Ford 2013 Annual Report Download - page 135

Ford Motor Company | 2013 Annual Report 133
FORD MOTOR COMPANY AND SUBSIDIARIES
NOTES TO THE FINANCIAL STATEMENTS
NOTE 22. INCOME TAXES (Continued)
Other
A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows for the years listed
(in millions):
2013 2012
Beginning balance $ 1,547 $ 1,721
Increase – tax positions in prior periods 128 84
Increase – tax positions in current period 45 19
Decrease – tax positions in prior periods (24) (246)
Settlements (79)(31)
Lapse of statute of limitations (54)(14)
Foreign currency translation adjustment 114
Ending balance $ 1,564 $ 1,547
The amount of unrecognized tax benefits at December 31, 2013 and 2012 that would affect the effective tax rate if
recognized was $1.2 billion and $1.2 billion, respectively.
Examinations by tax authorities have been completed through 2004 in Germany, and through 2007 in Canada, the
United States, and the United Kingdom. Although examinations have been completed in these jurisdictions, limited
transfer pricing disputes exist for years dating back to 1996.
We recorded on our consolidated income statement approximately $11 million, $9 million, and $77 million in tax-
related interest income for the years ended December 31, 2013, 2012, and 2011. As of December 31, 2013 and 2012, we
had recorded a net payable of $83 million and $137 million, respectively, for tax-related interest.
NOTE 23. DISPOSITIONS, CHANGES IN INVESTMENTS IN AFFILIATES, AND ASSETS HELD FOR SALE
We classify assets and liabilities as held for sale (“disposal group”) when management, having the authority to
approve the action, commits to a plan to sell the disposal group, the sale is probable within one year, and the disposal
group is available for immediate sale in its present condition. We also consider whether an active program to locate a
buyer has been initiated, whether the disposal group is marketed actively for sale at a price that is reasonable in relation
to its current fair value, and whether actions required to complete the plan indicate that it is unlikely that significant
changes to the plan will be made or that the plan will be withdrawn. We classify a disposal group as a discontinued
operation when the criteria to be classified as held for sale have been met and we will not have any significant
involvement with the disposal group after the sale.
When we classify a disposal group as held for sale, we test for impairment. An impairment charge is recognized
when the carrying value of the disposal group exceeds the estimated fair value, less transaction costs. We also cease
depreciation for assets classified as held for sale.
We aggregate the assets and liabilities of all held-for-sale disposal groups on the balance sheet for the period in
which the disposal group is held for sale. To provide comparative balance sheets, we also aggregate the assets and
liabilities for significant held-for-sale disposal groups on the prior-period balance sheet.
Automotive Sector
Dispositions
Automotive Components Holdings, LLC (“ACH”). During the second quarter of 2012, ACH completed the sales of
its automotive interior trim components business and automotive lighting business resulting in pre-tax losses of
$96 million and $77 million, respectively, reported in Automotive interest income and other income/(loss), net, and
contractual obligations of $182 million and $15 million, respectively, associated with the pricing of products to be
purchased over the term of the related purchase and supply agreements.
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