Aetna 2014 Annual Report Download - page 87

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Annual Report- Page 81
allows an entity to adopt the standard either through a full retrospective approach or a modified retrospective
approach with a cumulative effect adjustment to retained earnings. We are still assessing the impact of this standard
on our financial position and operating results in addition to evaluating the transition method we will use when we
adopt this standard.
Repurchase-to-Maturity Transactions, Repurchase Financings, and Disclosures
Effective January 1, 2015, we will adopt new accounting guidance related to the accounting for repurchase-to-
maturity transactions and repurchase financing arrangements. This guidance aligns the accounting for repurchase-
to-maturity transactions and repurchase agreements executed as repurchase financings with other typical repurchase
agreements, resulting in these transactions generally being accounted for as secured borrowings. The guidance also
requires additional disclosures about repurchase agreements and other similar transactions. The adoption of this
new guidance is not expected to have a material impact on our financial position or operating results.
Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be
Achieved after the Requisite Service Period
Effective January 1, 2016, we will adopt new accounting guidance related to the accounting for share-based
payments when the terms of an award provide that a performance target could be achieved after the requisite service
period. This guidance clarifies that awards with these provisions should be treated as performance conditions that
affect vesting, and do not impact the award’s estimated grant-date fair value. Early adoption for this new guidance
is permitted. The adoption of this new guidance will not have an impact on our financial position or operating
results.
Disclosure of Uncertainties About an Entity’s Ability to Continue as a Going Concern
Effective December 31, 2016, we will adopt amended accounting guidance related to management’s evaluation of
whether there is substantial doubt about an entity’s ability to continue as a going concern and the related
disclosures. The adoption of this new guidance will not have a material impact on our financial position or
operating results.
Determining Whether the Host Contract in a Hybrid Financial Instrument Issued in the Form of a Share Is More
Akin to Debt or to Equity
Effective December 31, 2015, we will adopt amended accounting guidance related to the approach used in
determining whether the host contract in a hybrid financial instrument issued in the form of a share is more akin to
debt or equity. Early adoption for this new guidance is permitted. The adoption of this new guidance is not expected
to have a material impact on our financial position or operating results.
Simplifying Income Statement Presentation by Eliminating the Concept of Extraordinary Items
Effective January 1, 2016, we will adopt amended accounting guidance related to the presentation of extraordinary
items. The amendment eliminates the concept of extraordinary items which represent events that are both unusual
and infrequent. Presentation and disclosure of items that are unusual or infrequent will be retained, and will be
expanded to include items that are both unusual and infrequent. The adoption of this new guidance is not expected
to have a material impact on our financial position or operating results.
Use of Estimates
The preparation of the accompanying consolidated financial statements in conformity with GAAP requires the use
of estimates and assumptions that affect the amounts reported in these consolidated financial statements and notes.
We consider the following accounting estimates critical in the preparation of the accompanying consolidated
financial statements: health care costs payable, other insurance liabilities, recoverability of goodwill and other
acquired intangible assets, measurement of defined benefit pension and other postretirement employee benefit
plans, other-than-temporary impairment of debt securities and revenue recognition, and allowance for estimated
terminations and uncollectible accounts. We use information available to us at the time estimates are made;
however, these estimates could change materially if different information or assumptions were used. Additionally,
these estimates may not ultimately reflect the actual amounts of the final transactions that occur.