ADT 2011 Annual Report Download - page 259

TYCO INTERNATIONAL LTD.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
19. Accumulated Other Comprehensive Loss (Continued)
adjustments as a result of the sale of foreign entities. Of these amounts, $126 million, nil and
$21 million, respectively, are included in income from discontinued operations.
(2) Income tax on the net investment hedge was nil for the year ended September 30, 2011, $7 million
of an income tax benefit for the year ended September 24, 2010 and nil for the year ended
September 25, 2009.
(3) Adjustment to accumulated (deficit) earnings recorded to correct the distribution amount to
Covidien and TE Connectivity at the date of the Separations in 2007.
20. Redeemable Noncontrolling Interest
As described in Note 5, on June 29, 2011, the Company acquired a 75% ownership interest in
KEF. The remaining 25% interest is held by a noncontrolling interest stakeholder. In connection with
the acquisition of KEF, Tyco and the noncontrolling interest stakeholder have a call and put
arrangement, respectively, for Tyco to acquire the remaining 25% ownership interest at a price equal to
the greater of $100 million or a multiple of KEF’s average EBITDA for the prior twelve consecutive
fiscal quarters. The arrangement becomes exercisable beginning the first full fiscal quarter following the
third anniversary of the KEF closing date of June 29, 2011. Noncontrolling interest with redemption
features, such as the arrangement described above, that are not solely within the Company’s control are
considered redeemable noncontrolling interests. The Company accretes changes in the redemption
value through noncontrolling interest in subsidiaries net income (loss) attributable to the noncontrolling
interest over the period from the date of issuance to the earliest redemption date. Redeemable
noncontrolling interest is considered to be temporary equity and is therefore reported in the mezzanine
section between liabilities and equity on the Company’s Consolidated Balance Sheet at the greater of
the initial carrying amount increased or decreased for the noncontrolling interest’s share of net income
or loss or its redemption value.
The rollforward of redeemable noncontrolling interest as of September 30, 2011 is as follows:
2011
Balance as of September 24, 2010 ................................. $—
Acquisition of redeemable noncontrolling interest as of June 29, 2011 ..... $92
Net loss .................................................. (2)
Adjustments to redemption value ................................ 3
Balance as of September 30, 2011 ................................. $93
21. Consolidated Segment Data
Segment information is consistent with how management reviews the businesses, makes investing
and resource allocation decisions and assesses operating performance. The Company, from time to
time, may realign businesses and management responsibility within its operating segments based on
considerations such as opportunity for market or operating synergies and/or to more fully leverage
existing capabilities and enhance development for future products and services.
During the first quarter of fiscal 2011, the Company realigned its Safety Products segment between
its ADT Worldwide and Fire Protection segments to create two new segments: Tyco Security Solutions
156 2011 Financials