Hertz 2015 Annual Report Download - page 90

Table of Contents
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Hertz Global Holdings, Inc. ("Hertz Holdings" and together with its subsidiaries, the "Company") was incorporated in Delaware in 2005 to serve as
the top-level holding company for Hertz Investors, Inc. which wholly owns The Hertz Corporation (“Hertz”), Hertz Holding's primary operating
company. The Company is a successor to corporations that have been engaged in the car and truck rental and leasing business since 1918 and
the equipment rental business since 1965. Hertz was incorporated in Delaware in 1967. Hertz Holdings' common stock trades on the New York
Stock Exchange ("NYSE") under the symbol "HTZ".
The Company operates its U.S. car rental and International car rental businesses through the Hertz, Dollar, Thrifty and Firefly brands from
company-owned, licensee and franchisee locations in the U.S., Africa, Asia, Australia, Canada, Europe, Latin America, the Middle East and New
Zealand. In its worldwide equipment rental business, the Company rents equipment in the U.S., Canada, China, Qatar, Saudi Arabia and the United
Kingdom, as well as through its international franchises. Through its Donlen subsidiary, the Company provides fleet leasing and fleet management
services.
In March 2014, the Company announced that its Board of Directors approved plans to separate Hertz Holdings into two independent, publicly
traded companies. One of the companies, Hertz Rental Car Holding Company, Inc. ("HRCHC") will continue to operate the Hertz, Dollar, Thrifty
and Firefly car rental businesses as well as Donlen; and the other, HERC Holdings, Inc. ("HERC Holdings") will operate the Hertz Equipment
Rental Corporation ("HERC"). The Company expects to separate the businesses in a tax-efficient manner. In December 2015, HRCHC filed a
registration statement on Form 10 with the SEC in respect of the separation.
In November 2015, the Company completed the relocation of its worldwide headquarters to Estero, Florida from Park Ridge, New Jersey.
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The Company’s consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United
States of America (“U.S. GAAP”).
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The consolidated financial statements include the accounts of Hertz Holdings and its wholly owned and majority owned U.S. and international
subsidiaries. In the event that the Company is a primary beneficiary of a variable interest entity, the assets, liabilities, and results of operations of
the variable interest entity are included in the Company's consolidated financial statements. The Company accounts for its investment in CAR Inc.
and other immaterial investments in joint ventures using the equity method when it has significant influence but not control and is not the primary
beneficiary. All significant intercompany transactions have been eliminated in consolidation.
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The Company identified various misstatements relating to prior year financial statements that it corrected in the third quarter 2015. The cumulative
impact of the adjustments was a decrease to pre-tax income of approximately $13 million and a decrease to net earnings of approximately $9
million and is comprised of $4 million related to the accounting for the post-acquisition sale of land that was revalued as part of the December 2005
acquisition of the Company, $4 million of additional accruals for the periods 2009 through 2014 resulting from concession audits at certain airport
locations, a $4 million obligation to a jurisdiction for customer transaction fees and $1 million of additional write-offs of assets that were incorrectly
capitalized. The Company considered both quantitative and qualitative factors in assessing the materiality of the items individually, and in the
aggregate, and determined that the misstatements were not material to any prior period and not material to the year ended December 31, 2015.
The misstatements were identified in the third
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except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.