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AMERICAN EXPRESS COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
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, 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(b) 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 GAAP(c) (315) (315)
Net unrealized gains (losses) (139) (2) (141)
Reclassification for realized (gains) losses into earnings 4 23 (2) 25
Net translation of investments in foreign operations 189 189
Net gains related to hedges of investment in foreign operations 32 32
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)
Net unrealized gains (losses) 245 (2) 243
Reclassification for realized (gains) losses into earnings (14) 8 (6)
Net translation of investments in foreign operations (153) (153)
Net losses related to hedges of investment in foreign operations (26) (26)
Pension and other postretirement benefit losses (17) (17)
Net change in accumulated other comprehensive (loss) income 231 6 (179) (17) 41
Balances as of December 31, 2011 $ 288 $ (1) $ (682) $ (481) $ (876)
(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) 2011 2010 2009
Investment securities $ 149 $ (272) $ 749
Cash flow hedges 311 29
Foreign currency translation adjustments (40) 22 33
Net investment hedges (14) (396) –
Pension and other postretirement benefit losses (7) 18 (28)
Total tax impact $91$ (617) $ 783
(b) 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.
(c) As a result of the adoption of new GAAP governing consolidations and VIEs, 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.
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