Ford 2012 Annual Report Download - page 127

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Ford Motor Company | 2012 Annual Report 125
FORD MOTOR COMPANY AND SUBSIDIARIES
NOTES TO THE FINANCIAL STATEMENTS
NOTE 17. DEBT AND COMMITMENTS (Continued)
Asset-Backed Debt
Ford Credit engages in securitization transactions to fund operations and to maintain liquidity. Ford Credit's
securitization transactions are recorded as asset-backed debt and the associated assets are not de-recognized and
continue to be included in our financial statements.
The finance receivables and cash flows related to the net investment in operating leases that have been included in
securitization transactions are only available for payment of the debt and other obligations issued or arising in the
securitization transactions. They are not available to pay Ford Credit's other obligations or the claims of its other
creditors. Ford Credit does, however, hold the right to the excess cash flows not needed to pay the debt and other
obligations issued or arising in each of the securitization transactions. The debt is the obligation of our consolidated
securitization entities and not Ford Credit's legal obligation or that of its other subsidiaries.
The following table shows the assets and liabilities related to our asset-backed debt arrangements that are included in
our financial statements for the years ended December 31 (in billions):
2012
Cash and Cash
Equivalents
Finance
Receivables, Net
and
Net Investment in
Operating Leases
Related
Debt
VIEs (a)
Finance receivables $ 2.5 $ 47.5 $36.0
Net investment in operating leases 0.4 6.3 4.2
Total $ 2.9 $ 53.8 $40.2
Non-VIE
Finance receivables (b) $ 0.1 $ 3.5 $ 3.3
Total securitization transactions
Finance receivables $ 2.6 $ 51.0 $39.3
Net investment in operating leases 0.4 6.3 4.2
Total $ 3.0 $ 57.3 $43.5
2011
Cash and Cash
Equivalents
Finance
Receivables, Net
and
Net Investment in
Operating Leases
Related
Debt
VIEs (a)
Finance receivables $ 3.0 $ 49.8 $37.2
Net investment in operating leases 0.4 6.4 4.2
Total $ 3.4 $ 56.2 $41.4
Non-VIE
Finance receivables (b) $ 0.3 $ 6.2 $ 5.6
Total securitization transactions
Finance receivables $ 3.3 $ 56.0 $42.8
Net investment in operating leases 0.4 6.4 4.2
Total $ 3.7 $ 62.4 $47.0
__________
(a) Includes assets to be used to settle liabilities of the consolidated VIEs. See Note 12 for additional information on Financial Services sector VIEs.
(b) Certain debt issued by the VIEs to affiliated companies served as collateral for accessing the ECB open market operations program. This external
funding of $145 million and $246 million at December 31, 2012 and 2011, respectively was not reflected as a liability of the VIEs and is reflected as
a non-VIE liability above. The finance receivables backing this external funding are reflected in VIE finance receivables.
Financial Services sector asset-backed debt also included $64 million and $75 million at December 31, 2012 and 2011,
respectively, that is secured by property.
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