Hertz 2008 Annual Report Download - page 154

HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Reclassifications
Certain prior year amounts have been reclassified to conform with current reporting.
Recent Accounting Pronouncements
In September 2006, the Financial Accounting Standards Board, or ‘‘FASB,’’ issued SFAS No. 157, ‘‘Fair
Value Measurements,’’ or ‘‘SFAS No. 157.’’ SFAS No. 157 defines fair value, establishes a framework for
measuring fair value in accordance with GAAP and expands disclosures about fair value measurements.
We adopted the provisions of SFAS No. 157 on January 1, 2008, except as they relate to non-financial
assets and liabilities that are not recognized or disclosed at fair value in the financial statements on a
recurring basis (at least annually), which provisions become effective for us beginning in January 2009.
We are currently reviewing SFAS No. 157, as it relates to our non-financial assets and liabilities that are
not recognized or disclosed at fair value in the financial statements on a recurring basis (at least
annually), to determine its impact, if any, on our financial position or results of operations. See Note 13—
Financial Instruments.
In February 2007, the FASB issued SFAS No. 159, ‘‘The Fair Value Option for Financial Assets and
Financial Liabilities,’’ or ‘‘SFAS No. 159.’’ SFAS No. 159 permits entities to choose to measure many
financial assets and liabilities and certain other items at fair value. The provisions of SFAS No. 159 were
effective for us beginning in January 2008. We chose not to change the measurement of the pertinent
assets and liabilities as a result of SFAS No. 159; therefore, SFAS No. 159 did not have any impact on our
financial position or results of operations.
In December 2007, the FASB issued SFAS No. 141 (revised 2007), ‘‘Business Combinations,’’ or ‘‘SFAS
No. 141(R).’’ The new standard requires the acquiring entity that gains control in a business combination
to recognize 100% of the fair value of the assets acquired and liabilities assumed in the transaction;
establishes the acquisition-date fair value as the measurement objective for all assets acquired and
liabilities assumed; requires that acquisition related costs be expensed; and requires the acquirer to
disclose to investors and other users all of the information they need to evaluate and understand the
nature and financial effect of the business combination. The provisions of SFAS No. 141(R) became
effective for us in January 2009.
In December 2007, the FASB issued SFAS No. 160, ‘‘Noncontrolling Interests in Consolidated Financial
Statements-an amendment of ARB No. 51,’’ or ‘‘SFAS No. 160.’’ SFAS No. 160 will change the
accounting and reporting for minority interests, which will be recharacterized as noncontrolling interests
and classified as a component of stockholders’ equity. Additionally, the amount of consolidated net
income attributable to the parent and to the noncontrolling interests must be clearly identified and
presented on the face of the consolidated statement of operations. Finally, changes in a parent’s
ownership interest while the parent retains its controlling financial interest in its subsidiary will be
accounted for consistently as equity transactions. The provisions of SFAS No. 160 became effective for
us in January 2009.
In March 2008, the FASB issued SFAS No. 161, ‘‘Disclosures about Derivative Instruments and Hedging
Activities—an amendment of FASB Statement No. 133,’’ or ‘‘SFAS No. 161.’’ SFAS No. 161 changes the
disclosure requirements for derivative instruments and hedging activities. Entities are required to
provide enhanced disclosures about how and why an entity uses derivative instruments, how derivative
instruments and related hedged items are accounted for under FASB Statement 133 and its related
interpretations, and how derivative instruments and related hedged items affect an entity’s financial
position, financial performance, and cash flows. The provisions of SFAS No. 161 will be effective for us
beginning with our quarterly report for the period ended March 31, 2009.
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