Wendy's International (WEN)

Significant Estimates

The Company’s significant estimates which are susceptible to change in the near term relate to (1) provisions for the resolution of income tax contingencies subject to future examinations of the Company’s Federal and state income tax returns by the Internal Revenue Service or state taxing authorities, including remaining provisions included in “Current liabilities relating to discontinued operations,” (see Note 15), (2) provisions for the resolution of legal and environmental matters (see Note 29), (3) the valuation of investments and liability positions related to investments which are not publicly traded (see Note 14), (4) provisions for Other Than Temporary Losses (see Notes 1 and 20) and (5) estimates of impairment of the carrying values of long-lived assets of the restaurant business (see Notes 1 and 19). The Company’s estimates of each of these items historically have been adequate. Due to uncertainties inherent in the estimation process, it is reasonably possible that the actual resolution of any of these items could vary significantly from the estimate and, accordingly, there can be no assurance that the estimates may not materially change in the near term. In this connection, the Company’s results of operations were materially impacted by the release of income tax reserves and related interest accruals in 2004 and, to a much lesser extent, in 2005 and 2006, that were no longer required (see Notes 15 and 23).

Significant Estimates

       The Company's significant estimates which are susceptible to change in the near term relate to (1) provisions for the resolution of income tax contingencies subject to future examinations of the Company's Federal and state income tax returns by the Internal Revenue Service or state taxing authorities, including remaining provisions included in “Current liabilities relating to discontinued operations,” (see Note 15), (2) provisions for the resolution of legal and environmental matters (see Note 28), (3) the valuation of investments and liability positions related to investments which are not publicly traded (see Note 14), (4) provisions for Other Than Temporary Losses (see Note 19) and (5) estimates of impairment of the carrying values of long-lived assets of the restaurant business (see Notes 1 and 18). The Company's estimates of each of these items historically have been adequate. Due to uncertainties inherent in the estimation process, it is reasonably possible that the actual resolution of any of these items could vary significantly from the estimate and, accordingly, there can be no assurance that the estimates may not materially change in the near term. In this connection, in 2004 and, to a much lesser extent, in 2005 the Company's results of operations were materially impacted by the release of income tax reserves and related interest accruals that were no longer required (see Notes 15 and 22).