General Motors 2012 Annual Report Download - page 116

GENERAL MOTORS COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
Note 15. Variable Interest Entities
Consolidated VIEs
Automotive
VIEs that we do not control through a majority voting interest that are consolidated because we are the primary beneficiary include
certain vehicle assembling, manufacturing and selling venture arrangements, the most significant of which is GM Egypt. We
consolidated GM Egypt in January 2010 in connection with our adoption of amendments to ASC 810, “Consolidation.” GM Egypt, a
31% owned operating entity, assembles and manufactures vehicles. Certain voting and other rights permit us to direct those activities
of GM Egypt that most significantly affect its economic performance. At December 31, 2012 and 2011; (1) Total assets of these VIEs
were $436 million and $463 million, which were composed of Cash and cash equivalents, Accounts and notes receivables, net,
Inventories, and Property, net; and (2) Total liabilities were $254 million and $298 million, which were composed of Accounts
payable (principally trade), and Accrued and other liabilities. In the years ended December 31, 2012 and 2011 Total net sales and
revenue recorded for these consolidated VIEs were $1.0 billion and $748 million and Net income was $56 million and $61 million.
These amounts are stated prior to intercompany eliminations. Liabilities recognized as a result of consolidating VIEs generally do not
represent claims against us or our other subsidiaries and assets recognized generally are for the benefit of the VIEs’ operations and
cannot be used to satisfy our obligations.
HKJV and GM Korea are non-wholly owned consolidated subsidiaries that we control through a majority voting interest. They are
also VIEs because in the future they may require additional subordinated financial support.
The following table summarizes the liabilities of HKJV and GM Korea for which their creditors do not have recourse to our general
credit (dollars in millions):
December 31, 2012 December 31, 2011
GM Korea HKJV (a) Total GM Korea
Short-term debt ........................................................ $124 $104 $228 $171
Current derivative ...................................................... $ 18 $ — $ 18 $ 44
Long-term debt ........................................................ $ 2 $120 $122 $ 7
(a) Consolidated effective September 1, 2012. Refer to Notes 4 and 10 for additional information on the acquisition of HKJV.
In February 2011 we provided a guarantee to a minority shareholder in GM Korea to repurchase the GM Korea mandatorily
redeemable preferred shares according to the redemption schedule should GM Korea not repurchase the shares. This guarantee
decreased the amount of long-term debt which did not have recourse to our general credit in the years ended December 31, 2012 and
2011.
Automotive Financing — GM Financial
GM Financial finances its loan and lease origination volume through the use of credit facilities and securitization trusts that issue
asset-backed securities to investors. GM Financial retains a residual interest in these entities and is not required to provide any
additional financial support to its sponsored credit facilities and securitization SPEs. The SPEs are considered VIEs because they do
not have sufficient equity at risk and are consolidated because GM Financial has the power over those activities that most significantly
affect the economic performance of the SPEs. The finance receivables, leased assets and other assets held by these subsidiaries are not
available to our creditors or creditors of our other subsidiaries. Refer to Notes 5, 6 and 17 for additional information on GM
Financial’s involvement with the SPEs.
General Motors Company 2012 ANNUAL REPORT 113