Ally Bank 2011 Annual Report Download - page 143

Table of Contents
Notes to Consolidated Financial Statements
Ally Financial Inc. • Form 10−K
Intangibles−Goodwill and Other − Testing Goodwill for Impairment (ASU 2011−08)
In September 2011, the FASB issued ASU 2011−08, which permits the option of performing a qualitative assessment before calculating the fair value
of a reporting unit in step 1 of the goodwill impairment test. If it is determined, on the basis of qualitative factors, that the fair value of a reporting unit is
more likely than not more than the carrying amount, the two−step impairment test would not be required. Otherwise, further evaluation would be needed.
ASU 2011−03 is effective for us on January 1, 2012. We do not expect the adoption to have a material impact to our consolidated financial condition or
results of operation.
Balance Sheet − Disclosures about Offsetting Assets and Liabilities (ASU 2011−11)
In December 2011, the FASB issued ASU 2011−11, which contains new disclosure requirements regarding the nature of an entity's rights of setoff and
related arrangements associated with its financial instruments and derivative instruments. The new disclosures will give financial statement users
information about both gross and net exposures. ASU 2011−11 is effective for us on January 1, 2013, and retrospective application is required. Since the
guidance relates only to disclosures, adoption is not expected to have a material effect on our consolidated financial condition or results of operation.
2. Discontinued and Held−for−sale Operations
Discontinued Operations
We classify operations as discontinued when operations and cash flows will be eliminated from our ongoing operations and we will not retain any
significant continuing involvement in their operations after the respective sale transactions. For all periods presented, all of the operating results for these
discontinued operations were removed from continuing operations and were presented separately as discontinued operations, net of tax, in the Consolidated
Statement of Income. The Notes to the Consolidated Financial Statements were adjusted to exclude discontinued operations unless otherwise noted.
Select Mortgage — Legacy Portfolio and Other Operations
During the fourth quarter of 2011, we committed to sell the Canadian mortgage operations of ResMor Trust. No impairment was recognized to present
the operations at the lower−of−cost or fair value. We expect to complete the sale during 2012.
During 2010, we sold certain international operations. These operations included residential mortgage loan origination, acquisition, servicing, asset
management, sale, and securitizations in the United Kingdom and continental Europe.
Select Global Automotive Services — Insurance Operations
During the fourth quarter of 2011, we committed to sell our U.K.−based operations that provide vehicle service contracts and insurance products in
Europe and Latin America. No impairment was recognized to present the operations at the lower−of−cost or fair value. We expect to complete the sale
during 2012.
During the second quarter of 2011, we completed the sale of our U.K. consumer property and casualty insurance business. During 2010, we completed
the sale of our U.S. consumer property and casualty insurance business.
Select Global Automotive Services — International Automotive Finance Operations
During the fourth quarter of 2011, we committed to sell our full−service leasing operations in Austria, Germany, Greece, Portugal, and Spain, which
resulted in a pretax loss of $30 million. The loss represents the impairment recognized to present the operations at the lower−of−cost or fair value. The fair
value was determined using sales price negotiations with potential third−party purchasers (a Level 2 fair value input). We expect to complete the sale during
2012. We expect to complete the sale of our Venezuela operations, also classified as discontinued operations, during the first quarter of 2012.
During the first quarter of 2011, we completed the sale of our Ecuador operations. During 2010, we completed the sale of our Argentina and Poland
operations and our full−service leasing operations in Australia, Belgium, France, Poland, and the United Kingdom. We also ceased operations in Australia
and Russia and classified them as discontinued during 2010. During 2009, we completed the sale of our full−service leasing operations in Italy, Mexico, and
the Netherlands.
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