Ford 2011 Annual Report Download - page 101

Notes to the Financial Statements
Ford Motor Company | 2011 Annual Report 99
NOTE 3. ACCOUNTING STANDARDS ISSUED BUT NOT YET ADOPTED
Balance Sheet - Offsetting. In December 2011, the Financial Accounting Standards Board ("FASB") issued a new
standard that requires disclosures about offsetting and related arrangements for recognized financial instruments and
derivative instruments. The standard is effective for us as of January 1, 2013 and will impact our financial statement
disclosures.
Intangibles - Goodwill and Other. In September 2011, the FASB issued a new standard that provides the option to
evaluate prescribed qualitative factors to determine whether a calculated goodwill impairment test is necessary. The
standard is effective for us as of January 1, 2012 and will not materially impact our financial condition, results of
operations, or financial statement disclosures.
Comprehensive Income - Presentation. In June 2011, the FASB issued a new standard that modifies the options for
presentation of other comprehensive income. The new standard will require us to present comprehensive income either
on a single continuous statement or two separate but consecutive statements. The standard is effective for us as of
January 1, 2012 and will impact our financial statement disclosures.
Fair Value Measurement. In May 2011, the FASB issued a new standard that provides a consistent definition of fair
value measurement and closely aligns disclosure requirements between GAAP and International Financial Reporting
Standards. The new standard will require us to report the level in the fair value hierarchy of assets and liabilities not
measured at fair value in the balance sheet but for which the fair value is disclosed, and to expand existing disclosures.
The standard is effective for us as of January 1, 2012 and will impact our financial statement disclosures.
Transfers and Servicing - Repurchase Agreements. In April 2011, the FASB issued a new standard for agreements
that both entitle and obligate a transferor to repurchase or redeem financial assets before their maturity. The standard is
effective for us as of January 1, 2012 and will not impact our financial condition, results of operations, or financial
statement disclosures.
Financial Services - Insurance. In October 2010, the FASB issued a new standard addressing the deferral of
acquisition costs within the insurance industry. The new standard modifies which types of costs can be capitalized in the
acquisition and renewal of insurance contracts. The standard is effective for us as of January 1, 2012 and will not
materially impact our financial condition, results of operations, or financial statement disclosures.
NOTE 4. FAIR VALUE MEASUREMENTS
Cash equivalents, marketable securities, and derivative financial instruments are presented on our financial
statements at fair value. The fair value of finance receivables and debt is disclosed in Notes 7 and 18, respectively.
Certain other assets and liabilities are measured at fair value on a nonrecurring basis, such as impairments, and vary
based on specific circumstances.
Fair Value Measurements
In determining fair value, we use various valuation methodologies and prioritize the use of observable inputs. The use
of observable and unobservable inputs and their significance in measuring fair value are reflected in our hierarchy
assessment.
• Level 1 — inputs include quoted prices for identical instruments and are the most observable
• Level 2 — inputs include quoted prices for similar instruments and observable inputs such as interest rates,
currency exchange rates and yield curves
• Level 3 — inputs include data not observable in the market and reflect management judgment about the
assumptions market participants would use in pricing the instruments