Hertz 2011 Annual Report Download - page 118

HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
affect the amounts reported in the financial statements and footnotes. Actual results could differ
materially from those estimates.
Significant estimates inherent in the preparation of the consolidated financial statements include
depreciation of revenue earning equipment, reserves for litigation and other contingencies, accounting
for income taxes and related uncertain tax positions, pension costs valuation, useful lives and
impairment of long-lived tangible and intangible assets, valuation of stock-based compensation, public
liability and property damage reserves, reserves for restructuring, allowance for doubtful accounts and
fair value of derivatives.
Reclassifications
Certain prior period amounts have been reclassified to conform with current reporting.
During the third quarter of 2011, we identified certain errors in our previously issued consolidated
financial statements. While these errors did not, individually or in the aggregate, result in a material
misstatement of the Company’s previously issued consolidated financial statements, correcting these
items in the third quarter would have been material to the third quarter and nine-months ending
September 30, 2011 results. Accordingly, management has revised in this filing, its previously reported
balance sheet and consolidated statement of operations as noted below. These errors relate to
additional telecommunication charges and depreciation of revenue earning equipment, as well as
certain corrections to deferred taxes on income for years 2005 through 2010 and the related impact on
the 2008 goodwill impairment. We are recording the cumulative effect $(8.7) million of these adjustments
for the periods prior to 2009 as a decrease to the previously reported December 31, 2008 Accumulated
deficit of $936.3 million, resulting in revised December 31, 2008 Accumulated deficit of $945.0 million.
These adjustments also resulted in a decrease to revenue earning equipment, net and increases to
goodwill, accounts payable and deferred taxes on income as of December 31, 2010. As such, total
assets were revised from the previously reported $17,332.2 million to $17,345.0 million, total liabilities
were revised from the previously reported $15,200.9 million to $15,226.5 million and total equity was
revised from the previously reported $2,131.3 million to $2,118.5 million as of December 31, 2010.
The following tables present the effect of this correction on our Consolidated Statements of Operations
(in thousands, except per share data):
Year Ended December 31, 2010 Year Ended December 31, 2009
As As
Previously As Previously As
Reported Adjustment Revised Reported Adjustment Revised
Direct operating .............. $4,282,351 $1,043 $4,283,394 $4,084,176 $ 2,634 $4,086,810
Depreciation of revenue earning
equipment and lease charges .... 1,868,147 — 1,868,147 1,931,358 2,453 1,933,811
Selling, general and administrative . . — — — 641,148 796 641,944
(Provision) benefit for taxes on
income .................. (17,068) 406 (16,662) 59,666 2,377 62,043
Net loss attributable to Hertz Global
Holdings, Inc. and Subsidiaries’
common stockholders ......... (48,044) (637) (48,681) (126,022) (3,506) (129,528)
Loss per share:
Basic ................... $ (0.12) — $ (0.12) $ (0.34) $ (0.01) $ (0.35)
Diluted .................. $ (0.12) — $ (0.12) $ (0.34) $ (0.01) $ (0.35)
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