GE 2012 Annual Report Download - page 138

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136 GE 2012 ANNUAL REPORT
notes to consolidated financial statements
Note 27.
Intercompany Transactions
Transactions between related companies are made on an
arms-length basis, are eliminated and consist primarily of GECC
dividends to GE; GE customer receivables sold to GECC; GECC
services for trade receivables management and material procure-
ment; buildings and equipment (including automobiles) leased
between GE and GECC; information technology and other ser-
vices sold to GECC by GE; aircraft engines manufactured by GE
that are installed on aircraft purchased by GECC from third-party
producers for lease to others; and various investments, loans and
allocations of GE corporate overhead costs.
These intercompany transactions are reported in the GE and
GECC columns of our financial statements, but are eliminated in
deriving our consolidated financial statements. Effects of these
eliminations on our consolidated cash flows from operating,
investing and financing activities are $(8,542) million, $2,328 mil-
lion and $6,703 million for 2012, $(558) million, $(373) million
and $903 million for 2011 and $(124) million, $26 million and
$293 million for 2010, respectively. Dividends from GECC to GE
of $6,426 million have been eliminated from consolidated cash
from operating and financing activities for 2012. There were no
such dividends for 2011 or 2010. Net decrease (increase) in GE
customer receivables sold to GECC of $(1,809) million, $2,005 mil-
lion, and $(196) million have been eliminated from consolidated
cash from operating, investing and financing activities for 2012,
respectively. Net decrease (increase) in GE customer receiv-
ables sold to GECC of $(601) million and $147 million have been
eliminated from consolidated cash from operating and investing
activities for 2011 and 2010, respectively. Intercompany borrow-
ings (includes GE investment in GECC short-term borrowings) of
$473 million, $903 million and $293 million have been eliminated
from financing activities for 2012, 2011 and 2010, respectively.
Other reclassifications and eliminations of $(307) million, $43 mil-
lion and $(271) million have been eliminated from consolidated
cash from operating activities and $323 million, $(974) million and
$173 million have been eliminated from consolidated cash from
investing activities for 2012, 2011 and 2010, respectively.
Note 28.
Operating Segments
Basis for Presentation
Our operating businesses are organized based on the nature of
markets and customers. Segment accounting policies are the
same as described in Note 1. Segment results for our financial
services businesses reflect the discrete tax effect of transactions.
Results of our formerly consolidated subsidiary, NBCU, and
our current equity method investment in NBCU LLC are reported
in the “Corporate items and eliminations” line on the Summary of
Operating Segments.
On February 22, 2012, we merged our wholly-owned subsid-
iary, GECS, with and into GECS’ wholly-owned subsidiary, GECC.
Our financial services segment, GE Capital, continues to com-
prise the continuing operations of GECC, which now include the
run-off insurance operations previously held and managed in
GECS. Unless otherwise indicated, references to GECC and the GE
Capital segment relate to the entity or segment as they exist sub-
sequent to the February 22, 2012 merger.
Effective October 1, 2012, we reorganized the former Energy
Infrastructure segment into three segments—Power & Water, Oil
& Gas and Energy Management. We also reorganized our Home
& Business Solutions segment by transferring our Intelligent
Platforms business to Energy Management. Results for 2012 and
prior periods are reported on this basis.
A description of our operating segments as of December 31,
2012, can be found below, and details of segment profit by
operating segment can be found in the Summary of Operating
Segments table in Management’s Discussion and Analysis of
Financial Condition and Results of Operations.
Power & Water
Power plant products and services, including design, installation,
operation and maintenance services are sold into global markets.
Gas, steam and aeroderivative turbines, generators, combined
cycle systems, controls and related services, including total asset
optimization solutions, equipment upgrades and long-term main-
tenance service agreements are sold to power generation and
other industrial customers. Renewable energy solutions include
wind turbines and solar technology. Water treatment services
and equipment include specialty chemical treatment programs,
water purification equipment, mobile treatment systems and
desalination processes.