended ~~June~~September 30, 2013 compared to the three months ended ~~June~~September 30, 2012, both on an as-reported and constant currency basis.

(IN MILLIONS)	Three Months Ended ~~June~~September 30, 2013 Reported		Three Months Ended ~~June~~September 30, 2012 Reported		% Variance 2013 vs. 2012 Reported			Three Months Ended ~~June~~September 30, 2012 Constant Currency		% Variance 2013 vs. 2012 Constant Currency
Revenues by segment
Buy	$	~~867~~871	$	~~849~~852		2.12	%	$	~~845~~843		23.63	%
Watch		~~519~~516		~~493~~499		5.3.4	%		~~492~~495		54.52	%
Total	$	1,~~386~~387	$	1,~~342~~351		32.37	%	$	1,~~337~~338		3.7	%

Buy Segment Revenues

Revenues increased 2.12% to $~~867~~871 million for the three months ended ~~June~~September 30, 2013 from $~~849~~852 million for the three months ended ~~June~~September 30, 2012, (23.63% on a constant currency basis). ~~The increase was primarily driven by a 4.6% increase in Developing markets (6.1% on a constant currency basis) and a 0.9% increase in Developed markets (0.9% on a constant currency basis).~~

Revenues from Information services increased 2.0.9% to $~~652~~664 million for the three months ended ~~June~~September 30, 2013 from $~~639~~658 million for the three months ended ~~June~~September 30, 2012, 21.58% on a constant currency basis. Growth ~~These increases were driven by 0.9% growth~~ in ~~Developed~~Information ~~markets~~services ~~(0.7%~~was onsteady, abut ~~constant~~muted ~~currency basis) driven primarily~~ by ~~increased client investment in retail measurement, including additional coverage in~~ the ~~U.S.,~~year-over-year ~~despite~~Walmart ~~a challenging operating environment in Europe~~comparable. Revenues from Developing markets increased 4.3% (6.3% on a constant currency basis), for the three months ended June 30, 2013 as compared to the three months ended June 30, 2012 due to the continued expansion of our retail measurement and services to both new and existing customers.

Revenues from Insights services increased 26.47% to $~~215~~207 million for the three months ended ~~June~~September 30, 2013 from $~~210~~194 million for the three months ended ~~June~~September 30, 2012, (28.94% on a constant currency basis) ~~primarily~~driven ~~due~~by to increased client demand ~~around~~for ~~the~~our ~~world.~~analytical services versus last year.

Total revenue from developing markets grew 3.2% (7.5% on a constant currency basis) with double digit growth in many key markets as both global and local clients continued to increase their demand for our retail measurement services and analytics.

Watch Segment Revenues

Revenues increased 5.3.4% to $~~519~~516 million for the three months ended ~~June~~September 30, 2013 from $~~493~~499 million for the three months ended ~~June~~September 30, 2012, or 54.52% on a constant currency basis, primarily driven by 5.4.7% growth in Television measurement (5.70% on a constant currency basis) due to increases in spending from existing customers. This ~~and~~was ~~international~~partially ~~expansion~~offset ofby ~~our~~the ~~services~~ongoing toexit ~~both~~of ~~new~~certain ~~and~~international ~~existing~~online ~~customers~~legacy products.

Business Segment Operating Income/(Loss)

We do not allocate items below operating income/(loss) to our business segments and therefore the table below sets forth a summary of operating income/(loss) at the business segment level for the three months ended ~~June~~September 30, 2013 and 2012.

(IN MILLIONS)	Three Months Ended ~~June~~September 30, 2013			Three Months Ended ~~June~~September 30, 2012			Variance 2013 vs. 2012
Operating income/(loss) by segment
Buy	$	~~107~~110		$	~~110~~118		$	(38	)
Watch		~~157~~160			~~137~~141			2019
Corporate and Eliminations		(2426	)		(1814	)		(612	)
Total	$	~~240~~244		$	~~229~~245		$	11(1	)

Buy Segment Operating Income

Operating income was $~~107~~110 million for the three months ended ~~June~~September 30, 2013 from $~~110~~118 million for the three months ended ~~June~~September 30, 2012 as the revenue performance mentioned above was more than offset by higher ~~depreciation~~restructuring charges and ~~amortization expense as well as~~ an increase in retail measurement ~~cost~~costs.

Watch Segment Operating Income

Operating income was $~~157~~160 million for the three months ended ~~June~~September 30, 2013 from $~~137~~141 million for the three months ended ~~June~~September 30, 2012. The increase was driven primarily by the revenue performance discussed above, the impact of productivity initiatives and lower ~~restructuring~~depreciation expense partially offset by higher restructuring charges.

Corporate Expenses and Eliminations

Operating expenses were $2426 million for the three months ended ~~June~~September 30, 2013 as compared to $1814 million for the three months ended ~~June~~September 30, 2012 due primarily to higher ~~deal~~ transaction-related costs ~~partially~~and ~~offset by lower~~ restructuring ~~expense~~charges.

Results of Operations—~~Six~~Nine Months Ended ~~June~~September 30, 2013 Compared to the ~~Six~~Nine Months Ended ~~June~~September 30, 2012

The following table sets forth, for the periods indicated, the amounts included in our Condensed Consolidated Statements of Operations:

	Six Months Ended June 30,
	Nine Months Ended September 30,
(IN MILLIONS)	2013			2012
Revenues	$	24,~~705~~092		$	23,~~615~~966
Cost of revenues, exclusive of depreciation and amortization shown separately below		1,~~159~~732			1,~~099~~649
Selling, general and administrative expenses, exclusive of depreciation and amortization shown separately below		~~874~~1,307			~~865~~1,293
Depreciation and amortization		~~247~~364			~~243~~367
Restructuring charges		4363			5357
Operating income		~~382~~626			~~355~~600
Interest income		12			23
Interest expense		(~~149~~227	)		(~~189~~284	)
Foreign currency exchange transaction losses, net		(1623	)		(1312	)
Other (expense)/income, net		(12	)		4
Other income, net		—			3
Income from continuing operations before income taxes and equity in net income of affiliates		~~206~~378			~~159~~310
Provision for income taxes		(64104	)		(3896	)
Equity in net income of affiliates		3			21
Income from continuing operations		~~145~~277			~~123~~215
Income from discontinued operations, net of tax		319			1737
Net income	$	~~464~~596		$	~~140~~252

Consolidated Results for the Nine Months Ended September 33 30, 2013 Compared to the Nine Months Ended September 30, 2012

Consolidated Results for the Six Months Ended June 30, 2013 Compared to the Six Months Ended June 30, 2012

Revenues

Revenues increased 3.42% to $24,~~705~~092 million for the ~~six~~nine months ended ~~June~~September 30, 2013 from $23,~~615~~966 million for the ~~six~~nine months ended ~~June~~September 30, 2012, or 43.19% on a constant currency basis, which excludes a 0.7% unfavorable impact of changes in foreign currency exchange rates. Revenues within our Buy segment increased 2.75% (3.5% on a constant currency basis), while revenues within our Watch segment increased 4.83% (54.07% on a constant currency basis).

Cost of Revenues, Exclusive of Depreciation and Amortization

Cost of revenues increased 5.50% to $1,~~159~~732 million for the ~~six~~nine months ended ~~June~~September 30, 2013 from $1,~~099~~649 million for the ~~six~~nine months ended ~~June~~September 30, 2012, or 65.17% on a constant currency basis, excluding a 0.67% favorable impact of changes in foreign currency exchange rates. Costs within our Buy segment increased 6.71% (76.49% on a constant currency basis) due primarily to the continued global expansion of our services and an increase in retail measurement ~~cost~~costs. Costs within our Watch segment increased 3.53% (3.86% on a constant currency basis) due primarily to spending on product portfolio management initiatives.

Selling, General and Administrative Expenses, Exclusive of Depreciation and Amortization

Selling, general and administrative expenses increased 1.01% to $~~874~~1,307 million for the ~~six~~nine months ended ~~June~~September 30, 2013 from $~~865~~1,293 million for the ~~six~~nine months ended ~~June~~September 30, 2012, or 1.69% on a constant currency basis, excluding a 0.68% favorable impact of changes in foreign currency exchange rates. Costs within our Buy segment ~~decreased~~were ~~0.2%~~flat (~~an increase of~~ 0.68% on a constant currency basis). Costs within our Watch segment ~~increased~~decreased 12.53% (2a decrease of 1.06% on a constant currency basis) due primarily to ~~increased~~the ~~investment~~impact inof ~~product~~productivity ~~development~~ initiatives. Corporate costs increased by approximately $619 million asprimarily adue ~~result~~to of higher transaction-related costs.

Depreciation and Amortization

Depreciation and amortization expense was $~~247~~364 million for the ~~six~~nine months ended ~~June~~September 30, 2013 as compared to $~~243~~367 million for the ~~six~~nine months ended ~~June~~September 30, 2012. This ~~increase~~decrease was primarily due to ~~depreciation~~certain ~~and~~assets ~~amortization~~becoming ~~expense~~fully ~~associated~~amortized ~~with~~during ~~capital~~the ~~expenditures~~period partially offset by ~~certain~~higher ~~assets~~depreciation ~~becoming~~and ~~fully~~amortization ~~amortized~~expense ~~during~~associated ~~the~~with ~~period.~~capital expenditures.

For the ~~three~~nine months ended ~~June~~September 30, 2013 and 2012, depreciation and amortization expense included charges for the depreciation and amortization of tangible and intangible assets acquired in business combinations of $74109 million and $71107 million, respectively.

Restructuring Charges

We recorded $4363 million ~~and $53 million~~ in restructuring charges ~~relating~~related to employee severance associated with productivity initiatives and contract termination costs during the ~~six~~nine months ended ~~June~~September 30, 2013 ~~and 2012, respectively~~.

We recorded $57 million in restructuring charges relating to employee severance associated with productivity initiatives and contract termination costs during the nine months ended September 30, 2012.

Operating Income

Operating income for the ~~six~~nine months ended ~~June~~September 30, 2013 was $~~382~~626 million as compared to operating income of $~~355~~600 million for the ~~six~~nine months ended ~~June~~September 30, 2012. Operating income within our Buy segment was $~~160~~270 million for the ~~six~~nine months ended ~~June~~September 30, 2013 as compared to $~~145~~263 million for the ~~six~~nine months ended ~~June~~September 30, 2012. Operating income within our Watch segment was $~~279~~439 million for the ~~six~~nine months ended ~~June~~September 30, 2013 as compared to $~~248~~389 million for the ~~six~~nine months ended ~~June~~September 30, 2012. Corporate operating expenses were $5783 million for the ~~six~~nine months ended ~~June~~September 30, 2013 as compared to $3852 million for the ~~six~~nine months ended ~~June~~September 30, 2012.

Interest Expense

Interest expense was $~~149~~227 million for the ~~six~~nine months ended ~~June~~September 30, 2013 compared to $~~189~~284 million for the ~~six~~nine months ended ~~June~~September 30, 2012. This decline is due to our refinancing of the 11.5% senior notes and our 8.5% senior secured term loan in the fourth quarter of 2012, and the impact of our refinancing of the Class A, B, and C senior secured term loans in February 2013.

Foreign Currency Exchange Transaction Losses, Net

Foreign currency exchange transaction losses, net, represent the net gain or loss on revaluation of external debt, intercompany loans and other receivables and payables denominated in currencies other than the respective entity’s functional currency. Fluctuations in the value of foreign currencies relative to the U.S. Dollar, particularly the Euro, have a significant effect on our operating results. The average U.S. Dollar to Euro exchange rate was $1.3132 to €1.00 for the ~~six~~nine months ended ~~June~~September 30, 2013 as compared to $1.3028 to €1.00 for the ~~six~~nine months ended ~~June~~September 30, 2012.

We incurred $23 million and $12 million in foreign currency exchange losses for the nine months ended September 34 30, 2013 and 2012, respectively. The loss in 2013 resulted primarily from the devaluation of the Venezuela Bolivars Fuertes as discussed in the “Foreign Currency” section of “Factors Affecting Nielsen’s Financial Results”, and fluctuations in certain foreign currencies associated with a portion of our intercompany loan portfolio. The loss in 2012 resulted primarily from fluctuations in certain foreign currencies associated with a portion of our intercompany loan portfolio.

WeOther ~~incurred $16 million and $13 million in foreign currency exchange losses for the six months ended June 30~~Income, ~~2013~~Net and 2012, respectively. The loss in 2013 resulted primarily from the devaluation of the Venezuela bolivars Fuertes as discussed in the “Foreign Currency” section of “Factors Affecting Nielsen’s Financial Results” and fluctuations in certain currencies associated with a portion of our intercompany loan portfolio. The loss in 2012 resulted primarily from fluctuations in certain currencies associated with a portion of our intercompany loan portfolio.

~~Other~~The ~~(Expense)/Income~~other income, ~~Net~~net for the nine months ended September 30, 2013 netted to zero and primarily relates to the write-off of deferred financing costs and other costs associated with the amendment to our Senior Secured Credit Agreement of $12 million and charges of $12 million associated with the unused bridge loan terminated as part of the Arbitron acquisition offset by the gain from the Scarborough step acquisition of $24 million.

~~The $12 million of other expense amount for the six months ended June~~ ~~30, 2013 primarily relates to the write-off of deferred financing costs and other costs associated with the amendment to our Senior Secured Credit Agreement.~~ 38

The $43 million of other income, ~~amount~~ net for the ~~six~~nine months ended ~~June~~September 30, 2012 primarily relates to a $10 million gain on the purchase of a previously nonconsolidated business, partially offset by the write-off of deferred financing costs and other costs associated with the amendment and restatement of the Senior Secured Credit Facility.

Income Taxes

The effective tax ~~rate~~rates for the ~~six~~nine months ended ~~June~~September 30, 2013 and 2012 were 3127% and 2431%, respectively. The tax rate for the ~~six~~nine months ended ~~June~~September 30, 2013 was higher than the statutory rate as a result of the tax impact of the Venezuela currency revaluation, tax rate differences in other jurisdictions where we file, and accrual for future audit settlements partially offset by ~~2012~~ return to provision adjustments as well as the favorable impact of certain financing activities and the release of tax contingencies. The tax rate for the ~~six~~nine months ended ~~June~~September 30, 2012 was ~~lower~~higher than the statutory rate as the favorable impact of certain financing activities was ~~offset~~more ~~slightly~~than offset by the tax rate and other differences in other jurisdictions where wethe ~~file~~Company files tax returns.

Business Segment Results for the ~~Six~~Nine Months Ended ~~June~~September 30, 2013 Compared to the ~~Six~~Nine Months Ended ~~June~~September 30, 2012

Revenues

The table below sets forth our segment revenue performance data for the ~~six~~nine months ended ~~June~~September 30, 2013 compared to the ~~six~~nine months ended ~~June~~September 30, 2012, both on an as-reported and constant currency basis.

(IN MILLIONS)	~~Six~~Nine Months Ended ~~June~~September 30, 2013 Reported		~~Six~~Nine Months Ended ~~June~~September 30, 2012 Reported		% Variance 2013 vs. 2012 Reported			~~Six~~Nine Months Ended ~~June~~September 30, 2012 Constant Currency		% Variance 2013 vs. 2012 Constant Currency
Revenues by segment
Buy	$	12,~~692~~563	$	12,~~648~~500		2.75	%	$	12,~~634~~477		3.5	%
Watch		1,~~013~~529		~~967~~1,466		4.83	%		~~965~~1,460		54.07	%
Total	$	24,~~705~~092	$	23,~~615~~966		3.42	%	$	23,~~599~~937		43.19	%

Buy Segment Revenues

Revenues increased 2.75% to $12,~~692~~563 million for the ~~six~~nine months ended ~~June~~September 30, 2013 from $12,~~648~~500 million for the ~~six~~nine months ended ~~June~~September 30, 2012, or an increase of 3.5% on a constant currency basis. Revenues from Developing markets increased 3.54% (6.05% on a constant currency basis) and revenues from Developed markets increased 2.31% (2.40% on a constant currency basis).

Revenues from Information services increased 32.9% to $1,~~300~~964 million for the ~~six~~nine months ended ~~June~~September 30, 2013 from $1,~~251~~909 million for the ~~six~~nine months ended ~~June~~September 30, 2012, or an increase of 43.8% on a constant currency basis. ~~These increases were driven primarily by increased client investment in retail measurement, including additional coverage in the U.S. market.~~ Revenues from Developing markets increased 43.15% (7.0% on a constant currency basis), for the ~~six~~nine months ended ~~June~~September 30, 2013 as compared to the ~~six~~nine months ~~June~~September 30, 2012 due to the continued expansion of our retail measurement and services to both new and existing customers. Revenues from Developed markets increased 2.6% (2.2% on a constant currency basis) for the nine months ended September 30, 2013. These increases were driven primarily by increased client investment in retail measurement including additional coverage in the U.S. market.

Revenues from Insights services ~~decreased~~increased 1.34% to $~~392~~599 million for the ~~six~~nine months ended ~~June~~September 30, 2013 from $~~397~~591 million for the ~~six~~nine months ended ~~June~~September 30, 2012, (~~flat~~2.6% on a constant currency basis) primarily due to ~~declines in Developed markets partially offset by~~ growth in the Asia Pacific markets.

Watch Segment Revenues

Revenues increased 4.83% to $1,~~013~~529 million for the ~~six~~nine months ended ~~June~~September 30, 2013 from $~~967~~1,466 million for the ~~six~~nine months ended ~~June~~September 30, 2012, or 54.07% on a constant currency basis, primarily driven by 65.08% growth in Television measurement (6.21% on a constant currency basis) driven by increases in spending from existing customers and international expansion of our services to both new and existing customers.

3539

currency basis) driven by increases in spending from existing customers and international expansion of our services to both new and existing customers.

Business Segment Operating Income

We do not allocate items below operating income/(loss) to our business segments and therefore the table below sets forth a summary of operating income/(loss) at the business segment level for the ~~six~~nine months ended ~~June~~September 30, 2013 and 2012.

(IN MILLIONS)	~~Six~~Nine Months Ended ~~June~~September 30, 2013			~~Six~~Nine Months Ended ~~June~~September 30, 2012			Variance 2013 vs. 2012
Operating income/(loss) by segment
Buy	$	~~160~~270		$	~~145~~263		$	157
Watch		~~279~~439			~~248~~389			3150
Corporate and Eliminations		(5783	)		(3852	)		(1931	)
Total Nielsen	$	~~382~~626		$	~~355~~600		$	2726

Buy Segment Operating Income

Operating income was $~~160~~270 million for the ~~six~~nine months ended ~~June~~September 30, 2013 asfrom ~~compared to~~ $~~145~~263 million for the ~~six~~nine months ended ~~June~~September 30, 2012. The increase was driven by the revenue performance discussed above and lower restructuring cost offset in part by an increase in retail measurement cost and stock-based compensation expense.

Watch Segment Operating Income

Operating income was $~~279~~439 million for the ~~six~~nine months ended ~~June~~September 30, 2013 asfrom ~~compared to~~ $~~248~~389 million for the ~~six~~nine months ended ~~June~~September 30, 2012. The increase was driven by the revenue performance discussed above, offset in part by increased investment in product portfolio management initiatives.

Corporate Expenses and Eliminations

Operating expenses were $5783 million for the ~~six~~nine months ended ~~June~~September 30, 2013 as compared to $3852 million for the ~~six~~nine months ended ~~June~~September 30, 2012 due primarily to higher restructuring and transaction-related ~~cost~~costs.

Liquidity and Capital Resources

Overview

Our contractual obligations, commitments and debt service requirements over the next several years are significant. We expect that our primary source of liquidity will continue to be cash generated from operations as well as existing cash. At ~~June~~September 30, 2013, cash and cash equivalents were $~~1,154~~725 million and our total indebtedness was $6,~~283~~909 million. In addition, as of ~~June~~September 30, 2013, we had $622 million available for borrowing under our senior secured revolving credit facility. Our cash interest paid for the ~~six~~nine months ended ~~June~~September 30, 2013 and 2012 was $~~149~~196 million and $~~192~~259 million, respectively.

Of the $~~1,154~~725 million in cash and cash equivalents, approximately $~~441~~322 million was held in jurisdictions outside the U.S. and as a result there may be tax consequences if such amounts were moved out of these jurisdictions or repatriated to the U.S. We regularly review the amount of cash and cash equivalents held outside of the U.S. to determine the amounts necessary to fund the current operations of our foreign operations and their growth initiatives and amounts needed to service our U.S. indebtedness and related obligations.

We believe we will have available resources to meet both our short-term and long-term liquidity requirements, including our senior secured debt service. We expect the cash flow from our operations, combined with existing cash and amounts available under the revolving credit facility, will continue to provide sufficient liquidity to fund our current obligations, projected working capital requirements, restructuring obligations, and capital spending over the next year. In addition we may, from time to time, purchase, repay, redeem or retire any of our outstanding debt securities (including any publicly issued debt securities) in privately negotiated or open market transactions, by tender offer or otherwise.

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Financing Transactions

In February 2013, the Second Amended and Restated Senior Secured Credit Agreement (as amended, the “Credit Agreement”) was amended and restated to provide for a new class of term loans (the “Class E Term Loans”) in an aggregate principal amount of $2,532 million and €290 million, the proceeds of which were used to repay or replace in full a like amount of our existing Class A Term Loans maturing August 9, 2013, Class B Term Loans maturing May 1, 2016 and Class C Term Loans maturing May 1, 2016. As a result of this transaction, we recorded a charge of $12 million primarily related to the write-off of previously capitalized deferred financing fees associated with the Class A, B and C term loans to other income/(expense), net in the condensed consolidated statement of operations.

The Class E Term Loans will mature in full on May 1, 2016 and are required to be repaid in equal quarterly installments in aggregate annual amounts equal to 1.00% of the original principal amount of Class E Term Loans, with the balance payable on May 1, 2016. Class E Term Loans denominated in dollars bear interest equal to, at our election, a base rate or eurocurrency rate, in each case plus an applicable margin, which is equal to 1.75% (in the case of base rate loans) or 2.75% (in the case of eurocurrency rate loans). Class E Term Loan denominated in Euros bear interest equal to the eurocurrency rate plus an applicable margin of 3.00%. The newly Amended and Restated Senior Secured Credit Agreement contains substantially the same affirmative and negative covenants as those of the Existing Credit Agreement, other than certain amendments to the limitation on the ability of us and certain of our subsidiaries and affiliates to incur indebtedness and make investments.

In ~~December~~February ~~2012,~~2013 weand ~~signed~~May a2013, ~~definitive~~secondary ~~agreement~~public toofferings ~~acquire~~of ~~Arbitron Inc~~40.8 million ~~(NYSE:~~shares ~~ARB), an international media~~ and ~~marketing~~40.3 million ~~research~~shares, ~~firm~~respectively, ~~for~~of ~~$48~~Holdings’ ~~per~~common ~~share~~stock inwere ~~cash~~completed ~~(the~~on ~~“Transaction”).~~behalf Inof ~~addition,~~certain weselling ~~entered~~stockholders, ~~into~~primarily acomprised ~~commitment~~of ~~for~~the anSponsor ~~unsecured~~group, ~~note~~at ora ~~unsecured~~price ~~loan~~ of up$32.55 toper share and $135.01 per share,~~300~~ ~~million~~respectively. ~~(the~~All ~~“Commitment~~proceeds ~~Letter”)~~were toreceived ~~fund~~by the ~~closing~~selling ofstockholders and the ~~Transaction. As~~offering ofdid ~~June 30,~~not ~~2013,~~have ~~there~~a ~~were~~significant noimpact ~~borrowings~~on ~~outstanding~~our ~~under~~operating ~~the~~results ~~Commitment~~or ~~Letter~~financial position.

In ~~April~~September 2013, ~~Arbitron’s~~we ~~shareholders~~issued ~~voted~~$625 million aggregate principal amount of 5.50% Senior Notes due 2021at par, with cash proceeds of approximately $616 million, net of fees and expenses. Concurrent with this issuance we called for redemption of all of our 11.625% Senior Notes due 2014 effective October 23, 2013, at a redemption price equal to ~~approve~~100% of the ~~Transaction,~~principal ~~which~~amount ~~remains~~of ~~subject~~such 2014 notes redeemed plus accrued and unpaid interest to ~~customary~~the ~~closing~~redemption ~~conditions,~~date ~~including~~and ~~regulatory~~an ~~review~~“applicable premium” as described in the indenture related to the 2014 notes. The redemption of the 11.625% Senior Note due 2014 will result in a pre-tax charge of $8 million in the fourth quarter of 2013.

In February 2013 and May 2013, secondary public offerings of 40.8 million shares and 40.3 million shares, respectively, of Holdings’ common stock was completed on behalf of certain selling stockholders, primarily comprised of the Sponsor group, at a price of $32.55 per share and $35.01 per share, respectively. All proceeds were received by the selling stockholders and the offering did not have a significant impact on our operating results or financial position.

Cash Flows

Operating activities. Net cash provided by operating activities was $~~270~~590 million for the ~~six~~nine months ended ~~June~~September 30, 2013, as compared to $~~122~~459 million for the ~~six~~nine months ended ~~June~~September 30, 2012. The increase in cash flows from operating activities was primarily driven by timing of vendor and employee payroll payments. Our key collections performance measure, days billing outstanding (DBO), remained flat for the period.

Investing activities. Net cash ~~provided~~used byin investing activities was $~~745~~523 million for the ~~six~~nine months ended ~~June~~September 30, 2013, as compared to ~~a use of cash of~~ $~~226~~362 million for the ~~six~~nine months ended ~~June~~September 30, 2012. The primary driver for the increase was the net payments for the Arbitron acquisition partially offset by the net proceeds received from the sale of our Expositions business.

Financing activities . Net cash ~~used~~provided inby financing activities was $~~126~~390 million for the ~~six~~nine months ended ~~June~~September 30, 2013 as compared to a ~~source~~use of cash of $6797 million for the ~~six~~nine months ended ~~June~~September 30, 2012. The primary driver for the ~~decrease~~increase was primarily driven by the ~~dividends~~results ~~paid~~of asthe 2013 transactions described under the “~~Dividends~~Financing Transactions” ~~section~~partially ~~below~~offset asby ~~well as~~ the ~~results~~dividends ofpaid ~~the~~as ~~2013 transactions~~ described under the “~~Financing Transactions~~Dividends” section below.

Capital Expenditures

Investments in property, plant, equipment, software and other assets totaled $~~170~~255 million for the ~~six~~nine months ended ~~June~~September 30, 2013 as compared to $~~152~~225 million for the ~~six~~nine months ended ~~June~~September 30, 2012.

Dividends and Share Repurchase

On January 31, 2013, our board of directors adopted a cash dividend policy to pay quarterly cash dividends on Holdings’ outstanding common stock. The board also declared the first quarterly cash dividend of $0.16 per share, that was paid on March 20, 2013 to holders of record of the Holdings’ common stock on March 6, 2013. On May 2, 2013, ~~the~~our ~~Board~~board of directors declared the second quarterly cash dividend of $0.16 per share, which was paid on June 19, 2013 to holders of record of ~~the~~ Holdings’ common stock on June 5, 2013. On July 25, 2013, our board of directors approved a 25% increase of the quarterly cash dividend to $0.20 per share, which was paid on September 11, 2013 to holders of record of shares of Holdings’ common stock on August 28, 2013. On October 22, 2013, we declared a quarterly cash dividend of $0.20 per share, to be paid on December 9, 2013 to holders of record of shares of

3741

~~on September 11, 2013 to holders of record of shares of Holdings~~Holding’s common stock on ~~August~~November 2825, 2013. The dividend policy and the payment of future cash dividends are subject to the discretion of ~~the~~ our board of directors.

On July 25, 2013, our board of directors approved a new share repurchase program for up to $500 million of Holdings’ outstanding common stock. The primary purpose of the program is to mitigate dilution associated with our equity compensation plans. Repurchases will be made in accordance with applicable securities laws from time to time in the open market depending on our management’s evaluation of market conditions and other factors. The program will be executed within the limitations of the existing authority granted at our 2013 Annual General Meeting of Shareholders. As of September 30, 2013 there have been no repurchases of shares under this program.

Covenant Compliance

Financial covenants contained in our Credit Agreement consist of a maximum leverage ratio and a minimum interest coverage ratio as related to our indirect wholly-owned subsidiary, Nielsen Holding and Finance B.V. and its restricted subsidiaries. The leverage ratio requires that we not permit the ratio of total net debt (as defined in the Credit Agreement) at the end of any calendar quarter to Covenant EBITDA (as defined in the Credit Agreement) for the four quarters then ended to exceed a specified threshold. The maximum permitted ratio is 6.25 to 1.0.

The interest coverage ratio requires that we not permit the ratio of Covenant EBITDA at the end of any calendar quarter to Consolidated Interest Expense (as defined in the Credit Agreement) for the four quarters then ended to be less than a specified threshold. The minimum permitted ratio is 1.50 to 1.0.

Failure to comply with either of these covenants would result in an event of default under our Credit Agreement unless waived by our senior credit lenders. An event of default under our Credit Agreement can result in the acceleration of our indebtedness under the facility, which in turn would result in an event of default and possible acceleration of indebtedness under the agreements governing our debt securities as well. As our failure to comply with the covenants described above can cause us to go into default under the agreements governing our indebtedness, management believes that our Credit Agreement and these covenants are material to us. As of ~~June~~September 30, 2013, we were in full compliance with the covenants described above.

Off-Balance Sheet Arrangements

We have no off-balance sheet arrangements that currently have or are reasonably likely to have a material effect on our consolidated financial condition, changes in financial condition, results of operations, liquidity, capital expenditure or capital resources.

Summary of Recent Accounting Pronouncements

Reclassification from accumulated other comprehensive income

In February 2013, the FASB issued an accounting update, “Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income”, to improve the transparency of reporting reclassifications out of accumulated other comprehensive income. We have presented the significant amounts reclassified from each component of accumulated other comprehensive income and the income statement line items affected by the reclassification in Note 6 to the condensed consolidated financial statements. This amended guidance does not have any other impact on our condensed consolidated financial statements.

Foreign Currency Matters

In March 2013, the FASB issued an accounting update, “Parent’s Accounting for the Cumulative Translation Adjustment upon Derecognition of Certain Subsidiaries or Groups of Assets within a Foreign Entity or of an Investment in a Foreign Entity”, to resolve the diversity in practice regarding the release into net income of the cumulative translation adjustment upon derecognition of a subsidiary or group of assets within a foreign entity. The amendment requires an entity that ceases to have a controlling financial interest in a subsidiary or group of assets within a foreign entity to release any related cumulative translation adjustment into net income. Accordingly, the cumulative translation adjustment should be released into net income only if the sale or transfer results in the complete or substantially complete liquidation of the foreign entity in which the subsidiary or group of assets had resided. This guidance is effective for our interim and annual reporting periods in 2014. The adoption of this update is not expected to have a significant impact on our condensed consolidated financial statements.

Income Taxes

financial statement presentation of an unrecognized tax benefit, as either a reduction of a deferred tax asset or as a liability, when a net operating loss carryforward, similar tax loss, or a tax credit carryforward exists. The update will be effective for interim and annual periods beginning after December 15, 2013 and may be applied on a retrospective basis. Early adoption is permitted. We do not expect the adoption of this update to have a significant impact on our condensed consolidated financial statements.

Commitments and Contingencies

Outsourced Services Agreements

In February 2013, we amended our Amended and Restated Master Services Agreement (the “MSA”), dated as of October 1, 2007 with Tata America International Corporation and Tata Consultancy Services Limited (jointly, “TCS”). The term of the MSA has been extended for an additional three years, so as to expire on December 31, 2020, with a one-year renewal option granted to Nielsen. In addition, we have increased our commitment to purchase services from TCS (the “Minimum Commitment”) from $1.0 billion to $2.5 billion over the life of the contract (from October 1, 2007), including a commitment to purchase at least $100 million in services per year (the “Annual Commitment”). TCS’ charges under the separate Global Infrastructure Services Agreement between the parties will be credited against the Minimum Commitment and the Annual Commitment. TCS will globally provide us with professional services relating to information technology (including application development and maintenance), business process outsourcing, client service knowledge process outsourcing, management sciences, analytics, and financial planning and analytics. As we order specific services under the Agreement, the parties will execute Statements Of Work (“SOWs”) describing the specific scope of the services to be performed by TCS. The amount of the Minimum Commitment and the Annual Commitment may be reduced on the occurrence of certain events, some of which also provide us with the right to terminate the Agreement or SOWs, as applicable.

In addition, we have increased our commitment to purchase services from TCS (the “Minimum Commitment”) from $1.0 billion to $2.5 billion over the life of the contract (from October 1, 2007), including a commitment to purchase at least $100 million in services per year (the “Annual Commitment”). TCS’ charges under the separate Global Infrastructure Services Agreement between the parties will be credited against the Minimum Commitment and the Annual Commitment. TCS will globally provide us with professional services relating to information technology (including application development and maintenance), business process outsourcing, client service knowledge process outsourcing, management sciences, analytics, and financial planning and analytics. As we order specific services under the Agreement, the parties will execute Statements Of Work (“SOWs”) describing the specific scope of the services to be performed by TCS. The amount of the Minimum Commitment and the Annual Commitment may be reduced on the occurrence of certain events, some of which also provide us with the right to terminate the Agreement or SOWs, as applicable.

Other Contractual Obligations

Our other contractual obligations include capital lease obligations (including interest portion), facility leases, leases of certain computer and other equipment, agreements to purchase data and telecommunication services, the payment of principal and interest on debt and pension fund obligations.

Cyprus Agreement

(1)	The immediate dissolution of Cyprus Popular Bank under which equity shareholders, bondholders and uninsured depositors (defined as those with deposits in excess of €100 thousand) will contribute to make up the losses of the bank; and

(2)

As a result of this agreement, we recorded a charge of $4 million during the first quarter of 2013 in Selling, General and Administrative expenses in the statement of operations representing the uninsured deposits either contributed to make up losses of Cyprus Popular Bank or converted into Class A shares of BoC, as described above. We do not expect this agreement to significantly impact future operating results.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Omitted under the reduced disclosure format permitted by General Instruction H of Form 10-Q.

Item 4. Controls and Procedures

(a)	Evaluation of Disclosure Controls and Procedures

The Company maintains disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) that are designed to ensure that information required to be disclosed in the reports that the Company files or submits to the SEC under the Exchange Act, is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to the Company’s management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate, to allow timely decisions regarding required disclosure. In designing and evaluating the disclosure controls ~~and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives.~~

~~The Company’s Chief Executive Officer and Chief Financial Officer have evaluated the effectiveness of the Company’s disclosure controls and procedures as of June~~ 30, 2013 (the “Evaluation Date”). Based on such evaluation and subject to foregoing, such officers have concluded that, as of the Evaluation Date, the Company’s disclosure controls and procedures are effective at the reasonable assurance level. 43

and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives.

The Company’s Chief Executive Officer and Chief Financial Officer have evaluated the effectiveness of the Company’s disclosure controls and procedures as of September 30, 2013 (the “Evaluation Date”). Based on such evaluation and subject to foregoing, such officers have concluded that, as of the Evaluation Date, the Company’s disclosure controls and procedures are effective at the reasonable assurance level.

(b)	Changes in Internal Control over Financial Reporting

There have been no changes in the Company’s internal control over financial reporting that occurred during the period covered by this report that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

PART II. OTHER INFORMATION

Item 1. Legal Proceedings

Sunbeam Television Corp. (“Sunbeam”) filed a lawsuit in Federal District Court in Miami, Florida in April 2009. The lawsuit alleged that we violated Federal and Florida state antitrust laws and Florida’s unfair trade practices laws by attempting to maintain a monopoly and abuse our position in the market, and breached our contract with Sunbeam by producing defective ratings data through our sampling methodology. The complaint did not specify the amount of damages sought and also sought declaratory and equitable relief. In January 2011, the U.S. District Court in the Southern District of Florida dismissed all federal and state antitrust claims brought against us by Sunbeam stating that Sunbeam failed to show that any competitor was “willing and able” to enter the local television ratings market in Miami and was excluded from that market by us. The Court also determined that Sunbeam could not prove that the current ratings for Sunbeam’s local station WSVN are less accurate than they would be under a prospective competitor’s methodology. The Court deferred ruling on the remaining ancillary claims, including breach of contract and violation of Florida’s Deceptive and Unfair Trade Practices Act. Subsequent to the court’s decision, Sunbeam voluntarily dismissed with prejudice the remaining claims in the case so that all claims have been dismissed. Sunbeam appealed the court’s dismissal of the antitrust claims. On March 4, 2013, the U.S. Court of Appeals for the Eleventh Judicial Circuit affirmed the lower court’s decision to dismiss the claims. On March 22, 2013, Sunbeam filed a petition for rehearing the case. The petition was denied on May 13, 2013.

We are subject to litigation and other claims in the ordinary course of business, some of which include claims for substantial sums. Accruals have been recorded when the outcome is probable and can be reasonably estimated. While the ultimate results of claims and litigation cannot be determined, we do expect that the ultimate disposition of these matters will not have a material adverse effect on our operations or financial condition. However, depending on the amount and the timing, an unfavorable resolution of some or all of these matters could materially affect our future results of operations or cash flows in a particular period.

Item 1A. Risk Factors

There have been no material changes to our Risk Factors as previously disclosed in our Annual Report on Form 10-K for the year ended December 31, 2012.

Item 5. Other Information

Iran Sanctions Related Disclosure

Under the Iran Threat Reduction and Syrian Human Rights Act of 2012, which added Section 13(r) of the Exchange Act, we are required to include certain disclosures in our periodic reports if we or any of our “affiliates” knowingly engaged in certain specified activities during the period covered by the report. Because the SEC defines the term “affiliate” broadly, it includes any entity controlled by us as well as any person or entity that controls us or is under common control with us (“control” is also construed broadly by the SEC). We are not presently aware that we and our consolidated subsidiaries have knowingly engaged in any transaction or dealing reportable under Section 13(r) of the Exchange Act during the ~~six~~nine months ended ~~June~~September 30, 2013. In addition, we sought confirmation from companies that may be considered our affiliates as to whether they have knowingly engaged in any such reportable transactions or dealings during such period and, except as described below or as previously disclosed by us, are not presently aware of any such reportable transactions or dealings by such companies.

The Blackstone Group L.P (“Blackstone”), one of our Sponsors, informed us that it included disclosures, as reproduced below, in its quarterly report on Form 10-Q as filed with the SEC on ~~May~~August 8, 2013 as required by Section 13(r) of the Exchange Act. We have no involvement in or control over the activities of either of these companies, any of their predecessor companies or any of their subsidiaries, and we have not independently verified or participated in the preparation of Blackstone’s disclosure.

Blackstone Disclosure

Hilton Worldwide, Inc. ~~(“Hilton”)~~, which may be considered our affiliate, provided the disclosure reproduced below in connection with activities during the second fiscal quarter of 2013. We have not independently verified or participated in the preparation of this disclosure.

“~~During~~As previously disclosed, during the reporting period, certain individual employees at two Hilton-branded hotels in the ~~Iranian~~United ~~Ministry~~Arab ofEmirates ~~Youth~~received ~~and~~routine ~~Sports~~wage ~~purchased~~payments aas ~~number~~direct ofdeposits ~~room~~to ~~nights~~their personal accounts at Bank Melli, an entity identified on the ~~Hilton~~Specially ~~Ankara,~~Designated ~~Turkey,~~Nationals ~~which~~and isBlocked ~~leased~~Persons List (“SDN List”) maintained by athe ~~foreign~~Office ~~affiliate~~of Foreign Assets Control in the U.S. Department of ~~Hilton~~the Treasury. ~~Revenue~~ ~~received~~Both of these hotels are owned by a third party, staffed by employees of the third-party owner and operated pursuant to a management agreement between the owner and a Hilton ~~for~~affiliate. In each case, these ~~hotel~~payments ~~stays~~originated ~~was~~ from the third-party owner’s account to the personal accounts of the employees at their chosen bank. During the reporting period, both hotels discontinued making direct deposits to accounts at Bank Melli. No revenues or net profits are associated with these transactions.

Also as previously disclosed, during the reporting period, several individuals stayed at the DoubleTree Kuala Lumpur, Malaysia, pursuant to a rate agreement between the hotel and Mahan Air, an entity identified on the SDN List. The rate agreement was terminated as of May 40 2, 2013. This hotel is staffed by employees of the third-party owner and operated pursuant to a management agreement between the owner and a Hilton affiliate. Under the rate agreement, which was entered into in the name of the owner, the hotel reserved a number of rooms for Mahan Air crew members at the DoubleTree Kuala Lumpur several times each week. Revenue and net profit received by Hilton attributable to Mahan Air crew hotel stays during the reporting period was approximately $430.”

~~approximately~~Travelport $4Limited,~~360~~ ~~and~~which ~~net~~may ~~profit~~be ~~was~~considered ~~approximately~~our $1affiliate,~~700. During~~ ~~calendar~~included ~~year 2012,~~ the ~~Embassy~~disclosure ofreproduced ~~Iran~~below ~~purchased a number of room nights at the hotel and organized a concert event~~ in ~~the~~its ~~hotel~~Form ~~ballroom. Revenue~~10-Q ~~received by Hilton~~ for the ~~services~~fiscal ~~provided~~quarter toended ~~the Embassy of Iran in 2012 was approximately $11~~June 30,~~070~~ ~~and net profit was approximately $4,300~~2013. ~~Hilton~~ ~~believes~~We ~~that~~have ~~the~~not ~~hotel~~independently ~~stays~~verified ~~were~~or ~~exempt~~participated ~~from the Iranian Transactions and Sanctions Regulations, 31 C.F.R. Part 560, pursuant to the International Emergency Economic Powers Act (“IEEPA”). The Hilton Ankara intends to continue engaging~~ in ~~future similar transactions to~~ the ~~extent~~preparation ~~they~~of ~~remain~~this ~~permissible under IEEPA~~disclosure.

~~Also~~“As ~~during~~part ~~the~~of ~~reporting~~our ~~period,~~global ~~certain~~business ~~individual employees at two Hilton-branded hotels~~ in the ~~United~~travel ~~Arab Emirates received routine wage payments as direct deposits to their personal accounts at Bank Melli~~industry, anwe ~~entity~~provide ~~identified~~certain onpassenger ~~the~~travel ~~Specially~~related ~~Designated~~GDS ~~Nationals~~ and ~~Blocked~~airline ~~Persons~~IT ~~List~~Solutions ~~(“SDN~~services ~~List”)~~to ~~maintained~~Iran ~~by the Office of Foreign Assets Control in the U~~Air.S. ~~Department~~We ofalso ~~the~~provide ~~Treasury. In addition,~~ certain ~~individual~~airline ~~employees~~IT atSolutions ~~these~~services ~~hotels received routine wage payments as direct deposits~~ to ~~their~~Iran ~~personal~~Air ~~accounts at Bank Melli during calendar year 2012~~Tours. ~~Both~~ All of these ~~hotels~~services are ~~owned~~either byexempt afrom ~~third~~applicable ~~party,~~sanctions ~~staffed~~prohibitions ~~by employees of the third-party owner and operated~~ pursuant to a ~~management~~statutory ~~agreement~~exemption ~~between~~in the ~~owner~~International ~~and~~Emergency aEconomic ~~Hilton~~Powers ~~affiliate. In~~Act ~~each~~permitting ~~case,~~transactions ~~these~~ordinarily ~~payments~~incident ~~originated~~to ~~from~~travel ~~the~~or, ~~third-party owner’s account~~ to the ~~personal~~extent ~~accounts~~not ofotherwise ~~the~~exempt, ~~employees~~specifically atlicensed ~~their~~by ~~chosen~~the ~~bank~~U. NoS. ~~revenues~~Office orof ~~net~~Foreign ~~profits~~Assets ~~are~~Control ~~associated~~(“OFAC”). ~~with~~Subject ~~these~~to ~~transactions. Both~~any ~~hotels~~changes ~~have~~in ~~advised~~the ~~Hilton~~exempt/licensed ~~that~~status ~~they~~of ~~will~~such ~~discontinue~~activities, ~~making~~we ~~direct~~intend ~~deposits~~ to ~~accounts~~continue atthese ~~Bank~~business ~~Melli.~~activities, ~~(We~~which ~~have~~are ~~been~~directly ~~informed~~related byto ~~Blackstone~~and ~~that~~promote ~~both~~the ~~hotels~~arrangement ~~have~~of ~~discontinued~~travel ~~making~~for ~~direct deposits~~individuals.)

~~During~~Prior ~~the reporting period, several individuals stayed at the DoubleTree Kuala Lumpur, Malaysia, pursuant~~ to ~~a rate agreement between the hotel~~ and Mahan Air, an entity identified on the SDN List. This hotel is staffed by employees of the third-party owner and operated pursuant to a management agreement between the owner and a Hilton affiliate. Under the agreement, which was entered into in the name of the owner, the hotel reserved a number of rooms for Mahan Air crew members at the DoubleTree Kuala Lumpur several times each week. Revenue received by Hilton attributable to Mahan Air crew hotel stays during the reporting period ~~was approximately $1~~,~~550. The~~ ~~DoubleTree~~we ~~Kuala Lumpur~~ also ~~reserved~~provided aairline ~~number~~IT ofSolutions ~~rooms~~services ~~for Mahan Air crew members during calendar year 2012. Revenue received by Hilton attributable~~ to ~~Mahan~~Syrian ~~Air~~Arab ~~crew hotel stays in 2012 was approximately $3,820~~Airlines. ~~Hilton~~ ~~considers~~These ~~its~~services ~~net~~were ~~profit~~generally onunderstood ~~management fees~~ to be ~~approximately~~permissible under the same asstatutory ~~its~~travel ~~revenue~~exemption. The ~~DoubleTree~~services ~~Kuala~~were ~~Lumpur has~~ terminated ~~the~~following ~~agreement and does not intend to engage in any future transactions with Mahan Air.” (We have been informed by Blackstone that~~ the ~~rate agreement was terminated as of~~ May 2, 2013~~. Blackstone~~ ~~has~~action ~~further~~by ~~informed~~OFAC usto ~~that~~designate ~~revenues~~this ~~and~~airline ~~net~~as ~~profits~~a ~~received~~Specially byDesignated ~~Hilton~~Global ~~attributable~~Terrorist pursuant to ~~Mahan~~the ~~Air~~Global ~~crew~~Terrorism ~~hotel~~Sanctions ~~stays during their second quarter was approximately $430~~Regulations.)

~~SunGard~~The ~~Capital~~gross ~~Corp.,~~revenue ~~SunGard Capital Corp. II~~ and ~~SunGard~~net ~~Data~~profit ~~Systems,~~attributable ~~Inc. (collectively referred~~ to ~~herein~~these ~~as “SunGard”),~~activities ~~which may be considered our affiliates, provided the disclosure reproduced below~~ in ~~connection with activities during~~ the ~~first fiscal~~ quarter ofended June 30, 2013~~. We~~ ~~have~~were ~~not~~approximately ~~independently~~$248,000 ~~verified~~and or$176,000, ~~participated in the preparation of this disclosure~~respectively.”

“As previously reported on our Annual Report on Form 10-K for the year ended December 31, 2012, pursuant to Section 13(r)(1) (D)(i) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), during 2012 a U.K. subsidiary of ours provided certain limited disaster recovery services and hosted co-location of some hardware at our premises in London for Bank Saderat PLC, a bank incorporated and based in the U.K. Bank Saderat PLC is identified on the U.S. Treasury Department’s List of Specially Designated Nationals and Blocked Persons pursuant to Executive Order No. 13224. Our subsidiary terminated this contract in the first quarter of 2013, and we do not otherwise intend to enter into any Iran-related activity. The gross revenue and net profits attributable to these activities in the first quarter of 2013 were less then £5,000 each.”

Travelport Limited, which may be considered our affiliate, provided the disclosure reproduced below in connection with activities during the first fiscal quarter of 2013. We have not independently verified or participated in the preparation of this disclosure.

“As part of our global business in the travel industry, we provide certain passenger travel-related GDS and airline IT services to Iran Air. We also provide certain airline IT services to Iran Air Tours. All of these services are either exempt from applicable sanctions prohibitions pursuant to a statutory exemption permitting transactions ordinarily incident to travel or, to the extent not otherwise exempt, specifically licensed by the U.S. Office of Foreign Assets Control. Subject to any changes in the exempt/licensed status of such activities, we intend to continue these business activities, which are directly related to and promote the arrangement of travel for individuals.”

Travelport has not provided us with gross revenue and net profits attributable to the activities described above.

KKR & Co. L.P. (“KKR”), one of our Sponsors, informed us that it included disclosures, as reproduced below, in its quarterly report on Form 10-Q as filed with the SEC on May 2, 2013 as required by Section 13(r) of the Exchange Act. We have no involvement in or control over the activities of either of these companies, any of their predecessor companies or any of their subsidiaries, and we have not independently verified or participated in the preparation of KKR’s disclosure.

KKR Disclosure

“A European subsidiary of a portfolio company in which our private equity funds have invested provided certain limited disaster recovery services and hosted co-location of some hardware at the portfolio company’s premises in London for Bank Saderat PLC, a bank incorporated and based in the United Kingdom. The company has informed us that the gross revenue and net profits attributable to these activities was approximately £16,300 and £5,700, respectively, for the fiscal year ended December 31, 2012 and less than £5,000 each for the quarter ended March 31, 2013. We have been advised that the subsidiary terminated this contract in the first quarter of 2013, and the portfolio company does not otherwise intend to enter into any Iran-related activity.”

The Carlyle Group L.P. (“Carlyle”), one of our Sponsors, informed us that it included disclosures, as reproduced below, in its quarterly report on Form 10-Q as filed with the SEC on May 14, 2013 as required by Section 13(r) of the Exchange Act. We have no involvement in or control over the activities of either of these companies, any of their predecessor companies or any of their subsidiaries, and we have not independently verified or participated in the preparation of Carlyle’s disclosure.

Carlyle Disclosure

“We have been advised by Applus Servicios Technologicos S.L.U. (“Applus”), a European company in which our private equity funds have invested and which may be considered our affiliate, that during the period January 1, 2013 until March 31, 2013, a subsidiary of Applus provided certain services to customers that could be affiliated with the Industrial Development and Renovation Organization (IDRO), which has been designated as an agency of the Government of Iran. For this period, gross revenue attributable to such sales was €86,633, with estimated net profits to Applus of approximately €15,593. At this time, we are unable to determine whether the IDRO, directly or indirectly, controls these customers. Although these activities were not prohibited by U.S. law at the time they were conducted, Applus has advised us that its subsidiary has discontinued its dealings with such customers, and that it does not otherwise intend to continue or enter into any Iran-related activity. All such dealings (including limited wind-down activities) were discontinued prior to March 8, 2013, in accordance with the requirements of Section 218 of the Iran Threat Reduction and Syria Human Rights Act of 2012, as amended.”

Item 6. Exhibits

The exhibit index attached hereto is incorporated herein by reference.

4245

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

		The Nielsen Company B.V. (Registrant)
Date:	~~July~~October 3023, 2013	/s/ Jeffrey R. Charlton
		Jeffrey R. Charlton Senior Vice President and Corporate Controller Duly Authorized Officer and Principal Accounting Officer

4346

EXHIBIT INDEX

The agreements and other documents filed as exhibits to this quarterly report on Form 10-Q are not intended to provide factual information or other disclosure other than with respect to the terms of the agreements or other documents themselves, and you should not rely on them for that purpose. In particular, any representations and warranties made by the registrant in these agreements or other documents were made solely within the specific context of the relevant agreement or document and may not describe the actual state of affairs as of the date they were made or at any other time.

Exhibit Number		Description of Exhibits
2.1†		Stock Purchase Agreement between VNU International B.V. and Expo Event Transco Inc., dated May 4, 2013 (incorporated herein by reference to Exhibit 2.2 to the Amendment No. 1to the Form S-4 filed by The Nielsen Company B.V. on July 17, 2013 (File No. 333-142546-29)
10.1		Agreement Terminating the Amended and Restated Shareholders’ Agreement Regarding Nielsen Holdings N.V., dated as of August 14, 2013, with The Nielsen Company B.V., Valcon Acquisition B.V., Valcon Acquisition Holding (Luxembourg) S.ar.l. and funds associated with or designated by AlpInvest Partners, The Blackstone Group (“Blackstone”), The Carlyle Group (“Carlyle”), Centerview Partners, Hellman & Friedman LLC (“Hellman & Friedman”), Kohlberg Kravis Roberts & Co. (“KKR”) and Thomas H. Lee Partners (“THL”)
10.2		Form of Letter Agreement with affiliates of each of Blackstone, Carlyle, Hellman & Friedman, KKR and THL, dated as of August 14, 2013
10.3		Indenture, dated as of September 27, 2013, among The Nielsen Company (Luxembourg) S.ar.l., the Guarantors (as defined therein) and Deutsche Bank Trust Company Americas, as Trustee (incorporated herein by reference to the Current Report on Form 8-K filed on September 27, 2013 (File No. 333-142546-29))
10.4		Amended and Restated Arbitron Inc. 2008 Equity Compensation Plan (incorporated herein by reference to the Registration Statement on Form S-8 filed by Nielsen Holdings N.V. on September 30, 2013 (File No. 333-191458))
31.1		CEO 302 Certification Pursuant to Rule 13a-15(e)/15d-15(e)
31.2		CFO 302 Certification Pursuant to Rule 13a-15(e)/15d-15(e)
32.1		Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (Subsections (a) and (b) of Section 1350, Chapter 63 of Title 18, United States Code)
101		The following financial information from The Nielsen Company B.V.’s Quarterly Report on Form 10-Q for the quarter ended ~~June~~September 30, 2013, formatted in XBRL includes: (i) Condensed Consolidated Statements of Operations (Unaudited) for the three and ~~six~~nine months ended ~~June~~September 30, 2013 and 2012, (ii) Condensed Consolidated Statements of Comprehensive Income (Unaudited) for the three and ~~six~~nine months ended ~~June~~September 30, 2013 and 2012, (iii) Condensed Consolidated Balance Sheets at ~~June~~September 30, 2013 (Unaudited) and December 31, 2012, (iv) Condensed Consolidated Statements of Cash Flows (Unaudited) for the ~~six~~nine months ended ~~June~~September 30, 2013 and 2012, and (v) the Notes to Condensed Consolidated Financial Statements.

~~† Certain of the schedules and exhibits have been omitted pursuant to Item~~ 601 (b) (2) of regulation S-K. The registrant hereby undertakes to furnish supplementally to the Securities and Exchange Commission on copies of any omitted schedules and exhibits upon request by the Securities and Exchange Commission. 47

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