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70 Goldman Sachs Annual Report 2000
Segment Operating Results
Management believes that the following information provides a reasonable representation of each segment’s contribution to
consolidated pre-tax earnings and total assets:
Year Ended November
(in millions) 2000 1999 1998(6)
Global Capital Markets Net revenues(1) $ 11,998 $ 10,132 $ 5,747
Operating expenses(2) 7,844 6,232 3,978
Pre-tax earnings $ 4,154 $ 3,900 $ 1,769
Segment assets $149,459 $127,515 $102,724
Asset Management Net revenues(1) $ 4,592 $ 3,213 $ 2,773
and Securities Services Operating expenses(2) 3,008 2,396 1,621
Pre-tax earnings $ 1,584 $ 817 $ 1,152
Segment assets $139,215 $121,693 $114,293
Total Net revenues(1) $ 16,590 $ 13,345 $ 8,520
Operating expenses(2) 11,570 11,353 5,599
Pre-tax earnings $ 5,020(4) $ 1,992(5) $ 2,921
Total assets(3) $289,760 $250,491 $217,380
(1) Net revenues include net interest as set forth in the table below:
Year Ended November
(in millions) 2000 1999 1998
Global Capital Markets $131 $ 15 $ 364
Asset Management and Securities Services 855 689 688
Total net interest $986 $704 $1,052
(2) Operating expenses include depreciation and amortization as set forth in the table below:
Year Ended November
(in millions) 2000 1999 1998
Global Capital Markets $336 $228 $158
Asset Management and Securities Services 150 109 84
Total depreciation and amortization $486 $337 $242
(3) Includes deferred tax assets relating to the firm’s conversion to corporate form, acquisition awards and certain assets that management believes
are not allocable to a particular segment.
(4) Pre-tax earnings for the year ended November 2000 include the following expenses that have not been allocated to the firm’s segments: (i) the
ongoing amortization of employee initial public offering and acquisition awards of $428 million and (ii) the acquisition awards of $290 million
related to the firm’s combination with SLK.
(5) Pre-tax earnings for the year ended November 1999 include the following expenses that have not been allocated to the firm’s segments:
(i) nonrecurring employee initial public offering awards of $2.26 billion, (ii) the ongoing amortization of employee initial public offering awards
of $268 million and (iii) the charitable contribution to The Goldman Sachs Foundation of $200 million made at the time of the firm’s initial
public offering.
(6) As a partnership, payments for services rendered by profit participating limited partners were accounted for as distributions of partners’ capital
rather than as compensation and benefits expense. As a result, pre-tax earnings in 1998 are not comparable with 2000 or 1999.