GE 2005 Annual Report Download - page 80

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(80)
Accounting principles
Our financial statements are prepared in conformity with U.S. generally accepted accounting principles (GAAP).
Consolidation
Our financial statements consolidate all of our affiliates-companies that we control and in which we hold a majority
voting interest. Associated companies are companies that we do not control but over which we have significant
influence, most often because we hold a shareholder voting position of 20% to 50%. Results of associated
companies are presented on a one-line basis. Investments in and advances to associated companies are presented on
a one-line basis in the caption “All other assets” in our Statement of Financial Position, net of allowance for losses
that represents our best estimate of probable losses inherent in such assets.
Because of new accounting requirements that became effective in 2004 and 2003, we consolidated certain
non-affiliates, including certain special purpose entities (SPEs) and investments previously considered associated
companies, in each of those years.
Financial statement presentation
We have reclassified certain prior-year amounts to conform to the current year’ s presentation.
Financial data and related measurements are presented in the following categories:
• GE This represents the adding together of all affiliates other than General Electric Capital Services, Inc.
(GECS), whose operations are presented on a one-line basis.
• GECS This affiliate owns all of the common stock of General Electric Capital Corporation (GE Capital) and
GE Insurance Solutions Corporation (GE Insurance Solutions), the parent of Employers Reinsurance
Corporation. GE Capital and its respective affiliates are consolidated in the accompanying GECS columns and
constitute its business.
In 2005, most of GE Insurance Solutions was classified as part of our discontinued insurance operations. See
note 2.
• CONSOLIDATED This represents the adding together of GE and GECS.
• OPERATING SEGMENTS These comprise our six businesses focused on the broad markets they serve:
Infrastructure, Industrial, Healthcare, NBC Universal, Commercial Finance and Consumer Finance. For
segment reporting purposes, certain GECS businesses are included in the industrial operating segments that
actively manage such businesses and report their results for internal performance measurement purposes. These
include Aviation Financial Services, Energy Financial Services and Transportation Finance reported in the
Infrastructure segment, and Equipment Services reported in the Industrial segment.
Unless otherwise indicated, information in these notes to consolidated financial statements relates to
continuing operations.