Hertz 2014 Annual Report Download - page 125

Table of Contents
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Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists
In January 2014, the Company adopted new guidance that clarifies that an unrecognized tax benefit, or a portion of an unrecognized tax benefit,
should be presented in the financial statements as a reduction to a deferred tax asset for a net operating loss carryforward, a similar tax loss, or a
tax credit carryforward if such settlement is required or expected in the event the uncertain tax position is disallowed. In situations where a net
operating loss carryforward, a similar tax loss, or a tax credit carryforward is not available at the reporting date under the tax law of the applicable
jurisdiction or the tax law of the jurisdiction does not require, and the entity does not intend to use, the deferred tax asset for such purpose, the
unrecognized tax benefit should be presented in the financial statements as a liability and should not be combined with deferred tax assets. The
adoption of this accounting guidance did not have a material impact on the Company's financial position, results of operations or cash flows.
Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity
In April 2014, the FASB issued guidance that changes the criteria for reporting discontinued operations. As a result of this guidance, only
disposals of a component that represent a strategic shift that have, or will have, a major effect on the Company’s operations and financial results
will be reported as a discontinued operation. Expanded disclosures are required for discontinued operations and for individually significant
components that do not qualify for discontinued operations reporting. This guidance is effective on a prospective basis for fiscal years beginning
after December 15, 2014 and interim periods within those years. This new guidance is not expected to have a material impact on the Company's
financial position, results of operations or cash flows.
Revenue from Contracts with Customers
In May 2014, the FASB issued guidance that will replace most existing revenue recognition guidance in U.S. GAAP. The core principle of the
guidance is that an entity should recognize revenue for the transfer of goods or services equal to the amount that it expects to be entitled to
receive for those goods or services. The guidance requires additional disclosure about the nature, amount, timing and uncertainty of revenue and
cash flows arising from customer contracts, including significant judgments and changes in judgments. The new guidance may be adopted on
either a full or modified retrospective basis. As issued, the guidance is effective for annual reporting periods beginning after December 15, 2016,
including interim periods within those reporting periods. In April 2015, the FASB issued a proposal to defer the effective date of the guidance until
annual and interim reporting periods beginning after December 15, 2017. The Company is in the process of determining the method of adoption and
assessing the potential impacts of adopting this guidance on its financial position, results of operations and cash flows.
Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could be Achieved after the Requisite
Service Period
In June 2014, the FASB issued guidance that requires that a performance target in a share-based payment award that affects vesting and that can
be achieved after the requisite service period is completed is to be accounted for as a performance condition; therefore, compensation cost should
be recognized in the period in which it becomes probable that the performance target will be achieved, and the amount of compensation cost
recognized should be based on the portion of the service period fulfilled. The guidance is effective either prospectively or retrospectively for annual
periods beginning after December 15, 2015 and interim periods within those annual periods. The Company is in the process of determining the
potential impacts of adopting this guidance on its financial position, results of operations and cash flows.
Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern
In August 2014, the FASB issued guidance that requires management to assess an entity’s ability to continue as a going concern and provide
related footnote disclosures. This guidance was adopted early, as permitted, as of December 31, 2014 and did not have a material impact on the
Company's financial position, results of operations or cash flows.
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Source: HERTZ GLOBAL HOLDINGS INC, 10-K, July 16, 2015 Powered by Morningstar® Document Research℠
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