American Express 2010 Annual Report Download - page 100

Download and view the complete annual report

Please find page 100 of the 2010 American Express annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 127

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127

NOTE 15
CHANGES IN ACCUMULATED OTHER COMPREHENSIVE (LOSS) INCOME
AOCI is a balance sheet item in the Shareholders’ Equity section of the Company’s Consolidated Balance Sheets. It is comprised of
items that have not been recognized in earnings but may be recognized in earnings in the future when certain events occur. Changes in
each component of AOCI for the three years ended December 31 were as follows:
(Millions, net of tax)
(a)
Net Unrealized
Gains (Losses) on
Investment
Securities
Net Unrealized
Gains (Losses) on
Cash Flow Hedges
Foreign Currency
Translation
Adjustments
Net Unrealized
Pension and Other
Postretirement
Benefit Losses
Accumulated Other
Comprehensive
(Loss) Income
Balances as of December 31, 2007 $ 12 $ (71) $ (255) $ (128) $ (442)
Net unrealized gains (losses) (718) (170) (888)
Reclassification for realized (gains) losses into earnings (8) 161 153
Net translation of investments in foreign operations (1,102) (1,102)
Net gains related to hedges of investment in foreign
operations 961 961
Pension and other postretirement benefit losses (329) (329)
Discontinued operations
(b)
15 28 (2) 41
Net change in accumulated other comprehensive (loss)
income (711) (9) (113) (331) (1,164)
Balances as of December 31, 2008 (699) (80) (368) (459) (1,606)
Net unrealized gains (losses) 1,351 (22) 1,329
Reclassification for realized (gains) losses into earnings (145) 74 (71)
Net translation of investments in foreign operations
(c)
523 523
Net losses related to hedges of investment in foreign
operations (877) (877)
Pension and other postretirement benefit losses (10) (10)
Net change in accumulated other comprehensive (loss)
income 1,206 52 (354) (10) 894
Balances as of December 31, 2009 507 (28) (722) (469) (712)
Impact of the Adoption of new GAAP
(d)
(315) (315)
Net unrealized gains (losses) (139) (2) (141)
Reclassification for realized (gains) losses into earnings 423 1 28
Net translation of investments in foreign operations 189 189
Net gains related to hedges of investment in foreign
operations 29 29
Pension and other postretirement benefit losses 55
Net change in accumulated other comprehensive (loss)
income (450) 21 219 5 (205)
Balances as of December 31, 2010 $ 57 $ (7) $ (503) $ (464) $ (917)
(a) The following table shows the tax impact for the three years ended December 31 for the changes in each component of accumulated other comprehensive
(loss) income:
(Millions) 2010 2009 2008
Investment securities $ (272) $ 749 $ (472)
Cash flow hedges 11 29 (4)
Foreign currency translation adjustments 22 33 (66)
Net investment hedges (396) ——
Pension and other postretirement benefit losses 18 (28) (159)
Discontinued operations
(b)
——16
Total tax impact $ (617) $ 783 $ (685)
(b) Relates to the change in accumulated other comprehensive (loss) income prior to the dispositions of AEB and AEIDC.
(c) Includes a $190 million other comprehensive loss, recorded in the third quarter of 2009, representing the correction of an error related to the accounting in prior
periods for cumulative translation adjustments associated with a net investment in foreign subsidiaries. (Refer to Note 19 for further details).
(d) As described further in Notes 6 and 7, as a result of the adoption of new GAAP effective January 1, 2010, the Company no longer presents within its Consolidated
Financial Statements the effects of the retained subordinated securities issued by previously unconsolidated VIEs related to the Company’s cardmember loan
securitization programs.
98
AMERICAN EXPRESS COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS