Pitney Bowes 2008 Annual Report Download - page 98

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PITNEY BOWES INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Tabular dollars in thousands, except per share data)
79
Leveraged Leases
Our investment in leveraged lease assets consists of the following:
December 31,
2008 2007
Rental receivables $ 1,523,617 $ 1,889,083
Unguaranteed residual values 11,522 32,487
Principal and interest on non-recourse loans (1,173,789) (1,478,555)
Unearned income (159,429) (193,824)
Investment in leveraged leases 201,921 249,191
Less: Deferred taxes related to leveraged leases (97,980) (117,500)
Net investment in leveraged leases $ 103,941 $ 131,691
The following is a summary of the components of income from leveraged leases:
December 31,
2008 2007 2006
Pre-tax leveraged lease income $ 316 $ 4,270 $ 8,019
Income tax effect 7,063 1,186 (923)
Income from leveraged leases $ 7,379 $ 5,456 $ 7,096
Income from leveraged leases was positively impacted by $2.6 million and negatively impacted by $0.2 million in 2008 and 2007,
respectively, due to changes in statutory tax rates.
18. Business Segment Information
We conduct our business activities in seven business segments within the Mailstream Solutions and Mailstream Services business
groups. For a description of our reportable segments and the types of products and services from which each reportable segment
derives its revenue, see Item 1 – “Business” on page 3 of this Form 10-K. That information is incorporated herein by reference. The
information set forth below should be read in conjunction with such information. The accounting policies of the segments are the
same as those described in the summary of significant accounting policies, with the exception of the items outlined below.
EBIT is determined by deducting from revenue the related costs and expenses attributable to the segment. Segment EBIT excludes
general corporate expenses, restructuring charges, interest expense, other income (expense) and income taxes. Identifiable assets are
those used in our operations and exclude cash and cash equivalents, short-term investments and general corporate assets. Long-lived
assets exclude finance receivables and investment in leveraged leases.
As a result of certain organizational changes made during 2008, we have reclassified certain prior year amounts to conform to the
current year presentation. The amounts reclassified did not have a material impact to our segment disclosures.